    [House Hearing, 109 Congress]
    [From the U.S. Government Publishing Office]

          REGIONAL INSECURITY: DHS GRANTS TO THE NATIONAL CAPITAL AREA

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

                                    HEARING

                                   before the

                                  COMMITTEE ON
                               GOVERNMENT REFORM

                            HOUSE OF REPRESENTATIVES

                           ONE HUNDRED NINTH CONGRESS

                                 SECOND SESSION

                                   __________

                                 JUNE 15, 2006

                                   __________

                               Serial No. 109-193

                                   __________

           Printed for the use of the Committee on Government Reform

      Available via the World Wide Web: http://www.gpoaccess.gov/congress/
                                   index.html
                          http://www.house.gov/reform

                                     ______

                        U.S. GOVERNMENT PRINTING OFFICE
    30-591                      WASHINGTON : 2006
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                         COMMITTEE ON GOVERNMENT REFORM

                         TOM DAVIS, Virginia, Chairman
    CHRISTOPHER SHAYS, Connecticut       HENRY A. WAXMAN, California
    DAN BURTON, Indiana                  TOM LANTOS, California
    ILEANA ROS-LEHTINEN, Florida         MAJOR R. OWENS, New York
    JOHN M. McHUGH, New York             EDOLPHUS TOWNS, New York
    JOHN L. MICA, Florida                PAUL E. KANJORSKI, Pennsylvania
    GIL GUTKNECHT, Minnesota             CAROLYN B. MALONEY, New York
    MARK E. SOUDER, Indiana              ELIJAH E. CUMMINGS, Maryland
    STEVEN C. LaTOURETTE, Ohio           DENNIS J. KUCINICH, Ohio
    TODD RUSSELL PLATTS, Pennsylvania    DANNY K. DAVIS, Illinois
    CHRIS CANNON, Utah                   WM. LACY CLAY, Missouri
    JOHN J. DUNCAN, Jr., Tennessee       DIANE E. WATSON, California
    CANDICE S. MILLER, Michigan          STEPHEN F. LYNCH, Massachusetts
    MICHAEL R. TURNER, Ohio              CHRIS VAN HOLLEN, Maryland
    DARRELL E. ISSA, California          LINDA T. SANCHEZ, California
    JON C. PORTER, Nevada                C.A. DUTCH RUPPERSBERGER, Maryland
    KENNY MARCHANT, Texas                BRIAN HIGGINS, New York
    LYNN A. WESTMORELAND, Georgia        ELEANOR HOLMES NORTON, District of
    PATRICK T. McHENRY, North Carolina       Columbia
    CHARLES W. DENT, Pennsylvania                    ------
    VIRGINIA FOXX, North Carolina        BERNARD SANDERS, Vermont
    JEAN SCHMIDT, Ohio                       (Independent)
    ------ ------

                          David Marin, Staff Director
                    Lawrence Halloran, Deputy Staff Director
                           Teresa Austin, Chief Clerk
              Phil Barnett, Minority Chief of Staff/Chief Counsel

                                C O N T E N T S

                                  ----------
                                                                       Page
    Hearing held on June 15, 2006....................................     1
    Statement of:
        Foresman, George W., Undersecretary for Preparedness,
          Department of Homeland Security; Edward D. Reiskin, deputy
          mayor for public safety and justice, government of the
          District of Columbia; Robert P. Crouch, Jr., assistant to
          the Governor for the Commonwealth preparedness,
          Commonwealth of Virginia; Dennis R. Schrader, director,
          Governor's Office of Homeland Security, State of Maryland;
          and David J. Robertson, executive director, Metropolitan
          Washington Council of Governments..........................    33
            Crouch, Robert P., Jr....................................    68
            Foresman, George W.......................................    33
            Reiskin, Edward D........................................    53
            Robertson, David J.......................................    71
            Schrader, Dennis R.......................................    70
    Letters, statements, etc., submitted for the record by:
        Clay, Hon. Wm. Lacy, a Representative in Congress from the
          State of Missouri, prepared statement of...................   109
        Cummings, Hon. Elijah E., a Representative in Congress from
          the State of Maryland, prepared statement of...............   124
        Davis, Chairman Tom, a Representative in Congress from the
          State of Virginia:
            Prepared statement of....................................     4
            D.C. Resolution 16-677...................................   113
        Foresman, George W., Undersecretary for Preparedness,
          Department of Homeland Security, prepared statement of.....    37
        Maloney, Hon. Carolyn B., a Representative in Congress from
          the State of New York, prepared statement of...............    18
        Moran, Hon. James P., a Representative in Congress from the
          State of Virginia, prepared statement of...................    26
        Norton, Hon. Eleanor Holmes, a Delegate in Congress from the
          District of Columbia, prepared statement of................    14
        Reiskin, Edward D., deputy mayor for public safety and
          justice, government of the District of Columbia, prepared
          statement of...............................................    56
        Robertson, David J., executive director, Metropolitan
          Washington Council of Governments, prepared statement of...    74
        Ruppersberger, Hon. C.A. Dutch, a Representative in Congress
          from the State of Maryland, prepared statement of..........   127
        Towns, Hon. Edolphus, a Representative in Congress from the
          State of New York, prepared statement of...................   120
        Waxman, Hon. Henry A., a Representative in Congress from the
          State of California, prepared statement of.................     8

          REGIONAL INSECURITY: DHS GRANTS TO THE NATIONAL CAPITAL AREA

                                  ----------

                            THURSDAY, JUNE 15, 2006

                              House of Representatives,
                                Committee on Government Reform,
                                                        Washington, DC.
        The committee met, pursuant to notice, at 10 a.m., in room
    2154, Rayburn House Office Building, Hon. Tom Davis (chairman
    of the committee) presiding.
        Present: Representatives Tom Davis, Mica, Gutknecht,
    Platts, Foxx, Schmidt, Fossella, Wolf, Waxman, Maloney,
    Cummings, Kucinich, Clay, Watson, Van Hollen, Ruppersberger,
    Higgins, Norton, and Moran.
        Staff present: David Marin, staff director; Keith Ausbrook,
    chief counsel; John Hunter, counsel; Rob White, communications
    director; Andrea LeBlanc, deputy director of communications;
    Shalley Kim and Wimberly Fair, professional staff members;
    Teresa Austin, chief clerk; Sarah D'Orsie, deputy clerk; Leneal
    Scott, computer systems manager; Kirstin Amerling; minority
    general counsel; Karen Lightfoot, minority communications
    director/senior policy advisor; Michael McCarthy and Kim
    Trinca, minority counsels; Richard Butcher, minority
    professional staff member; Earley Green, minority chief clerk;
    and Jean Gosa, minority assistant clerk.
        Chairman Tom Davis. The meeting will come to order.
        I would ask unanimous consent that Mr. Moran, Mr. Wynn, Mr.
    Cardin, Mr. Hoyer, Mr. Fossella and Mr. Wolf be able to
    participate in today's hearing. Without objection, it is so
    ordered.
        The committee will come to order. On May 31st, the
    Department of Homeland Security announced fiscal year 2006
    grant allocations for States and eligible high-risk urban
    areas. For the first time, grant awards reflected the use of
    relative risk and effectiveness criteria in an effort to better
    target Federal investments and make measurable progress toward
    the National Preparedness Goal. The new elaborate evaluation
    process used by DHS produced some unexpected, seemingly
    punitive results, particularly for the National Capital Region.
    We convene this morning to shed some needed light on how DHS
    assessed risks and needs in a region that has already been
    attacked and remains an attractive target for terrorists.
        Without question, the Nation's Capital bears a
    disproportionate burden in terms of public safety challenges
    and Homeland Security costs. Comprised of 12 local
    jurisdictions, two States and the District of Columbia, this
    region must be prepared to protect critically important
    facilities and monuments of high operational and symbolic value
    to the entire Nation: the White House, the Pentagon, the
    Congress, the Supreme Court, to name just a few. The tragic
    events of September 11, 2001, and the anthrax attacks that same
    year unfortunately confirmed our unwelcome status as a prime
    target.
        Yet one discretionary DHS grant program allocated on the
    basis of risk, the Urban Areas Security Initiative, yielded a
    reduced award to the National Capital Region this year: $47
    million. Last year, the region received $77 million. True,
    Congress appropriated 14 percent less for the program this
    year, but the 40 percent reduction suffered by the NCR is
    clearly the product of something more than tight budgets.
        According to DHS, this region stands in the top 25 percent
    of urban areas at risk in terms of both critical assets and
    geographic vulnerabilities. But the effectiveness of the
    proposed grant expenditures was ranked by DHS reviewers in the
    bottom 25 percent of all similar investment strategies. Leaders
    in this region and in other high-risk jurisdictions like New
    York and Los Angeles are asking, what happened? Why did some
    grant justifications score so poorly under the DHS system? And
    how much did secret reviews of unquestionably subjective
    factors, like relevance, innovative necessary and feasibility,
    undermine efforts to address real security needs?
        In attempting to implement a risk-based grant allocation
    system and improve State and local response capabilities, DHS
    appears to have built a dangerous house of mirrors for the
    unwary, an overly elaborate system of marginally relevant
    evaluation criteria that equates the risk of terrorism with the
    risk of filing a bad grant application. The system seems to
    have taken little or no account of the most obvious indicator
    of risk imaginable, that the Nation's Capital has already been
    attacked.
        Last week, the chairman of the 9/11 Commission, appointed
    by President Bush, former New Jersey Governor Thomas keen, said
    the grant awards to D.C. and New York appeared to ``defy common
    sense.'' The process so far has also defied clear explanation,
    as DHS officials have offered different accounts of what
    factors produced the surprising allocations and what applicants
    might have done to improve their chances.
        So today we seek to bring greater transparency to an
    important Homeland Security program. The effort to apply sound
    risk analysis and risk management standards to Homeland
    Security grants is commendable, and overdue. Scarce resources
    need to be focused on development of tangible and sustainable
    preparedness and response capabilities. But regional readiness
    to meet the threat of terrorism is not enhanced by wide,
    unpredictable and disruptive funding swings. At-risk cities and
    regions need to know their grant applications are being fully
    and fairly evaluated. The rules of the game should be clear.
    Now, grant applicants can only guess at the outcome of ``black
    box'' procedures fueled by classified threat information and
    secret peer reviews.
        The Department has proposed a sustained and detailed debate
    on the difficult process of assessing risk, evaluating need and
    judging the effectiveness of local plans to build capabilities.
    We take them up on that pledge. Officials from the National
    Capital Region are also here to give their perspectives on
    their application and its evaluation. We look forward to a
    productive discussion of how DHS and this region plan to work
    together to address the National Capital area's unique security
    needs.
        Let me just remind everybody, for the inaugural costs last
    year, 2 years ago, the money came out of the Department of
    Homeland Security grant money to the region. This was a burden
    shouldered by the city as well. Nothing was taken into account
    there, no reimbursements except to take it out of Homeland
    Security moneys at that point.
        I would now recognize the distinguished ranking member, Mr.
    Waxman, for his opening statement.
        [The prepared statement of Chairman Tom Davis follows:]

        [GRAPHIC] [TIFF OMITTED] T0591.001

        [GRAPHIC] [TIFF OMITTED] T0591.002

        Mr. Waxman. Thank you, Mr. Chairman, for holding this
    hearing, examining the drastic cuts in Homeland Security
    funding for the National Capital Region. The reduction in
    funding is sudden and unexpected, and it presents a serious
    challenge to the State and local officials work to protect this
    area. It also calls into question the priorities of this
    administration.
        The Department of Homeland Security says that one reason
    for the cuts to D.C. is that the level of the risk for the
    region is lower relative to other cities according to
    classified computer programs and matrixes that the DHS uses.
    Well, this is difficult to understand. The Nation's Capital has
    enormous symbolic importance and is the center of our
    government and has already been the sight of a deadly attack.
    It is hard to see how it could be downgraded like this, and it
    is hard to have confidence in the secret system that the
    Department is using to rank risk when it comes to conclusions
    like this.
        Ever since September 11th, I have been asking the
    administration to provide Congress with a comprehensive threat
    and risk assessment that we could use to inform budget
    decisions. To date, we have received a lot of rhetoric about
    how important it is to make sound risk-based decisions, but we
    have never seen the proof.
        Local officials also suffer from the lack of transparency
    at the Department of Homeland Security. According to DHS,
    another reason for the cuts to D.C. was that the region's
    proposal scored poorly for effectiveness. But officials from
    D.C., Maryland and Virginia will testify today that they are
    baffled about why their proposals received low marks from DHS.
    Ironically, one of the criteria for effectiveness that DHS
    claims to examine is sustainability. How could local officials
    build sustainable programs when DHS funding for them varies
    wildly from year to year?
        To protect our Nation, we need to think outside the narrow
    box the administration wants to put us in. The Department is
    proposing to increase funding for Los Angeles, which is
    absolutely right. The answer to the underfunding of D.C. is not
    to take funds from other high priorities. Instead, we need to
    look at our national priorities.
        Last week, the Senate tried to pass a complete repeal of
    the estate tax. That boondoggle for the wealthiest families in
    the United States would have cost over $1 trillion. Yet we are
    being told today that we can't afford $30 million more to
    protect the Nation's Capital from terrorist attacks.
        Earlier this year, we learned that auditors had challenged
    over $250 million in charges by Halliburton, yet the
    administration went ahead and paid them anyway. If we had saved
    that money, we would have had more than enough to fully fund
    Homeland Security grants to all of our urban areas.
        Just this week, we learned that FEMA paid more than $1
    billion in fraudulent claims in the aftermath of Katrina
    because the administration failed to have even basic controls
    in place. If we had spent these funds responsibly, we could
    have paid for the protections this region desperately needs.
        Ultimately, the problem our Nation faces isn't the lack of
    funds; it is a lack of accountability and a failure of
    government to be responsible stewards of taxpayers' dollars. I
    am glad we are having this hearing on how to protect the
    National Capital Region, and I hope we can get answers about
    why funding was cut so dramatically and how the threats to this
    area can be addressed. I also hope the administration and
    Congress will reassess their spending priorities so we can
    truly make this Nation safer.
        [The prepared statement of Hon. Henry A. Waxman follows:]

        [GRAPHIC] [TIFF OMITTED] T0591.003

        [GRAPHIC] [TIFF OMITTED] T0591.004

        [GRAPHIC] [TIFF OMITTED] T0591.005

        [GRAPHIC] [TIFF OMITTED] T0591.006

        Chairman Tom Davis. Thank you very much.
        Ms. Norton.
        Ms. Norton. Thank you very much, Mr. Chairman.
        I appreciate that you called this hearing. I believe, as I
    will indicate in my own statement, that the hearing you called
    today is a public service not only for this region but for our
    country because of the responsibilities of security officials
    in localities in this region.
        Actually, this is the first of two hearings by committees
    on which I serve seeking answers to the same question: How
    could a risk-based security formula lead to unusually large
    reductions in Homeland Security funds for al Qaeda's favorite
    targets? Among them the National Capital Region, the sight of
    the September 11th attack on the Pentagon and site of the
    Capitol, located on this campus, where analysts believe the
    plane that was brought down in Pennsylvania was headed?
        The Homeland Security Committee has asked the mayors of New
    York City and the District of Columbia to testify on this same
    subject next Wednesday. I have asked for a face-to-face meeting
    between regional officials and Department of Homeland Security
    headquarters staff, not only to get a greater understanding of
    the basis for the DHS decisions but particularly to understand
    how the region is expected to meet its unique dual obligations
    as officials charged with preventing and responding both for
    the Federal Government and local communities.
        When the DHS grants were announced, the initial despair and
    bewilderment of residents and officials in this region quickly
    escalated to anger and outrage. The decision that was as
    astonishing as it was counter-intuitive was made with little
    explanation. We seek that explanation today.
        Regional residents and Federal employees alike have
    admirably learned to live with higher risks than their fellow
    Americans, in part because of the special effort they see from
    regional and Federal security officials and the funding they
    assumed would come annually. Among these residents are 200,000
    Federal employees from whom are drawn scores of thousands
    directly charged with the principal responsibility for
    designing and planning the National Homeland Security effort.
        This region ranks high as a target, not only because of its
    almost 4 million residents, but unlike other targeted areas,
    the entire Federal presence, including the Nation's priceless
    iconic monuments and the Capitol, the Supreme Court and the
    White House and the Pentagon, all extremely inviting targets,
    are concentrated in a few square miles in the District of
    Columbia, Maryland and Virginia. Although individual sites are
    protected by Federal police and security guards, prevention and
    response for the region where the Federal presence is located
    is up to local officials and first responders, not the Federal
    Government.
        When the Pentagon was attacked on September 11th, this
    Federal installation was completely dependent upon the largest
    fire department in the region, the D.C. Fire Department and
    other regional fire services and a helicopter and burn unit at
    Washington Hospital Center, among other local services.
        The Nation learned that local officials here had a unique
    double responsibility for their own residents as well as for
    the Nation's most valuable and priceless Federal assets. And if
    I may say so, the Congress learned that the District of
    Columbia had almost total responsibility after the anthrax
    attack in the Congress of the United States, not the Federal
    Government, no agency of the Federal Government. They were sent
    to the old D.C. General Hospital for the District of Columbia
    to figure it out when we had an unprecedented attack right here
    on the campus of the Congress of the United States.
        It is this twin responsibility that accounts for this
    region's unique obligations. It is this twin responsibility
    that most seriously raises questions about the judgment of the
    Department of Homeland Security in severely cutting the
    region's security funding. Even with the funding the region has
    received, I have spent more time than I can say worrying that
    there has not been enough time or funding to staunch, major and
    obvious vulnerabilities that mainly affect Federal employees
    who work here, not my own constituents. Working with
    appropriators, not DHS, I have gotten some but not all of the
    funding for ER One, for Washington Hospital Center, the only
    place where visitors to the Capitol and others in the region
    could be taken and isolated if there is a biological, chemical
    or other major such attack in Washington.
        The tunnels, bridges and Metro rail and bus system that are
    responsible for bringing Federal workers to and from Federal
    jobs in the District every day present major untouched and
    difficult security issues, such as preventing and responding to
    attacks and accidents involving chemical, biological and other
    hazardous substances and fires from explosives in tunnels and
    the tunnels leading to this city.
        After September 11th, a lack of interoperability here
    should be unthinkable, but that is a work in progress that
    requires additional funding. Perhaps most telling, given the
    many Federal buildings here where controversial decisions are
    made every day, is the lack of necessary equipment even for
    area bomb squads, not one of which has the equipment necessary
    to meet FEMA's top standard.
        We will hear of other vulnerabilities today. We will want
    to know whether they were considered when DHS funding decisions
    were made, and we will want to know what precisely is now
    expected from local security officials charged with major
    prevention and recovery operations in the National Capital
    Region.
        We will want to know not only because of those we
    represent; we will want to know because of the weighty, unique
    burden local security officials carry for the region where the
    Nation's most highly targeted assets are located.
        Thank you, Mr. Chairman.
        [The prepared statement of Hon. Eleanor Holmes Norton
    follows:]

