[Senate Hearing 108-332]
[From the U.S. Government Publishing Office]
S. Hrg. 108-332
NOMINATION OF ADMIRAL JAMES M. LOY
=======================================================================
HEARING
before the
COMMITTEE ON
GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
ONE HUNDRED EIGHTH CONGRESS
FIRST SESSION
ON THE
NOMINATION OF ADMIRAL JAMES M. LOY TO BE DEPUTY SECRETARY OF HOMELAND
SECURITY
__________
NOVEMBER 18, 2003
__________
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COMMITTEE ON GOVERNMENTAL AFFAIRS
SUSAN M. COLLINS, Maine, Chairman
TED STEVENS, Alaska JOSEPH I. LIEBERMAN, Connecticut
GEORGE V. VOINOVICH, Ohio CARL LEVIN, Michigan
NORM COLEMAN, Minnesota DANIEL K. AKAKA, Hawaii
ARLEN SPECTER, Pennsylvania RICHARD J. DURBIN, Illinois
ROBERT F. BENNETT, Utah THOMAS R. CARPER, Deleware
PETER G. FITZGERALD, Illinois MARK DAYTON, Minnesota
JOHN E. SUNUNU, New Hampshire FRANK LAUTENBERG, New Jersey
RICHARD C. SHELBY, Alabama MARK PRYOR, Arkansas
Michael D. Bopp, Staff Director and Chief Counsel
Johanna L. Hardy, Senior Counsel
Tim Raducha-Grace, Professional Staff Member
Joyce A. Rechtschaffen, Minority Staff Director and Counsel
Holly A. Idelson, Minority Counsel
Jennifer E. Hamilton, Minority Research Assistant
Amy B. Newhouse, Chief Clerk
C O N T E N T S
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Opening statements:
Page
Senator Collins.............................................. 1
Senator Stevens.............................................. 3
Senator Akaka................................................ 5
Senator Carper............................................... 6
Senator Lautenberg........................................... 7
Prepared statement:
Senator Durbin............................................... 25
WITNESSES
Tuesday, November 18, 2003
Hon. Daniel K. Inouye, a U.S. Senator from the State of Hawaii... 4
Admiral James M. Loy to be Deputy Secretary of Homeland Security. 9
Alphabetical List of Witnesses
Inouye, Hon. Daniel K.:
Testimony.................................................... 4
Prepared statement........................................... 25
Loy, Admiral James M.:
Testimony.................................................... 9
Prepared statement........................................... 27
Biographical and professional information requested of
nominees................................................... 30
Pre-hearing questionnaire and responses for the Record....... 39
Post-hearing questions and responses for the Record from:
Senator Collins............................................ 162
Senator Lieberman.......................................... 181
Senator Durbin............................................. 184
Senator Lautenberg......................................... 186
Senator Specter............................................ 193
APPENDIX
Letter from Admiral Loy, dated Feb. 23, 2004, with a correction
for a factual error contained in response to pre-hearing
question No. 63................................................ 194
NOMINATION OF ADMIRAL JAMES M. LOY
----------
TUESDAY, NOVEMBER 18, 2003
U.S. Senate,
Committee on Governmental Affairs,
Washington, DC.
The Committee met, pursuant to notice, at 2:32 p.m., in
room SD-342, Dirksen Senate Office Building, Hon. Susan M.
Collins, Chairman of the Committee, presiding.
Present: Senators Collins, Stevens, Akaka, Carper, and
Lautenberg.
OPENING STATEMENT OF SENATOR COLLINS
Chairman Collins. The Committee will come to order. Today
the Committee on Governmental Affairs will consider the
nomination of Admiral James Loy to be the Deputy Secretary of
the Department of Homeland Security, the No. 2 post in this
important Department.
We are fast approaching the first anniversary of the
Homeland Security Act which established the new Department.
Integrating 22 Federal agencies was necessary to enhance the
security of the United States and the safety of its people in
this environment of global terrorism. But unifying 22 agencies
and more than 170,000 employees is an extraordinary challenge.
Secretary Ridge and his team are to be commended for their
tireless efforts on what is a monumental undertaking.
But there is a seat at the helm that is now empty and I can
think of no finer person to fill it than the nominee who is
before us today. Admiral Loy, you have spent 40 years on the
front lines of homeland security. In 1998, during your Commerce
Committee hearing to be the commandant of the Coast Guard,
Senator Inouye remarked, ``you are to be commended for the
decades of superb service you have given to your country. You
have gotten this nomination the old-fashioned way--you have
earned it.'' You have certainly earned this one, too.
Helping to run this enormous new Department will take all
of your skills, dedication, and savvy. The Department of
Homeland Security has to address an endless number of threats
and issues each and every day, yet it must be able to balance
security concerns with the need to preserve our American way of
life.
My home State of Maine shares more than 600 miles of border
with Canada making border security issues especially important
to me. The people, communities, and businesses on both sides of
the border depend upon each other for friendship, mutual aid,
and economic success. Many families, including my own, have
relatives on both sides of the border and the ease of crossing
has allowed them in the past to maintain strong family ties. I
understand and certainly support the efforts that the United
States is making to improve border security at home, but as the
Department moves forward on policies that tighten border
security it must also take into consideration the social and
economic ramifications of any changes.
Admiral Loy, should you be confirmed, as I believe you will
be, the Committee will also support your efforts to improve the
level of preparedness in every community. This Committee has
held hearings and approved legislation to strengthen homeland
security grant programs, to put cutting edge counterterrorism
technologies in the hands of local law enforcement, and to
strengthen American seaports against a terrorist attack. We
must make certain that our communities receive a long-term,
steady stream of funding to prevent a future terrorist attack
and to respond should the worst occur.
The Committee has already approved legislation that I
introduced that provides a solid baseline of funding to each
State but that allocates the majority of the funding, more than
60 percent, to States based on the individual circumstances of
risk, threat, and vulnerability. We hope that you will work
with the Committee to ensure that this legislation is enacted
into law next year.
I also appreciate your efforts to improve coordination
within the Department and with other agencies. The Department's
efforts to set up a single website for many homeland security
grant programs is a step in the right direction. In addition,
however, we need to reduce paperwork, standardize equipment and
training standards, and coordinate emergency preparedness
plans. If confirmed, I hope that you will work with this
Committee to forge a bipartisan consensus on all of these
issues, and I trust that you will let us know promptly if you
need more tools or resources to help our States, communities,
and first responders.
Finally, let me comment on your outstanding 38-year career
in the Coast Guard. When the new Department of Homeland
Security was first being debated Senator Stevens and I joined
forces to ensure that the Coast Guard's vital traditional
missions, such as search and rescue, were not compromised as
the Coast Guard took on additional homeland security
responsibilities. I am confident that given your long career in
the Coast Guard you will ensure that both the letter and the
spirit of the Stevens-Collins amendment are followed.
Perfect timing; the Senator from Alaska has come in.
In short, we are very pleased to have you here today and I
look forward to hearing the introduction of you, the formal
introduction by two of our most esteemed colleagues. I would
first call upon the--now you are each pointing at the other.
Senator Stevens. He is senior.
Chairman Collins. I will call on the distinguished senior
Senator from Hawaii. I want to tell you that I had a big debate
with my staff over whom I should call upon first, the President
pro tempore or the senior member, and it was a toss-up. So
since Senator Stevens has suggested I proceed with the
distinguished Senator from Hawaii, I am going to follow his
advice, which is always sound. Senator Inouye.
Senator Inouye. Madam Chairman, I very seldom disagree with
my brother but he is the President pro tempore, and most
importantly, this day is his birthday.
Chairman Collins. That is true and we hope to celebrate
that later today.
Senator Inouye. If you want this nomination to go through,
you had better get the octogenarian---- [Laughter.]
Chairman Collins. Senator Stevens, I think the
distinguished Senator has yielded to you.
Senator Stevens. Thank you very much, Madam Chairman.
