[Senate Hearing 108-922]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 108-922
 
 COVERING THE WATERFRONT: A REVIEW OF SEAPORT SECURITY SINCE SEPTEMBER 
                                11, 2001

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

                                HEARING

                               before the

                 SUBCOMMITTEE ON TERRORISM, TECHNOLOGY
                         AND HOMELAND SECURITY

                                 of the

                       COMMITTEE ON THE JUDICIARY
                          UNITED STATES SENATE

                      ONE HUNDRED EIGHTH CONGRESS

                             SECOND SESSION

                               __________

                            JANUARY 27, 2004

                               __________

                          Serial No. J-108-55

                               __________

         Printed for the use of the Committee on the Judiciary



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                       COMMITTEE ON THE JUDICIARY

                     ORRIN G. HATCH, Utah, Chairman
CHARLES E. GRASSLEY, Iowa            PATRICK J. LEAHY, Vermont
ARLEN SPECTER, Pennsylvania          EDWARD M. KENNEDY, Massachusetts
JON KYL, Arizona                     JOSEPH R. BIDEN, Jr., Delaware
MIKE DeWINE, Ohio                    HERB KOHL, Wisconsin
JEFF SESSIONS, Alabama               DIANNE FEINSTEIN, California
LINDSEY O. GRAHAM, South Carolina    RUSSELL D. FEINGOLD, Wisconsin
LARRY E. CRAIG, Idaho                CHARLES E. SCHUMER, New York
SAXBY CHAMBLISS, Georgia             RICHARD J. DURBIN, Illinois
JOHN CORNYN, Texas                   JOHN EDWARDS, North Carolina
             Bruce Artim, Chief Counsel and Staff Director
      Bruce A. Cohen, Democratic Chief Counsel and Staff Director
                                 ------                                

      Subcommittee on Terrorism, Technology and Homeland Security

                       JON KYL, Arizona, Chairman
ORRIN G. HATCH, Utah                 DIANNE FEINSTEIN, California
ARLEN SPECTER, Pennsylvania          EDWARD M. KENNEDY, Massachusetts
MIKE DeWINE, Ohio                    JOSEPH R. BIDEN, Jr., Delaware
JEFF SESSIONS, Alabama               HERB KOHL, Wisconsin
SAXBY CHAMBLISS, Georgia             JOHN EDWARDS, North Carolina
                Stephen Higgins, Majority Chief Counsel
                David Hantman, Democratic Chief Counsel


                            C O N T E N T S

                              ----------                              

                    STATEMENTS OF COMMITTEE MEMBERS

                                                                   Page

Biden, Hon. Joseph R., Jr., a U.S. Senator from the State of 
  Delaware, prepared statement...................................    37
Feinstein, Hon. Dianne, a U.S. Senator from the State of 
  California.....................................................     3
    prepared statement...........................................    44
Kyl, Hon. Jon, a U.S. Senator from the State of Arizona..........     1
    prepared statement...........................................    50
Leahy, Hon. Patrick J., a U.S. Senator from the State of Vermont, 
  prepared statement.............................................    62

                               WITNESSES

Bald, Gary M., Acting Assistant Director, Counterterrorism 
  Division, Federal Bureau of Investigation, Washington, D.C.....     6
Hereth, Larry L., Rear Admiral and Director of Port Security, 
  U.S. Coast Guard, Alexandria, Virginia.........................     4
Jacksta, Robert M., Ececutive Director, Border Security and 
  Facilitation, Office of Field Operations, Customs and Border 
  Protection.....................................................     8

                         QUESTIONS AND ANSWERS

Responses of Gary Bald to questions submitted by Senators 
  Feinstein and Leahy............................................    26
A question submitted by Senator Leahy to Admiral Hereth and Mr. 
  Jacksta (Note: Responses to this question were not available at 
  the time of printing.)

                       SUBMISSIONS FOR THE RECORD

Bald, Gary M., Acting Assistant Director, Counterterrorism 
  Division, Federal Bureau of Investigation, Washington, D.C., 
  statement......................................................    32
Hereth, Larry L., Rear Admiral and Director of Port Security, 
  U.S. Coast Guard, Alexandria, Virginia.........................    46
Jacksta, Robert M., Ececutive Director, Border Security and 
  Facilitation, Office of Field Operations, Customs and Border 
  Protection, statement..........................................    53


 COVERING THE WATERFRONT: A REVIEW OF SEAPORT SECURITY SINCE SEPTEMBER 
                                11, 2001

                              ----------                              


                       TUESDAY, JANUARY 27, 2004

                              United States Senate,
        Subcommittee on Terrorism, Technology and Homeland 
            Security, of the Committee on the Judiciary,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 11:15 a.m., in 
Room SD-226, Dirksen Senate Office Building, Hon. Jon L. Kyl, 
Chairman of the Subcommittee, presiding.
    Present: Senators Kyl and Feinstein.

  OPENING STATEMENT OF HON. JON KYL, A U.S. SENATOR FROM THE 
                        STATE OF ARIZONA

    Chairman Kyl. Good morning. This hearing of the Judiciary 
Committee's Subcommittee on Terrorism, Technology and Homeland 
Security will come to order.
    Today, the Subcommittee will examine how to protect our 
seaports against terrorism. Even before the tragic events of 
September 11th this Subcommittee concerned itself with the 
protection of Americans from terrorist attacks within our 
shores. Senator Feinstein and I have worked to address the 
problem of identifying terrorists and stopping them from 
entering the United States. But we believe that the public 
needs to be made more aware that our seaports offer access 
points for terrorists and their weapons, including weapons of 
mass destruction, to enter the country with relative ease.
    Consider the fact that an attack that shut down a major 
American port for even a few days could devastate the regional 
economy that it serves. In fact by one estimate a nuclear 
weapon detonated in a major seaport or Washington, D.C. would 
kill 50,000 to 1 million people and would result in direct 
property damage of $50 billion to $500 billion dollars, losses 
due to trade disruption of $100 billion to $200 billion, and 
indirect costs of $300 billion to $1.2 trillion.
    This hearing is a follow-up to the one held by the 
Subcommittee in February of 2002, shortly after the 9/11 
attacks. At that hearing we highlighted the importance of 
seaport security. For example, in response to the attacks of 9/
11 the Transportation Secretary had to shut down virtually the 
entire airline industry for 4 days and to check every airplane 
to ensure the safety of air travel and prevent additional 
attacks. If we ever had a similar situation with shipping, if 
we had to shut down our ports and check all of our ships for 
terrorists, commercial shipping would be shut down for at least 
4 months. As a representative of the Department of 
Transportation testified, if anything can bring our economy 
down, that can.
    So today's hearing will determine what progress has been 
made and what more need to be done. Before the attacks the 
Coast Guard devoted not more than 2 percent of its operations 
to port security according to the Council on Foreign Relations. 
In the months immediately following September 11th it spent 50 
percent to 60 percent of its time and effort defending U.S. 
ports. Since then that figure has fallen to between 20 and 30 
percent because of other commitments and mounting costs. In 
fact Noel Cunningham. the Los Angeles port's chief of police 
said the Los Angeles Harbor remains wide open to terrorist 
attack.
    The Subcommittee will hear from three experts today. Rear 
Admiral Larry Hereth of the United States Coast Guard is 
currently serving as the director of port security in the 
Marine Safety, Security, and Environmental Protection Director 
at the U.S. Coast Guard headquarters in Washington. As director 
of port security he oversees all aspects of the Coast Guard 
port security mission and coordinates activities with other 
Coast Guard programs, other Government agencies, and industry 
to improve maritime homeland security. He is a 1973 graduate of 
the United States Coast Guard Academy and has also received an 
MBA from the Florida Institute of technology. In his 29 years 
of service Rear Admiral Hereth has broad-based career with an 
emphasis on field operations and his assignments have taken him 
throughout the United States with multiple tours at East, Gulf 
and West Coast ports.
    Director Gary M. Bald, acting assistant director of the 
FBI's Counterterrorism Division. He oversees the FBI's 
operations in international and domestic terrorism and its 
terrorist financing. Prior to this appointment Director Bald 
was the special agent in charge of the Baltimore division. In 
1999 he was detailed to the criminal investigative division of 
FBI headquarters where he headed a high-profile organization 
crime corruption investigation. Director Bald has served in the 
FBI since 1977.
    And finally, executive director Robert M. Jacksta is the 
executive director of border security and facilitation for the 
U.S. Customs and Border Protection. He directs the activities 
of border security and facilitation with policy oversight for 
day to day operations at ports of entry. Director Jacksta has 
been with the Customs Service since 1973 and has served as port 
director of Washington, D.C. and as the executive director of 
passenger programs. In 1999 he received the Commissioner's 
outstanding performance award. He has a bachelor of science in 
criminal justice from Buffalo State College in New York. I want 
to thank all three of you for being here today.
    In conclusion, we are now aware of the economic fallout 
from the destruction of the World Trade Center Towers. Closing 
of any of the major 12 seaports would also have a severe 
economic effect, not only locally but throughout the country. 
It is increasing important that local, State, Federal and 
private entities make a coordinated effort to ensure the safety 
of our ports. We have a very distinguished panel of witnesses 
before us today, and we are interested in examining with them 
how we can inspect a greater portion of containers without 
delaying the movement of goods through our seaports and what 
assistance Congress can provide to reach our objective of 
protecting our seaports, our economy and our citizens.
    I want to thank Senator Feinstein, as usual, for assisting 
me. In fact this hearing was her idea, to give proper credit. 
We have always been able to work together on matters of 
interest relating to national security and this area is simply 
another example of that. So I certainly look forward to working 
with her not only at this area but in the follow-up that will 
be required as a result. Thank you.
    [The prepared statement of Senator Kyl appears as a 
submission for the record.]
    Senator Feinstein.