    [GRAPHIC] [TIFF OMITTED] T0591.007

    [GRAPHIC] [TIFF OMITTED] T0591.008

        Chairman Tom Davis. Thank you very much.
        Mrs. Maloney, any opening statement?
        Mrs. Maloney. Thank you very much, Chairman Davis and
    Ranking Member Waxman, for holding this very important hearing.
    My only wish is that this hearing would not only focus on
    D.C.'s Homeland Security but also New York's Homeland Security.
    Both D.C. and New York City, their funding was cut by 40
    percent, yet by all lists, they remain target No. 1 in this
    Nation. The al Qaeda ranks them as target No. 1. Bin Laden has
    attacked New York City twice and has been caught on tape saying
    he intends to do it again. Likewise, the Capital Region has
    been attacked and suffered many other reported attempts to
    attack the Capital Region.
        Since the announcement of the Homeland Security funding 2
    weeks ago, I have heard a number of reasons why New York and
    Washington suffered such a tremendous cut. If you listen to the
    variety of explanations and excuses coming from Secretary
    Chertoff, your head will start spinning. He often contradicts
    himself.
        We have heard that New York City and D.C. had their funding
    cut because overall funding for the Urban Area Security
    Initiative has been cut, the high threat funding formula. On
    June 7th, Secretary Chertoff was quoted in the paper as saying,
    ``Congress gave us about $600 million less than our grant
    programs, including $125 million less for the Urban Areas
    Security Initiative.'' While it is true high-threat funding was
    cut by 15 percent, New York and D.C.'s funding was cut by 40
    percent each while other communities saw increases of over 70
    percent.
        Also the initial formula had seven high-threat cities. That
    has now been expanded to 40 high-threat cities. Yet the 40
    high-threat cities are not on the al Qaeda list, according to
    intelligence that has been released to Congress and others.
        In fact, the cut to New York City was $83 million alone, or
    more than two-thirds of the total nationwide cut. When we have
    questioned the jump in funding for other communities, Tracy
    Henke, the DHS official in charge of the process, told me,
    ``You have to understand that there is risk throughout the
    Nation.''
        I understand that risk exists outside of New York and D.C.,
    but I would have preferred to have followed the recommendations
    of Secretary Chertoff when he stated in January that high
    threat grants are ``not party favors to be distributed as
    widely as possible.''
        Then there is the much talked about listing of national
    monuments and icons or lack thereof. Yet the administration
    still thinks that New York has no icons, and certainly D.C. has
    more than any city in the country. I would like them to take a
    tour of New York. The Secretary's excuse for this is that they
    listed the Empire State Building, for example, as a large
    office building and the Brooklyn Bridge as a bridge. He
    contrasts that with Mount Rushmore, a monument with much fewer
    visitors.
        To that I ask, can't our icons be listed as both? The
    Empire State Building is a large office building with thousands
    of workers, and it is also a very famous site that attracts
    hundreds of thousands of visitors and attention from
    terrorists. Al Qaeda was not videotaping the Brooklyn Bridge
    because it is a bridge. They were doing so because it is a
    bridge and a national icon on which thousands of people
    traverse each day.
        It is this kind of common sense that seems to have
    completely escaped DHS as it tried to come up with a formula
    that is as complicated as possible.
        The next reason the Department has been giving us as to why
    New York and Washington, DC, received a cut is due to our
    application. We both rank at the top for risk but at the bottom
    for our application.
        Believe me, if there is one thing D.C. and New York know
    how to do, it is paperwork. They know how to fill out an
    application. They probably file more papers on more issues in
    more areas than any area in the country. So I don't know about
    you, Mr. Chairman, but I am going to ask the city of New York
    to maybe hire Steven King next time to write our application.
    Maybe then the Department will understand the full threat to
    New York City. And D.C., as my colleague mentioned, has
    suffered other attacks, the anthrax attacks, as has New York
    City.
        So what started as a promising commitment from Secretary
    Chertoff at the beginning of this year that Homeland Security
    funding would, in fact, be based on risk has turned into one of
    the greatest displays of incompetency, and really, we cannot
    afford to be incompetent in the protection of our people and in
    our Homeland Security grants.
        I look forward to the testimony. Thank you.
        [The prepared statement of Hon. Carolyn B. Maloney
    follows:]

    [GRAPHIC] [TIFF OMITTED] T0591.009

    [GRAPHIC] [TIFF OMITTED] T0591.010

    [GRAPHIC] [TIFF OMITTED] T0591.011

    [GRAPHIC] [TIFF OMITTED] T0591.012

    [GRAPHIC] [TIFF OMITTED] T0591.013

    [GRAPHIC] [TIFF OMITTED] T0591.014

        Chairman Tom Davis. Thank you very much.
        Mr. Moran.
        Mr. Moran. Thank you, Mr. Chairman. Thanks for holding this
    hearing and for staying on top of this through the Government
    Reform Committee.
        It does boggle the mind that we would be cutting
    expenditures for Homeland Security by $690 million, that we
    would be taking $122 million out of the Urban Area Security
    Initiative, and then we would be paying for that $120 million
    cut by taking it all out of Washington, DC, and New York City.
        I mean, this is, as I say, it boggles the mind. I hear the
    excuses, and that is what we are going to talk about today.
    But, you know, you put it in the larger context: What are we
    doing cutting Homeland Security by $690 million? We are going
    to debate today and tomorrow 10 hours on the topic of Iraq.
    Well, Iraq, and it has been said and will be said hundreds of
    times today, I trust, had nothing to do with September 11th.
    Saddam did not attack this country. He was not harboring
    terrorists. And until we went in and invaded the country and
    occupied it, he was no threat whatsoever to the United States
    of America. And yet it is relevant because we are spending $300
    million a day in Iraq, almost $9 billion a month in Iraq. And
    how are we paying for it? We take $690 million out of this
    entire Nation's Homeland Security funds.
        We had an amendment in the Appropriations Committee, the
    Homeland Security Appropriations bill. Mr. Obey offered it.
    What it did was to completely pay for all of the 9/11
    Commission's recommendations that the President endorsed and
    the Congress endorsed. It would have paid for all of it: all of
    the public transit monitoring; all of the port security;
    instead of checking 5 percent of the containers, we would have
    checked 100 percent of the containers for radiological,
    chemical or biological threats, rail security, on and on. It
    would have paid for all of it.
        You know how we were going to offset it? The people who
    earned more, more than $1 million a year in this country, get
    $114,000 annual tax cuts in addition to all the other tax cuts
    they get. This is just the new tax cuts we passed. Instead of
    getting a $114,000 tax cut a year, they get $101,000; a $13,000
    reduction to people making more in tax cuts than $1 million a
    year. That would have paid for all of the 9/11 Commission's
    Homeland Security recommendations. Now, it was defeated on a
    party line vote, no surprise, but my point is, where is this
    Nation's priorities?
        Now, you are not going to be able to answer that, but we
    have some people from DHS here. They might relay that message
    to some of their bosses, that there was some questioning about
    the Nation's priorities.
        Now, within DHS, you tell us that you didn't like the grant
    applications. I think Mrs. Maloney makes a pretty good point
    that not to identify the Brooklyn Bridge as anything more than
    a bridge was questionable, not to identify the Statue of
    Liberty as a national icon is questionable, and not to
    recognize the priority that Washington, DC, must have when we
    have millions of people here, 20 million visitors a year, the
    seat of the Nation's Capital, of the entire free world, and you
    make a 40 percent reduction in the funding?
        Now, maybe you don't like the application. But I worked in
    the executive branch for a few years. We thought--this was
    during the Nixon administration, and one of our roles was to
    sit down with the local government and work with them, because
    the objective is not to grade papers; it is to do what is in
    the best interests of the American people, in this case, to
    figure out how best to secure our Nation's Capital. There was
    $190 million additional needs identified, and the Department of
    Homeland Security decided to address 6.5 percent of those
    needs, from what I see, down from almost 10 percent.
        You recognize that D.C. is at the top of the terrorism
    target list. To put it at the bottom of funding, these are
    things that need some answers, and I don't think it is
    unreasonable for us to be asking these questions.
        Again, what we are going to be doing is shooting the
    messenger. It is the people that sent you here who make these
    top decisions in terms of allocating our Nation's resources who
    are the ones who ought to be on the hot seat. But,
    nevertheless, this hearing needs to be held. More importantly,
    we need to get some answers.
        Mr. Chairman, again, I appreciate your holding the hearing.
        [The prepared statement of Hon. James P. Moran follows:]

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        Chairman Tom Davis. Thank you very much.
        Mr. Van Hollen.
        Mr. Van Hollen. Thank you, Mr. Chairman.
        Thank you for holding the hearing today on a very important
    issue. As some of my colleagues said, this does raise the
    overall question of our national priorities. We hear a lot of
    rhetoric from the White House and the administration about
    Homeland Security. It is a top priority. Yet when you look at
    the resources devoted to it, you find out that, hey, look what
    happened here?
        One of the reasons we have seen cuts in Washington, DC, and
    New York is because we don't have the resources this year that
    we had last year. If it is the administration's position now
    that the threat to the homeland has reduced that much, it would
    be interesting to hear from them. Otherwise, it would be nice
    to have the resources match the rhetoric.
        We are often told that we shouldn't prepare for the last
    war, and that is absolutely true. You got to always be thinking
    about new possible threats. On the other hand, I don't think
    there is anybody with a shred of common sense that can tell you
    that, going forward, the Nation's Capital and New York City
    don't remain top targets of al Qaeda and any other group,
    terrorist group, seeking to do our Nation harm. Clearly, they
    remain at the top of that list.
        Now, many of us have been concerned for some time about the
    degree of attention the Department of Homeland Security has
    been paying to the Nation's Capital. We had a back and forth a
    little while ago about the downgrading of the position of the
    Office of the National Capital Region Coordinator within the
    Department of Homeland Security who used to report directly to
    the Secretary. The Secretary has now apparently determined that
    he will be buried within a couple of layers of bureaucracy. We
    haven't gotten any response to the complaints many of my
    colleagues and I wrote to the Secretary with respect to that
    downgrading. Now it appears that downgrading is not just with
    respect to the regional coordinating position, but with respect
    to the resources that are devoted to the National Capital area.
        Now, this is an important hearing because we are going to
    be able to find out a little bit more why these decisions were
    made, because there are conflicting comments in the media. Some
    media reports say that the Homeland Security evaluation that
    New York City and the Washington, DC, area were given lower
    amounts because they were inadequate, that they were not well
    thought out and substantial. Yet there are other comments from
    representatives, including some on the panel from the
    Department of Homeland Security, that said that is not the
    reason they were downgraded. So I think it is a mystery to many
    people why these areas received less money.
        I would just close by pointing out that the Washington, DC,
    area, as we all know, is a multi-jurisdictional area. You have
    two States, Virginia and Maryland. You have the Nation's
    Capital. Within the two States, you have lots of jurisdictions.
    Coordinating that area is a major challenge. To have the one
    source of money that really helps pull all those different
    jurisdictions together and working as one and pulling them in
    the same direction, to have that source of money cut sends I
    believe absolutely the wrong signal at the wrong time. There
    are lots of good ongoing efforts in the regions to try to bring
    everybody together. I think they can do even better, but they
    can't do even better with a lot less than they are getting now.
        So this is a great mystery to many of us, how this decision
    was reached. Thank you, Mr. Chairman, for holding this hearing.
    Hopefully, we will get some answers.
        Chairman Tom Davis. Thank you very much.
        Mr. Ruppersberger.
        Mr. Ruppersberger. Thank you, Mr. Chairman, for having
    this.
        Mr. Moran, I am glad you are here to make an argument.
        First, I represent Maryland's Second Congressional
    District, includes the Baltimore region, part of the National
    Capital area. Also in my district is the port of Baltimore,
    NSA, BWI Airport, Fort Meade, Aberdeen Proving Ground and the
    sector of Baltimore which is a Coast Guard shipyard.
        In 2006, the Department, as we know, that is why we are
    having this hearing today, the Department of Homeland Security
    cut National Capital Regional funding 40 percent from the
    previous year. They also cut $18 million in Homeland Security
    grants from the State of Maryland from the previous year.
        Now, it is of great concern to me that DHS would cut
    counter-terrorism money for New York City, the Washington
    region, which together have been 100 percent of al Qaeda's
    terrorist attacks on American soil. Each jurisdiction has been
    cut, based on my investigation, by, again, at least 40 percent.
        Now, it is also of great concern to me that DHS has shown
    by their actions that the National Capital Region is a low-risk
    city. That is preposterous. When you compare the State of
    Maryland, which I represent, with nearly 5.5 million people,
    the per capita spending for DHS dollars is $4.5 per person.
    That means each person in Maryland gets $4.5 that could be
    allocated.
        You look at Wyoming. Wyoming received nearly $16 per person
    in DHS funding per capita. Wyoming gets more than 15 times as
    many DHS dollars than they have people. $7.6 million and only
    493,000 people who live in Wyoming.
        I like Wyoming. The Grand Tetons is one of our most
    magnificent rural areas in the country. I have been there. I
    observed grizzly bears and other wild animals. Based on this
    new funding system, it seems that DHS is protecting the grizzly
    bears in Wyoming over the people who live and work around Fort
    Meade and NSA and other parts of this country. I choose people
    over bears.
        Now, I am willing to listen to DHS's argument, and they are
    on the hot seat, as they should be. But I feel very strongly
    that we need to focus on our high-priority targets. I am a
    Member of the House Select Intelligence Committee. We focus on
    terrorism and al Qaeda all the time. I am just very, very
    concerned of DHS's priorities as it exists here today.
        If DHS has a better understanding of where the risk is, why
    was the funding for such densely populated urban areas like
    Washington, DC, New York and Baltimore cut so much? The new DHS
    system which supposedly balances risk and effectiveness places
    more emphasis--and this is what really concerns me--places more
    emphasis on the quality of the writing of the grant proposal
    than the actual risk a community faces. I want to repeat that
    because that seems to be the argument that certain
    jurisdictions might not have written the grant proposal the way
    DHS wanted it.
        I agree that giving money to States without having a plan
    is putting the cart before the horse, and DHS should have been
    criticized for the amount of waste, of money that went to
    different jurisdictions, pork, for dog vests and everything
    else. That has to stop. I am sure that is why this system is
    coming here now. But giving Homeland Security dollars on the
    basis of the quality of how a proposal is written is trying to
    drive the cart without a horse.
        If the State plans are being analyzed, where is the
    congressional oversight? I question whether a group of peer
    review experts should be telling first responders what projects
    have value and which don't and determining how much money they
    should receive. Have these peer review experts ever managed a
    Federal grant or Federal emergency? I don't know, because I
    don't know who they are. They haven't been before the
    committee. There is an argument about being classified. I am on
    the committee that is classified. So there needs to be
    oversight with respect to that.
        This process is not acceptable, and I believe the new DHS
    system puts our most vulnerable cities at risk. I think the DHS
    has put the needs of a few over the needs of the most
    vulnerable. I will work with my colleagues to fix the DHS grant
    formula so it accurately protects America's most vulnerable
    assets, our families, our community and our Nation.
        Thank you, Mr. Chairman.
        Chairman Tom Davis. Thank you.
        Mr. Mica.
        Mr. Mica. Thank you, Mr. Chairman. I really don't have a
    lengthy opening statement, which I am sure many will
    appreciate. But I am actually looking forward to hearing from
    some of these folks. I have never seen a goofier list of
    priorities for receiving Department of Homeland Security grants
    than the one most recently provided us.
        I just want to figure out how they figured out how to mess
    things up so badly, particularly addressing the needs of some
    of our most critical cities and regions, Washington and New
    York and others. I want to hear the explanations to the goofy
    decisions.
        Thank you. I yield back.
        Chairman Tom Davis. Thank you.
        Ms. Watson.
        Ms. Watson. Thank you so much, Mr. Chairman. This hearing
    is very important to our oversight responsibilities, and I
    would like to thank all the witnesses that are here today for
    coming.
        I believe homeland security manifested as guns, barriers
    and blind response protocol is a false sense of security.
    Homeland security should be about the health of the American
    people. It really is not about the land; it is about the
    people; the people's education and the proper expertise that
    can be brought to strategic management and preparedness.
        You see, these alerts go high every day. What do you do?
    The people have no clue. The Department of Homeland Security
    was born in America's moment of crisis. Unfortunately, as a
    result, it seems the Department's management itself is in a
    perpetual moment of crisis.
        We saw the most devastating results of this mismanagement
    during Hurricane Katrina last autumn. But the hidden disaster
    is the way that our local government and our first responders
    are blown about by the capricious winds of DHS's policy shifts.
    Now DHS has again changed the way it allocates grant money to
    the local governments that are expected to respond in a case of
    disaster.
        I am still concerned that we have not fixed the problems
    that have plagued the way we allocate these funds since the
    beginning. It seems to me that the endless debate over
    allocation formula is a product of the President's failure to
    provide the resources necessary to secure the homeland, the
    people.
        Rather than debate who is going to get the biggest piece of
    a shrinking pie, we need to base not just our formula but also
    our overall spending levels on the true threats and risks to
    America.
        So I want to thank you, Mr. Chairman. I look forward to
    hearing from the witnesses about how they believe we can
    improve DHS's grantmaking policies, specifically in the
    National Capital area.
        I yield back.
        Chairman Tom Davis. Thank you. I think that will conclude
    opening statements and we can get to our panel. Members will
    have 7 days to submit opening statements for the record.
        I recognize our very distinguished panel of witnesses.
        We have the Honorable George Foresman, the Undersecretary
    for Preparedness, Department of Homeland Security; there is Mr.
    Edward Reiskin, Deputy Mayor for Public Safety and Justice; Mr.
    Robert Crouch, the Assistant to the Governor of the
    Commonwealth of Virginia for Preparedness; Mr. Dennis Schrader,
    the Director of the Governor's Office of Homeland Security of
    the State of Maryland; and Mr. David Robertson, the executive
    director of the Metropolitan Washington Council of Governments.
        It is our policy to swear all witnesses in before they
    testify, if you would rise and raise your right hands.
        [Witnesses sworn.]
        Chairman Tom Davis. Mr. Foresman, we will start with you
    and move on down the line. Thank you.