Chairman Collins. We welcome you.
OPENING STATEMENT OF SENATOR STEVENS
Senator Stevens. It is a privilege to be here with you and
to introduce Admiral Loy to our Committee. He has had a long
and distinguished record of public service. You may have
already stated this, his career spans over 30 years with the
Coast Guard. He graduated from the Coast Guard Academy in 1964
and came through the ranks to be the commandant in May 1998.
Now my State has a unique relationship with the Coast
Guard. We have more than half the coastline of the United
States, 6,640 miles of coastline. That literally makes us
stewards of the coastline longer than all 48 States combined.
We have the Coast Guard's largest base on Kodiak Island. I had
some experience with that when I was a brand new Senator.
Senator Nixon wanted to close the Kodiak Naval Station and we
thought it was a place that should have some presence. I went
to the Coast Guard and asked them to come visit Kodiak and was
able to convince them to move a small station there. They have
since learned that that is the place from which we can guard
the Pacific and all its resources for the United States.
I got to know Admiral Loy well when he served as
commandant. During his tenure he led the Coast Guard's effort
to rebuild and restore readiness, he rebuilt the Coast Guard's
workforce to authorized levels, improved retention and prepared
the Coast Guard to fulfill its future duties and
responsibilities. He also made sure the Coast Guard had the
resources it needed to protect our coastline and our maritime
boundary of Alaska, which is so important to all of us. Over
half of the fishery resources in the United States are in the
north Pacific, and the Admiral has had a commitment and a
dedication to protect those resources.
When our Nation needed Admiral Loy's expertise to secure
our transportation systems after September 11, he answered the
call to service and assumed a newly-created post of Deputy
Undersecretary of Transportation for Security. In 2003, he
became the administrator of the Transportation Security
Administration and assumed the critical task of securing every
facet of our Nation's transportation system. Admiral Loy
successfully led TSA through the transition into the Department
of Homeland Security, and furthered his agency's dedication to
security while improving public outreach and customer service.
I do believe that I know of no man more qualified to take
over this position than Admiral Loy. He has completed enormous
tasks as though they were small tasks, and I think the
Committee would agree, the Admiral's experience and dedication
will serve him well as the second in command at the Department
of Homeland Security. I know of no greater honor than to ask
the Committee to move very quickly on this nomination.
Thank you very much.
Chairman Collins. Thank you very much, Senator Stevens.
Senator Inouye.
Senator Inouye. Madam Chairman, I thank you very much. I
wish to ask for your permission to have my statement made part
of the record.
Chairman Collins. Without objection.
TESTIMONY OF SENATOR DANIEL K. INOUYE,\1\ A U.S. SENATOR FROM
THE STATE OF HAWAII
Senator Inouye. As my distinguished friend from Alaska
indicated, he has the longest coastline. The State of Hawaii is
surrounded by water. We have all the services on our islands,
but the most favorite service is the Coast Guard. It saves more
lives. We are surrounded by fishermen all the time, men who go
out and surf, and without the Coast Guard we would have crise
every day. Thanks to them, our families are happy, people are
happy.
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\1\ The prepared statement of Senator Inouye appears in the
Appendix on page 25
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Admiral Loy has had a long and distinguished tenure with
the Coast Guard. He has been commandant for 4 years. He has led
the Coast Guard through one of the most significant periods of
transformation in the history of that service. He has improved
the readiness of the operation. He is preparing for the future.
For many, many years they could not maintain their recruitment
level. He has exceeded that. He has exceeded in retention, and
he has ensured the personnel were properly supported by the
finest equipment possible. He has had the training and the
background and experience that we sorely need in this new
position.
So I am most pleased and proud to join Senator Stevens in
commending Admiral Loy to you.
Senator Stevens. Could I just add something, Madam
Chairman?
Chairman Collins. Senator Stevens.
Senator Stevens. In my State, the Coast Guard operates
helicopters that fly over barren seas and barren areas that are
one-fifth the size of the United States. His people deliver
babies, they pick up stranded people from ice floes, they
patrol to see that the foreign fleets do not come into our
shores, and they are really great neighbors. I think the fact
that we have this nomination before us today demonstrates the
wisdom of the battle that you and I fought that you were
speaking of when I came in the room. But now, by having Admiral
Loy in the position he is going to assume, it shows to everyone
that that commitment is a real commitment, to make sure the
Coast Guard will survive and be really compatible with the
whole concept of homeland security.
So I really welcome this nomination and the assurance it
gives those of us who had some fear about putting the Coast
Guard in this new Department. I hope you will move the
nomination quickly. Thank you very much.
Chairman Collins. Thank you very much. I know that both
Senators have other engagements and I am going to give you the
opportunity to depart the Committee. But I want to thank you
both for taking the time to be here and to endorse this
nominee. Your endorsement means a great deal.
Senator Inouye. Thank you very much, Madam Chairman.
Chairman Collins. I would now like to call on the other
distinguished Senator from Hawaii, Senator Akaka, for his
opening comments.
OPENING STATEMENT OF SENATOR AKAKA
Senator Akaka. Thank you very much, Madam Chairman.
Admiral Loy, you come before this Committee with high
recommendations from two colleagues whose opinions I respect
tremendously, my good friends Senators Stevens and Senator
Inouye. I thank you for being here this afternoon, and I thank
you for your visit with me earlier today.
Admiral Loy, as Administrator of the Transportation
Security Administration and the former Commandant of the Coast
Guard, you have served your country well. As was mentioned, you
were in the Coast Guard some 40 years. You understand firsthand
the unique challenges faced by the Department of Homeland
Security, and the experience you have had in the Coast Guard
certainly will make a huge difference in securing our country.
To be effective, policies within the Department must
address the specific homeland security needs of each State and
municipality. The State of Hawaii is over 2,500 miles from Los
Angeles and is accessible only by plane or ship. It takes 5\1/
2\ hours to fly from the mainland and 4\1/2\ days by sea. This
distance makes mutual aid from mainland States or from other
Pacific jurisdictions unfeasible. Hawaii is home to 53,600
military personnel and hosts about 160,000 tourists on any
given day. I have joined with Senator Collins to ensure that
first responder funding covers all who reside in a State
including military and tourist populations. I look forward to
working with you to ensure that this priority is addressed in
first responder allocations.
As the head of TSA, you serve on the DHS human resource
system design team which has forwarded its recommendation for a
new personnel system to DHS Secretary Ridge and OPM Director
James. I expect you to foster an environment of inclusion that
brings together the different talents of Federal workers and
the different cultures of agencies included in this new
Department. Your experience tells me that you will.
As we protect America by reorganizing the Federal
Government we cannot overlook the fundamental rights of Federal
employees. Union representation, collective bargaining, and
appeal rights whistleblower protections are all critical
elements of a strong and stable workforce. The rights of
Federal workers complement our ability to safeguard the
country.
Our goal is to protect the Nation. The key to attaining
this goal is skilled and highly motivated employees and capable
leadership. If the imposition of a new personnel system results
in a demoralized workforce and accelerated retirement by
skilled workers, then the question needs to be asked, is our
Nation's security at risk?
There will soon be new personnel systems for the largest
Federal agency, the Department of Defense, and the third
largest, the Department of Homeland Security, which will bring
massive changes to those personnel essential to our national
security. Any changes have to be looked at more seriously, and
I want your commitment to work with me to ensure that we
protect the rights and benefits of our Federal workforce. Much
of the debate has focused on union rights. I, for one, believe
that a modern and agile workforce is not incompatible with
collective bargaining.
Admiral Loy, you have an immense task before you. I commend
you for accepting the responsibilities of this position, and I
know you will continue to make significant contributions to
protecting the people of our great country. I consider you as a
tremendous plus for what we are doing to secure our country.
Thank you very much, Madam Chairman.
Chairman Collins. Thank you Senator. Senator Carper.