  STATEMENT OF HON. DIANNE FEINSTEIN, A U.S. SENATOR FROM THE 
                      STATE OF CALIFORNIA

    Senator Feinstein. Thank you very much, Mr. Chairman. I 
appreciate your words and I appreciate your focus and the fact 
that the two of us have been able to concentrate on this. We 
have co-sponsored a bill which is in Commerce Committee which I 
hope to speak about in a moment. And I very much appreciate the 
working relationship.
    It is my belief, ladies and gentlemen, that our ports are 
the soft underbelly of our Nation's security. I believe that it 
is really essential that our ports, working with the 
department, develop a security capability that are not only 
going to protect employees of the port but also the citizens of 
our Nation from a potentially devastating terrorist attack on 
our ports or the very real possibility that a weapon of mass 
destruction could be brought in in a container, either 
detonated in a port in a busy metropolitan area or shipped in 
by rail or truck into Arizona or the heartland of our Nation. 
So I think both of us here realize that the safety of our ports 
does not only affect the State where the port is located but in 
fact affects the safety of our entire Nation.
    To understand more about this and to understand what the 
captains of the port are feeling, I had hoped to hear from 
someone with front-line responsibility. Thus, I was very 
disappointed that the department turned down our request that 
the captain of the port of Los Angeles/Long Beach, the busiest 
container port in the Nation, testify here today. I had hoped 
that the captain could give us an on-the-ground and on-the-
water view of the problems that that port faces. We were told 
that the Admiral could do that just as well, so I appreciate 
that, but I am disappointed. It is the first time we have asked 
a witness, at least in the 10 years I have been here, like that 
to testify and been turned down.
    There are a number of options, direct Federal funding, cost 
sharing with States and localities, user fees, and private 
funding to get the job done. A lot of these can be combined or 
modified. One area that I have been particularly concerned 
with, and this came directly from the Port of L.A./Long Beach 
is the need to have a long-term commitment of funds so that 
they can do those things that are necessary. They suggested 
such as a letter of intent which has been used by TSA with 
airports. We talked to Admiral Loy about this and he tells me 
that it cannot be used in the context of port security. I had 
hoped to find out why it cannot be used in the context of port 
security today because I believe the need is there. I think it 
is very difficult for large ports like the port of L.A./Long 
Beach which has 40 percent of all the containers that come into 
this Nation to plan with large amounts of money and not know 
how they are going to be able to fund it long-term.
    We also have to give those who are able to make the 
decisions the responsibility, and the legislation that Senator 
Kyl and I have introduced, the Anti-Terrorism and Port Security 
Act was introduced last year. It is now pending before the 
Commerce Committee. What we would do is address areas of 
criminal law where either the reach of the law is insufficient 
or the penalties are insufficient, such as piracy, or terrorist 
attacks on maritime infrastructure. Our bill would also clarify 
the responsibilities of the captain of the port, would 
strengthen mechanisms to learn about who and what is aboard the 
ships that are entering our ports, would mandate the 
development of security standards for shipping containers, 
would bring about personal identification systems for employees 
and those who use our ports, and ensure that the Secretary of 
the Department of Homeland Security takes into account traffic 
volume when allocating funds to our ports.
    So these are the question lines that I hope to enter into 
and I hope the opening remarks of these gentlemen, where 
appropriate, will address the questions.
    Thanks, Mr. Chairman.
    [The prepared statement of Senator Feinstein appears as a 
submission for the record.]
    Chairman Kyl. Thank you, Senator Feinstein. Now let me turn 
to each of you. We have a clock that will let you know when you 
have spoken for 5 minutes. Obviously we will have questions but 
feel free to insert longer statements in the record, if you 
would like to do that. Let me just take each one of you in 
order and then we will do the questions after each of you have 
spoken.
    We will start with Admiral Hereth.

  STATEMENT OF REAR ADMIRAL LARRY L. HERETH, DIRECTOR OF PORT 
   SECURITY, UNITED STATES COAST GUARD, ALEXANDRIA, VIRGINIA

    Admiral Hereth. Thank you, Mr. Chairman. With your 
permission I will summarize my opening statement. I provided 
written copies for the record.
    Good morning, Mr. Chairman and Senator Feinstein. It is a 
pleasure to appear before you today to discuss Coast Guard 
efforts to prevent and respond to terrorism and to improve 
maritime transportation security for our seaports. I will 
briefly highlight a few of the programs we are using to 
implement our maritime security strategy and provide any 
insight I can based on my experience as the director of Coast 
Guard port security and as a previous captain of the port in 
San Francisco during 9/11.
    The United States and the world have come to recognize how 
valuable but also how vulnerable the international 
transportation system is to those who intend to do us harm. 
Valuable and vulnerable, these factors make protection of our 
maritime transportation system a high priority in the U.S. 
maritime homeland security strategy. Working in concert with 
the Department of Homeland Security and its agencies we 
developed a strategic approach to maritime security that places 
a premium on identifying and intercepting threats well before 
they reach U.S. shores.
    The Maritime Transportation Security Act of 2002 
established a comprehensive approach to maritime security. In 
October 2003, within the demanding deadlines set by the MTSA, 
the Coast Guard issued final maritime security regulations that 
address vessel and facility security, address automatic 
identification systems and other security requirements. The 
Coast Guard collaborated extensively with the maritime industry 
in the development of these regulations, including eight public 
meetings and the consideration of thousands of public comments. 
The regulations also incorporate standards adopted by the 
International Maritime Organization. The international 
standards and the MTSA regulations come into force on July 1st, 
2004.
    The cost of implementing MTSA is shared by Federal, State, 
and local government and the maritime industry. The Federal 
Government is bearing the cost for increased security in our 
Nation's port through the creation and deployment of maritime 
safety and security teams, increased personnel, contract 
support for vessel and facility plan reviews, and the increased 
deployment of Coast Guard assets. We estimate industry's costs 
for implementing Section 102 of the MTSA to be about $1.5 
billion in the first year and $7.3 billion over the next 10 
years. We reconcile this cost against the devastating and long-
lasting impact on global shipping, international trade and the 
world economy that a terrorist incident would cause.
    For example, a West Coast major port closure for 1 month, 
as you pointed out, due to a maritime terrorist act could cost 
up to billions in economic loss to the United States. We are 
sensitive, however, to the cost to the maritime industry and 
developed the MTSA regulations to be performance-based, 
providing the majority of owners and operators with the ability 
to implement the most cost-effective security measures rather 
than imposing prescriptive, one-size-fits-all requirements.
    It is important to note that a wide variety of security 
measures implemented to date has had no significant adverse 
impacts on the flow or velocity of maritime commerce. The 
security implemented by facilities and vessels under the 
regulations will also be augmented by a wider area maritime 
security Committee and area plan. Each Federal maritime 
security coordinator, the captain of the port in 47 areas 
around the country, has formed such a Committee comprised of 
Federal, State, local agencies and members of the local 
maritime industry. These committees will be critical in the 
development of the area maritime security plans to augment the 
security of vessels and facilities within the port environment.
    With the average age of our cutters approaching 30 years, 
the Coast Guard's deep water program is very important. We must 
recapitalize Coast Guard assets to counter threats to U.S. 
security by providing the capability to board vessels before 
they reach port and respond to acts of terrorism or piracy well 
away from our shores while also developing a far more robust 
and effective maritime domain awareness system. Implementation 
of our security programs will complement and reinforce the 
additional maritime transportation security improvements 
currently being developed through ongoing DHS initiatives to 
improve the security of containers and the entire cargo supply 
chain.
    We have increased our uniform presence at waterfront 
facilities and critical infrastructure adjacent to the marine 
environment, but we need express authority to arrest a person 
who commits a Federal offense onshore and to carry firearms 
ashore in the performance of official law enforcement duties. 
As a top priority for the Coast Guard, the Administration's 
Coast Guard authorization act currently before Congress 
includes a provision that would grant clear that authority and 
we would appreciate the committee's support in that matter.
    In conclusion, the Coast Guard will continue to take a 
leadership role in coordinating the multi-agency, public and 
private, national and international maritime security effort as 
part of DHS's larger national transportation system security 
plan. The men and women of the Coast Guard are committed to the 
continuing protection of our Nation's ports.
    Thank you for the opportunity to testify before you today. 
I would be glad to take questions at the appropriate time.
    [The prepared statement of Admiral Hereth appears as a 
submission for the record.]
    Chairman Kyl. Thank you, Admiral.
    Director.