         STATEMENTS OF GEORGE W. FORESMAN, UNDERSECRETARY FOR
       PREPAREDNESS, DEPARTMENT OF HOMELAND SECURITY; EDWARD D.
    REISKIN, DEPUTY MAYOR FOR PUBLIC SAFETY AND JUSTICE, GOVERNMENT
     OF THE DISTRICT OF COLUMBIA; ROBERT P. CROUCH, JR., ASSISTANT
    TO THE GOVERNOR FOR THE COMMONWEALTH PREPAREDNESS, COMMONWEALTH
    OF VIRGINIA; DENNIS R. SCHRADER, DIRECTOR, GOVERNOR'S OFFICE OF
     HOMELAND SECURITY, STATE OF MARYLAND; AND DAVID J. ROBERTSON,
        EXECUTIVE DIRECTOR, METROPOLITAN WASHINGTON COUNCIL OF
                              GOVERNMENTS

                    STATEMENT OF GEORGE W. FORESMAN

        Mr. Foresman. Mr. Chairman, thank you.
        Ranking Member Waxman and members of the committee, thanks
    to each of you for the opportunity to appear today along with
    colleagues from the National Capital Region to discuss the 2006
    Homeland Security Grant Program and specifically the Urban Area
    Security Initiative.
        I would like to highlight several key issues for the
    committee today in advance of the very important discussions
    about reducing America's overall risk from terrorism. The
    discussion on funding should not be an issue of placing the
    safety and security of any one person, community or State in
    America ahead of another. Managing risk is a national
    responsibility. The process used by the Department this year
    reflects the desires of the administration, Congress and the
    American people to make our entire Nation safer and more
    secure. It is in that vein that I feel compelled to present to
    the committee some clear facts.
        First, the amount of funding available for the Urban Area
    Security Initiative program has been reduced by $125 million
    compared to 2005. This does in fact represent a reduction of 14
    percent. The State Homeland Security Grant Program has been
    reduced by $550 million compared to 2005, representing a
    reduction of approximately 50 percent.
        Second, the Department, at congressional direction,
    implemented an approach this year that includes both risk
    analysis and effectiveness scoring. It is an approach that is
    supported by the administration and reflects the evolution of
    our post-September 11th approach to managing the risk of
    terrorism.
        I would like to draw two excerpts from the House Homeland
    Security Appropriations Committee report for 2006: We are at a
    turning point in the methodology for administering the First
    Responder Grant Program. Historically, funds have been
    distributed based on minimum percentages and population.
        A little later, the report language reads: ODP, now known
    as the Office of Grants and Training in the Department, will
    begin a new methodology for administering the First Responder
    Grant Program. Funding will be targeted based on threat and
    risk while targeting gaps in preparedness.
        This guidance from the Congress has informed the
    development of the process that we used this year.
        Third, the risk to our Nation is better understood than
    even 1 year ago. National risk is an umbrella that encompasses
    community and State risks together. No single community or
    State constitutes the sum of America's risk. Our adversaries
    have publicly stated their desire to kill and injure our
    citizens, wreck our economy and destabilize public confidence.
    We know that there are key facilities across America that, if
    attacked, could cause grave harm to the people inside and in
    the immediate vicinity and cause potentially devastating ripple
    affects across the entire Nation, chemical and nuclear power
    plants, key transportation, telecommunications and energy hubs,
    as well as financial centers, just to name a few.
        In 2004, at the earliest stages of our national efforts, we
    had documented approximately 200 facilities nationwide. Last
    year, we had documented about 11,300. Today we have documented
    more than 260,000 nationwide. This documentation process is
    critical to understanding both the scope and diffuse nature of
    our national threat.
        In addition, the post-September 11th efforts to fuse the
    work of the intelligence and law enforcement communities at all
    levels of government is producing a more accurate picture of
    suspicious activity. This is activity that may point to an
    impending plot against Americans, our economy and our way of
    life anywhere in our country. This information also strengthens
    our analysis and underscores mode of attack of the past may not
    be the mode of attack of the future.
        The Department has adopted the lessons from the tragedy of
    September 11th. It is important to connect the dots, to
    understand our vulnerabilities, their consequences and the
    realities of potential threats all across the country.
    Together, these inform our risk analysis.
        The Department of Homeland Security's job is to protect an
    entire Nation. We are using all available information to guide
    us in doing just that. Just as we know that putting all police
    resources in a single neighborhood after a robbery or murder
    will not reduce the risk of crime in an entire community, we
    also know that reducing an entire Nation's risk cannot be
    accomplished by focusing resources in any one area alone.
        Fourth, and with what I just mentioned in mind, analyzing
    risk is neither absolute nor is it static. We have a much more
    accurate understanding of our entire Nation's risk. New York
    and the National Capital Region do not suddenly have less risk.
    Because of our better analysis, we know that the risk measures
    in some other urban areas are actually higher than previously
    assessed in relation to New York and the Washington region.
        In some cases, the share of national risk for these other
    communities actually doubled or tripled as a result of our
    incredible analysis this year. This means that additional
    resources had to be applied to these areas to help address the
    better understood risk as part of a truly national approach.
    Two-thirds of funding to the 46 urban areas was based on these
    risk measures.
        Let me be very clear: New York City and the Washington
    region continue to be at the top of our risk consideration. You
    will see a chart on the screen that shows the risk curve in the
    upper righthand corner and the funding curve in the lower
    lefthand corner. You can see that funding corresponds to risk.
    In fact, more than 45 percent of all funds go to just 5 of the
    46 urban areas, New York City, the National Capital Region, Los
    Angeles, Long Beach, Chicago and the San Francisco Bay area.
        It is also important to note that these 46 urban areas
    constitute approximate 85 percent of our national urban area
    risk. I should underscore that as our knowledge and information
    continue to evolve, relative risk rankings could change again
    in the future.
        Fifth, we assessed the effectiveness of urban area
    applications this year relative to each other in support of
    meeting national priorities. These assessments also included
    review of how investments matched their respective State
    strategies and potential for continuing beyond the flow of
    Federal dollars.
        The effectiveness score is not in any way a measure of how
    well urban areas are implementing programs, managing their
    resources, succeeding in keeping their citizens safe or how
    well they write their grant applications. It is simply a
    mechanism for promoting a national unified approach to the
    national threat of terrorism by encouraging efforts that meet
    program directions set forth by Congress and the
    administration.
        Effectiveness accounted for one-third of the allocation
    decisions, and it is important to note that the maximum
    increase or reduction of funds based on these measures would
    have been at most 7 percent for any of the urban areas. The
    vast majority fell into the median, meaning there was very
    little change.
        Finally, we continue to work on improving communication.
    The Department is responsible for addressing a national threat,
    and that means by working closely with many stakeholders,
    including our partners at the State and local level. Before
    this position, I spent nearly a quarter of a century in local
    and State public safety activities, and I clearly understand
    that funding decisions can send unintended messages.
        The message here should be very clear: Members of the
    committee, managing America's risk requires a national approach
    that applies Federal resources wisely to supplement the work of
    State and local governments. The Secretary and I continue to
    balance the need for maximum transparency in the funding
    processes with the need to avoid publicly giving our enemies a
    roadmap to our national vulnerabilities.
        We will continue to work closely with our partners at the
    State and local level here in the National Capital Region and
    with the Congress to ensure that we protect the entire Nation
    and that we provide clearer understanding of the progress that
    we are making on reducing America's risk from terrorism on
    numerous fronts.
        Mr. Chairman, members of the committee, thank you for your
    attention and I look forward to your questions.
        [The prepared statement of Mr. Forseman follows:]

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        Chairman Tom Davis. Thank you, Mr. Foresman.
        Mr. Reiskin, thanks for being with us.

                     STATEMENT OF EDWARD D. REISKIN

        Mr. Reiskin. Good morning, Mr. Chairman, Congresswoman
    Norton, members of the delegation and committee.
        My name is Ed Reiskin, I am the Deputy Mayor for Public
    Safety and Justice for the District of Columbia, and I have the
    day-to-day responsibility for Homeland Security in the
    District. I am pleased to have this opportunity to be here
    today to talk about this very important issue for the District
    and the region.
        Mr. Crouch from Virginia, Mr. Schrader from Maryland and I
    work together collectively and collaboratively on a day-to-day
    basis to improve the safety and security of the region, and
    that is a responsibility that we take very seriously, and it is
    in that spirit that we are jointly presenting our testimony
    today.
        I will discuss our application, the risk and effectiveness
    assessment of it and the impacts to the District. My colleagues
    will discuss impacts to the region as well as impacts to pair
    to their respective States. If you are following in the written
    testimony, the State impacts are in the last pages of the
    testimony.
        With regard to the application sample, some of the
    documents which are in front of me, significant effort by
    experienced practitioners from fire chiefs to health directors
    to communication experts, volunteer managers, hospital
    executives, many of whom I am pleased to see are in the room
    today, and many other stakeholders work toward the regional
    security of the homeland and worked together jointly to develop
    the fiscal year 2006 funding applications.
        With our understanding of the fiscal climate and the
    Department's shift to a more risk-based approach, we were
    expecting an award somewhere in the area of $100 million to
    $120 million. To be conservative, we developed an application
    for $188 million, which was a prioritization of over $250
    million of identified need that represented an amount we felt
    comfortable we would be able to execute. The breakdown of the
    areas that make up that $188 million are in your written
    testimony.
        As many of you have mentioned, the Nation's funding for the
    Urban Area Security Initiative was reduced by 50 percent. We
    were reduced by 40 percent, yielding a $46.5 million award,
    which was, needless to say, considerably lower than we had
    expected.
        With regard to risk and effectiveness, as many of you have
    said, we know we are a high-risk area. We understand through a
    press release that DHS found our region to be in the 97th
    percentile in terms of risk, and with risk as two-thirds of the
    equation for determining the allotments, it is hard for us to
    understand the disproportionate reduction that we seem to have
    received.
        Absent any specific feedback from the Department, which we
    understand will be forthcoming, we can't speak to the
    effectiveness analysis of our proposal, although it was rated
    at or above average in each of their rating categories for each
    of the investment areas.
        What we do know is that some of the most experienced
    responders and planners, many of which are in the room, people
    who did respond to September 11th, who have responded to
    anthrax, were the ones developing the content for this
    application. So we don't understand how peers from across the
    country could have somehow found this application to be
    lacking.
        We have built significant capability in the region over the
    last 5 years that we are proud of and that should give comfort
    to those who live here, work here and visit here. That
    capability will not generally diminish as a result of this or
    any other award. But preparedness is a dynamic and complex
    process, and we have significant unmet need that remains, and
    we will be unable to meet all of it in this grant cycle. We
    can't speak to the levels of need or risk elsewhere in this
    country, but we do know that ours is high.
        With respect to the District of Columbia, as many of you
    mentioned, we are the seat the Federal Government, home of the
    Capitol, the White House, the Supreme Court, the Department of
    Homeland Security and its national operations center, the FBI
    headquarters, the Washington Monument, 20 million visitors and
    countless other national icons and critical Federal functions.
    Yet the Department of Homeland Security determined that we face
    less risk than 75 percent of the Nation's States and
    territories.
        The region was found to be in the top 25 percent of risk,
    but the city that serves at its core was in the bottom 25
    percent. State Homeland Security grant funding was cut 50
    percent nationally compared to last year. The District of
    Columbia's share was cut more than 53 percent. Only American
    Samoa, the Northern Marianas Islands, the Virgin Islands and
    Guam received less State Homeland Security grant funding than
    the District of Columbia.
        Between State and law enforcement grant programs, from an
    identified need of over $37 million, we submitted an
    application for $21.5 million and were awarded $7.4 million.
    Our application included the following, which directly support
    national priority capabilities: $3.7 million for planning,
    training and exercising in areas such as national incident
    management system, hazardous materials response, continuity of
    operations planning; $1.6 million for enhanced preparedness,
    focusing especially on special needs populations, schools and
    businesses; funds for mass care, $1 million for critical
    infrastructure protection, there is no question we have a
    significant amount of critical infrastructure here; $3.4
    million for intelligence fusion, following the guidelines of
    the Federal Government, both Homeland Security and justice;
    $2.4 million to continue our work in interoperable
    communications, including the dedicated wireless public safety
    network that is currently used to support events by both
    District and Federal agency users; $1.5 million for response to
    chemical, biological, radiological, nuclear weapons of mass
    destruction attacks that the District may face; $5 million for
    law enforcement response to raise our capabilities for our
    harbor patrol, our emergency response teams, our air support
    unit and others to Tier I as required by Homeland Security
    Presidential Directive 8.
        There is obviously a lot more in the applications, and the
    bottom line is we won't be able to complete all of those things
    as we proposed.
        I do want to close by saying we fully support a risk-based
    approach, and we support and acknowledge the Department of
    Homeland Security's efforts to make this process more objective
    and more transparent, which I do believe it has been. However,
    we have to question the outcomes, which don't seem to square
    with professional or common sense.
        We are confident that the lessons learned from this year's
    process will ensure that next year's is better. With that, I
    will turn to my colleague from Virginia.
        [The prepared statement of Mr. Reiskin follows:]

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        Chairman Tom Davis. Thank you very much.
        Mr. Crouch.

                   STATEMENT OF ROBERT P. CROUCH, JR.