OPENING STATEMENT OF SENATOR CARPER
Senator Carper. Thank you, Madam Chairman. Earlier, Admiral
Loy, when Senator Stevens and Senator Inouye were jockeying,
debating about who was going to go first and Senator Inouye
mentioned that it was Senator Stevens' 80th birthday today, I
thought the person at that table who really receives the best
gift is you. To be introduced by either of them at a
confirmation hearing is a great honor.
Admiral Loy. Indeed.
Senator Carper. To be introduced by not one but by both of
them is really quite extraordinary.
As an old Navy guy for 23 years active and reserve duty and
someone who served for 10 years on the Coast Guard Subcommittee
in the House of Representatives before I was elected governor,
I just want to express my thanks to you for your service to our
country, my great respect for the Coast Guard for the good they
do in Delaware and the Delaware Bay, the Delaware River, and
the Atlantic Ocean not far from where we live.
I am grateful for the work that you have done in leading
TSA within this new Department over the last couple of years.
And I appreciate the chance to have sat down with you and to
have spoken earlier today about some issues and when we get
into questions I hope to be able to revisit a couple of those.
I will just mention them again.
One of those was the issue of the funding formula for first
responders that Senator Collins and I have worked on. I would
like to discuss that with you a bit more. Among the
responsibilities that TSA has is not only aviation security and
important transit security but also rail security and I would
like to revisit that with you, if I might.
Finally, I would like to talk a bit more about the concerns
that have been expressed to us by port workers. The Port of
Wilmington--and I know you have heard these from workers in
other ports--employs some people who have had problems with the
law and have some criminal violations on their records. They
have gone straight. They have become law-abiding citizens and
contributing members of our society, and a number of them have,
I think, real concerns about their future as breadwinners for
themselves and for their families. I would like to have a
chance to delve into that with you as well. We will have a
chance for that here shortly.
I want to thank you again for your service to our country
and for your family to be willing to share you with the rest of
us.
Admiral Loy. Thank you, sir.
Chairman Collins. Thank you very much, Senator. Senator
Lautenberg.
OPENING STATEMENT OF SENATOR LAUTENBERG
Senator Lautenberg. Thank you, Madam Chairman. My respect
for holding this hearing and dealing with this complicated
problem of having a nominee about whom there is virtually no
controversy. It is not usual that we do these things.
But also, I always think about New Jersey and its
relatively enormous coastline for the landmass that we have.
Then we get Hawaii and Alaska. Ain't nothing there but water.
But the fact that you have enjoyed the universal respect, and I
might even say, Admiral James Loy, the affection of people you
work with, because it is not just a pleasing personality. You
have taken to your tasks very well.
Few have had the rich experience that Admiral Loy has had.
To come to this fairly complicated job, having been with the
Coast Guard, and commandant, I think it equips you particularly
well because for a relatively small agency they have more
responsibilities, the Coast Guard. And it is constantly
enlarging the responsibilities without commensurately enlarging
the budget. The Coast Guard has, I think, performed miracles.
When you think of all the duties they have, everything from
ship manifests, to pollution control, to illegal refugee
movements, the drug enforcement, to picking people off the high
seas, and to contributing as well to being a good neighbor to
make sure that things operate well.
We are very fortunate in the State of New Jersey to have
the Coast Guard training base there. Admiral Loy and I had a
fair amount of contact in his days as the Coast Guard
commandant and it was always a pleasure to see him and to hear
from others who served with and for him, the respect that he
enjoyed.
Having said all those nice things now I want to get down to
the nub of some things that we are going to have to be
concerned about. One of them was mentioned by our friend from
Delaware, and from Hawaii as well. I served as the commissioner
of the Port Authority before I came to the U.S. Senate so I
know quite a bit about how the port operates, its importance to
our economy, its vulnerability to terrorism.
By the way I mentioned, Admiral Loy, yesterday we had a
chance to chat, to see a couple of Coast Guardsmen out there
post-September 11. The Hudson River compared to the Atlantic
Ocean may not look like a place that you have got to worry
about, but there is an awful lot of ship traffic, a lot of
turbulence in that river because of the ship traffic. Out there
in a rubber dinghy with a machine gun mounted, making sure that
they did whatever they could to protect us and to protect the
commerce that goes through the harbor. The Coast Guard
estimated that they needed $963 million this year and $4.4
billion over the next 10 years to make our ports safe. I hope
that Admiral Loy, in his new post, can pry that money loose.
The question of first responder grants, for me a particular
concern in the State of New Jersey was that our State and our
neighboring State New York, suffered the most on September 11
directly. We are ranked near the bottom per capita when the
money was doled out. Some of that stems from a faulty
allocation formula embedded in the USA Patriot Act, but to his
credit Secretary Ridge has acknowledged problems with the
formula and we still need to fix that.
There is another element that concerns me and that is our
color-coded threat system. It does not do much, and if we do
not scrap it altogether, we need to revamp it considerably.
Because to issue threats that have no support or no advice as
to what you do, where do you go? I have had these silly calls.
I think they are silly because I believe that we are doing
largely what is necessary. But when a threat comes out and I
get calls in our office, dare we go to New York City now; or
dare we go here; or dare I take my kids on vacation, it is not
the way to do things. It just alarms everybody without offering
any solution.
Another problem that I am concerned about is with the air
marshals. Now I am concerned that the principal security
inspectors are allowing flight attendants to take home study
courses as part of their security training, but more concerned
about what is happening to our Federal air marshal program. It
is up, is it down, with regard to budget cuts and so-called
cross-training with Customs agents. I am not quite sure what
the intentions are. At one point they said they would get rid
of them. Then I saw they were bringing them back. I think we
ought to firm up that program. It is a very important
protection that we afford the flying public, and we want to
make certain that that is manned to the proper degree.
Last, the new threats that seem to arise. Whenever you
think you are working on the things that really count you find
out that there is another leak in the dike, and this one is
surface to air missiles. A year ago this month the world saw
the SAM attack on the Israeli jet in Mombasa, Kenya. And more
recently, a sting operation in the port of New Jersey, port of
Newark, we revealed an attempted to smuggle SAMS into the port.
They were almost boastful about how they got into it. The
prosecution was there and it will be taken care of, but the
fellow who they caught with this was determined to create a
structure, an organization to bring these things in on a
regular basis. How devastating. So these weapons may present
the biggest terror threat to commercial airliners and I want to
know what the administration is prepared to do to address it.
Madam Chairman, I will spare you the time and the
Committee. Those are a few of my concerns, raising them, I want
to suggest that we have to go further to make our country safer
against the scourge of international terrorism. But I think
Admiral Loy is equal to the task and I look forward to
confirming him as I know others do as well. We wish him well in
this very important task.
Admiral Loy. Thank you, sir.
Chairman Collins. Thank you, Senator.
Admiral Loy has filed responses to a biographical and
financial questionnaire, answered prehearing questions
submitted by the Committee, and had his financial statements
reviewed by the Office of Government Ethics. Without objection,
this information will be made part of the hearing record with
the exception of the financial data which are on file and
available for public inspection in the Committee's offices.
Admiral our Committee rules require that all witnesses at
nomination hearings give their testimony under oath, so if you
will please stand and raise your right hand.
[Witness sworn.]
Admiral Loy, do you have a prepared statement that you
would like to give at this time?
Admiral Loy. I have a prepared written statement, ma'am. If
I could submit it for the record, I would appreciate that, and
just provide perhaps a couple moments of oral comments.
Chairman Collins. It will be included in full.
TESTIMONY OF ADMIRAL JAMES M. LOY,\1\ TO BE DEPUTY SECRETARY OF
HOMELAND SECURITY, DEPARTMENT OF HOMELAND SECURITY
Admiral Loy. Good afternoon, Senator Collins and Senator
Akaka, and all Members of the Committee. Thank you for
scheduling this hearing so quickly and giving me the
opportunity to appear before you today. I also want to thank
Senator Stevens and Senator Inouye for their kindness in
sponsoring my nomination today. Both represent to me the
epitome of public service and our work together for many years
on Coast Guard issues really now represents a foundation of
capability our Nation needs to secure our homeland.