     STATEMENT OF GARY M. BALD, ACTING ASSISTANT DIRECTOR, 
   COUNTERTERRORISM DIVISION, FEDERAL BUREAU OF INVESTIGATION

    Mr. Bald. Good morning, Chairman Kyl. Good morning, Senator 
Feinstein. Thank you for inviting me here to speak to you today 
on the topic of seaport security and the FBI's partnership with 
the Department of Homeland Security and the United States Coast 
Guard and local port authorities.
    Recognizing the new profound threat that became evident to 
us on 9/11, the President directed the FBI to make prevention 
of terrorist acts our number one priority. This is in keeping 
with the President's strategy to defeat, deny, diminish, and 
defend against terrorism, and failure is simply not an option. 
In President Bush's address to FBI headquarters shortly after 
9/11 he reemphasized to all FBI employees that the FBI has no 
greater priority than preventing terrorist acts against 
America.
    Since the attacks of 9/11, the FBI has embraced this 
challenge and transformed itself to address the current threat 
facing this country. As part of a major reorganization, the FBI 
restructured its approach to counterterrorism to enhance 
analysis and information-sharing, improved analysis and 
operational capabilities, combined with increased cooperation 
and integration. These have enhanced the FBI's ability to 
investigate and prevent acts of terrorism.
    This is especially trust as we address the complex issue of 
security of our Nation's seaports. The port system of the 
United States is the most extensive and complex port system in 
the world and as such is a national asset. While now two ports 
in the United States are exactly alike, many have shared 
characteristics such as being close to major metropolitan 
areas, containing fuel farms, and having major roadways running 
into and out of the port are.
    Ports not only affect the State in which they are located 
but also impact on neighboring States that depend on the port 
for foreign trade. The United States economy depends on the 
free flow of goods through these waterways and this elevates 
the risk of terrorist attack to maritime facilities. Ports are 
vulnerable because of their accessibility both to water and 
land, and the presence of recreational vehicles and the 
presence of chemical and natural resource storage facilities 
that are often located within close proximity.
    Ports have historically been vulnerable to a variety of 
criminal activity including drug trafficking, cargo theft, 
weapon and alien smuggling. The terrorist organizations we now 
face have learned from these traditional smuggling 
organizations and operations and are looking for holes in port 
security systems to exploit. Access into and around United 
States port facilities is difficult to secure without closing 
access to legitimate business and recreational port traffic. 
While the Federal Government has jurisdiction over navigable 
waters as well as the interstate commerce and foreign trade of 
our Nation's ports, local authorities are the primary 
regulators of the port's day to day operations.
    Legislation passed since 9/11 has significantly increased 
the security requirements at port facilities. The Department of 
Homeland Security through the United States Coast Guard has 
overall Federal responsibility for seaport security. DHS is 
currently working to screen more shipping containers both 
entering and exiting the United States, and is assisting State 
and local authorities in implementing security plans for the 
ports. The FBI works in conjunction with the DHS in a 
coordinated response to the security concerns of the port 
authorities, primarily through a participation in the National 
Joint Terrorism Task Force which is located in the strategic 
information and operations center at FBI headquarters.
    In addition to the National JTTF, the FBI has assigned 
supervisory special agents full-time to the Department of 
Homeland Security to assure a timely and effective response to 
any crisis that may arise.
    Prior my current position I served as the head of the FBI's 
Baltimore field office and I can personally attest to the 
importance of these interagency partnerships. Prior to 9/11, 
the Baltimore office established a maritime team to provide 
proactive and reactive maritime responses in support of the 
counterterrorism program and of the JTTF. The primary goal was 
to enhance our ability to respond either overtly or covertly to 
maritime incidents, special events and other maritime issues.
    After 9/11, the Baltimore office joined a partnership that 
existed between the U.S. Coast Guard and the city of Baltimore. 
This partnership was subsequently named the Maryland Maritime 
Security Group and has grown in terms of both other agency 
participation and in terms of an expanded statewide focus. The 
MMSG is co-chaired by the United States Coast Guard and the FBI 
and its members meet often to identify and share resources. 
U.S. Coast Guard Captain Curt Springer plays a strong 
leadership role in the MMSG and I enjoyed partnering with him 
in this important endeavor.
    Every FBI officer that has a seaport in its territory 
participates through the joint terrorism task forces in similar 
information sharing initiatives and counterterrorism security 
working groups. Currently these types of maritime working 
groups have been formed in Los Angeles, Tampa, Boston, Houston, 
New York and Miami, in addition to Baltimore which I previously 
mentioned.
    The institution of new security regulations and the 
cooperative approach to port security between the United States 
Coast Guard and the joint terrorism task forces have greatly 
enhanced maritime security in the United States. While port 
security may never be guaranteed due to the sheer size of the 
facilities and the areas they cover, the FBI and our partner 
agencies are striving to provide the most secure port 
facilities in the world. The FBI continues to pursue an 
aggressive proactive response to meet the challenges of 
terrorism and we remain committed to identifying and disrupting 
terrorist activities, particularly within the United States 
port system.
    I want to emphasize to you, this issue has the full 
attention of Director Mueller and the FBI and I appreciate the 
interest that the Committee has shown in this matter and I look 
forward to working with you in the future. Thank you for the 
invitation to speak today and I will be happy to address your 
questions at the appropriate time.
    [The prepared statement of Mr. Bald appears as a submission 
for the record.]
    Chairman Kyl. Thank you, Mr. Bald.
    Mr. Jacksta.

  STATEMENT OF ROBERT M. JACKSTA, EXECUTIVE DIRECTOR, BORDER 
SECURITY AND FACILITATION, OFFICE OF FIELD OPERATIONS, CUSTOMS 
            AND BORDER PROTECTION, FAIRFAX, VIRGINIA