        Mr. Crouch. Thank you, Mr. Chairman, members of the
    committee. I do appreciate this opportunity to discuss this
    very critical issue, critical to the States of Virginia and
    Maryland and critical to the District of Columbia. Mr. Reiskin
    pointed out some of the investments that were included in our
    package and I think it might be useful to discuss some of the
    other proposals that are also included which we think
    demonstrate the forward thinking, seriousness and consideration
    made by the National Capital Region. We certainly know among al
    Qaeda's as targets in the past have been transit systems. We
    know that from the experience of London. We know that from the
    experience of Madrid.
        Among our proposals is a Washington Metropolitan Area
    Transit Authority Alternative Operation Control Center.
    Currently, 30 percent of the region's commuters rely on Metro
    rail service, and almost half of the peak period riders are
    Federal employees. Recent attacks in London and Madrid have
    shown the transit systems are a favorite target of terrorists.
        WMATA's existing Operation Control Center directs rail and
    bus operations, emergency repair actions, radio communications,
    coordinates communications with the region's emergency first
    responders, receives chemical sensor program data. It's an
    origination point for public announcements and needs to be
    extremely facile with the ability to quickly respond to a
    variety of incidents.
        WMATA's Operation Control Center represents a single point
    of vulnerability for operating the entire rail system. If the
    building that currently houses the OCC is destroyed or has to
    be evacuated, it would be essentially impossible to maintain
    rail service within the acceptable degree of reliability.
        Addressing this single point failure in WMATA's operating
    system in a timely fashion would serve to mitigate the negative
    impacts and enhance the response and recovery capabilities of
    the National Capital Region resulting from a terrorist attack
    directed toward transit or other high threat targets in the
    region.
        Similarly, among our proposals is the Metro Subway Security
    Strategic Initiative. Recently the National Capital Region Fire
    Chiefs Committee created the Subway Tunnel Working group to
    identify gaps in their response to an incident in the WMATA
    Metro system.
        Our current initiative is to address identified gaps in the
    region's fire services' abilities to respond effectively to an
    incident involving a WMATA tunnel system. This initiative
    includes implementing hazardous materials detection, mitigation
    and decontamination training to ensure proper hazardous
    materials techniques within the Metro system.
        This proposed project would also supply the first
    responders with longer-duration breathing apparatus so
    firefighters can rely on longer search and rescue missions
    within the tunnels in the case of an attack.
        Clearly one of the lessons of Hurricanes Katrina and Rita
    was the need to give additional attention to special needs
    populations. Included among our proposals for the National
    Capital Region is a project to increase the capability of
    nursing homes, group homes and providers of home health care to
    service those people with disabilities or other special needs,
    including economic special needs. We recognize that these
    organizations in the National Capital Region are not
    sufficiently prepared to shelter in place the people they serve
    or to evacuate them to a place of safety and shelter.
        Our current initiative would create a representative
    consortium of disability advocacy groups and service providers
    with national outreach and local National Capital Region focus
    to prepare organizations that serve people with disabilities in
    the National Capital Region to shelter in place or evacuate
    those they serve and conduct exercises to shelter in place or
    evacuate to a disaster shelter.
        These are just three examples of the proposals in our
    package. We do think they demonstrate effectiveness. They
    demonstrate an attention to critical needs, unmet needs that
    require the attention of the National Capital Region and the
    Nation.
        We are interested, as we know you are, in the process that
    was engaged in, in coming to the conclusions that ranked the
    National Capital Region as it has been ranked. Our colleagues,
    and we do regard them as colleagues, and partners at the
    Department of Homeland Security have assured us that we will
    have an opportunity in the very near future to have that kind
    of in-depth discussion.
        As Deputy Mayor Reiskin indicated earlier, we are
    interested in the process, both in learning why our proposals
    were not ranked as highly as they were but also learning that
    in part so we can address those issues in coming applications.
    We want to get it right, and if we don't understand why we
    didn't seem to get it right this year, we want to learn that
    lesson.
        Nevertheless, we do continue to have concerns about that
    process and whether the formula that is used is really the
    appropriate formula. In the Commonwealth of Virginia, we
    experienced a similar cut this year, dropping from over $36
    million in funds last year to $16.8 for this year.
        Again, the Commonwealth was ranked in the top 50 percent in
    risk, and we remain baffled why our proposals that included,
    for example, funding for our intelligence gathering and
    analysis fusion center, which is considered state-of-the-art
    among the Nation, funding for our interoperability programs.
    Virginia was the first State in the Nation to create a State
    interoperability coordinator, the first State to create a
    statewide interoperability strategic plan, which is being used
    today by the Department of Homeland Security as a model for
    other States.
        We want to complete our interoperability throughout the
    Commonwealth, and yet these are proposals that did not merit a
    higher ranking and higher funding by the Department.
        We continue to have concerns that the Hampton Roads region
    not only does not get Urban Areas Security Initiative funding
    but doesn't even qualify for consideration based on the
    formula, with all of its maritime and military traffic.
        So we do continue to have those concerns. We look forward
    to that discussion with the Department and learning more about
    the process and contributing to its improvement in the future.
    Thank you very much.
        Chairman Tom Davis. Thank you, Mr. Crouch.
        Mr. Schrader.

                    STATEMENT OF DENNIS R. SCHRADER

        Mr. Schrader. Mr. Chairman, thank you.
        It is a pleasure to be here to give you our perspective in
    representing Governor Ehrlich's, his homeland security advisor,
    and appearing with my colleagues Bob Crouch and Ed Reiskin from
    the District and our local jurisdiction representatives who are
    here today.
        Maryland is one of the three major components of the NCR,
    and one of the things we observed according to the Homeland
    Security application process is Maryland was ranged in the top
    50 percent for both risk and effectiveness. One of the things
    that we are wondering as we sift through this is, it is
    difficult to understand how Maryland and the NCR grant funds
    were cut so drastically.
        Our thinking is that we have to work on improving the
    process to ensure risk is properly calculated to realize a
    commonsense risk-based process, particularly since it's two-
    thirds of the application.
        Federal Homeland Security distribution procedures changed
    this past year, and we support that. But the application seems
    to have gone into a black box of literally thousands of
    calculations and, in the end, fell short for Maryland and the
    NCR.
        It appears that a laudable big picture goal which made a
    lot of sense in the front end of basing funding on risk instead
    got mired in complicated formulas, resulting in applications
    that don't match what we intuitively know to be high-risk
    areas.
        The bottom line is more capabilities mean less risk. What
    we are really focused on is lowering risk, and by not building
    the capabilities, it slows our ability to reduce that risk.
        Maryland, Virginia and the District jointly develop our
    security capabilities. We share information back and forth
    because it is a coordinated effort. We have three major
    airports, subways, ports, landmarks and, of course, the
    Nation's Capital.
        Just to add on to what my colleague, Mr. Crouch, mentioned
    earlier in some of the projects that are on our list but will
    have to be scrutinized even more tightly than we already have,
    and we have done some pretty tight scrutiny; we spent an awful
    lot of time together, probably 20, 25 percent of my time with
    these folks in the National Capital Region because of the
    importance that the Governor places on this region.
        Currently, all the bomb squads in the National Capital
    Region have a high level of interoperability. They participate
    in information exchange, do joint training and mutual aid, but
    they are not equipped up to the level that FEMA would expect
    for their highest level of standard, and we have an $8 million
    project which would address that issue in the National Capital
    Region.
        There is an awful lot of pressure on our local
    jurisdictions. We partner with the local jurisdictions in the
    Capital Region, and they bear a lot of the workload in terms of
    helping us with the bottoms-up process of understanding what
    direction we need to go, and we need to make sure they have the
    planning resources so that we can coordinate our efforts
    because it is in effect coordinating the States and the
    District and the local jurisdictions in a very complicated
    coordination effort.
        We have a program to continue to build our capabilities
    around evacuation planning, mass care and sheltering, animal
    shelters, regional coordination response plans, continuity of
    government plans, and we have $5 million projected for that.
        We were disappointed in the State because primarily the
    three States--two States and the District--have to be strong to
    work together collaboratively. As I said earlier, we had
    expected somewhere in the neighborhood of $35 to $40 billion
    because we have a Central Maryland urban area as well as our
    law enforcement and State grant. We ended up with $24 million
    of which of course we are very grateful for, but it was a bit
    of a surprise, and we had put in an application for about $120,
    $69 for the State and $51 for the central Maryland urban area.
        These are for key things like information sharing and
    intelligence. We have one of the Nation's first fusion centers
    that has been around since November 2003. Many of my colleagues
    from around the country have come to see our center and model
    it. Critical infrastructure protection, interoperability are
    just a couple of other major things that we need to invest in.
        The bottom line is, at the State level, we have an open and
    transparent process just like we have here in the National
    Capital Region. We have the local jurisdictions help us to find
    the priorities, and we sift through that to--basically, the
    State has strategic objectives that we are focused on, and then
    we would hope the Department of Homeland Security would review
    those priorities and fund it as appropriate.
        The bottom line is, we are looking forward to the July
    review session. We have reached out to DHS to start asking
    questions about these risk calculations. We do support this
    process, but we need to understand it better because the
    outcome in some cases just didn't make a lot of sense.
        Thank you, Mr. Chairman.
        Chairman Tom Davis. Thank you, very much.
        Mr. Robertson.

                    STATEMENT OF DAVID J. ROBERTSON

        Mr. Robertson. Thank you, Mr. Chairman and members of the
    committee. I'm Dave Robertson, executive director of the
    Metropolitan Washington Council of Governments, and I have the
    privilege to represent the interests of 20 local governments in
    the National Capital Region that have vested countless hours
    and energy in addressing homeland security preparedness and
    response since September 11th.
        Just yesterday, the Council of Governments' Board of
    Directors met to examine this issue and had a very thoughtful
    and helpful discussion. They, like this committee, have
    questions and concerns, and I believe they are seeking many of
    the same responses that the committee is seeking, which is, we
    need to know how to sustain what we have started and how it can
    be made more predictable and transparent for all those
    concerned.
        I am here today, as I said, to represent the interests of
    our local governments but would comment to the committee that
    most response is going to be local. The men and women that are
    our first responders, our network of first responders in this
    region, work for local governments by and large, and they will
    continue to do what is necessary to protect and strengthen this
    region regardless of UASI funds.
        We know we need these funds. We have identified a range of
    priorities, but in the event of an emergency, local officials
    will respond as they are required, no matter what the
    circumstances.
        We will be looking to our State partners, our region's
    mutual aid agreements and certainly our Federal partners to
    support that effort. I can't speak too much to the peer review
    panel that worked on these applications, but I can speak to the
    peer team that helped reduce the region's proposals.
        Tony Griffin, who is the county executive in Fairfax
    County, and his colleagues from around the region spent dozens
    of hours sifting through proposals and trying to make sure that
    they meet the region's top priorities and needs.
        Local governments are supported by, among the Nation's best
    first responder teams: police officials, fire officials,
    transportation directors, health officials and others that
    worked hundreds of hours to develop these recommendations to
    measure them against standards and guidelines provided by the
    Federal Government. We know very strongly and very confidently
    that the work that has been advanced is of great need.
        Speaking to the issue of predictability and sustainability,
    we are concerned that many of the projects that have been
    advanced may be jeopardized by the reduced funding. Two quick
    examples: Much of the equipment that has been purchased in the
    early rounds of UASI funding does sometimes have a shelf life
    or needs to be maintained. We will need ongoing funds to make
    sure that equipment is at the ready at all times.
        Certainly, the issue of citizen communication. We can't do
    a one-time citizen communication campaign because this is a
    tremendously transient region. We need to reach out
    aggressively to citizens and the millions of visitors on an
    ongoing basis.
        We also believe the impact on these UASI cuts will be
    serious for our region. Simply stated, this region cannot
    achieve the level of sustainability and predictability and
    confidence that we want to have in our region's preparedness
    with the funds that are out there. We have a tremendous unmet
    need that will be unmet, will not be recognized if we do not
    receive additional funds in our region.
        Finally, the issue of the insufficiency perhaps of the
    application. Like a lot of the folks that have spoken earlier,
    the Council of Governments does support and our member
    governments do support the issue of risk-based assessment. We
    need to understand better how that is defined. We have worked
    very hard to address our proposals regionally and through the
    37 capabilities that the Department of Homeland Security has
    identified. If there are other guidelines or additional
    information that will be coming forward in the next couple
    weeks and month, we look forward to working with State and
    local partners to pinpoint exactly how we can do better.
        The Council of Governments was one of the first
    organizations to reach out to the Federal Government, State
    partners and locals immediately after September 11th to see how
    we could strengthen preparedness and response. We are proud of
    our work to date. We know our work is not completed; this is a
    long-term commitment of our Nation and region. And we look
    forward to working with Members of Congress to strength our
    preparedness.
        [The prepared statement of Mr. Robertson follows:]