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\1\ The prepared statement of Admiral Loy appears in the Appendix
on page 00.
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I am honored that President Bush has nominated me to serve
alongside my good friend and fellow Pennsylvanian, Secretary
Tom Ridge, as the Deputy Secretary of Homeland Security, and if
confirmed I will do my utmost to serve the President and the
Secretary in protecting our homeland from acts of terrorism, as
we also maintain our way of life and all the freedoms that we
enjoy as Americans, and to preserve and expand our national
economy all at the same time; a difficult set of challenges.
I have the singular experience of having led the two
largest organizations that comprise the Department of Homeland
Security, the Transportation Security Administration and U.S.
Coast Guard. Together they include approximately 100,000
dedicated men and women, more than half the DHS workforce. This
gives me a unique perspective, I believe, on the challenges we
face in molding the Department into a fresh, cohesive agency.
If you will, having looked from the bottom up, I will be able
to bring those thoughts and lessons learned into the dialogue
of the leadership of the Department. I hope that perspective
will be valuable as we move forward together.
Madam Chairman, with your permission I would like to just
mention four quick things that I think are important to the
fundamental success of this new Department, this new adventure
called the Department of Homeland Security.
First, information sharing and analysis. If this Department
is to succeed we must build the capability to collect, to
share, to analyze and to distribute the intelligence and
information sets necessary to secure the homeland. I think this
will be very different from anything that we have ever been
expected to do in the past. We must design, if you will, a
common information picture such that all gathered information
is available to analyze, that all analyzed information becomes
actionable products, and that all those products gain
distribution to those who can best put them to use to secure
America.
Second, the notion of critical infrastructure must become
the product of criticality assessment on one hand,
vulnerability assessment on the second, threat assessment on
the third, and then very real, methodical risk management as a
fourth dimension of how to grapple with this challenge of
identifying and securing the critical infrastructure of our
homeland.
Third, this Department must become the model Cabinet-level
agency for the 21st Century. We have every opportunity to do
that. Organizational excellence must become the norm across the
board in all our operating agencies as well as in our support
structure. We must demonstrate with solid metrics that we are
doing our work efficiently, effectively, and with an eye to the
good stewardship of the taxpayer's dollar.
Fourth, we must accept the challenge offered by the
national homeland security strategy and interpreted boldly and
widely for the American public, and especially for our
workforce at DHS. That means each of us entrusted with
positions of leadership must be bold and directive and
methodical as we set goals, as we optimize objectives and
design systems to accomplish the departmental mission. And
second but simultaneously, to build the cultural norms expected
in a high-performing organization.
I spent all my professional life in one such organization
where the core values of honor and respect and devotion to
their duty meant something visceral and real to every sailor in
that organization. We are working hard now to build that same
culture at the Transportation Security Administration, and it
must also be done at DHS. I look forward to taking on that
challenge with Secretary Ridge.
Last, I offer the simple notion that we are all in this
together. Our strategies and plans must be open to all of those
with good ideas. Our reach must include State, tribal, and
local and private sector players. Securing the homeland is an
obligation now for every citizen of this great Nation. The
events of September 11 show that terrorists draw no
distinctions between military targets and civilian office
buildings. This is a gravely different security environment
that we are living in post-September 11. It calls for creative
thinking, diligent research, and a collective commitment to
hold the edge and to keep complacency at bay, because indeed I
believe to some degree it was complacency that got us into
trouble over the decade post-1989 after the fall of the wall
and after the dissolution of the Soviet empire took away that
single superpower that we were vying with.
I am very aware of the seriousness and the importance of
the challenge and opportunity that President Bush and Secretary
Ridge have entrusted to me, and if confirmed I pledge to bring
tirelessly whatever I have learned to the task.
Thank you again for your sensitivity to the scheduling of
this hearing and I look forward to your questions.
Chairman Collins. Thank you, Admiral Loy. I am going to
start my questions with three standard questions that are posed
of all nominees. First, is there anything you are aware of in
your background which might present a conflict of interest with
the duties of the office to which you have been nominated?
Admiral Loy. No, ma'am.
Chairman Collins. Second, do you know of anything personal
or otherwise that would in any way prevent you from fully and
honorably discharging the responsibilities of the office to
which you have been nominated?
Admiral Loy. No, ma'am.
Chairman Collins. Finally, do you agree without reservation
to respond to any reasonable summons to appear and testify
before any duly constituted committee of Congress if you are
confirmed?
Admiral Loy. I do so pledge.
Chairman Collins. Thank you. We will now start with the
first round of questions limited to 7 minutes each. I would ask
my colleagues to help me with the time limit and we will do a
second round if needed.
Admiral Loy, in my opening statement I raised the issue of
border security, which is one of the greatest challenges facing
DHS. Each year the United States legally admits millions of
non-citizens through our borders. In Maine, some 4.6 million
cars and trucks cross over the border from Canada each year.
That is a lot of traffic and obviously the Department is very
concerned about opportunities for terrorists to exploit
weaknesses in border security.
But there was a flip side to the coin. For many Maine
residents who live less than an hour's drive from the Canadian
border, traveling back and forth between Maine and Canada is a
way of life. Family members live across the border from one
another, businesses in one country depend upon suppliers and
customers from the other in order to survive. Sometimes the
border in Maine literally runs through a neighborhood, or on
one side of the street it is Canada, on the other side it is
the United States.
Last year, to try to tighten border security, the
Department eliminated the Form 1 and the port pass programs
which allowed American residents to use unmanned border
crossings 24 hours a day. This was very important to a lot of
the residents living in remote areas of my State who depended
upon those two programs for access to medical and religious
services, family events, social activities, the grocery store,
the hospital which are on the other side of the border. I would
like to give you an example to illustrate the problems that the
elimination of those programs have caused in my State.
There is a small border community in Quebec called St.
Pamphile. On the U.S. side of the border there is no
development, only miles and miles of woods that produce timber
for processing at the mills in Quebec. But there are some Maine
families who live on the U.S. side of the border and they
depend upon services in Canada. Everything they need from the
grocery store to the hospital to the church is on the Canadian
side, including emergency services. The problem is that once
that program was eliminated and the gates were locked, the
residents on the Maine side of the border are essentially
prohibited from crossing the border after 5 o'clock. They
cannot go at all on Sunday because the gates are locked.
This is a real problem. The residents are very frustrated
by this. They are obviously law-abiding American citizens. They
would be the first to point out any suspicious character in
their midst. This has changed their entire way of life.
I think ultimately technology is going to be the answer to
this problem where we can have some sort of biometric passcard
and perhaps remote cameras to check out who is crossing. But in
the meantime this is creating tremendous hardship in this one
community for the 50 or so residents who live on the American
side. But it is a problem for other remote border communities
in Maine too.
I would ask that you make a commitment to work with me to
try to come up with a solution that meets the need for tighter
border security while at the same time acknowledging the fact
that these individuals who are law abiding, who have lived here
their entire lives in some cases, now find that their movements
are greatly restricted. They would have to drive an
extraordinarily long distance to get to the next manned border
crossing. We have been working with the Department on this but
we have yet to be able to come up with a solution.
Admiral Loy. Madam Chairman, I am happy to pledge to work
with you in trying to find a better solution to the
circumstances you describe. I think this dual goal set that you
just described so well of security on one hand but holding onto
that way of life that has become so critical to people just a
couple hundred yards or just a mile or so away are legitimate
challenges that we have to find better ways to deal with.
I think the smart border accord that has been a very
fundamental exchange between Canada and the United States at
the diplomatic level, and Secretary Ridge and Minister Manley
have literally, each month since about 18 months ago, looked
carefully at a list of about 30 objectives that they have to
make such things happen better between the two countries. I
even think that further down the road there is a likelihood of
a notion referred to as a North American initiative where the
real borders we are concerned about are the borders that
circumvent the entire continent, let alone those that are
binational in nature between Canada and the United States, and
between Mexico and the United States on the southwest border as
well.