    Mr. Jacksta. Good morning, Chairman Kyl, Senator Feinstein. 
Thank you for the opportunity to testify on the subject of U.S. 
Customs and Border Protection, CBP, and its efforts to secure 
U.S. seaports, the vessels and the people who utilize them for 
work and travel. People, technology, automation, electronic 
information and partnerships are concepts that underpin CBP's 
port security and anti-terrorism initiatives. These concepts 
expand our borders and reinforce the components of our layered 
defense. These layers are interdependent and are deployed 
simultaneously to substantially increase the likelihood that 
weapons of terror will be detected. Today I would like to focus 
on how this layered defense works with regard to seaport 
security.
    To effectively secure sea, land and air ports of entry, CBP 
must have access to electronic cargo and travel information in 
advance. It must have the automation technology to manage this 
information and it must have experienced personnel to evaluate 
and apply this information. Our national targeting center 
achieves these goals. The national targeting center has 
established a range of liaisons with other agencies responsible 
for securing U.S. borders. Many of these agencies have 
personnel assigned to our National targeting center.
    For example, CBP and the Food and Drug Administration 
commenced around-the-clock operations on December 11th, 2003 in 
support of the Bioterrorism Act.
    CBP's automation targeting system is a tool that permits 
the national targeting center to process advance information 
and focus CBP's inspection efforts on potentially high-risk 
transactions and travelers. In the cargo environment, the 
targeting system analyzes electronic data related to individual 
shipments to profile and rank them in order of risk. The scope 
and reliability of the cargo information currently received 
under the 24-hour rule is reinforced by the Trade Act final 
rule published on December 5th, 2003. This rule mandates 
advance electronic cargo information inbound and outbound for 
all modes of transportation.
    Now I would like to talk about the container security 
initiative the reaches the waterfront in a concrete way. The 
container security initiative came into being as a direct 
result of September 11th. The purpose of this initiative is to 
expand our Nation's zone of security. Essentially, CBP screens 
and examines shipments before they leave the foreign port of 
lading. Nineteen of the 20 ports shipping the greatest volume 
of containers to the United States have committed to join CSI. 
These original 20 ports are points of passage for approximately 
two-thirds of the containers shipped to United States.
    After September 11th, the trade community approached CBP to 
devise a joint strategy to protect the global trading supply 
chain. The Customs trade partnership against terrorism, C-TPAT, 
was developed to meet this need. Some of the basic tenets of 
the C-TPAT program are strengthening and enhancing supply chain 
security, developing a security conscious environment 
throughout the entire commercial process, and engaging trade 
associations and international organizations in developing 
global standards.
    Participation in C-TPAT has grown. Currently there are over 
5,300 participants. Today CBP teams are in the process of 
verifying the information submitted by the C-TPAT participants 
to ensure that appropriate measures are in place to help secure 
the supply chain. CBP is also working with the industry to have 
a smart and secure container that prevents and deters 
tampering, alerts Government and trade when tampering does 
occur, and is inexpensive.
    Non-intrusive inspection technology and radiation detection 
technology is another cornerstone in our layered strategy. 
Technologies deployed to our Nation's sea, air and land ports 
of entry include large scale x-ray systems and gamma imaging 
systems as well as a variety of portable and handheld 
technologies. CBP is also moving quickly to deploy nuclear and 
radiological detection equipment including personal radiation 
detectors, radiation portal monitors, and radiation isotope 
identifiers. A portion of these large scale systems are 
deployed to seaports on both coasts and the Caribbean.
    CBP has also initiated the deployment of radiation portal 
monitors in the maritime environment with the ultimate goal of 
screening 100 percent of all containerized cargo imported into 
the United States. This equipment used in combination with our 
layered enforcement strategy allows for CBP to screen shipments 
rapidly for weapons of mass destruction. At the same time, we 
are working with stakeholders to ensure that radiation 
screening does not significantly impact operations within a 
port.
    Customs and Border Protection has a history of cooperation 
and coordination with other law enforcement agencies by 
participating in many multi-agency seaport security working 
groups. Some of these groups include Operation Safe Commerce, 
the container working group, and work groups for the 
implementation of the Maritime Transportation Security Act. I 
believe CBP has demonstrated and will continue to demonstrate 
its leadership and commitment to port security efforts and we 
anticipate that working together we will further these efforts.
    Thank you again, Chairman Kyl, Senator Feinstein, and 
members of the Subcommittee for this opportunity to testify. I 
would be happy to answer any questions if you have any.
    [The prepared statement of Mr. Jacksta appears as a 
submission for the record.]
    Chairman Kyl. Thank you very much. That is very helpful 
testimony. Let me begin by trying to paint a picture here. I am 
going to begin by asking Director Bald but either of the other 
two of you can add to the comments if you like. I do not want 
to know, Mr. Bald, how you know what you know and I do not want 
to know what you are going to do about it, or where you may 
have found something out. But I would like you to give us an 
idea of the types of threats that you've uncovered, and how 
serious they are, and what you expect in the future.
    Mr. Bald. Thank you, Mr. Chairman. Difficult to phrase 
without going into the areas that you mentioned. I will do my 
best. The intelligence that we have certainly points to the 
ports as a key vulnerability of the United States and of a key 
interest to certain terrorist groups that we have under active 
investigation. The ports themselves are very vulnerable, as I 
mentioned in my opening remarks.
    The presence of the recreational vessels complicates things 
tremendously. On the one side, looking at the commercial 
shipping is something that is perhaps easier to regulate than 
it is to regulate the vessels that do use the waterways around 
the country. That vulnerability and the potential for small 
boat attacks on larger vessels and commercial vessels is a 
particular concern, especially if we run into a situation where 
a major commercial vessel is sunk in a channel or a harborway. 
In addition to the ecological damage that it could cause, it 
will certainly have a tremendous economic detriment as well.
    As I mention, the size alone is daunting to try and 
address, either investigatively or legislatively, so it is a 
tremendous task for all of us to put our heads together on to 
try and address.--
    Chairman Kyl. Let me see if I can get a little bit more 
specific. We have had FBI Directors testify before this 
Subcommittee before and others who have characterized the types 
of threats and degree of threat, and I will give an example of 
one way they have done it. They have pointed out that since 
September 11th, working with our allies the United States has 
actually thwarted a specific number of planned attacks, and 
they give us the range of numbers each year, abroad and note 
that they may have caught planning in the earlier stages in the 
United States but there were no planned attacks specifically 
thwarted as a result of their activities.
    But they not only discuss the vulnerabilities as you have 
done, clearly, but note the motivations and aspirations of the 
terrorist groups by commenting on the fact that specific 
incidents were avoided as a result of our intelligence 
activities, again noting that that was abroad, and then they 
will discuss sometimes the types of areas that are most 
vulnerable.
    Those are helpful to us, to at least paint the picture of 
how serious the problem is. So I ask, can you be any more 
specific? Obviously we are not asking you to get into 
classified information here.
    Mr. Bald. I can't be more specific as to the thwarting of 
potential plans for attacks within the United States 
specifically as it relates to harbors and ports. I can tell you 
that is something that we are aggressively addressing. We have 
received source information and investigative information that 
does indicate there is an interest in those areas here.
    There is a variety of purchasing patterns that we are 
looking at to try and see if we can get ahead of the curve on 
those concerns and the surveillances that are conducted in 
those areas. But specifically I couldn't today address in this 
forum the specifics that I think you are referring to.
    Chairman Kyl. Okay, can I just summarize it this way and 
see if this is a fair statement, that information that you have 
leads you to conclude that given the interest of terrorists, 
the ability of putting together different kinds of attacks, and 
the vulnerability of the ports that it is a serious threat that 
this country needs to take very seriously?
    Mr. Bald. Yes, sir, it is fairly characterized.
    Chairman Kyl. Okay, and would either of the other two of 
you wish to add anything to that?
    Admiral.
    Admiral Hereth. Yes, Mr. Chairman, just one thing. Absent 
perfect intelligence, which we may never get there, but 
wonderful efforts are being done in that area--but absent the 
hundred-percent surety that we are going to know what is coming 
down the pike, we have to do broad-based planning efforts.
    So we felt it is an important common approach that needs to 
be pushed out both to industry and the government to look at 
all the threat scenarios that might occur in a port, and so we 
have established a port security risk assessment tool. It has 
been deployed around the country. It has some 200 scenarios 
attached to it that we expect all our captain of ports to visit 
with their port community and look at the threats that may be 
out there and then do some planning along those dimensions.
    Chairman Kyl. Let me just ask, Mr. Jacksta, you said that 
the goal obviously was to have a hundred percent inspection at 
some point. And there are many variables in the answer to the 