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        Chairman Tom Davis. I want to thank all of you for your
    testimony.
        Let me start the questioning, Mr. Foresman, with you. DHS
    rated the National Capital Region in the top 25 percent for
    risk but, as has already been stated, the District of Columbia
    was rated in the bottom 25 percent. Considering that the
    District has already been a terrorist target, it houses the
    Federal Government, the White House, the Nation's Capital, the
    Capitol building, Supreme Court, why was the risk rating for
    D.C. in the bottom 25 percent?
        Mr. Foresman. Mr. Chairman, thank you for the question.
    This actually goes to the importance of us making sure that we
    are very clear communicating to our State and local partners.
    You are actually referring to two separate grant programs and
    the analysis contained therein.
        In terms of the rating for the urban area, D.C., which is
    based predominantly on the risk structure, the District of
    Columbia and the National Capital Region was rated in the 97th
    percentile.
        D.C. also is unique as a city; it has both the State status
    and city status, and so it is eligible to participate in the
    State Homeland Security Grant Program. So that program has a
    different funding formula that is based, in part, based on a
    floor amount, population-based floor amount.
        So, in essence, D.C., from a ranking standpoint, is
    competing against 50 States from a population base before we
    even get out on the door on any of the risk discussions. So it
    is an artificiality of the fact that D.C. is lumped into what
    is a State-directed program with a population-based funding
    formula.
        Chairman Tom Davis. So the risk is there. I mean, a major
    criteria of risk under the State funding formula is population.
        Mr. Foresman. A major criteria, that is correct. There is
    also a floor funding for the State program. There is a floor
    funding before you can get into the risk discussion.
        Chairman Tom Davis. So you really think under a State
    formula that Montana is at higher risk than D.C.?
        Mr. Foresman. Congressman, there are all sorts of
    intricacies.
        Chairman Tom Davis. I just asked you a question.
        Mr. Foresman. Yes, sir. My answer is, we do not measure the
    risk of one community against the other and place the
    importance higher--the higher of one community against another.
        Chairman Tom Davis. Am I right, under the State program,
    you have two criteria, and one is risk, and on the risk side, I
    can understand looking at the grants, I'm not going to get, at
    least in this question, how good the city's grant was, but on
    risk analysis alone, doesn't it seem on risk analysis alone
    that the District of Columbia is a likelier target and at
    higher risk than the State of Montana, or North Dakota, where
    I'm from, if a terrorist can find North Dakota?
        Mr. Foresman. I understand. The point is a valid point. If
    it was purely risk, D.C. would have scored higher. But there is
    a population-based factor on the front end of it, that amount,
    for a large portion.
        Chairman Tom Davis. You call it risk analysis. I mean, what
    it says on the grant, it says risk; it doesn't say risk and
    population. There is risk, and there is effectiveness.
        Mr. Foresman. Mr. Chairman, I go back to what I said
    earlier in terms of the products we provided to the
    communities. We should have been clearer in our communication,
    and that does not effectively articulate the nature of the
    grant program and the allocation process.
        Chairman Tom Davis. So, at a minimum, you would agree with
    me that where it says risk, it shouldn't say risk because,
    otherwise, if you're saying risk and population is a factor,
    that's one thing, but you have ranked the District under the
    State categories as a lower risk than North Dakota.
        Mr. Foresman. Mr. Chairman, we could have provided a better
    and clearer descriptive response to the community.
        Chairman Tom Davis. Risk is really not a very good term
    there.
        Mr. Foresman. Mr. Chairman, this goes to the broader issue.
    Throughout this whole debate, a number of people have been
    confusing threat and risk in the same discussion, and risk
    analysis is not risk management. Threat is not risk. What is
    important for us----
        Chairman Tom Davis. What is risk?
        Mr. Foresman. Risk is the combination of threat,
    vulnerability and consequences. It is the threat, the intention
    of the adversary, the likely intention of the adversary to
    commit an act, the consequences, what's the likely outcome, and
    the vulnerability is the relative measure.
        Chairman Tom Davis. Under that criteria--I say that's a
    fair definition of risk. Let's agree that's fair. The city's
    population is concentrated, so one incident there is going to
    hit a lot more people than some of these western States where
    people are all over the place. It's a much more likely target.
        How in the world is, a risk or a threat in Montana, North
    Dakota or South Dakota higher than the District? I just need to
    understand that. They have a few more people there, but in
    terms of any kind of risk analysis, I don't think that passes
    the laugh test.
        Mr. Foresman. Congressman, this comes down to the fact that
    D.C. falls into two categories. It falls into a State category
    in some of these grant programs. It falls into an urban areas
    category in some of these grant programs. Deputy Mayor Reiskin
    and I have talked about this over the course of the last
    several years, and it creates a little bit of an artificial
    challenge.
        Chairman Tom Davis. I understand that DHS made
    adjustments--how much was in the State versus how much was in
    the urban category in terms of the amounts that DHS was
    throwing in? You have two different grant categories; how much
    went to the urban, and how much went to the State?
        Mr. Foresman. In terms of total dollars?
        Chairman Tom Davis. Yes. Or percentage wise.
        Mr. Foresman. The urban area was about a little over $700
    million and the State program was about, I believe, $500
    million.
        Chairman Tom Davis. All right. I understand that DHS did
    make adjustments to the risk factor assigned to the National
    Capital Region and New York City, based on a DHS briefing of
    our staff. Is that correct? That after the adjustments were
    made under the formulas, it looked like New York City and the
    District were lower, and you made what we used to call Kentucky
    windage adjustments.
        Mr. Foresman. This goes back to the discussion on common
    sense. Because we understand that we are responsible, and
    Congress's direction is to protect the Nation's risk. When we
    take a limited pot of money and we have to apply that against
    an entire risk of a Nation, we wanted to ensure that we did not
    reduce the National Capital Region funding and that of New York
    City below the average of what they received in past years
    because, frankly, this is the first year that we really
    quantitatively had a good understanding of risk outside of the
    National Capital Region in Washington, and that changed how we
    had to allocate the money accordingly.
        Chairman Tom Davis. Let's just take a look at the city side
    where you say the city is treated fairly here; that is the
    thesis here, isn't it? That the National Capital Region under
    the urban formula is going to get treated fairly? Even under
    that, as I understand it, Washington, DC, wasn't first, wasn't
    second, wasn't third, wasn't fourth. I was ranked below New
    Jersey; it was below the Bay area; it was below Los Angeles,
    and so on. And in fact, you included additional urban areas
    like Ohmaha that ate up money that could have come here.
        Mr. Foresman. Let me use an example without specific
    jurisdictions. There's a large metropolitan area that has
    roughly the same number of assets in terms of critical
    infrastructure as the National Capital Region, and it has a
    population that is roughly the same.
        The National Capital Region population, from a density
    standpoint, is spread over 3,000 miles, and in this major
    metropolitan city, it's spread over 230 square miles. So the
    net effect of an event in that particular community would have
    been potentially far more grave in terms of an immediate impact
    on a large concentrated population. This goes back to the whole
    discussion about New York City with its high population
    density.
        In that particular case, as we ran the numbers, when you
    looked at the risk ranking, it raised that city above the
    National Capital Region. But there's an intrinsic value of the
    Nation's Capital psychologically to the American value system,
    and that is the key reason and one of the key reasons that we
    put, as you say, the Kentucky windage to it, because risk
    management, risk analysis, it is not absolute. It only seeks to
    guide and inform our decisionmaking process and not control or
    dictate it. So we were trying to----
        Chairman Tom Davis. I appreciate your explanation, but I am
    going to yield to Ms. Norton in a second.
        I just tell you, from my perspective, you are looking at
    the Nation's Capital, which has been hit once, had the anthrax
    attack on top of that. We are still I think on everybody's--
    close to the top of everybody's--hit list for any terrorist
    group that wants to make a statement.
        Terrorists are hitting London and Madrid. They are hitting
    capitals. They're not likely to hit Bull Frog Corner, WV.
        The reality is, as you take a look at urban areas and our
    density and everything else, I think your bean counters are
    just counting the wrong beans. I mean, I just think that this
    is too formula driven. I do not think that Congress makes the
    right decisions when we start allocating money and earmarks;
    it's not done on an equitable basis. That is why in this
    particular area, when it came to allocating funds for Homeland
    Security, we tried to give it to the administration because we
    thought they would be fairer, that they would take a look at
    what was good for the country as a whole, take a look at the
    threats and try to take the politics out of it. But what you
    have replaced with the politics is some bean-counting formula
    that doesn't pass the laugh test.
        You have, under your procedures, Montana, North Dakota, and
    South Dakota ranking ahead of Washington, DC, and under the
    regional analysis now, the city is not even second--now they
    are fifth--and that is applying, as we say, some subjective
    factors. But more importantly, you are including other urban
    areas that could have been covered under State grants that
    frankly don't look like they are threatened at all.
        What I'm concerned about is, should an incident, God
    forbid, happen--and we hope it doesn't--if it happens in Omaha,
    I think you're covered. I think you can say, we took care of
    them. But should something happen in New York or Washington, I
    think you are going to hear a huge outcry that we didn't give
    the appropriate attention. And the problem is, in these areas,
    they've been hit before; they've been hit more than once. That
    is the likelihood, and that's our concern.
        Ms. Norton.
        Ms. Norton. Thank you, Mr. Chairman.
        Picking up on your questions, by the way, I certainly hope
    al Qaeda doesn't notice these rankings and the shift. They're
    informed more than Members of Congress.
        The chairman asked questions about the District. I'm
    curious, did you, in calculating risk for the District of
    Columbia in particular, take account of the fact that the
    District's daytime population is two or three times its census
    population?
        Mr. Foresman. Congresswoman, we do take in the computing
    population in the day and night population, and again, it
    depends on which of the programs.
        Ms. Norton. I'm talking about the area grant.
        Mr. Foresman. The urban area, yes, ma'am.
        Ms. Norton. So then, of course, we're talking about between
    15 and 20 million people a year who come; we're talking about a
    population that is not 600,000 but three times that. That's the
    population figure you used?
        Mr. Foresman. Congresswoman, I don't have the exact figures
    in front of me, but when I was serving in Virginia, whatever
    the current population of the National Capital Region is, with
    some slight increase for tourist population, is going to be the
    number that you see used, and I don't whether it's 4 million or
    5 million.
        Ms. Norton. I was asking you about the District of
    Columbia.
        Mr. Foresman. But the District of Columbia, Congresswoman,
    this is a very important distinction because the District of
    Columbia under the Urban Area Security Initiative program is
    part of the National Capital Region, and it looks at the
    combined total of all of the jurisdictions.
        Ms. Norton. If you look at the District of Columbia grant
    itself, did the District of Columbia grant take into account
    that what you're protecting is the daytime population, in
    effect?
        Mr. Foresman. Congresswoman, I don't know specifically on
    the State Homeland Security grant program, but I will find out
    which of the two numbers was used in the formula and give you a
    written answer.
        Ms. Norton. Very much appreciate that.
        Mr. Foresman, I know you would always, when grants are
    being made, expect some disagreement. I believe there would
    have been less disagreement or certainly less outrage if there
    had perhaps been cuts but they had been more modest.
        The impression created is that we got cut Homeland
    Security; who got the money, let's cut them. So without some
    explanation, it looks like you said, where's the money, and the
    money is in New York and the National Capital Region.
        This is my question. I have not heard you indicating in
    your formula what I will call, for lack of a better term, the
    price of postponement. In a real sense, if we know what we all
    know about the region, what al Qaeda and the terrorists know
    about this region, my question is: Isn't there some reason to
    make haste in places which are particularly at risk to get it
    done, as it were, to get its most vulnerable parts staunch down
    as opposed to looking at, of course, the various
    vulnerabilities across the country? Some have not been as
    adequately funded as you would like.
        But if you factor in what a single incident would mean here
    because we hadn't gotten to it as opposed to making sure that
    you take care of what is vulnerable in other regions, isn't
    there a value that the Department would put on getting as much
    of it done as rapidly as possible in this region and perhaps in
    New York, the other target that everyone is aware of?
        Mr. Foresman. Congresswoman, let me address it this way;
    that is a large part of why you see a major change. If you look
    at the five high urban areas: Los Angeles/Long Beach region,
    Chicago, the Newark region, San Francisco, the combined
    increase because of the understanding of the risk score in
    those communities, very densely populated areas with very
    critical infrastructure, that the change in allocation based on
    the risk scoring alone was $38 million.
        So part of what I offer to you, Congresswoman, is while
    everybody talks about Omaha or Louisville, they represent a
    very low dollar amount in the context of how these dollars were
    adjusted. A large amount of dollars went to these high
    metropolitan areas, recognizing that Chicago, for instance, is
    a major financial and transportation center, a major
    manufacturing center.
        So our concern is about making sure that we bring percent
    readiness up, and that we don't have any weak links or
    Achilles' heels, particularly in those urban areas.
        Ms. Norton. I looked at the other cities, New York, LA,
    Chicago. I don't understand Florida. You will have to make me
    understand that one. Then we get to D.C. I said, well,
    population, I can understand that.
        I have to tell you that with all of its population in LA
    spread out the way it is, they are now only making a downtown
    in LA, one only wonders if MO of al Qaeda is simply to look for
    population or whether it's not to look for concentration of
    icons and population.
        Why New York in the first place? Why was New York hit
    twice? Why was the same building hit twice?
        Mr. Foresman. Congresswoman, that goes to a key point. One
    of the great criticisms after September 11th was no one thought
    about a plane being flown into a building. We have heard bin
    Laden say on numerous occasions since September 11th he wants
    to hurt America physically, psychologically and, most
    importantly, economically.
        Take the LA area as a good example. It is spread out like
    the National Capital Region but with a higher density. It is a
    major center of economic activities.
        Ms. Norton. I have to stop you right there for a minute.
    They may well have gotten cut. What I indicated was, I'm asking
    you if you recognize that al Qaeda does have an MO, a known MO.
    They are looking for large concentrations of people that you
    can hit. We are not talking about the atom bomb here, so you
    can't just hit LA and expect it--we're talking about somebody
    that wants to hit someplace, and by hitting that one place you
    get an icon or you get huge numbers of people.
        The reason there is more chatter about New York than D.C.
    is because you hit a few blocks there, you have so many folks
    that you don't need to worry about LA, San Francisco or even
    Chicago.
        So I'm asking, with this notion of population, whether or
    not you are really focusing in on density, where al Qaeda has
    been focused, not just population.
        Mr. Foresman. We are focused on population. We're focused
    on population density. But, Congresswoman, as a good example,
    the day before Hurricane Katrina, one of our major metropolitan
    areas in America constituted 25 percent of the chemical
    production capability in America. The day after that, it
    constituted 45 percent because--not chemical, but petroleum--
    because of the number of refineries that had been knocked out
    of service in Louisiana.
        What this points out to us is that there is a physical
    impact on people, but we also have to be concerned about the
    impacts on infrastructure, because you and I both felt the pain
    at the pump right after Hurricane Katrina when we had to go in
    and pay more for gas because the petroleum industry's
    capabilities had been reduced.
        Ms. Norton. Did you take into account, because you just
    named infrastructure, Madrid and London and the vulnerability
    of WMATA and its tunnels when these cuts were made?
        Mr. Foresman. We have taken into account the critical
    infrastructure here, and if you look at the other metropolitan
    areas where you have subway and metro systems, some that are
    subject to worse flooding than metro, as a prime example, we
    take all of these factors into consideration.
        Chairman Tom Davis. Thank you.
        Mr. Gutknecht.
        Mr. Gutknecht. I yield to my colleague from New York.
        Chairman Tom Davis. Mr. Fossella.
        Mr. Fossella. Thank you, Mr. Chairman. Thank you for the
    indulgence here.
        We are here, as you all know, because of what happened on
    September 11th. The Department of Homeland Security exists
    because of what happened on September 11th. It happened in New
    York and Washington, DC, and obviously in Pennsylvania.
        There are many who I think share the goal that the
    fundamental responsibility of the National Government is to
    protect innocent people. That was the intent of the Department
    of Homeland Security. We are here today in addition to answer
    the question fundamentally how we have gone astray.
        By way of background, I represent Staten Island and
    Brooklyn. More than 200 people were killed on September 11th;
    78 of the 343 firemen were from Staten Island; 29 people in my
    parish were killed. And I just don't want to have another day
    of mourning, another September 11th.
        I have been wholehearted in support to ensure that not one
    family in America ever again has to fall victim to an act of
    terror. So when we wake up and we realize that New York City
    sees a reduction percentage wise of upwards of 40 percent while
    other cities around the country, arguably not as high on the
    threat list, receive increases of 20, 30, 40 percent, we have
    to ask the fundamental question, are we doing what's right?
        The original intent of UASI went from seven cities to 35 to
    46 regions that now cover over 100 cities; is that right?
        Mr. Foresman. That's correct, Congressman.
        Mr. Fossella. Are we not drifting from the original intent
    of much of what USAI was meant to serve, that is, the areas
    like Washington, DC, like Chicago? I'm not saying here that New
    York deserves 100 percent, or Washington, DC, deserves 100
    percent. Just follow the threat, follow the risk.
        Mr. Foresman. Congressman, I think it's a very reasonable
    question that you have asked here. The 46 urban areas represent
    about 85 percent of the Nation's urban area risk, and why this
    is important--and part of this gets into the debate that you go
    for 80 percent, 90 percent, 85 percent. Where we saw the risk
    measures have a measurable decline to where there was a clear
    separation was about the 85 percent point, and that was those
    46 urban areas.
        I don't think there was any intent of the program that I'm
    aware of back when it was first established to say it was going
    to be 7 versus 50 versus 46 versus 30, but I think that we have
    to get beyond the discussion of funding on a single year and
    look at it over the course of funding activity and look at it
    in the context of managing risk. And we are responsible for
    finding a way to manage America's risk, and the way we best
    feel we can do that is to apply those dollars to get the
    maximum reduction in our nationwide risk, and that's how we
    came up with the 46 urban areas.
        Mr. Fossella. Having said that, in all the intelligence
    chatter, I'm not asking you to divulge anything classified, is
    there any city that is more targeted than New York City? Not
    just in this country but in the entire world.
        Mr. Foresman. Congressman, I don't know the specific answer
    to that. I will make the assumption that probably not, but I
    won't make it exclusively, but we should not equate threats
    with the complete discussion on risk. Threats are one component
    to it, but we have clear indications of al Qaeda and other
    groups' intents; through the radicalization and the
    globalization of the al Qaeda activities, we have clear
    understandings of their intent to wreak economic, physical and
    psychological pain elsewhere.
        Mr. Fossella. But am I asking too much to indicate that New
    York City is still the No. 1 threat?
        Mr. Foresman. It was the No. 1 risk ranker last year; it
    remains this year.
        Mr. Fossella. So if you sit back and know, far and above,
    with the two attacks in 1993 and 2001, that New York City is
    indeed No. 1, isn't there anybody sitting back saying, well,
    why are they seeing a reduction in funding? I'm just curious,
    nothing about the good people of Omaha, but are they in the top
    10 or 20?
        Mr. Foresman. Congressman, I think one of the things I
    would go to is this particular pie chart. If you look at New
    York City alone in terms of the total allocation of the UASI
    program from fiscal year 2003 through fiscal year 2006, you
    know they have not quite gotten a quarter but almost a quarter
    of the dollars have gone to New York City alone, and they have