I do believe that there are technological possibilities
that can help us with this on the other end of the timeframe,
and at the same time reinforce the legitimate concerns that we
do have for our own borders. Whether there are hours that we
can play with here in terms of the openness of those border
crossings, I will be happy to take back to the Department and
review there the concerns that you have expressed to me and
work with you to see if we can find a better answer.
Chairman Collins. Thank you. I appreciate that commitment.
Earlier this year, the Committee held a hearing that
focused on the threat to our Nation's ports which I view as one
of our greatest vulnerabilities. I have a series of questions I
want to ask you about that but in the interest of time let me
cite one particular concern. In June, I wrote to Secretary
Ridge to express my concern about the Department's proposal to
allocate some of the money that had been designated for port
security by Congress for other purposes. I was pleased in
response to the concerns that many of us raised that that
decision was reversed.
As we anticipate a third round of port security grant
announcements I am pleased to hear that the TSA is poised to
distribute $105 million that is still left over. But once again
there are these rumors that the Department only plans to
release a portion of the 2004 funding in this round. I would
like you to address that. I think it is imperative that we make
a real effort to upgrade security at our ports.
Admiral Loy. I could not agree with you more, ma'am, as my
immediate last 8 months in uniform were all about maritime
security design efforts in the wake of September 11. Port
security has been something that is of great personal interest
to me as well. You are referring, of course, last year to
enormous and very consequential budget challenges that we had
to fight our way through at the Transportation Security
Administration and to whom those dollars for port security
grants had been appropriated for distribution. In the spend
plans over the course of that year where literally at the 364th
day of that fiscal year I as the administrator for TSA, was
still looking for an approved spend plan for that fiscal year.
That was the nature of the challenges that we had to actually,
potentially reprogram funds from purpose A to purpose B just to
get through the fiscal year.
I think it was all about what has classically been the case
historically in our country, in the wake of a tragedy when the
Congress passes a piece of legislation and the administration
tries to figure out how to execute that piece of legislation,
and sticker shock sinks in, and then we literally work a couple
budget cycles to find out the true job description and the
resource base necessary to do that work. We are still grappling
with that at TSA as this year plays out as well.
But with respect directly to the port security grants, as
you know, all of them were in fact reissued for fiscal year
2003. The $105 million you speak of is actually the monies that
were in the supplemental from the previous year that really
were round two but are becoming round three. This distinction
that you are making between $75 million and all of the $125
million set aside in fiscal 2004, this is the reasoning behind
why we are edging it at $75 million at the moment.
The application process for the third round of grants was
to the point where we had about $1 billion worth of requests
coming in. I am very proud of the process that we have
designed. There was local review with the harbor safety
committees involved in how to make sure that the applications
going forward were rated in such a fashion that all of the
players in that locale would see the value of that application.
Then there was a regional review and finally a leadership
review at the top between MARAD, the Coast Guard and TSA.
When we categorized them, they fell into logical categories
of one, two, and three, and this $75 million worth of the 2004
appropriation will simply enable us to fund all those who we
rated in category one. Then the balance of the $50 million will
become available to another round of port security grants on
into the fiscal year. That is the intention at the moment and
no mischief afoot here as it relates to potentially trying to
reprogram these dollars.
Chairman Collins. Thank you. Senator Akaka.
Senator Akaka. Thank you very much, Madam Chairman.
Let me begin my round of questioning by affirming that
collective bargaining rights are compatible with national
security. Providing Federal employees with a meaningful voice
in the workplace is a smart business practice that will enable
any agency the ability to attract and retain a motivated
workforce. The Homeland Security Act requires that the
Department must, ``ensure that employees may organize, bargain
collectively, and participate through labor organizations of
their own choosing in decisions which affect them, subject to
any exclusion from coverage or limitation on negotiability
established by law.''
Admiral Loy, how will you determine whether DHS employees
may bargain collectively?
Admiral Loy. Senator, the plan for which this new HR system
will be designed has gotten to a point where it is just about
to be offered to the Secretary for his decisions. We have been,
I believe, extraordinarily inclusive in the process to date in
terms of making certain that voices were heard from the
workforce through focus groups, town hall meetings that were
held around the country, and where in the holding of those
meetings it was not a management representative that went out
and held a meeting and then brought whatever information back.
But rather it was teams composed of those members of the design
team that had been assigned, including their union
representation from the three unions that represent Federal
workers in the Department of Homeland Security.
I was asked to be a member of the senior review committee
by Secretary Ridge in my position as the TSA administrator, as
were a number of other senior players in the Department: The
director of the Secret Service and the Commissioner of BCP. All
of us met for several days, listening carefully to the work
that the design team had put together, and our colleagues at
that table included the presidents of the three respective
unions as well. So the voices have been heard very inclusively
to this particular point in time. Just 2 weeks ago an
opportunity was provided again to the three union presidents to
meet personally with Director James at OPM and Secretary Ridge
at DHS to have those two people hear what the concerns may be
of the respective union representatives having been a part of
this process all the way from the beginning.
As you know, the legislation restricts us to actually
grapple with about four or five key elements of any HR system,
those being pay and compensation, performance management,
adverse actions and appeals, and labor relations. Those are the
areas that the new design effort will be allowed to grapple
with, leaving in place all those enormously important things
that have become part and parcel of American labor relations
over the years, including whistleblower protections and merit
foundations, respecting inclusiveness, all those things that we
want very much to be part of the system.
The next challenge, sir, is to have the Secretary hear out
his design team with those areas in mind. We want that to be an
inclusive process as well so that workers as well as their
representatives from the three unions are part of the team that
continues to do the design work once the Secretary has made his
judgments about the new system. So I am very pleased with where
we are so far, sir, and commit to you and to the Committee that
we will meet the specs that have been outlined for us in the
law.
Senator Akaka. Thank you. I also have a question regarding
the DHS Bureau of Immigration and Customs Enforcement known as
BICE. In response to questions my staff raised with the
director of operations at BICE last summer, I understood that
BICE planned to conduct a review of its June 9 reorganization
and would brief Congress after 90 days. To date we have not
received this briefing. Do you know the status of the review?
Admiral Loy. Senator Akaka, as I sit here I do not know the
status of the review but I will be happy to take that back as a
question from the dais and find out where that review is at the
moment and get information back to you quickly.
Senator Akaka. Thank you. During testimony before this
Committee a couple of months ago, the Office of Domestic
Preparedness Director stressed that communities should improve
their States' homeland security by working together to combine
resources across State lines. However, unlike all States but
Alaska, external assistance from the U.S. mainland is not
immediately available to Hawaii. As deputy secretary how would
you ensure that any regional approach fully addresses Hawaii's
homeland security?
Admiral Loy. I think we have to understand, Senator Akaka,
what is our fundamental goal. Our fundamental goal is to make
certain that the people of all 50 States are cared for properly
with respect to the design work associated with our homeland
security goals. Any kind of regional notion that makes very
good sense, for example, in the region of Pennsylvania, New
York, and New Jersey where they all come together, there are
regional issues there that can be very well served by mutual
effort between and among those States.
The notion of regionalization, however, must never fail to
include the State of Hawaii simply because geographically it is
not attached to what would logically be a region. It may be a
region of its own. To that end, sir, we will absolutely commit
to ensuring that Hawaii as a State and the people of Hawaii are
dealt with in the very same supportive fashion, whatever the
Federal programs might be, that would get to other States in a
regional sense.
Senator Akaka. Thank you. My time has expired, Madam
Chairman.
Chairman Collins. Thank you, Senator. Senator Carper.
Senator Carper. Thank you, Madam Chairman.