question, but could you give us an idea about when you think 
that might be possible if we committed the resources and 
attention to this that you think we need to?
    Mr. Jacksta. Sir, when I was speaking about a hundred 
percent, we were talking specifically about the screening 
through our radiation portal monitors. Our goal right now is to 
have these portal monitors; we are starting to deploy them and 
we have funding to put them at 22 major seaports. That would 
represent somewhere in the area of about 90 percent of the 
cargo that comes into the seaports. That is our goal, to have 
that. Hopefully by the end of this calendar year, we should be 
in place.
    Chairman Kyl. And what would that presumably find or enable 
us to have some sense that we have checked for?
    Mr. Jacksta. Sir, what that would allow us to do is to have 
the cargo screened for any type of radiological emitter that 
might be of concern to the public. What we would do at that 
point is based on the cargo going through the portal monitor, 
if something is unusual, we would stop that shipment and then 
at that point do a full examination to ensure that there was 
nothing in there that was a concern.
    Chairman Kyl. Okay, great. Let me just ask one more 
question. I have a whole bunch of questions, but we will just 
go back and forth here. Just to give folks a sense of the 
magnitude of the problem and the progress we are making, can 
you give us a meaningful statistic with respect to inspections 
of containers in terms of percentage?
    I have heard that it is a very low one-digit number in 
terms of the inspection that we are able to accomplish. But as 
of, let's say, this year or next year, with, you said, 19 of 
the 20 most significant ports in terms of imports to the United 
States allowing pre-inspection at the de-embarkation point 
rather than at U.S. ports participating with these other 
technologies that you are employing, and so forth, what general 
percentage of cargo containers do you think we should be able 
to inspect, let's say, in this year of 2004?
    Mr. Jacksta. Sir, in fiscal year 1903, we inspected 
approximately 5.4 percent of the containers that arrived at our 
ports of entry. And I think it is important to note that we 
believe this was the right 5.4 percent. Based on, as I 
discussed, our layered approach using our targeting system, 
using advanced information, having our inspectors with their 
personal radiation pagers available when the ships are 
offloading, allows us to basically be present when the cargo is 
coming in.
    But specifically looking at shipments, looking at 
containers, we are doing about 5.4 percent in fiscal year 1903. 
That is an increase from fiscal year 1902 of 2.3. So you can 
see, as we get the equipment, as we get the additional 
personnel that Congress has given us, we are able to do a lot 
more in that area. But once again we believe that this is the 
correct 5.3 percent.
    Chairman Kyl. Right, but if you had the ability, you would 
increase that if you could?
    Mr. Jacksta. Yes, sir.
    Chairman Kyl. Yes, okay, great.
    Again, I have more, but let me turn to Senator Feinstein 
now.
    Senator Feinstein. Thank you very much, Mr. Chairman. Let 
me begin with the Admiral, if I might.
    Admiral by December 31 of 2003, security plans for 
facilities and vessels operating in our ports were to be 
submitted to you for review and approval. Of the 5,000 
facilities and 10,000 vessels that you estimated would be 
required to have these security plans, how many plans have been 
received to date?
    Admiral Hereth. Probably 60 percent of the facility plans 
and 75 percent of the vessel plans, although let me frame that. 
The way we are looking at it is those numbers were estimates. 
So this week, and actually last week, I met with all the 
captains of the port in the country to discuss that issue, and 
we are scrubbing all the data associated with that in our 
database to make sure that we have good denominator data to 
understand what the entire population would be, specifically 
asking the captains of the ports to identify all those vessels 
and all those facilities to which the regs are applicable.
    So those were estimates based on a regulatory assessment 
that is required by the regulatory process. We will have some 
better numbers next week and I would be glad to share those 
with you.
    Senator Feinstein. I appreciate it because in June, at a 
hearing before the House Transportation and Infrastructure 
Committee, the commandant stated he would need $70 million to 
review these plans and he did not get the $70 million. So if I 
can conclude from your statement, you are able to do it without 
an additional appropriation.
    Admiral Hereth. We reprioritized our base to deal with the 
surge activity and have issued a couple of contracts to provide 
some support and infuse some resources into the Coast Guard 
system to help us review those plans. And I can talk about 
whatever level of detail you would like on that, but I can 
assure you of both the facility review planning process and the 
vessel planning process. The review processes for that are 
tight. They have been scrutinized; they are up and running. We 
are ready to take on the thousands of plans that we have 
received and review them properly.
    Senator Feinstein. That is terrific. I think you are 
required to complete the security assessments for all 55 of the 
Nation's most strategically important ports by December of 
1904. Will you be able to meet that goal?
    Admiral Hereth. We will, and we are in the process of 
improving that. That process started before 9/11 and is 
continuing to evolve. Before 9/11, almost no one had done 
assessments. Now, almost every port and many facilities have 
done assessments.
    So we need to be careful about not duplicating those 
efforts, so we are trying to retool that and make sure that we 
add significant value to the port activity. And we are going to 
provide a tool and now we have a customer, the Area Maritime 
Security Committee, which is a broad-based port community 
Committee somewhat analogous to the area response committees 
and the Harbor safety committees that have developed over the 
years that have been very successful building on those 
strengths.
    We are going to provide the Committee with some tools that 
will be very helpful in dealing with prevention and response to 
terrorist acts. And we think we have some great ideas that have 
been well received as we have vetted them around the country. 
So we are on our time schedule to complete those activities by 
the end of the year.
    Senator Feinstein. Well, that is terrific, very good.
    Mr. Chairman, I would like to introduce into the record a 
statement by the ranking member, Senator Leahy, and Senator 
Biden.
    Chairman Kyl. Both statements will be received in the 
record, without objection.
    Senator Feinstein. Thank you.
    I had an opportunity to read Senator Biden's statement, 
which is really excellent. I commend it to everybody because it 
is very precise, and among the things he mentions are some of 
the things that he covers in a bill with Senator Specter and 
that you and I cover in our port security bill.
    Right now, it is not a crime if a ship or vessel that you 
are trying to stop fails to comply. The carrying of firearms is 
not restricted on port property. It is not a crime to smuggle a 
terrorist into a port aboard a ship. These are specific lacks 
of reach within our law.
    I wanted to ask you, Admiral, what is your experience 
particularly with respect to your work at sea or I guess coming 
into a port if you try to halt a vessel? Have any refused or do 
they all just automatically comply?
    Admiral Hereth. In my experience, I have never had anyone 
refuse a captain of the port order. Of course, we have 
additional assets to go out and pursue the vessel, not only 
Coast Guard, but, if necessary, offshore; we will call in DOD 
for assistance. So we have the wherewithal to use whatever use 
of force is necessary to compel compliance. But in my 
experience, I have never had anyone just not follow a captain 
of the port order.
    Senator Feinstein. Well, I think we should try to bring the 
law up to date so at least there is a crime attached to these 
things. So I was delighted to see Senator Biden's statement. 
Thank you.
    Mr. Jacksta, I think it was about a year ago I spent the 
day at the Port of Hong Kong with the largest American 
container facility at the port. It was really quite amazing to 
see the size of that port and to review what they had been 
doing in terms of their strategic profiling. I met with some of 
your Customs people who were there then, because the Hong Kong 
port is such a big part of what comes into the West Coast of 
California.
    What has the progress been particularly in the profiling? 
When I was there, they were having some problem with the river 
travel, the riverboats coming in. And I don't know if you have 
these figures offhand, but how many of their priority screens 
actually go through the x-ray?
    Mr. Jacksta. Thank you, Senator, for trying to address this 
issue. One of the issues that we have when we established CSI 
was those types of what we call feeder ships bringing in 
various commodities into the major ports.
    When we initially went and started looking at various 
locations, we were concerned that a lot of these locations did 
not have the automated system or the manifest requirements that 
would allow us to make a decision on whether we should do a 
further inspection.
    Based on the 24-hour rule that was published last February 
and then again the Trade Act that was just published--a final 
rule was published in December--we are going to require the 
carriers when they are shipping goods to the United States to 
be able to provide CBP this information electronically. There 
are about 14 various elements in this manifest requirement.
    Once we get that information, that allows us to run it 
through our automated systems and make a decision if we need to 
do an examination overseas. One of the important parts of 
establishing a Customs presence overseas is that there is the 
capability to do that examination and there is the commitment 
from the foreign government to allow us to do the inspection.
    Based on our experience over the last couple of months, we 
have found that those countries that are participating are 
willing to basically take containers that we have selected 
through our process, CBP offices overseas have selected, and do 
an examination for us.
    So I can give you the exact numbers. I don't have them with 
me today, but I can tell you that it has improved considerably 