    about 14 percent of the Nation's urban area population.
        But what I will tell you is, we are putting our heaviest
    focus and our heaviest attention in terms of financial
    commitments into New York City. We have and we can continue to
    do so this year, and it's averaged twice as much as other--as
    the next highest jurisdiction, not quite----
        Mr. Fossella. The reason is because that's where the risk
    and the threat is. Whether you live in New York or have family
    who visits, the millions of people from across the country, if
    you have a daughter or son who's a tourist, I think you would
    want them to be there.
        I have one other question.
        Mr. Gutknecht [presiding]. I have to intervene here because
    we are going to try to keep the hearing going through the vote.
    We have a vote on the floor of the House, and the chairman has
    run over to vote, he's going to come back, and we're going to
    go. I really need to let Mrs. Maloney have her chance. We can
    have a second round. If you want to run and vote, you can come
    back, and I think the chairman would be more than willing to
    entertain questions.
        Mrs. Maloney.
        Mrs. Maloney. Thank you, and I support my colleague's line
    of questioning. He has joined, as I have, the chairman of
    Homeland Security Peter King in asking for a meeting with
    Secretary Chertoff. We sent that letter off in a bipartisan
    effort roughly 2 weeks ago. We have not heard back. Can you
    give us any indication when he'll be able to meet with us?
        Mr. Foresman. I don't know the specific date the meeting
    has been scheduled, but it's my understanding when I was last
    briefed on that a couple of days ago that the Secretary was
    more than willing to meet with the delegation, and it may in
    fact be early next week.
        Mrs. Maloney. I would like to go over my understanding of
    this year's process for distributing the Homeland Security
    funding. Let me see if I have this correct.
        Cities and States prepared an application for submission to
    the Department of Homeland Security, making their best case as
    to their threat, need and vulnerability. However, the
    individuals preparing the applications frequently do not have
    security clearances and, therefore, a lack of access to real-
    time information about true risk and vulnerability their city
    or State may actually face. It is therefore the job of the
    applicant to give their best guess on what their need is,
    absent a classified threat assessment.
        After the applications are submitted, they are analyzed by
    a peer review board, and it is the job of the peer review board
    to analyze and rank applications on the basis of risk,
    vulnerability, among other things.
        Once again, due to the sensitive nature of some of the
    information involved and the lack of security clearances among
    members of the peer review board, they also lack real-time
    information regarding the actual risk or vulnerabilities to the
    cities and States being reviewed and ranking.
        I have been informed that the methodology for the peer
    review process was developed and implemented by a consultant
    firm hired by the Department of Homeland Security, reportedly
    Booz Allen Hamilton, and it is my understanding that it was
    this consulting firm that administered the review, collected
    the review, scored the sheets following the review and ranked
    State and urban area applications.
        I have also been informed that it was only after Booz Allen
    Hamilton completed their analysis that the Department of
    Homeland Security became involved in the process by signing off
    on the analysis and allocated funding based on Booz Allen
    Hamilton's works.
        So my first question, Mr. Foresman, is my understanding of
    the process correct?
        Mr. Foresman. It is not very correct at all, Congresswoman.
        Mrs. Maloney. Let me ask you, do State and city application
    writers have access to the threat information to best prepare
    their applications?
        Mr. Foresman. Congresswoman, if you might, I can maybe try
    an explanation to capture all of it.
        Mrs. Maloney. If I could, answer----
        Mr. Foresman. There are two very distinct points. The
    application writers do not have the specific threat analysis
    data or the risk analysis data in front of them, but it's not
    necessary in the context of the preparation of the application.
        Mrs. Maloney. Let me just ask you, do the members of the
    peer review process have security clearance and access to real-
    time threat and risk assessment?
        Did they have security clearance and access to real-time
    threat and risk assessment?
        Mr. Foresman. Congresswoman, I won't give you a blanket
    answer, but I'll be more than happy to give you a written
    response on whether all, some, none. But what they were looking
    at was not the risk piece of it. Let me be very clear. In
    terms----
        Mrs. Maloney. Why in the world were they not looking at the
    risk piece of it? Your application says risk analysis, risk-
    based funding.
        Mr. Foresman. Congresswoman, there are two parts to the
    analytical process. The first part is the risk analysis. The
    risk analysis is conducted by the Federal interagency, if you
    will, predominantly by the Department of Homeland Security.
    That is based on the classified information, the unclassified,
    the open-source information, the data sets, the population
    data. That forms one piece of the allocation equation.
        On the effectiveness score, the peer reviewers were
    provided, in terms of the application packages, all the
    applicants were given a package that says, here are the
    national priorities, here are the things by which your
    application will be rated toward those national priorities; you
    understand your risk, what you need to do locally. And we've
    asked them to submit the peer review data.
        Mrs. Maloney. My time is running out, and I would just like
    some questions asked, specific questions. Do members of the
    peer review process have access to and sign off on the final
    rankings of the applications, yes or no?
        Mr. Foresman. No.
        Mrs. Maloney. Did the Department of Homeland Security have
    a contract with Booz Allen Hamilton to conduct the peer review
    of these grants, yes or no?
        Mr. Foresman. Congresswoman, that cannot be answered with a
    yes-or-no question.
        Mrs. Maloney. Did Booz Allen have a contract with the
    Homeland Security Department?
        Mr. Foresman. Booz Allen had a contract with the Department
    of Homeland Security to facilitate the peer review process, not
    to do the evaluation of the investment justification.
        Mrs. Maloney. Can you provide me and the committee with a
    copy of that contract?
        Mr. Foresman. We'd be more than happy to, Congresswoman.
        Mrs. Maloney. Was the Department of Homeland Security an
    active participant in the peer review process, or was that
    responsibility contracted out to Booz Allen Hamilton?
        Mr. Foresman. We used Booz Allen Hamilton to help
    facilitate the peer review process, but there was a second
    level of review by Federal Department of Homeland Security
    employees of the scoring, and they were also present during the
    scoring processes.
        Mrs. Maloney. Who actually ranked the States and the urban
    areas? Was it the peer review process, Booz Allen or the
    Department of Homeland Security?
        Mr. Foresman. The Department of Homeland Security, based on
    an amalgamation of information from the risk analysis and the
    peer review process.
        Mrs. Maloney. Who in the Department of Homeland Security
    made that decision?
        Mr. Foresman. Congresswoman, I don't know that it was any
    one person, but I will get you the specifics of who was
    involved in that.
        Mrs. Maloney. It appears that you shifted the formula from
    risk to need. Because if you based it on intelligence and real
    risk, there's no question that it would be New York City and
    D.C. I mean, did you consult the list of targets from al Qaeda
    and the intelligence from al Qaeda that has been reported in
    the papers? And some of us have seen it where all of the
    chatter is primarily, three-fourths, New York. Then maybe they
    get down to D.C. But by all security accounts, whether it's the
    FBI, the CIA, the National Intelligence Director, the 9/11
    Commission, all of them report that all of the intelligence,
    that the risk is New York City. The threat they believe is a
    bomb that would be put off that would kill hundreds of
    thousands of people.
        I lost--as my colleague Mr. Fossella and we've worked on
    many responses to September 11th together--I lost 500, he lost
    300. All of us lost people in New York. We appreciate the help
    of our colleagues here in Congress, but this formula does not
    reflect the reality of what's out there or the reality of risk.
        I'm all in favor of a State aid formula to help States, but
    don't call it Homeland Security, call it municipal overburden.
    Call it aid to States, but don't call it Homeland Security.
        I look forward to our meeting with Mr. Chertoff, and my
    time is up.
        Mr. Foresman. Thank you, Congresswoman.
        Chairman Tom Davis [presiding]. I have a few more
    questions. DHS said it worked closely with the urban areas
    applying for funding. It also provided a guide outlining the
    application process.
        Mr. Reiskin, what role did DHS's office of the National
    Capital Region play in assisting you with the application
    process?
        Mr. Reiskin. The application was developed, first of all,
    being guided by a strategic planning process that was in part
    guided by the Office of National Capital Region Coordination.
        Chairman Tom Davis. DHS helped you put together the plan,
    basically.
        Mr. Reiskin. They were an integral part. That office was an
    integral part, really leading the effort to develop the
    strategic plan guiding the region for the next 3 to 5 years.
    That was the starting point for the process.
        From there, the senior policy group which includes the
    Office of National Capital Region Coordination and the chief
    administrative officers, so, basically, the State and local
    leaders outlined the direction for the application, identified
    the target capabilities around which we would build the
    application. There were eight national priorities. We added six
    regional priorities, and then we let our subject matter
    experts, the police chiefs, fire chiefs, transportation
    directors, do the analysis of the region's position in each of
    those capability areas.
        That was all brought back together and again reviewed by
    the State and local level leaders, which includes the Office of
    National Capital Region Coordination.
        So throughout the process, from start to finish, they were
    a part of the process.
        Chairman Tom Davis. Did they give you any suggestions that
    you didn't take in putting the application together?
        Mr. Reiskin. I would say that the office was not acting as
    really an agent of the Office of Grants and Training; they were
    acting really as our partner, our Federal partner in the
    region, not really serving in the role of advising us on the
    grant process itself.
        Chairman Tom Davis. But the plan to which the grant applied
    was coordinated with DHS, correct? The regional plan?
        Mr. Reiskin. The regional strategic plan was coordinated
    with the Office of National Capital Region Coordination.
        Chairman Tom Davis. Which is part of DHS.
        Mr. Reiskin. Part of DHS and submitted to another part of
    DHS for approval. All urban areas have to submit these
    strategies.
        Chairman Tom Davis. So you were basically carrying out in
    your grant application what the Department of Homeland Security
    had asked you and worked with you to do.
        Mr. Reiskin. Absolutely. We followed the guidance to the
    letter from the Department.
        Chairman Tom Davis. Did they at any point say, we don't
    think this is going to cut it? We think you need to do more? As
    you were working through the grant process, did they say that
    anything was remiss?
        Mr. Reiskin. We did not get feedback from the Office of
    Grants and Training.
        Chairman Tom Davis. Did you fully understand how the DHS
    Homeland Security grants evaluation process was different for
    fiscal year 2006, that you would have to first submit fully
    justified plans for evaluation before any funds were allocated
    to your jurisdiction, unlike previous years with where you were
    awarded an amount without a detailed explanation?
        Mr. Reiskin. No, actually the Department was fairly clear
    at a high level about the risk, the effectiveness, the fact
    that we were now competing for these funds, the fact that we
    would have to justify our need. We didn't have visibility, and
    I'm not sure they even had it developed at the time what the
    actual formulas would be, how certain things would be weighted
    one versus the other, but they were fairly clear that they were
    using this risk.
        Chairman Tom Davis. Different than it had been before?
        Mr. Reiskin. That it was very different. To their credit, I
    think they did a fair bit of outreach and documented process to
    make that clear.
        Chairman Tom Davis. Did you make adjustments in the
    application preparation process from what you had in previous
    years?
        Mr. Reiskin. It was almost unrecognizably different.
        Chairman Tom Davis. Did you undergo any internal evaluation
    to determine the best strategy for preparing and submitting the
    application in light of the changes at DHS?
        Mr. Reiskin. There was considerable discussion among the
    State level group and local level group in addition to the
    emergency preparedness council for the region which has local
    elected leaders, private sector folks, nonprofit folks. We
    discussed starting early in December when the guidance was
    first released.
        Chairman Tom Davis. Mr. Foresman, let me just ask you, the
    city's application was not rated that highly. When you look, it
    was in the bottom quarter, I think. They were coordinating with
    the local Homeland Security folks. As he said, he ran this up
    the ladder, and it had kind of been approved. I don't expect
    DHS to try to grease the wheels for the city. I think it is a
    competitive process. But in light of that, what was deficient
    about their application when you compare it to other
    jurisdictions?
        Mr. Foresman. Congressman, I don't have the specifics on
    the National Capital Region, and we will provide that, but let
    me be----
        Chairman Tom Davis. Why not? You knew you were coming here
    today.
        Mr. Foresman. Mr. Chairman, let me get into----
        Chairman Tom Davis. You knew you were coming here today to
    talk about this.
        Mr. Foresman. Yes, sir.
        Chairman Tom Davis. I think they're interested in what they
    didn't do right. They sought guidance from DHS as they went
    through this process. I think there was every expectation that
    they wouldn't be cut 40 percent. I'm just trying to ask what
    went wrong here. Can you give me some help?
        Mr. Foresman. Mr. Chairman, absolutely. Let me be very
    clear, they were not deficient in their application, and I very
    much want to underscore the nature of the peer review or the
    peer preparation process that they used here in the National
    Capital Region.
        In the context of the effectiveness scoring, the
    effectiveness measures, their application was reviewed in
    relation to the others submitted from urban areas around the
    country, a relative ranking provided to that. And the simple
    reason for doing this, Mr. Chairman, is to encourage regions to
    submit applications that are consistent with the national
    priorities that will be sustainable even beyond the end of
    Federal grant funding.
        And in terms of their ranking, it doesn't mean that they
    did a good job or bad job on writing the application; it simply
    means that, in terms of where they chose to make their
    investments in relation to the other urban areas around the
    country, there was some level of ranking.
        The challenge, Mr. Chairman, I would have had coming in
    here is I would have had to have to know the specifics of what
    was in 456 investment justifications submitted from around the
    country and the specifics for all of your members on your
    committee. So I will be more than happy to provide you a very
    detailed written response, sir.
        Chairman Tom Davis. Are you comfortable with the evaluation
    criteria that DHS used this year to come to these outcomes, or
    do you suspect maybe next year, in light of some of the
    criticisms this has drawn, the way the allocation process
    works, that maybe it ought to be reviewed?
        Mr. Foresman. Congressman, Mr. Chairman, the one thing I
    will tell you is that I never let any program sit still without
    seeking continuous improvement. That has been the hallmark of
    the way that I have approached public policy over nearly a
    quarter century of service at the State and local level.
        I will tell you, though, that I feel confident in our risk
    analysis process. I feel confident in our peer review process,
    but we have not been effective in articulating and
    communicating that as we should have to the stakeholder
    community including the U.S. Congress. But, Mr. Chairman, if we
    can find something we can do better next year, we will
    absolutely do it.
        Chairman Tom Davis. George, I have a high regard for you.
    You were great in Virginia, and you have a tough job here, and
    you're defending something here that you didn't do these
    decisions, were peer review work. But I have to tell you, on
    the risk analysis side, if you're comfortable on the State side
    comparing the Nation's Capital to Montana and comfortable
    putting Montana and North Dakota and South Dakota ahead of the
    District in terms of the risk analysis as you defined it, I
    think there is something wrong.
        Mr. Foresman. Mr. Chairman, let me be very clear on that
    particularly. I was referring to the risk analysis as we did
    the threat vulnerability and consequence piece of it. The one
    thing to understand about D.C.'s ranking in relation to Montana
    is that is based on a formula set by the Congress that in large
    part drives our funding allocation process there, and it drives
    the way that we analyze this.
        I'm not comfortable, frankly, comparing the District of
    Columbia to 50 other States. I think that's unfair to the
    District, but it is the nature of the program. It's the nature
    that they're in the program, and so we've got to make the best
    of it.
        Chairman Tom Davis. They were ranked below every State,
    weren't they?
        Mr. Foresman. Primarily because of the population issue.
        Chairman Tom Davis. I think they've got more people than
    Alaska.
        Mr. Foresman. I don't know that they were at the total
    bottom.
        Chairman Tom Davis. I think there were some territories
    that ranked ahead of it.
        We will look forward to that information, but when you are
    taking a look at your grants and you have a factor of five for
    the State grants and seven for the urban grants, I think it
    really skews the grant process because vulnerable areas like
    the District and New York end up on the short end of the stick.
        Go ahead.
        Mr. Foresman. Mr. Chairman, I would just offer, I think
    that is indicative of the discussion that we have had here this
    morning, where it's difficult to keep separate the discussion
    about the State grant programs and the urban area grants
    programs, how risk versus a formula plays into each one, and I
    think it underscores how we need to do a much more effective
    job in our communication with the State and local partners in
    future years.
        Chairman Tom Davis. Let me ask this, under DHS funding
    requirements, a program and capability review is the first step
    in preparing a program capability enhancement plan, which is
    the building block for preparing investment justifications for
    Federal funding. What approach did the National Capital Region
    use in its program and capability review?
        For example, did the National Capital Region use a risk-
    based approach based on assessing current capabilities,
    determines how these capabilities responded to regional risks
    and threats and the gap between current and needed
    capabilities? What key information pieces were used in the
    review? Did the NCR review individual jurisdiction plans? Can
    you help me with that?
        Mr. Reiskin. The first thing we did was we availed
    ourselves of technical assistance offered by the Department of
    Homeland Security to kick off the program and capability review
    process both for the District and for the region. As I
    mentioned, it's outlined in our testimony as well, we
    identified six target capabilities in addition to the eight
    national priority capabilities. We then basically held
    workshops with the experts in each of those 14 capability areas
    for the region. Again, these are the fire chiefs, the police
    chiefs, health directors. We used that workshop process,
    following the guidance religiously, to work through the
    identified strengths, the weaknesses, things that were
    identified through our strategic planning process last year; to
    the extent that we had the information, threats that we faced,
    and out of that developed a pretty comprehensive plan in the
    areas of people, equipment, training, other resources, fairly
    complete and voluminous, of strengths and weaknesses for each
    of the 14 capability areas.
        It was out of that we developed the investment plans, out
    of that we developed the investment justifications that we
    submitted in our application.
        Chairman Tom Davis. Let me ask you this question. It's not
    quite a friendly question, but can I get the answer because,
    according to research by the American Enterprise Institute in
    March 2006, ``Washington, DC, used the region's first wave of
    Homeland Security aid as seed money for a computerized car-
    towing system, and the city also used $100,000 in homeland
    security money to fund the popular Summer Jobs Program.'' Is
    that accurate?
        Mr. Reiskin. These are not new issues that arose. This is
    not Department of Homeland Security funds. This is the $168.8
    million congressional appropriation we received in fiscal year
    2002. There was----
        Chairman Tom Davis. So that wasn't this kind of grant money
    or earmarked Homeland Security money?
        Mr. Reiskin. This preceded the standup of the Department of
    Homeland Security. That was out of a congressional
    appropriation. The Summer Jobs Program, I believe, was on the
    order of $18,000 out of the $168.8 million allocation, and
    there was a program, it's called--we actually still have it
    through our Department of Employment Services, called Team
    D.C., where we engage youth in disaster preparedness and
    community outreach surrounding disasters, and it's a program
    that we actually think is very good.
        The computerized towing contract, I can't say for certain
    if that was funded. I think it was $35,000 out of $168 million.
    If it was, I would offer that the ability to efficiently move
    stalled vehicles during a disaster would not have been an
    unwise expenditure of funds.
        Chairman Tom Davis. I just wanted to give you an
    opportunity to put it on the record.
        Ms. Norton.
        Ms. Norton. Just a few more questions, Mr. Chairman.
        I just want to understand, Mr. Foresman, whether your
    testimony is that Congress, it is Congress that mandated the
    increases. For example, that Louisville got a 70 percent
    increase, that Omaha got a 61 percent increase, you're saying
    Congress is responsible for that.