Admiral, I telegraphed earlier the three issues I wanted to
explore with you. Before I do that let me just ask on a more
personal note to talk about values, the values on which your
leadership is founded. You mentioned a couple of those in the
course of your earlier remarks--honor, respect, and so forth.
When I was privileged to be governor for my State we tried to
build an administration based on four or five core values:
Figure out the right thing to do; do it. Just be committed to
excellence in all things. Golden rule, treat other people the
way we want to be treated. Never give up. I believe when things
go well to give the credit to other people. When things go
badly, accept the blame. I always seek to surround myself with
people smarter than me.
Admiral Loy. Which is easy for me, sir.
Senator Carper. When I was in the National Governors
Association--I have actually mentioned this to at least Senator
Collins before. The National Governors Association, when you
are elected as a new governor you got assigned a mentor,
somebody who is already a governor, and usually within the same
party. I was assigned Tom Ridge. I had been elected in 1992
Governor of Delaware and in 1994 he was elected Governor of
Pennsylvania. He and I were friends and had been friends since
our days in the House of Representatives in 1982. But as his
mentor I sought to instill in him the kinds of values that I
just alluded to earlier. One of those was to always surround
himself with people smarter than him. I guess I would just ask
at the start, would you characterize yourself as smarter?
Admiral Loy. Than Governor Ridge? I would not go there in a
heartbeat, sir, but I thank you for the opportunity.
[Laughter.]
Senator Carper. Talk to us about your core values.
Admiral Loy. Yes, sir. All of those that you mentioned are,
I think, enormously important. I believe that there must become
an ethos in an organization that allows individual
accomplishment to feed the well-being of the organization and,
therefore, the accomplishment of its mission.
I was privileged to be the chief of the personnel shop in
the Coast Guard back in the early 1990's and one of the things
we initiated was a leadership development program that I
believe is now second to none anywhere in the Federal
Government. It is housed at the Coast Guard Academy where it
recognizes the contribution of not only the senior leaders in
terms of officers but breeds in the cadet corps, the future
leaders of that organization, the great strengths of the chief
petty officers and the young petty officers that make a
difference in the bowels of any organization; those kids on the
hangar deck, those kids that are taking that 47-footer out in
that terrible storm to pull off that rescue.
I believe there are fundamentals to all of us, whether that
is a Western ethic or whether it is one fundamentally just
based on those things that, in my case, I was so fortunate to
be brought up to value by my parents, and by scoutmasters and
people who cared for my well-being as a young person and did
whatever was necessary to make sure I did not fail to learn
those lessons.
This is not something that is rhetoric for me. This is
something that I believe in very deeply and try hard to
instill, just in a couple phrases, what might be of value to
the rest of the organization. At TSA our values are not honor,
respect, and devotion to duty, which are the values of the
Coast Guard. And you may know what they may be for the Navy, or
you know what they may be for the Marine Corps.
But at TSA I felt it was incredibly important for us to
have integrity, innovation and teamwork as our values because
what we were doing for the Nation became an opportunity to
breathe life into those words so every screener at every
airport, every supervisor looking out for the well-being of
those screeners took seriously the ethic associated with a
couple of simple words that could become so meaningful if
allowed to be broadcast widely to the organization at large. I
look forward to an opportunity to find that cultural foundation
in DHS and broadcast it widely.
Senator Carper. I think you are going to have that
opportunity. Let us talk about rail security for a bit, if we
could. We are mindful every time we go through an airport or
ride on an airplane of the work that TSA has done under your
leadership with respect to making air travel safer. We are
aware at the Port of Wilmington, and other ports, of the work
that has been done to make our ports and the shipping of goods
in and out of those ports less hazardous. I understand that the
Department of Homeland Security is working on, I think it is
called the national transportation security plan. I think it is
going to be released sometime maybe the middle of next year.
Any idea how this plan will address freight rail as well as
passenger rail security?
Admiral Loy. Yes, sir. We are working hard at TSA to build
a national transportation system security plan, recognizing
that it is a puzzle piece that has to first and foremost fit
into the larger puzzle that the Secretary is responsible for in
the other 12 economic sectors and four asset categories that
are outlined in the national homeland security strategy. So as
that big puzzle goes together I am obligated as the TSA
administrator to make certain that the transportation piece
fits well there, because there are intersector challenges.
I have been to, I do not know how many tabletop exercises
over the last 2 years where the focus may be on a chemical
plant security scenario, or a nuclear scenario, or a scenario
even dealing with something like banking, or food and
agriculture kinds of challenges. What is invariably the case is
that the transportation sector gets involved in that tabletop
exercise because whatever might be accomplished to either
respond to or restore the well-being of the Nation in that
process requires transportation in order to get that done. So
there is an intersector kind of connectivity there that the
Secretary has to be aware of as he composes that bigger puzzle.
My piece, however it is shaped to fit into the Secretary's
bigger puzzle, is also a complex one made up of aviation,
maritime, rail, highway, transit systems, pipelines, those
elements of the transportation sector that have to also fit
together. There are intermodal challenges there. That container
that comes from sea and gets on a train and eventually on a
truck to go to Iowa City has to be recognized as an intermodal
challenge with respect to the security of whatever is in that
container.
So the national transportation system security plan will be
the opportunity to talk about standard-setting, vulnerability
assessments, mitigation strategies, and compliance means by
which we can comfortably fit the transportation puzzle together
such that it fits well into Secretary Ridge's greater
challenge.
As to rail, sir, it is not a matter of waiting for the next
6 months or whatever. We have been doing a lot of very good and
worthwhile outreach to the rail industry already. There have
been critical asset inventories taken of rail infrastructure
across the country. Amtrak, and the American Association of
Railroads, and the Federal Rail Administration, and DOT and TSA
have worked together on those projects. Amtrak and class one
rails, the bigger rail services, have developed an information
sharing center, ISAC, Information Sharing and Analysis Center
that affords a chance to send information to them for
distribution to the industry, and gather information from the
industry through the ISAC back into the TSA so we can share it
with the intelligence and information aggregation process that
I think is so critical to what we are doing in this new
Department.
So whether it is the notion of learning from the rail
industry that it is not about prevention exclusively, but it is
perhaps also about restoration. I took a train ride to
Wilmington from Washington.
Senator Carper. Great ride, is it not?
Admiral Loy. Yes, sir, it is. But I was given the chance to
sit up there in the front cab with this wonderful, crotchety
old guy who had been driving that route for years, and he
helped me understand that it was not necessarily about
prevention in the rail business. Yes, prevention at the
terminals and those things are needed. But he asked me things
like, Admiral, have you seen a police officer? Have you seen a
fence? Have you seen a camera? Have you seen any of those kinds
of things along this--he was talking about 50 miles out of
Washington, but referring to thousands of miles of rail line
across the country, railbed across the country. He made it
clear to me that restoration is the fundamental reality in the
rail business that is different than other elements of the
transportation sector. So it literally reshaped my thinking in
putting a strategic plan together for the transportation
sector.
So we have done some very good things. AAR, American
Association of Railroads, is a marvelously impacting trade
association for that industry and have been terrific in coming
to the plate and helping us figure those things out.
Senator Carper. Good. My time has expired. If I could just
add a closing statement, Madam Chairman.
Chairman Collins. Certainly.
Senator Carper. Just keep in mind, Admiral, as you and your
team work on this transportation system security plan, keep in
mind that more people take the train today between Washington
and New York than will fly on all the airlines combined, that
during the course of this day hundreds of thousands of people
will be in those tunnels underneath some of the waterways that
we were talking about earlier going in and out of New York, and
that at any one time during the day there are more people in
those tunnels than in, I think, seven 747 aircraft.
Senator Collins and I have worked trying to come up with a
funding formula for first responder legislation. I will not get
into that any more. We have discussed that and we welcome your
input. Last, just keep in mind, please, going forward the
people who work in our ports, and sometimes in hard labor
positions, a lot of physical labor positions, people who have
made mistakes in their past, who have a criminal record, who
have gone on and made something out of their lives. So make
sure that as we attempt to provide for better security at our
ports and introducing this identification card program that we
do not needlessly put at risk their livelihood and their
ability to make a way for themselves and their families.