based on discussions between the commissioner and other foreign 
governments on this issue.
    Senator Feinstein. And the Chinese are cooperating with the 
Port of Hong Kong fully?
    Mr. Jacksta. I would tell you that they are cooperating, 
and I would tell you that we need as much cooperation as 
possible. I believe that they are much better today than they 
were months ago, and we will continue to make sure that we have 
all the information necessary to make that decision.
    Senator Feinstein. That is very helpful. Now, you said 5.3 
percent of the 6 million containers that come into this country 
today are screened. Could you define for us the screening 
process? Does that mean they have passed through the x-ray 
device, or does that mean they are opened and searched?
    Mr. Jacksta. It is a 5.4 percentage.
    Senator Feinstein. Excuse me, 5.4.
    Mr. Jacksta. Basically, what happens with that is that, 
first of all, all cargo coming into the United States is 
screened through our automated targeting system, and that is 
the information that the carriers provide us to allow us to 
screen it against our enforcement systems.
    That information and the automated targeting system selects 
various shipments for examination. Based on that selection 
process, we will have our inspectors go out to the container, 
use what we have. Our VACIS imagery systems, the big x-ray 
systems, will actually do a scan of the container.
    Also, at that time we have a policy in place that all our 
inspectors that are doing primary inspections--and this is 
considered primary inspections--will have radiation pagers with 
them on their belt buckle that will allow us to determine 
whether there is some kind of radiation being emitted.
    In addition to that, those containers that are a concern 
for us and that we target, we also bring out our extra 
equipment, what we call our RIID, our itemizer, which allows us 
to scan through the container and make a decision on whether 
there is any type of radiation being emitted.
    And then based on those types of observations of the VACIS, 
based on the information that might be in the manifest, we make 
a decision on whether we actually want to bring that container 
to a location and do a hundred-percent de-vanning.
    We also in certain locations, based on containers that may 
be coming empty, we will actually ask the vessel operators to 
crack the container so that we can take a quick look into the 
container to see if there is anything concealed. So there are a 
number of different--as I mentioned earlier, a layered 
approach, a number of different efforts taken to screen those 
shipments that are selected, that 5.4 percent.
    Senator Feinstein. When a truck comes into the Port of Hong 
Kong, the drivers are computerized and their badges are all 
read and they go to a computer station and they are assigned to 
a specific place, where they go and wait until they are called. 
So there is nothing that is unexpected that comes into the 
port.
    Is that the case in our ports?
    Mr. Jacksta. Well, I could tell you that we try to make 
sure that we regulate who is in the area. I know that the 
Admiral probably can explain a little bit more regarding the 
MTSA and how that is going to help us long-term. But, clearly, 
we want to know who is in that seaport area and what the 
purpose of them being in that seaport area is.
    Senator Feinstein. Admiral?
    Admiral Hereth. Yes, ma'am. Generally, the new regulations 
that come into force on the 1st of July require in-advance 
kinds of procedures like you are describing. However, the 
identification is still an issue, and that was addressed, of 
course, in MTSA as a transportation security card requirement.
    Those are still being developed and we are working as 
quickly as we can to move that ahead. TSA is leading that. They 
have a couple of pilot projects, one on the East Coast, one on 
the West Coast; actually, one out in LA/LB. Both of them are 
proceeding along. There are lots of technical issues that are 
being addressed, but that is an important piece of this 
equation, identity security.
    Our regs will only take a step in that direction by 
requiring in-advance requirements to be established by the 
operators based on their port practices. They might vary a 
little bit, but generally the idea was to know in advance the 
cargo that is coming to your facility, and then when it passes 
through the gate look at it and see if it has been tampered 
with. That is generally where we are with the regulations.
    Senator Feinstein. With respect to individuals coming onto 
port property and vehicles coming onto port property, what 
identification requirements are in play now?
    Admiral Hereth. Again, it attaches to the regulations which 
are just going into force. Now, many facilities have already 
adopted and are using access control procedures right now for 
vehicles. But the general principle is that within a facility 
that is owned by an operator, that company can define the 
sensitive areas where they handle cargo.
    Within those sensitive areas, they are supposed to have 
very strict access control procedures and understand exactly 
the vehicles, exactly the people who are in that area at any 
point in time through a badging process and through an access 
control process.
    Senator Feinstein. I am particularly concerned with the 
Port of Long Beach/Los Angeles because it is so big, 15 miles, 
and I guess a third the size of the District of Columbia, and 
it has proximity to two nuclear power plants. I am very 
concerned about the security at that port and that steps be 
taken as vigorously as possible to improve it.
    Specifically, with respect to that port, what advances have 
been made?
    Admiral Hereth. Well, California and the terminals in 
California led the way after 9/11, I think, in instituting a 
standard security protocol up and down the coast. LA/LB was 
really the leader in that whole development effort, working 
jointly with both agencies and with industry to develop some 
standards that were reasonable for the practices to protect 
that port. They have carried that many steps farther since 9/
11, of course, with the regulations that will have a very 
defined, level playing field, with a very consistent approach 
to security throughout that entire port area.
    Now, the size of the port area certainly is a challenge, 
but it is divided up into parcels by the terminals. And to some 
degree that size serves to benefit security. For example, the 
A.P. Mueller facility, Pier 400, that I am sure you are 
familiar with was just opened within the last year, a wonderful 
new facility, state-of-the-art security practices, in our 
opinion.
    So I think they are leading in many ways, and oftentimes 
people visit to look at their security practices and see how it 
is being done out there. So it is serving as a good model. We 
are still not there yet, but the regulations do come into force 
the 1st July. Again, we are going to have that consistency 
along the waterfront that is very important and creates a 
reasonable climate in which business can flourish.
    Senator Feinstein. Could you respond to my concern about 
the ability of the port to plan long-term, specifically the 
letter of intent which Admiral Loy said was not feasible?
    This whole area came to me directly from the Port of L.A./
Long Beach and this is their concern that they be able to be 
assured that there is a funding stream that enables them to do 
the things they need to do over a period of time. And it 
doesn't have to be a letter of intent, but, say, a 5-year plan 
that they know is going to be funded, and if the Federal 
Government can't fund the entire thing that we work out some 
methodology, whether it is fees and funds or whatever, but that 
the security can move ahead.
    Admiral Hereth. Sure. I think a long-term perspective is 
certainly a good thing and needs to be on the table for 
discussion. Up to this point, I think, as of the end of this 
fiscal year, fiscal year 2004, about $546 million worth of 
grant monies will have been handed out to ports. I think the 
figure is something like 95 percent of this last round will be 
handed out to regulated facilities, which you are talking about 
in LA/LB.
    There is still some concern about long-term and how do we 
do some good planning, and that is certainly an issue of 
concern that is being discussed. There are a couple of grant 
programs where the department is discussing integration of the 
grant programs to make sure that they are focused on the right 
thing.
    At the end of the day, the Coast Guard participates, along 
with MARAD and MTSA, in looking at every single project from a 
risk/management standpoint. Is the project being proposed 
contributing to a risk reduction in that particular port? That 
is the way the monies have been handed out, and again the focus 
of the effort has been to address risk as quickly and as 
directly as we possibly can. Now, after the initial projects 
are completed, I think it is appropriate to retool and to look 
at, longer-term, how we are going to manage those process. 
Those issues are all on the table for discussion.
    Senator Feinstein. So you are willing to do that. Could you 
let us know what you decide and how soon would that be?
    Admiral Hereth. I believe TSA will respond on the letter of 
intent issue.
    Senator Feinstein. They did; they said it was not feasible. 
So I am looking for them to come up with something that is 
feasible, whether it is a 5-year funding grant agreement or 
what, so that the ports know, particularly the big ports. I 
think you can give an annual appropriation to the smaller 
ports, but the big ports have to have that planning stream.
    Admiral Hereth. Sure, I understand. Planning is a good 
thing and that is the way the system is presently. I know that 
those issues are on the table for discussion. The concept of a 
shared burden is important, and allocating those resources and 
how those burdens will be shared from a cost standpoint going 
forward is a difficult topic just because you are dealing in 
that risk/management world.
    One person's view of risk is not necessarily consistent 
across the country, so it is a challenge to manage those 
programs. Again, I think the Department's intent is to try to 
integrate those programs and make sure that they are looking at 
risk and looking at issues from a long-term perspective.
    Senator Feinstein. One last question, if I may. Do you feel 
that the captain of the port has enough clearly-defined 
responsibilities to carry out this area of concern, which after 
all is a new area?
    Admiral Hereth. In terms of grant management or in terms of 