        Mr. Foresman. Congresswoman, what I am offering to you is
    the congressional direction was to move to a risk-based process
    and an effectiveness scoring system, and those things
    contributed to the changes. And the percentages, while
    dramatic, represent----
        Ms. Norton. Congress only mandated a risk-based system. You
    had to then go and figure out what that meant. Congress doesn't
    have anything to do with these increases or with these cuts.
    They're based on the formula that the Department came up with,
    not with any, ``congressional mandate.''
        Of course everybody on this panel is for a risk-based
    system; the controversy is about whether we mean the same
    things when we say that.
        Mr. Foresman, when I hear you describe the competition, and
    we value nothing more than the competitive process of the
    Federal Government, but when I heard you discuss the
    competition for these funds that you couldn't tell the chairman
    until you looked at all the other ones, etc., it sounded like
    nothing--it sounded exactly like the kind of competition that
    States and localities go through when they're applying for
    education grants and the rest.
        It was kind of scary to hear that it was the kind of same
    old competition, albeit with subsections, just like other
    competitions for grants have subsections.
        The reason I ask that or raise that is, you are, of course,
    aware that this region, unlike any region in the country, by
    mandate of Congress in the Department of Homeland Security
    legislation, has a coordinator for this region paid by the
    Department, that is to say by the Federal Government.
        I would like to know, in light of the fact that Congress--
    you want to know what Congress has mandated, when it lays out
    the money for a Federal coordinator and says that it will be
    paid out of DHS funds, Congress is mandating something very
    specific.
        I want to know whether or not, in light of this unique
    role, whether the coordinator was given instructions about how
    he was to relate to this region so as to make sure that, in his
    paid capacity, he helped the region to make out the kind of
    application that could protect all the Federal assets here.
    What was his role?
        Mr. Foresman. Congresswoman, there are two parts to the
    answer here. First, Tom Lockwood, who serves as our Director of
    the Office of National Capital Region Coordination, the
    National Capital Region is the only place where we have a
    single, full-time dedicated office and Federal personnel
    dedicated to regional activities. We are moving to a regional
    structure elsewhere in the country, but here in the National
    Capital Region, Tom works a wealth of issues from working with
    the communities on strategic planning preparation, operational
    coordination, coordination among the Federal work force issues.
        Ms. Norton. I want to know, given the importance of this
    region, that we are paying somebody to make sure that this
    region, even if the rest of the regions fall flat, that this
    region does what it is supposed to do because of what is
    located here. I want to know whether he had a specific role in
    making sure that these applications met your terms?
        Mr. Foresman. Congresswoman, I will answer it this way: Mr.
    Lockwood works with his three counterparts on a regular basis--
    --
        Ms. Norton. Yes or no? Did he have a role? My goodness, Mr.
    Foresman.
        Mr. Foresman. He was involved in the strategic planning
    process, Congresswoman.
        Mr. Norwood. He did not have a role, it seems.
        Did he have a role, Mr. Reiskin? Did he have a role versus
    the panel? Did he tell you, look, this is the National Capital
    Region, I am the coordinator; let me just put you on notice,
    these are the kind of things you have to do in order to get
    your applications to pass muster? Could you all tell me,
    please?
        Mr. Reiskin. I would say that Mr. Lockwood in his capacity
    serves as a peer with us on the senior policy group which makes
    the final decisions in terms of the submission of the
    application and the ultimate award of the funds. He was not
    serving as a kind of liaison to the Office of Grants and
    Training, which was driving the grant funding process. I think
    they might argue it would have been a conflict for him to do
    so.
        Mr. Norwood. Would it have been a conflict? That is really
    my point. If you were only protecting all of us, that might
    have been a conflict. This Department, this Congress and every
    Federal asset, which happens to be virtually all of them in the
    United States, are implicated here.
        I am not talking about whether or not he was helping you to
    protect D.C. or even Maryland and Virginia. I am talking now
    about, and I have to ask you, Mr. Foresman, if something
    happens here, are you prepared to say, for want of a good
    application, they didn't get the funds?
        We are thinking about the uniqueness of this region, and I
    really don't hear in your discussion of the competition a
    sensitivity to that uniqueness as indicated by the Congress
    with a Federal coordinator paid by Federal funds.
        It sounds as though this was a region among others. We
    looked at it as we look at others. We will look at 4,000 other
    applications, and then we will see how you came out. If that is
    what happened, that raises a very serious question.
        For example, let me ask you this: We know that asset risk
    is generally generic. Here I am trying to point to the
    difference between this region and many others.
        However, let's take Union Station. If we are talking about
    an ordinary train station, everybody has a train station.
    Philadelphia has a train station. Every place has a train
    station. This is what we are talking about.
        We are talking about the hub that the Federal workers use
    as a transportation hub for the region. We are talking about
    the Union Station that is within a couple of blocks of the
    Capitol. We are talking about Union Station where Members of
    Congress have events on the premises and can hear the trains
    rolling underground as they come in.
        In calculating the risk of Union Station, do you in fact
    treat it as other rail stations, or how do you in fact
    calculate the risk in this example I pose?
        Mr. Foresman. Congresswoman, let me go back to the first
    part of your question where you talked about the effectiveness
    score. I want to be very clear that 66 percent of the funding
    is based solely on the risk piece of it; 33 percent is based on
    the effectiveness.
        Ms. Norton. Say that again?
        Mr. Foresman. Sixty-six percent of the funding allocations
    are based solely on risk. It has nothing to do with
    effectiveness. And of the 33 percent that is based on
    effectiveness, the maximum, the maximum that any one
    jurisdiction could be affected by that effectiveness score is 7
    percent of their total allocation.
        Now, to the second part of your question----
        Ms. Norton. That wasn't my question. I asked about Union
    Station.
        Mr. Foresman. No, you asked me a question, and the first
    part, I was trying to address that one for you as well.
        Now with regard to Union Station, when we look at a
    specific asset, we look at it in the context of a particular
    geographical area, and in this case, the National Capital
    Region is a unique geographical area. We give special attention
    to the National Capital Region because it is the seat of
    government. So in the context of our evaluation, we take into
    account that it is not your average train station.
        Chairman Tom Davis. Thank you.
        Mr. Van Hollen.
        Mr. Van Hollen. Thank you, Mr. Chairman. A lot of the areas
    have been covered here, but I do want to ask you, with respect
    to the amount of funds, Mr. Foresman, for the D.C. area under
    the Urban Security Initiative, as I understood your answer to
    the last question, even if the D.C. area had gotten the maximum
    on the effectiveness score, the total increase would have been
    7 percent? I just want to make sure I understand.
        Mr. Foresman. Give or take 7 percent.
        Mr. Van Hollen. But you graded their submission, as I
    understand it, in the bottom 25 percent on effectiveness, is
    that right?
        Mr. Foresman. Congressman, I will need to double-check to
    see if they were in the bottom 25 percent of effectiveness, but
    I believe that is correct.
        Mr. Van Hollen. I guess I really haven't heard yet today
    why it is they scored in the bottom 25 percent effectiveness in
    your opinion. We have representatives here who were very
    involved in the submission. We have heard now that Mr.
    Lockwood, I guess, was not involved, and I want to ask a couple
    of questions about that. But we have representatives here who
    know their stuff; they know their business. They have teams of
    people working on it. Why was their application graded in the
    bottom 25 percent? The bottom 25 percent in my kids' school is
    a failing grade. I would like to know why that was. They would
    like, I am sure, to know, so if they disagree with you, they
    can contest it; or if they agree with you, they can improve in
    the future.
        Mr. Foresman. Congressman, let me be very specific. This
    was not a grade. This was a relative measure to all of the
    other urban area investments that were submitted.
        Mr. Van Hollen. Where you graded on a curve.
        Mr. Foresman. In the context of it, from the standpoint of
    those urban areas, they submitted proposals which were deemed
    during the review process by the reviewers to be at a certain
    level of compliance in terms of sustainability beyond the end
    of the grant program, consistent with the philosophical
    approach of the national program, and this goes back to the New
    York piece of it, Congressman. In the context of it, we had
    this discussion with Mayor Bloomberg, they had a different
    philosophical approach than what the national program is for.
        We are trying to develop a bunch of independent urban area
    activities as part of an interdependent national approach, so
    we have to have some target from a national perspective.
        But I want to be very clear in saying, having worked
    closely with these gentleman over the years, having worked in
    the National Capital Region and living here today, I am proud
    of the work that has been done. I feel safe in terms of what
    they are doing.
        This was not a scoring of the capability of the National
    Capital Region. This was a ranking in terms of how well the
    investment justifications comported with the national
    priorities in relation to the 400 or so that we received from
    other metropolitan areas.
        Again, I go back to the scoring piece of it. At the end of
    the day, there has been much made about this effectiveness
    score. In the most extreme case, the maximum of adjustment
    would have been about 7 percent. I don't know in the context of
    where they fall what that would have done to the dollars, but
    we are talking in, probably, the single digit millions here in
    the National Capital Region.
        Mr. Van Hollen. But let me just get to that issue. You
    mentioned sustainability and lack of compatibility with the
    national plan. If you could just be specific about it.
        Mr. Foresman. Yes, sir. One of the things that Congress
    directed that we do is to develop the National Preparedness
    Goal to make sure that we were providing States and communities
    and, frankly, the Federal interagency with a clear road map of
    what levels of preparedness are we trying to get to in urban
    areas, in States, in regions, in individual communities; what
    do we need to do as a nation?
        So the National Preparedness Goal informs the grant
    programs in terms of the priorities in those grant programs. So
    what we are essentially saying to a particular community, or in
    this case an urban area, how will your proposals increase your
    ability to get to that desired National Preparedness Goal and
    also fit within your regional strategy and be sustainable
    beyond the end of the Federal grant funds?
        Congressman, let me be clear. This is a tough position for
    all of us. But, you know, at the end of the day, the Federal
    assistance is not designed to be the primary tool for
    protecting communities. It is designed to supplement local and
    State dollars that this region has been very good about
    committing to its public safety activities, whether crime or
    terrorism.
        And, you know, I will tell you the challenge that we face
    from a public policy debate is we have not had to do give and
    take at the State and local level in terms of what we are not
    going to do. If we feel like these security measures that
    aren't being funded by the Federal Government, if they are that
    important, are we still going to go ahead and do them?
        Mr. Van Hollen. I appreciate the fact that the local
    jurisdiction is supposed to be the primary mover in this area,
    and I think all of these gentlemen next to you do as well. But
    that doesn't mean that it is not important for us to rely on
    the Federal contribution, especially in the Nation's Capital.
    So we are all still struggling I think with why we are seeing
    such a reduction from last year.
        Part of it, obviously, is due to the reduction of the
    overall level. Part of it may be due to risk adjustments upward
    for other areas. Part of it, though, is due to the fact that,
    at least on a curve, we were at the very bottom.
        I guess if I could just ask the other witnesses at the
    table whether you have had an opportunity to look at the
    criticisms or the evaluation by the Department of Homeland
    Security and whether you have any responses to them or whether
    you feel that you are still left in the dark as to why you
    didn't measure up relative to other jurisdictions that
    submitted their proposals?
        Mr. Crouch. I will respond to that, Congressman. Thank you.
        We have been offered opportunities by the Department of
    Homeland Security, including Under Secretary Foresman, to meet
    with them in the future to get that detailed analysis. We are
    very eager to do that for all the reasons you so well stated
    just awhile ago.
        Mr. Van Hollen. Let me make it clear. You have not yet had
    an opportunity to review any of that?
        Mr. Crouch. We have not.
        Mr. Van Hollen. One last question that goes to Mr.
    Lockwood's role. I think we would all agree, Mr. Foresman, I am
    sure you would agree, the goal is to have in place a plan that
    best protects people, the National Capital Area and other areas
    of threat around the country; right?
        Mr. Foresman. Yes, sir.
        Mr. Van Hollen. So I am a little concerned about this idea
    that Lockwood's participation in this effort to come up with
    the plan would somehow be seen to give this area a
    disadvantage, because our goal should be for him to provide the
    input that makes it the very best plan we can have so that the
    people in this area can access the full amount of resources
    that are potentially available for them to access.
        This idea that somehow when we, the Congress, have created
    this position specifically because it recognized the kind of
    unique threat posed to people in the National Capital area, to
    say that person would somehow be, you know, it wouldn't be fair
    for that person to participate, seems to me to put sort of
    bureaucratic gaming concerns over the welfare of the people of
    the region. Because what we want is a good plan that everyone
    agrees is a good plan.
        So why would you not allow him to help participate so that
    this region could get the very best plan possible?
        Mr. Foresman. Congressman, I don't believe I said, it
    wouldn't be fair, and, if I did, I was incorrect in that
    statement. It may have been said by one of the other panelists.
    We expect Tom to be engaged, but he has got a multitude of
    things that he is engaged in. The greater expectation is for
    our team in our Grants and Training Office, who works with the
    community on a regular basis, is in constant contact with them,
    to provide them the advice and counsel.
        But, Congressman, let me also be clear that one of the
    things, and the chairman pointed this out, that this needs to
    be about a transparent process that is not driven by politics,
    and there have been some incorrect allegations to that extent.
    This has got to be driven by a very clear process that puts
    everybody in an equitable playing field, but doesn't do it in
    such a bureaucratic way that we don't get the best solution for
    the region. So we understand that.
        Tom is not excluded from the process, but he doesn't have
    the intimate grant expertise that the other folks who are
    assigned, the gentlemen who are assigned here in the National
    Capital Region, will have.
        So it may be more appropriate to say Tom was involved to
    the degree he should have been involved, but we also had our
    team members from our Grants and Training shop who are working
    with the individual States and the National Capital Region as a
    regional jurisdiction, working with them throughout the
    process.
        Mr. Van Hollen. Thank you, Mr. Chairman.
        Chairman Tom Davis. Mr. Fossella.
        Mr. Fossella. Thank you, Mr. Chairman.
        Mr. Foresman, it is my understanding that the funds from
    the State Homeland Security Grant Program can be used by the
    States to increase preparedness for building basic security
    capacities in their States and the UASI program is intended to
    protect the largest urban areas in the country. Is that
    correct?
        Mr. Foresman. That is correct, Congressman.
        Mr. Fossella. So the question I have is whether the States
    and cities, shouldn't they be competing within the State
    Homeland Security Grant money for ``building basic security
    capacities'' instead of UASI?
        Mr. Foresman. Congressman, I think in the context of the
    guidance that we received as part of the appropriations
    process, they did not make the distinction between the two
    programs. So what we are looking to do is to build capacity in
    both contexts.
        In the case of New York City, we had the conversation with
    the mayor, you know, is capacity paying for the overtime costs
    in the case of the New York Police Department or other things?
    It represents a philosophical discussion that will go into the
    grant development process in the future.
        Mr. Fossella. So do you see the UASI grant program as an
    opportunity to shift funds, let's say, to maybe what many of us
    believe--I don't think it is a philosophical difference. I
    thought that the State Homeland Security Grant Program is
    different from UASI insofar as the State Homeland Security
    Grant Program was to allow States to increase preparedness for
    building basic security capacities, as opposed to UASI, which
    was originally intended for the large Urban High Threat Areas.
        You are saying you can go in there and take the money out
    of UASI because you have been guided by the appropriations
    process to do so?
        Mr. Foresman. No, Congressman. If that is what you
    perceived I said, that is not what I intended to say. We view
    these programs in the context of a singular grant program. What
    we are looking to do is to make sure that expenditures at the
    urban area are consistent and not conflicting with what a
    particular State is doing as part of an overall national
    initiative.
        Mr. Fossella. When you say single, so you see both fund
    programs as one funding stream?
        Mr. Foresman. We see them in the context of broad Homeland
    Security funding but specific different program areas.
        Mr. Fossella. You don't sit there and say, OK, we are going
    to take some money from UASI and some money from there. You see
    it as one pot of money to comply with your goal?
        Mr. Foresman. Well, based on the guidance that we are
    provided by Congress, we have the allocation within the
    particular sub-program areas, if you will.
        Mr. Fossella. Sub-program areas?
        Mr. Foresman. Between the urban area program and the State
    Homeland Security Grant Program.
        Mr. Fossella. I don't think I have heard you. Do you see it
    as one pot of money or not? Yes or no?
        Mr. Foresman. Yes, Congressman, we do see it as one large
    pot of money, with many different utilizations.
        Mr. Fossella. We respect to, among the different
    submissions, particularly to the purity of process, can you
    reveal where New York fell within that process on the
    applications?
        Mr. Foresman. New York State or New York City?
        Mr. Fossella. New York City.
        Mr. Foresman. Congressman, I don't know, but I will provide
    you a written response.
        Mr. Fossella. It was my understanding it was toward the
    bottom, like toward the lower, like Washington, DC
        Mr. Foresman. That is generally my recollection based on
    the discussion that Secretary Chertoff and I had with Mayor
    Bloomberg. Again, one of the things, it was a very good, a very
    constructive discussion in the context of, did New York, from a
    philosophical standpoint, about 27 percent of what they were
    asking for was personnel costs, which tend not to be allowed in
    broad terms under the UASI program. So that was part of it.
        There were other issues. But, again, it doesn't point to
    bad programs in New York City. It doesn't point to bad
    activities in New York City. It just simply says that, in terms
    of your relative ranking, they scored differently than the
    others submitted from around the country.
        Mr. Fossella. It was my understanding, again, it was toward
    the bottom. I think you are confirming that. But you say you
    are going to get that.
        Two points, one on process, one on substance. That
    conversation took place after the grant program was announced;
    is that right?
        Mr. Foresman. That is correct.
        Mr. Fossella. Do you think it was the responsibility of
    anybody at Homeland Security to have an obligation to go back
    to, for example, New York City and say that your application or
    your submissions are wrong, rather than wait to make that
    determination? Do you think anybody had that obligation?
        Mr. Foresman. Congressman, in terms of the process, there
    is ongoing discussion regular between New York City and their
    designated liaison in our Grants and Training shop. When the
    applications came in, we went through those applications to
    make sure that all of the component pieces were there so that,
    if someone left out a piece of paper, they weren't going to be
    excluded from the review process.
        But what we did not do, we did not go in and preview any of
    the applications to say, this is on point, this is not on
    point. That is what the peer review process was about. With the
    recognition that, as we have gone through this process, we have
    tried to make sure that we treat New York and Washington, DC,
    with the understanding that they are the highest-risk urban
    areas, that they are unique in many, many ways, but also put it
    on an equal playing field with the other urban areas from
    around the country, because, at the end of the day, the
    challenge is not to be up here saying that we allowed anything
    other than a very objective review process to have guided our
    funding decisions.
        Mr. Fossella. Back to the substance aspect of it, I am not
    so sure on the process of whether--I do believe somebody in
    Homeland Security had an obligation to step forward. If it was
    a function of who had the best application, you can make the
    hypothetical that a city with 100 percent threat that submitted
    a lousy application, but a city with zero threat who submitted
    the best application would get the funding. So let me push that