Admiral Loy. Absolutely, sir.
Senator Carper. Thank you. Thank you, Madam Chairman.
Chairman Collins. Thank you. Admiral, another challenge
facing the Department is striking the right balance between
privacy concerns and security. Recently, the Department's chief
privacy officer began an investigation of the role, if any, the
TSA personnel may have played in assisting an Army contractor,
Torch Concepts, in obtaining personal data from passenger
records on over one million customers of Jet Blue Airways. I am
sure you are familiar with that case.
Admiral Loy. Yes, ma'am.
Chairman Collins. First, do you know yet whether any TSA
personnel were involved in encouraging Jet Blue to provide this
private data on its customers to the DOD for the research
project or to the contractor?
Admiral Loy. Madam Chairman, my understanding is that if
there was TSA involvement, it was the bringing of the two
together, not with respect to what might actually occur once
they got together. But it was almost an invitation kind of
thing, and an association kind of thing where Jet Blue and the
contractor were introduced, if you will, to each other by TSA
but without any value judgments on the part of the TSA
personnel.
We are looking at that very carefully and I would probably
be remiss in trying to speculate what might end up at the other
end of the investigation that is underway, but the important
thing here to me is to have it become that lesson that
reinforces, as Jet Blue found out in this instance, that having
violated their own privacy gameplan and rules and regulations
that they had in place in the company, they got burned at the
other of the day. And properly so, I might add.
At the other end of our day at the Federal level, for
example, in our Computer Assisted Passenger Pre-screening
System, CAPPS-II, the privacy implications of that system must
be inviolate at the other end of the day with respect to our
concerns for probably six or seven areas that are properly
challenging us to make sure we got it right before there is any
switch turned on, so to speak, with this new system. This new
system is going to be probably one of the most important
projects we finish and put on the line for our country with
respect to the security of the aviation system.
Having said that, we should never turn that switch on until
those privacy concerns about effectiveness, about redress
opportunities, about appeal rights, about mission creep, about
all those issues that are enormously important to the privacy
community are properly dealt with. The Congress has made that
quite clear. In our appropriation bill this year there are
eight areas that we are obliged to work with GAO on and return
by February 15 in order to continue the testing of the system
that will prove its effectiveness after February 15. We are on
track to do that and I hold that as one of our most important
chores.
Chairman Collins. I appreciate that update and your
assurance that before the CAPPS-II system goes into effect that
there will be a lot of thought given to the appropriate
safeguards that need to be included. I think it is also
important that those safeguards be in effect during the testing
of the system because it is going to be difficult to test the
system without access to the same kind of real world passenger
data, that got Jet Blue in trouble. I would also ask you to
keep that in mind as you proceed.
Admiral Loy. Yes, ma'am. It is not only the domestic side
of the house, but there are very real issues associated with
international PNR data, passenger name record data that are
challenges to us at the moment that we have to get through
before we can make the system viable.
Chairman Collins. I would like to turn just quickly to an
issue that both Senator Stevens and I raised, and that is the
role of the Coast Guard. As you know, Senator Stevens and I
worked hard to get language in the authorization for the
Department of Homeland Security to ensure that the traditional
mission of the Coast Guard would not be jeopardized as it took
on new and expanded responsibilities for homeland security.
Just last month Maine suffered the loss of four more fishermen
at sea who were on the Candy B II. That has been a real tragedy
for our State and the Coast Guard's search and rescue mission.
The search and recovery mission in some cases is just so
critical to my State.
Could you give us an update of your assessment on how well
the Coast Guard is doing in this new post-September 11
environment, whether it does have sufficient resources to take
on these new responsibilities without compromising its vital
traditional missions?
Admiral Loy. As you might imagine, I am very personally
invested in what I know to be perhaps the greatest attribute
that organization brings to our country, and that is the
flexibility to go from almost crisis to crisis on any given
day, but to go from where the Nation needs it best on day two
to where the Nation needs it best on day three.
For example, on September 10, 2001 we were spending in the
Coast Guard somewhere around 3 or 4 percent of our appropriated
capability operationally on what I would call classic homeland
security activity. Two days later we were spending about 53
percent of our appropriated capability on what became the
crisis of the moment for our Nation. I think that is the good
news and the bad news.
The good news is that it is yet again a demonstration of
the flexibility of that organization to go where the Nation
needs it. The challenge is how quickly can you return to
whatever you perceive normalcy to be the day before the
tragedy. I think with this particular tragedy, that old
normalcy we will never see again. So our challenge is to
provide the resources necessary to this service to find that
new normalcy where heightened address of homeland security
realities are there as well as the continued service in
fisheries and counternarcotics and all the other missions that
are operationally dependent--or the Coast Guard is the provider
of those services for our country.
One of the most important projects in that regard is the
Integrated Deepwater System project which offers the
modernization of that service's offshore capability. That
modernization will provide the Coast Guard the wherewithal to
do better search and rescue, to do better national defense, to
do better homeland security, to do better fisheries, to do
better everything that it does in that environment 50 miles or
more offshore, and be interconnected with the coastal realities
that are so much a part of our homeland security missions
today.
I spoke with Admiral Collins just last week for the first
formal time in getting ready--that rookie that took over after
I left my job. He is doing a marvelous job with the
organization and has been in fact supported by the Congress
very well, I believe, in the last two budget cycles to provide
him the tools to do this new homeland security job while he
continues to provide those services that America has come to
count on the Coast Guard to provide.
Chairman Collins. Before I yield to my colleague I just
want to indicate to you that Senator Lieberman and I recently
wrote to the OMB Director suggesting that the deep water
project be accelerated and funded over 10 years rather than 20
years. It actually saves money in the long term and you get the
capability. But I will not put you on the spot by asking you
whether you would support that change.
Senator Akaka. But you could, Senator. [Laughter.]
Thank you very much, Madam Chairman. I would like to ask
about FEMA. The Department of Homeland Security now includes
FEMA, which among its many responsibilities administers natural
disaster mitigation grants. This multitasking has raised
concerns that FEMA's emphasis on terrorism may result in a
lower priority for natural disaster mitigation.
My question is, will you work to ensure that natural
disaster mitigation grants, which Hawaii and so many other
States rely upon, are not shortchanged as the result of FEMA's
move to the Department of Homeland Security?
Admiral Loy. Indeed, I will, sir. One of the chores the
Secretary had asked of me about 6 or 7 months ago was to take
on the responsibility to design the new national response plan
and the national incident management system for our country. It
is an all-hazards plan. So the notion of whether it is a
tsunami on its way to, God forbid, some island in Hawaii, or
fires in the west of our country, or hurricanes as they go by,
those natural disasters of the past are every bit spoken for in
the design work of this new national response plan and national
incident management system.
Furthermore, I think we are enormously proud of what FEMA
has been able to do in just this past year in the new
Department in responding to the fires in California, as well as
the hurricanes that have gone by.
In California, I know that Mike Brown was out there
personally day in and day out, and within 24 hours of the State
being recognized for relief was actually writing checks to
California State individuals for the challenges that they had
undertaken through the course of the fires. So I feel very good
about demonstrated behavior already and the planned inclusion
of all hazards, including those that you described, sir, is
very much a part of the Secretary's intention.
Senator Akaka. The General Accounting Office added the
consolidation of the Department of Homeland Security to its
high risk list this year, partially as a result of the existing
management challenges of entities included in the Department.
At the same time, the Department is subject to the President's
management agenda which includes competitive sourcing as one of
its five components.
My question is, given the challenges of consolidation do
you believe that contracting out goals are appropriate for the
Department? If so, why?