risk--
    Senator Feinstein. In terms of grants, in terms of 
security, because in talking to some of them, a number of them 
believe they do not.
    Admiral Hereth. In terms of authorities, I think we are 
well-positioned. We have, of course, MTSA and we have some 
prior legislation--the Ports and Waterways Safety Act, the 
Magnuson Act--that give us a lot of authority. Now, the 
challenge before us is to implement those regulations and 
implement and carry out that authority in a proper manner that 
is consistent around the country.
    So the intent of our conference last week was--the 
centerpiece was consistency. We need to approach security in a 
consistent way that facilitates commerce and minimizes the 
impact of the flow and velocity of cargo movement throughout 
the country because of its importance to our economic situation 
in the United States. So our intent is to implement these 
security practices in a consistent way, minimize impact on 
cargo flow, trying to maintain the ports in a safe and secure 
manner.
    Senator Feinstein. And if a captain of a port does not feel 
that their authority is adequate, are they free to weigh in 
with this Subcommittee?
    Admiral Hereth. Well, to be honest with you, I haven't 
heard a captain of the port express that. And having been a 
captain of the port and served at several captain of the port 
offices, large ones around the countries, our authorities are 
fairly robust.
    We have, under a couple of different statutes, quite a bit 
of authority and discretion, based on the decision of the 
captain of the port at the local field level, to require 
vessels and facilities to operate in a certain way, including 
ceasing operations, if necessary, or not coming into port.
    So our authorities under the international codes, our 
authorities under the statutes presently that exist, are very 
robust. So we are pretty well-positioned from an authority 
standpoint. The law enforcement issue ashore is the only issue 
that is outstanding that is of concern to us.
    Senator Feinstein. So how would you handle that?
    Admiral Hereth. We need the authority to carry weapons 
ashore, and we would be glad to work with you in a specific way 
on that provision of an authorization bill or something. That 
is a concern to us because we have had jurisdiction over 
waterfront facilities for a number of years now and we need the 
direct authority to carry weapons ashore, to make arrests, and 
carry out law enforcement functions ashore.
    Senator Feinstein. Thank you very much, and Senator Kyl and 
I perhaps can talk with you further about that and see what we 
can do to help.
    Admiral Hereth. Thank you very much.
    Senator Feinstein. Thank you very much, gentlemen.
    Chairman Kyl. Let me ask a couple more questions.
    Probably, Admiral, this is for you, but any of you can 
respond. On the proliferation security initiative which the 
United States is very much trying to push with allies around 
the world, do we do anything with that in our port areas? 
Presumably, we do and I am just wondering how much that has 
helped.
    Mr. Jacksta. One of the ways--and maybe this would be 
answering your question, sir--is that we are working with the 
Department of Energy for putting radiation portal monitors in 
locations where we have CSI locations. So that is an effort to 
try to once again extend the borders outward and to use our 
technology on containers before they get on the ships. So that 
is being controlled right now by the Department of Energy and I 
know it is moving forward.
    Chairman Kyl. Well, is it the Department of Defense that 
will have jurisdiction over the U.S. participation in the PSI 
around American ports or in American waters, or is it the Coast 
Guard?
    Admiral Hereth. It will be the Department of Energy working 
with Defense on the proliferation issue. We provide support to 
both organizations.
    Chairman Kyl. Okay. Is it important to know at any given 
time where a particular ship is? There has been a suggestion 
that they should have a GPS kind of identifier on board to be 
able to track them.
    Admiral Hereth. Yes, sir. The Coast Guard it is important 
and we have proposed that internationally. That is going to be 
discussed this May. There is an issue on the table for long-
range tracking of all vessels around the world. We think that 
is an important provision that needs to be moved forward and we 
are pushing that very hard.
    Maritime demand awareness--i.e., knowing what is out there 
and coming our way--is very important to us. We think we need 
to build maritime demand awareness in a more complete fashion 
over the next few years. We need to have a common operational 
picture that all agencies have access to that need it. So from 
a law enforcement or intelligence or other perspective, 
everybody is kind of looking at the same picture and has the 
same model.
    Chairman Kyl. Do you all need any additional authority or 
resources from the Congress to effectuate even more 
aggressively the cooperation of other countries in pre-
inspections at their ports prior to the transportation of goods 
to the United States? And then I will ask you a follow-up 
question, Admiral.
    Mr. Jacksta. Sir, as I indicated earlier, we do have 19 
countries that have intended to become part of our CSI program. 
Also, the commissioner has identified 20 additional locations 
which we would like to be moving out, and we are now in 
discussions with those foreign governments. So there is a 
process in place. We have identified those ports overseas that 
we think are the right ports for us to actually do examinations 
before the freight starts on its way.
    Chairman Kyl. So you would call this good progress and 
continuing progress, and if you need anything else from us, you 
will ask.
    Mr. Jacksta. That is correct, sir.
    Chairman Kyl. Okay, good. Now, another question about 
potential needs. You mentioned the age of the Coast Guard 
fleet, and clearly boarding vessels long before they get to 
port is another option and an important part of the inspection 
process. And you do it, and I gather you want to be able to 
continue to do that and perhaps even increase the use of that 
technique.
    Obviously, we would like to know what the Coast Guard 
thinks it needs in that regard, and I would specifically ask 
whether, in lieu of the larger Coast Guard cutter vessels, 
smaller vessels that I know some countries use--granted, it may 
be in closer to port, because you are meeting these ships 
sometimes quite a ways out. But would it be possible and 
perhaps more affordable to use some smaller vessels to achieve 
that function?
    Admiral Hereth. Yes, sir, and we have proposed and built, 
actually, and deployed about 200 more small boats, I think, 
ranging anywhere from the very small 25-foot harbor craft, up 
to 87-foot patrol boats, since 9/11; a very important part of 
the equation, but also supplemental to the deep-water effort, 
which is based on the larger aircraft and vessels that we need 
to be able to sustain offshore operations.
    Senator Feinstein. On that point, could I ask a quick 
question?
    Chairman Kyl. Yes, sure, go right ahead.
    Senator Feinstein. The fast boat, for example, the 
narcotics-carrying fast boat--do you have corollaries which can 
chase and catch a fast boat?
    Admiral Hereth. We do. We have new equipment that has great 
speed, but we also have helicopters now that are armed. And 
certainly that presents a big threat to the drug smugglers and 
is used pretty routinely down in the Caribbean. That is a 
capability that needs to be expanded, we think, in a much 
broader way around the country. It is a capability that is 
useful not only for smuggling operations, but also potential 
terrorist operations.
    Senator Feinstein. And if you tell a boat to put into port 
or you have to put into port in another country, are they 
cooperating with you in terms of quick refueling? There was a 
problem a while back getting your boats quickly refueled and 
out.
    Admiral Hereth. I haven't heard any problems that have 
surfaced in the last year. I think our bilateral arrangements 
pretty much with all the countries that we deal with that are 
close are very excellent now.
    Chairman Kyl. Let me just ask one more question. In the 
hearing back in 2002, one of the problems raised was the 
discrepancy between what is reported on a manifest and what the 
cargo actually may contain. You have put a lot of emphasis on 
the electronic data, checking the manifests early, and so on.
    How do you maintain the correlation, or determine the 
correlation between what the manifest says and what is really 
in there, and how good is this data? How well can we rely upon 
it and how do we check to make sure it is correct?
    Mr. Jacksta. Senator, that is a very important issue for 
CBP. If we don't have good information, our systems don't work 
and our inspectors can't take the appropriate action.
    Once again, going back to the 24-hour rule that we put in 
place in February, we started a phased approach where we 
actually had our inspectors at the ports of entry working with 
the vessel operators, the brokers, and had them reviewing the 
manifests.
    What we did was that if the manifest did not have the 
appropriate information, we would tell the carrier that they 
could not load that container on a vessel to the United States. 
So that is why we wanted the information 24 hours before it was 
laden on board. That is one of the things that we do.
    The other important action that we take is at the port of 
arrival, when we do our examinations, we make sure that we 
review the manifests and we do spot-checks to verify if there 
are any type of discrepancies. Are there containers on the ship 
that should not be on the ship? Are there containers that 
things are manifested that were not manifested in the actual--
and we have a penalty provision that allows us to do a number 
of things. We can actually seize the goods, we can actually 
penalize the carriers for not properly manifesting.
    I can tell you personally that since February of last year, 
the industry has taken actions to correct this. They recognize 
the concerns and they recognize that we are there, first of 
all, telling them whether they can load the container on or 
not, and then we are there at the port entry and if it is not 
correct, we can penalize them. So there are mechanisms that are 
in place and we feel it is very important that for our systems 
to be successful, we have to have the proper information.
    Chairman Kyl. I think for the American people it is 
important for us to make the point that these processes are 
achieving results. So let me just ask you as a very general 
proposition--and, Mr. Bald, maybe this question is first 
directed to you--do we find contraband, do we find things that 
shouldn't be in the cargo, and do we, in fact, even perhaps 
sometimes find materials that could relate to acts of 
terrorism?
    In other words, are all of the inspections that we are 
doing, are all of the checking of the manifests that we are 
doing, and so on, resulting in--are we just coming up 
absolutely dry, but it is good to check? Or are we, in fact, 
finding stuff that shouldn't be there and it encourages us to 
continue to enhance our efforts?
    Mr. Bald. As intelligence gets better, we will do a better 
job, obviously, in the future. The JTTFs working with CBP have 
come up with a number of successes. The actual items that are 
discovered fall under CBP, and I would defer to them to clarify 
or amplify on that.
    Mr. Jacksta. Yes, sir, we definitely believe that the 
equipment that we are putting out there has shown tangible 
effects. First of all, we have made a number of seizures 
regarding contraband. I think I can report that the good news 
is that we haven't discovered any weapons of mass destruction, 
but we have been able to discover shipments where people are 
still trying to smuggle narcotics into the United States.
    We are also finding, using our VACIS system, our imagery 
system, containers where once again it is manifested as one 
commodity and when our inspectors take a look at the image, 
they realize it is not what it is supposed to be. So there are 
clearly still shipments where the manifests are not properly 
notated and things that people try to bring into the United 
States not properly declared, not having the right license.
    So in that area, the seaport environment, we have been very 
successful, and I can tell you also as a result of the 
technology that we put in place both at the southern border and 
the northern border, we have also been able to use that to 
discover narcotics in areas that we probably might not have 
been able to discover without having the equipment that is 
available for us.
    Chairman Kyl. Thank you.
    Senator Feinstein, anything else?
    Senator Feinstein. Thank you.
    Mr. Jacksta, has the immigrant smuggling in containers been 
abated, do you believe, worldwide?
    Mr. Jacksta. I would say that we still discover individuals 
that are stowaways on ships, and so therefore it is still a 
threat and a concern for us. Once again, we do not know exactly 
who these individuals are, and any time someone is smuggled 
onto a vessel and into a container and we discover it at a port 
of entry, or the vessel operator discovers it, it is a concern 
for us. So the threat is still real.
    I think what we are trying to do is work very closely with 
the Coast Guard. Within CBP, we are trying to use the Border 
Patrol and our inspectors to actually go and when a ship 
arrives to make sure that there is nobody that is a stowaway or 
an absconder on the boat. So I do not know whether the problem 
of immigration smuggling through the seaports has been 
alleviated. I think we have taken some actions to try to 
address this concern.
    Senator Feinstein. [Presiding] One last question. 
Credentialing of employees is somewhat controversial. What kind 
of credentialing system has been decided upon?
    Admiral Hereth. You are familiar when we talked about the 
transportation security card before that it is still under 
development. There is another provision in MTSA that deals with 
credentialing, I think, to what you are referring, the enhanced 
mariner credential.
    There are really two aspects to that. Number one, the law 
requires that we develop that. Now, the Coast Guard took that 
forward on the international front and has now worked with the 
ILO, the International Labor Organization, to develop a new, 
enhanced mariner document.
    ILO 185 was passed back in June, and agreed to by the 
countries involved. The United States supported that provision, 
even though it has a provision that may prevent ratification. 
Nevertheless, the document itself is a better document. It has 
a biometric indicator on it and it has a better database that 
we will have access to. So, overall, we view it has a security 
enhancement to the United States.
    The second part of the law requires us to set requirements 
for visiting vessels, for example. And we intend to do that 
through a regulatory project probably over the next year, but 
that is an important part, again, of security. Fraud is rampant 
throughout the world, and so we need to take some steps to 
further tighten that up. But those are the steps that have been 
accomplished so far and we believe that is a significant step 
forward.
    A multilateral approach is certainly the strongest approach 
to ensure that we don't have reciprocal problems confronting 
U.S. mariners going overseas. So that is why we use the forum 
the International Labor Organization.
    Senator Feinstein. Do you feel that the system that is in 
place is adequate to prevent individuals from being smuggled in 
and avoiding Customs and others at the port of entry?
    Admiral Hereth. Let me just comment from two perspectives 
on that. Number one, when the regulations go into effect--and I 
think the powerful thing about the position that we are in is 
that we have negotiated an international agreement that is very 
much like the MTSA requirements.
    So, essentially, all the countries in the world, all the 
vessels and all the facilities, have to enact standards that 
are very similar to the United States standards. So that is 
good from a consistency standpoint. We don't want the United 
States to be at a competitive disadvantage vis-a-vis other 
countries. That is happening the 1st of July.
    There are provisions in the international code that require 
access control and all the things that will help prevent 
smuggling of people and hopefully reduce that problem, reduce 
absconding, reduce smuggling and things like that. So it is our 
hope that as those regulations go into effect that problem will 
hopefully be addressed by both facilities and vessels.
    The other thing I will say is that as vessels approach the 
United States, we have a 96-hour advanced notice of arrival 
requirement. That requirement is probably three dozen items' 
worth of information that have to be provided to the Coast 
Guard. All that information is vetted and we screen for any 
security risks for the vessel, the cargo, or the crew.
    If we find any security risks related to the crew, we work 
with CBP to issue a captain of the port order to the vessel to 
provide us a security plan to make sure that those folks, those 
security risks, the crew members that we are concerned about, 
are, in fact, detained on board as they are ordered by CBP. 
That means they have to hire additional security guards that 
are U.S.-based companies and do things like that to ensure that 
those people don't get off.
    So absconding and stowaways, and so forth, are a concern to 
us, but they are being addressed on those two fronts, the regs 
and then additional provisions under captain of port orders on 
specific cases.
    Senator Feinstein. Are there any specific protocols for 
specific ports, say, Karachi; specific manifests, say--I don't 
know if he still owns them, but Osama bin Laden owned some 
freighters.
    Admiral Hereth. Yes, and I can't go into any classified 
material. We would be glad to talk with you offline on that, 
but any of those concerns are tracked by our Intelligence 
Coordination Center that is collocated up in Suitland with the 
Office of Naval Intelligence. They, together, form the National 
Maritime Intelligence Center, and any vessels of concern are 
tracked worldwide.
    Senator Feinstein. With respect to port employees, what 
kind of credentials or I.D.s will they have?
    Admiral Hereth. Port employees are envisioned to have the 
transportation security card or the TWIC, the transportation 
work identity card. Anybody that works on the waterfront is 
envisioned to have a transportation security card.
    Senator Feinstein. And are there any criteria by which that 
card is denied?
    Admiral Hereth. There are. There are provisions in the law 
and those are being discussed. As you mentioned, that is still 
underway.
    Senator Feinstein. Right. Well, let me thank you very, very 
much, and let me say something, Mr. Jacksta. I know your 
department, in particular, has been very burdened and it has 
been hard on some of the ports. But from what I have seen, I 
think you are really doing an excellent job. I think it is a 
very good idea sending Customs people to these critical ports 
and working with the country to try to see that we have got a 
seamless system, because if you are going to push the 
boundaries out and that is going to work, I worry very much 
about that manifest system, the shipper system; you know, who 
is reliable and who isn't, and whether you can kind of 
obfuscate in the protocol that is put together.
    But from what I have been able to see, I think Customs is 
really doing a good job and I just wanted to say that.
    Mr. Jacksta. Thank you very much, Senator.
    Senator Feinstein. I thank you, too, Admiral. And, Mr. 
Bald, thank you for your comments and for your work. I know 
this is an unforgiving area because if something does happen, 
it would be catastrophic.
    Chairman Kyl has returned. I will stop filibustering.
    Chairman Kyl. Well, I know you have thanked our panel, too, 
and we have a great panel here. I appreciate it. There are a 
lot of questions we could ask, and I would leave the record 
open for a brief period of time so other members, as well as 
Senator Feinstein and I, might pose additional questions to 
you.
    We probably will want to revisit the issues we have raised 
here. Perhaps we can do it informally and not necessarily have 
to have a hearing. But as our legislation moves forward and as 
others try to deal with the follow-up on all the different 
things that we have put in place to get this job, we will want 
to exercise our oversight to make sure that it is being done, 
that we are doing everything we can, and if there is anything 
that you all need so that we can together accomplish this 
objective, that we provide those resources or those legal 
authorities or whatever it might be.
    So, again, thank you very much. Thank you for what you are 
doing to help provide security to our country.
    If there is nothing further, this hearing is adjourned.
    [Whereupon, at 12:32 p.m., the Subcommittee was adjourned.]
    [Questions and answers and submissions for the record 
follow.]
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