Admiral Loy. I certainly believe that the notion that there
are skills and competencies that have been honed to a higher
level in the private sector compared to the Federal sector is a
legitimate thing for us to address and sort our way through. On
those occasions where the American public can be served better
by outsourced functionality we should be about the business of
doing that. That is, as you say, sir, very much a part of the
President's management agenda which has four or five other
aspects to it which we are equally zealous about taking on.
So the idea of making certain as we contemplate where some
function is accomplished for the American public and being very
methodical about the checks necessary to make those decisions
methodically as well is part and parcel of the review process
that gets us the answers to those on a one-at-a-time basis. It
is not a blanket that is going to be strewn across the whole
array of functions of the Federal Government. But where those
things can be done better, I believe we serve the American
public better by outsourcing them appropriately.
Senator Akaka. I want to thank you very much for your
responses, and I feel that we are so fortunate to have you in
this position. You know that the government is setting new
milestones and seeking flexibilities in governance in light of
challenges that we never faced before. So it is going to be
tough going and as far as I am concerned you are the man for
it.
Admiral Loy. Thank you, sir.
Senator Akaka. Thank you very much, Madam Chairman.
Chairman Collins. Thank, you, Senator.
Admiral I am just going to ask you one more question and
then submit some additional questions on port security and
other issues for the record. My final question for you has to
do with the allocation of homeland security grant funds to
first responders and to States and communities.
As I mentioned, this Committee has unanimously reported
legislation that would make changes in the funding formula, but
we would continue to provide a stream of money to each and
every State because every State has homeland security concerns
and vulnerabilities. I feel strongly we need to bring every
State up to a minimum level before we could ever discontinue
that funding stream. I often remind people that when you think
of the State of Maine you think what a safe State it is, but in
fact two of the hijackers on September 11 started in Portland,
Maine. We are a State with an extensive coastline. We are a
border State. That is why it is important that we provide some
funding to every State and then look at specific threats, not
just allocate on the basis of population which may not have a
correlation to the vulnerabilities and threats.
Do you agree with that general approach? I am not asking
you to endorse specific funding levels or percentages, but that
each State should receive a certain amount of funding?
Admiral Loy. Indeed I do. I think so, for the moment at
least, until we can be much more sophisticated in how we would
develop an algorithm that would take into account each and
every State's requirements. When I got into this TSA position
someone told me that when you have been to one airport, you
have been to one airport. So the notion that the 450 airports
that I would have to grapple with, each of them has a unique
set of challenges. I believe our 50 States are like that in a
way. When you have been to one State, you have been to one
State.
The point there is that I do believe until we can reach a
more sophisticated algorithm that would take that into
consideration our default position for the moment must be a
threshold level of funding for all States. Then it is an
already sophisticated notion as to how you then distribute the
rest. In my opening comments I tried to articulate criticality
assessments, vulnerability assessments, and then this challenge
of truly understanding what is being threatened, by whom and
how, and what is the risk management that you are going to use
to deal with that.
With respect to the balance of the distribution, I believe
it should probably be around population density in some fashion
because that represents a targeting value to the bad guys. We
know that is the case. But I also believe that the inventory of
critical infrastructure, however that is deemed in that State,
should be part and parcel of the thinking in that algorithm.
Then just what do we know from the intelligence going by that
suggests that critical infrastructure, that population density
is on the bad guys' targeting list for this year's grants as
they go by. So criticality, vulnerability, the real sense of
the threat, and then the judgment about how to manage the risk
associated with that package, that becomes the means by which
we distribute the balance of the funds.
I think in there somewhere is both support for your notion
at the moment and a challenge to us to think our way through a
better algorithm, if it is out there, for the distribution in
the future.
Chairman Collins. I want to thank you for your testimony
today, and I want to join Senator Akaka and my colleagues in
thanking you for your willingness to serve in this
extraordinarily vital post. You are taking on a huge
responsibility and we are very grateful that you are willing to
step forward. With your background not only in the Coast Guard
but as head of TSA, I really cannot think of a better candidate
for this position, so we very much appreciate your willingness
to serve.
It is my hope that the Committee will be able to act
expeditiously on your nomination and that we can have the full
Senate move to confirm you before we adjourn for the year,
which I hope will be sooner rather that later.
Without objection, the hearing will be kept open until 10
a.m. tomorrow morning for the submission of any additional
written questions or statements for the record. This hearing is
now adjourned.
[Whereupon at 4 p.m., the Committee was adjourned.]
A P P E N D I X
----------
PREPARED OPENING STATEMENT OF SENATOR DURBIN
Madam Chairman, I am pleased that the Committee is considering the
nomination of James M. Loy to be the Deputy Secretary of the Department
of Homeland Security.
Admiral Loy has devoted his entire career--spanning nearly four
decades--in service to our country. I commend his willingness to accept
yet another challenge.
James Loy brings a refreshing sense of enthusiasm to the task
ahead, along with expertise as a tested manager. The breadth and depth
of his working knowledge of Departmental programs, as well as the
challenges it faces, will serve him well. The American public will be
ably served with his leadership and vision at the helm, working side-
by-side with Secretary Ridge.
I know from our conversation last week the tremendous respect that
Admiral Loy has for the dedicated efforts of the 170,000 Homeland
Security Department employees who vigilantly protect our citizens, gird
our borders and domestic infrastructure, and thwart terrorism on
American soil. I certainly share those sentiments, and trust that, in
assuming this new post, he will routinely engage that workforce as an
essential partner in accomplishing the Department's mission.
I enjoyed the opportunity to meet with Admiral Loy last week to
discuss several issues facing Illinois communities relating to
transportation security, specifically passenger screening delays facing
the Central Illinois Regional Airport and Chicago Midway Airport. I
appreciated his interest and his offer to respond to those concerns,
and look forward to their prompt resolution.
I wish Admiral Loy fair winds and calm seas in this new assignment,
and pledge my support for his expeditious confirmation.
Thank you, Madam Chairman.
__________
OPENING PREPARED STATEMENT OF SENATOR INOUYE
I am pleased to be here today to introduce Admiral James Loy, who
has been nominated to be Deputy Secretary of the Department of Homeland
Security. His long career in public service has prepared him well for
this new challenge.
Admiral Loy wore the uniform of our Nation for more than 40 years
as a commissioned officer serving in the United States Coast Guard.
Admiral Loy began his career at the U.S. Coast Guard Academy, where
every cadet learns the creed, ``Who lives here reveres honor, honors
duty.'' Admiral Loy not only learned the creed, but has also lived by
that creed throughout his career.
Admiral Loy's long and distinguished tenure with the Coast Guard
culminated with four years of service as Commandant. He led the Coast
Guard through one of the most significant periods of transformation in
the history of that venerable service, improving its readiness for the
operations of today, and preparing for those of the future. After years
of less than optimal recruitment levels, he rebuilt the Coast Guard's
workforce to authorized levels and improved retention. Then, to ensure
that these personnel were properly supported with the finest equipment
possible, he oversaw the initial phase of the Integrated Deepwater
System acquisition project, a systematic modernization of U.S. Coast
Guard ships, aircraft, and sensors. This reinvigorated Coast Guard
stands ready to fulfill its mission of protecting our marine
environment and those that operate within it.
Admiral Loy's administrative experience will serve our Nation well
in the Department of Homeland Security. As Chief of Staff to the Coast
Guard, Admiral Loy redesigned the headquarters management structure. He
also worked to focus the Coast Guard's planning and budgeting process
on performance and results. His administrative skills were put to good
use when he took over at the newly created Transportation Security
Administration (TSA). Under his leadership, the TSA met every major
deadline required to increase the safety and security of the American
public traveling our Nation's airways. This expertise will be a
valuable addition to the Department which has been working to integrate
many different agencies to serve our homeland defense.
I am confident Admiral Loy will continue to serve our Nation in the
same exemplary manner he always has. I support his nomination to be
Deputy Undersecretary of the Department of Homeland Security fully and
without reservation.
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