    a side for a second.
        Is there any movement to change the philosophical view? A
    couple weeks ago, there was a conviction in New York city of a
    man who plotted to blow up the Herald Square Subway station.
    That was not done with so much building basic security
    capacity; that was human intelligence for the most part. That
    was the 1,000-plus New York City police officers to the tune of
    $200 million on an annual basis, which is larger than the
    entire Police Department of Denver, CO, for example.
        If we determine that human intelligence is the best way to
    thwart or prevent a terrorist attempt, don't you think that
    maybe the philosophy that Homeland Security should change in
    terms of providing adequate funding to meet and thwart those
    threats, rather than just building basic security capacity?
        Mr. Foresman. Congressman, two points to that. First, let
    me address the first point where you said the effectiveness
    would have--a real bad application versus a real good
    application.
        I just need to be very clear. It would have made very
    little impact in terms of the total dollars allocated, in New
    York City or anywhere else.
        The second point to the particular philosophical piece.
    That is the broader public policy discussion that has been had
    in the U.S. Congress with States and communities over many,
    many years about, should the Federal Government provide funds
    to communities for personnel costs, whether it is personnel
    costs in this case for cops on the beat doing crime reduction
    or whether it is personnel costs for law enforcement personnel
    doing human intelligence. That is part of a broader debate.
        I will tell you, on the whole piece of intelligence, as a
    good example, that is the one area where we have provided
    flexibility to urban areas in the context of intelligence
    fusion to be able to use these dollars for some personnel
    costs, because we recognize, prior to September 11th, that was
    a capacity that very few urban areas, New York City being one
    of the exceptions, that was a capability that many areas didn't
    have.
        So we do give flexibility in those particular areas, but
    not for a broad number of people to be out, ``collecting
    intelligence for analysts.''
        Mr. Fossella. If I hear you correctly, a city like New
    York, for example, has that flexibility, to a point?
        Mr. Foresman. To a very limited point in the context of
    intelligence and from an analytical standpoint, not a
    collection standpoint. You would think probably about law
    enforcement personnel on the street being more on the
    collection side than on the analytical side.
        Mr. Fossella. I know there are other questions. I yield
    back.
        Chairman Tom Davis. Thank you very much.
        Mr. Ruppersberger.
        Mr. Ruppersberger. Well, I think one of the things that is
    occurring here today is that we have people, and you, Mr.
    Foresman, are attempting to do your job, and you seem to be
    very competent. But it seems to me that you are trying to
    defend a major system that, when you look at the end game, it
    is just from public perception point of view but more from a
    reality point of view, giving resources to first responders,
    isn't really working.
        To have a formula that really discounts the threats to
    Washington, DC, to New York, to those areas, to come up with
    the way it is, something is wrong.
        Homeland Security has had a lot of bumps, and I hope we
    have learned from those bumps, and I hope that we have become a
    lot more practical and start focusing on realities, because
    what I heard here today really disturbs me, and I know you have
    to take your position where you are.
        Let me get into some areas. The first thing, what we
    haven't talked about here today, in all fairness, from what I
    understand, and correct me if I am wrong, this program was cut
    by Congress, the State side, by 50 percent and, on the urban
    side, by 14 percent. Is that correct?
        Mr. Foresman. That is correct.
        Mr. Ruppersberger. OK. So you are sitting here attempting
    to defend a system that I think is flawed at this point, but
    you have less money, and that was because of Congress. So we
    have to look at ourselves and see where we are.
        You also have made a comment about what Congress has told
    us to do. I am not sure what you mean by that, and I don't know
    if I have time to get into it.
        But what my concern is and what I would like to really
    determine is where your priorities are. When it comes to
    funding, it is about priorities.
        According to the President, and I believe it, too, we are
    at war with terror. We are at war in another country, but we
    also have a terrorism war. We need to do a lot of things very
    quickly, in Homeland Security and FBI, to find cells, to
    protect our country. But we know right now that we have been
    attacked, and we have a lot of intelligence of where we think
    al Qaeda is going to go.
        You made a couple comments, I wrote some notes, about
    equity and how we need to be equitable. The way I see it, when
    it comes to protecting our citizens from a terrorist attack, it
    is not about equity. It is getting resources to the areas which
    we have chosen, which the President has chosen, what the FBI,
    NSA, CIA have come together--and that is, by the way, what the
    Director of National Intelligence is about, to find out where
    the priorities are and where we are going to put the money. I
    just am concerned with this matrix, that you have grades where
    they are.
        Now, I am going to stop that with you, because I want to
    get to Mr. Schrader. I am from the State of Maryland. You put
    together what you thought was a very good proposal. Let's just
    talk about the State on a risk basis. You have NSA. You have
    Fort Meade. You have proximity to Washington, DC. In the
    region, you have BWI Airport. You have the port of Baltimore,
    and if you want to get nuclear components in and your target
    is, say, Washington, DC, the port of Baltimore is the closest
    port. You have Aberdeen, one of the top testing centers for the
    U.S. military probably in the country. You have all of these
    areas here. To me, that is an exposure issue, a risk issue.
        Now, I think Homeland Security was doing well as far as
    prioritizing money to New York, money to Washington. Now we
    have this new matrix which I perceive is a bureaucratic matrix.
    I would like to hear from you and go through your process, Mr.
    Schrader; where you think the priorities are, what you did with
    respect to your presentation and proposal, and then your
    anxiety on what occurred and how it occurred.
        I would like you to get into an area, too, because I am
    concerned about a lot of this. Even though Mr. Foresman will
    not admit it, I think a lot of it has to do with who has the
    best grant writers and who has the ability to put certain
    people in certain pegs. That might be OK if you are talking
    about education funding, health funding, but when it comes to
    fighting terror, I don't think that is OK.
        Could you answer that?
        Mr. Schrader. Congressman Ruppersberger, let me start by
    saying that the unfortunate part of all of this is, I think DHS
    had the right intent when they started this process.
        Mr. Ruppersberger. I agree with you.
        Mr. Schrader. The approach and the concept was good. Quite
    frankly, the other troubling part of this, and I will get into
    the direct answer, is that if we push them into changing the
    process again----
        Mr. Ruppersberger. By the way, the reason I want you to
    answer the question is I want Mr. Foresman to hear this.
        Mr. Schrader. Yes, sir. It would be very troubling at the
    State and local level to have this process change completely
    again next year. The nice thing about what we found is, it
    seemed to be a good framework on the front end that we can then
    have a multi-year planning process in place, and that is what
    we did.
        We organized the State into regions. We did regional
    bottoms-up data. We put these governance groups together to
    review our statewide program. But our policy in Maryland has
    been one Maryland in coordination with the NCR, because the NCR
    is not an operational unit.
        For example, we have a fusion center, intelligence
    gathering in Maryland, that we do for a very limited amount of
    money through our grant process. It is up in Baltimore, but it
    covers the entire State, and it supports the NCR. So part of
    the process here is, we look at the entire State, we have a
    focus on the NCR, but we also have the central Maryland urban
    area.
        As I said earlier, we had estimated that a reasonable
    amount of money for the State of Maryland would have been about
    $35 million to $40 million. We ended up getting about $24
    million, which, quite frankly, shocked us.
        We did have a very good quality application. So what we
    were assuming was maybe the risk from the two urban areas
    sucked off the risk from the State. I am being told now that is
    not the case.
        So the bottom line is, we have been working collaboratively
    with DHS for over 7 or 8 months now to make sure we put the
    very best application together. We shared a lot of that
    information with the National Capital Region. There was a
    tremendous amount of work that went into the application
    process. And I think it was all for good intention.
        Mr. Ruppersberger. Why do you think you were cut?
        Mr. Schrader. To be honest with you, I am mystified still.
        Mr. Ruppersberger. Why do you think you were cut, based on
    what you have heard here today?
        Mr. Schrader. I don't know. I don't know.
        Chairman Tom Davis. Thank you.
        Mr. Ruppersberger. Can he finish answering?
        Chairman Tom Davis. He doesn't know. He said he didn't
    know.
        Mr. Schrader. Let me make it clearer. If the State program
    was cut in half, we had $20 million last year, we would have
    expected to get $10 million, just if we did nothing, if we
    threw something up against the wall. We ended up getting $8
    million, which didn't make any sense to us. We worked really
    hard and thought we would get more.
        Chairman Tom Davis. Let me just ask, did everybody get less
    than you thought you would get?
        Mr. Crouch. We did.
        Chairman Tom Davis. I guess the other question, if I could
    just tag along, is, what regional Homeland Security programs
    will now have to be underfunded because of the loss of grant
    money? If each of you could take a second and give us an idea.
        Mr. Reiskin. I will start. As I mentioned, we had
    identified about $250 million worth of need and submitted an
    application for $188 million. We didn't expect to get an award
    of $188 million. But all $188 million represents things we
    think are important in advancing the safety and security of the
    region. We now have $46.5 million. So about three-quarters of
    what we had proposed won't get done.
        One major thing I will mention, about $42 million was in
    the area of interoperable communications. Of that, I think $25
    million was to continue the basic infrastructure that we are
    building, a secure, robust, dedicated network for interoperable
    communications. That $42 million alone is the entire amount.
        Chairman Tom Davis. Mr. Crouch, what will be underfunded in
    Virginia, do you think?
        Mr. Crouch. Thank you, Mr. Chairman.
        As Mr. Reiskin indicated, we had identified $188 million in
    grant programs. We have already gone into a process
    anticipating that we wouldn't get that amount, certainly, to
    reduce the amount down to $121. That is pretty much where we
    are in our analysis at this point. So as Deputy Mayor Reiskin
    pointed out, we are going to have to look at that $121 million
    and reduce it to the $46 million.
        I mentioned some of the meritorious programs we are looking
    at earlier, the WMATA operations center backup, the fire
    assistance for the tunnels, programs to deal with special
    needs. All of the programs that were submitted had merit to get
    as far as they did in terms of our submission, and again, they
    had tremendous stakeholder and local first responder
    participation in their development.
        We will now have to begin the process of determining what
    programs we eliminate, whether we can partially fund some with
    anticipation of sustaining them in the future and accomplishing
    those goals but at a slower pace.
        So to identify a specific program at this time, Mr.
    Chairman, I am not able to do that. But, obviously, we think
    all of the programs, the projects that were presented, had
    merit, and obviously, we are not going to be able to proceed
    with all of those.
        Mr. Schrader. Three things will be difficult. We have been
    working closely with Prince George's County to help them with
    their radio system. It will make it more difficult. Our
    Critical Infrastructure Resilience Program, reaching out to the
    private sector and getting the private sector organized in
    Maryland will probably be affected. Then the last thing, we
    have a major focus on maritime security in the maritime
    channels leading up to the Capital Region which would be of
    concern.
        Chairman Tom Davis. Thank you.
        I am sorry, did anybody else want to add anything?
        Mr. Robertson. One addition is that the regional system
    education campaign I think will be quite vulnerable. We cannot
    educate our citizens on a cyclical, every 2 or 3 years, basis.
    We have to do that on an ongoing sustained basis.
        Chairman Tom Davis. Thank you.
        Mrs. Maloney.
        Mrs. Maloney. Thank you, Mr. Chairman.
        Mr. Foresman, if I could ask you, did Booz Allen Hamilton
    give the Department of Homeland recommendations on how to rank
    urban areas based upon information that they gathered from the
    peer review process?
        Mr. Foresman. Congresswoman, Booz Allen Hamilton, just so I
    am clear, they facilitated the peer review groups. Each one of
    the investments were reviewed, and then they were reviewed as a
    package. Booz Allen did the facilitation and rolled up the data
    and gave it to the Federal team members. But the Federal team
    members were there with the peer review process. They did the
    administrative backbone work, if you will, the typing and
    printing and copying and that type of thing.
        Mrs. Maloney. But they did gather together the information
    they had from this peer review process and gave it to the
    Department of Homeland Security; correct?
        Mr. Foresman. Yes, ma'am.
        Mrs. Maloney. And did the Department of Homeland Security
    follow the recommendations of Booz Allen Hamilton?
        Mr. Foresman. They were not Booz Allen Hamilton
    recommendations. They were the peer review recommendations that
    Booz Allen Hamilton was responsible for simply documenting as
    an administrative support function.
        Congresswoman, I will go back. I do not believe there were
    any deviations from the peer review process, but let me provide
    you a clear written response so that I am very accurate on
    that.
        Mrs. Maloney. So you believe they did follow the peer
    review process data compiled and presented to the Department of
    Homeland Security. May this committee have copies of the data
    and the rankings that were provided to the Department of
    Homeland Security from Booz Allen Hamilton that compiled it
    from the peer review process?
        Mr. Foresman. Congresswoman, we are in the process of
    providing Chairman King with a significant amount of
    information. Let me sit down with the internal folks. The
    Secretary and I are committed to being as transparent as we
    can. The only two areas that we are trying to find the right
    accommodation is the classified information, and of course,
    Congress knows how to deal with classified information. That is
    easier.
        And then on the peer review process, peer review processes
    are widely used among Federal agencies. We want to make sure,
    if there were confidentiality agreements with these folks, that
    we respect those agreements. But we will seek to get you
    everything you are looking for.
        Mrs. Maloney. You will provide that information to Mr. King
    and Benny Thompson of the Homeland Security Committee?
        Mr. Foresman. Congresswoman, we have already set the first
    delivery over this past Friday, I believe, the first round of
    material. But we want to get a whole bunch of different
    material and provide it. I mean, we do. We have every reason to
    be very transparent with this process.
        Mrs. Maloney. Was it the peer review process that ranked
    the applications of D.C. and New York City in the bottom 25
    percent?
        Mr. Foresman. The peer review process provided the relative
    measures. How they were actually ranked against it was, you had
    17 peer review teams, and all of this data had to be
    corresponded because one peer review team didn't do all of the
    applications. So just from a simple administrative standpoint,
    someone had to take the findings from the 17 peer review teams
    and mix it altogether to create the ranking, if you will, as
    you describe it.
        Mrs. Maloney. So it was the peer review that ranked New
    York and D.C. in the bottom 25 percent. So my real question
    then is, how in the world can they make a determination of the
    risk and need of D.C. and New York City and others if they, as
    you testified earlier, do not have access to security clearance
    and to real-time threat analysis?
        Mr. Foresman. Congresswoman, I did not testify earlier that
    they did not have access to it. I told you I would provide to
    the committee a written response just to be clear on it. What I
    was offering to you earlier----
        Mrs. Maloney. I was told they did not have access to it.
        Mr. Foresman. Congresswoman, I want to make sure we are
    dealing with facts and not what people have been told, because
    that has led to some emotional debate, and I want to be very
    accurate with you.
        Mrs. Maloney. I would appreciate it if you would let us
    know how many had security clearances.
        Mr. Foresman. Absolutely, but it is not relevant to the
    evaluation of the effectiveness piece. Let me just be very
    clear about that.
        Mrs. Maloney. Recently we had a hearing on the 9/11
    Commission, and both former Governor Kean and Lee Hamilton, a
    bipartisan commission, testified that the best way to combat
    terrorism was intelligence, and that this should be our focus.
    That is why Congress revamped our entire intelligence system
    now into the National Intelligence Director. They also
    testified that the biggest threat that our country faces is a
    so-called dirty bomb, nuclear bomb, set off in New York City.
        My question is, did the peer review council read the 9/11
    Commission report? Did they take into account the intelligence
    efforts of localities which our experts say is the place we
    should be putting our money and our effort in combating
    terrorism? Zarqawi apparently was captured through
    intelligence. We have prevented several attacks that people
    were plotting in New York based on intelligence. We have an
    anti-terrorism intelligence center that works on this.
        I want to know, in your ratings, did you give a higher
    rating to the possibility that a nuclear bomb would go off in a
    particular area and kill hundreds of thousands of people, or
    how was this decision made? Was that part of the rating, since
    the experts say that is our No. 1 threat to our country at this
    point?
        Mr. Foresman. Congresswoman, two parts to that. First, on
    the intelligence piece, you know, both the co-chairs of the 9/
    11 Commission are on point with regard to intelligence, and it
    is because of that, because we are following their
    recommendations and other commission recommendations, that we
    have better intelligence, we have better analytical
    understanding of threats.
        Mrs. Maloney. Was that part of the formula?
        Mr. Foresman. That is where I am going to. Congresswoman,
    it was part of the formula, because in order to get to
    consequences, we have to understand the consequences of a wide
    range of plausible scenarios in metropolitan areas.
        But let me be clear again: New York City is at the top of
    the risk ranking. It doesn't own exclusive risks. Chicago, LA,
    and other metropolitan areas do as well, and they also have
    active threats. We have actually seen active investigations
    elsewhere. So, you know, there are statements, and then there
    are facts, and what we are trying to use are factual data to
    inform our risk analysis.
        Chairman Tom Davis. The gentlelady's time has expired.
        Mr. Clay.
        Mr. Clay. Thank you, Mr. Chairman.
        Mr. Foresman, I have major concerns about fiscal
    responsibility and funding management in regard to these
    grants. Can you tell us how your agency is addressing these
    concerns and what standards have been put in place to ensure
    proper utilization of funds? And, if you could, do you have any
    examples of waste and abuse in this grant program?
        Mr. Foresman. Congressman, my most glowing example is the
    exact reason that we are here today. It is because we simply
    didn't provide funds to urban areas based on some formula and
    send the dollars out the door and say, come back to us and
    report. We asked them to provide various specific investment
    justifications of how the dollars will produce tangible
    results.
        I will tell you that I am actually quite proud of the men
    and women in State and local governments across America. While
    there have been isolated cases of fraud and abuse, I will tell
    you the vast majority of expenditures that I have personally
    seen with these Homeland Security funds have measurably
    improved the safety and security of America. I will tell you, I
    think the rule is the vast majority of these funds are used
    very effectively for their intended purposes.
        Mr. Clay. Thank you.
        Secretary Chertoff has testified before this committee that
    DHS analyzes risk using a three-dimensional matrix. One of our
    colleagues, Ms. Matsui, wrote to Secretary Chertoff asking
    about how the Department assessed risk for her district in
    Sacramento.
        Let me quote from the reply she got: The Department is
    continuing to develop a more robust risk model as it gains the
    capabilities to increase its knowledge of interdependency,
    cascading effects and refined data sets. These issues are
    currently being studied to provide both sector-specific and
    cross-sector modeling through a suite of consequence analysis
    and decision support tools.
        Can you translate this into plain English for me?
        Mr. Foresman. Congressman, I can.
        The tone and tenor of that response is that--and I think
    the question may have come for two reasons: one, because
    Sacramento is one of those areas that was deemed, because of
    the new relative risk ranking, to go off of UASI after this
    current year. The second piece, and I am not sure, I haven't
    seen the specific correspondence, we have had issues with
    levies up there, and we have gotten some letters about, do you
    consider natural disasters and terrorism risks at the same
    time?
        But if it is strictly in the context of the terrorism
    piece, it is because our understanding of the risk nationally
    has changed in other urban areas. From a relative standpoint,
    it has put Sacramento a little lower on the list.
        If we need to get her a clearer response, I will be more
    than happy to take personal charge of getting that done.
        Mr. Clay. Thank you very much.
        Chairman Tom Davis. Mr. Clay, unfortunately, we have to get
    the bus over to the Pentagon, which leaves in 3 minutes.
        Mr. Clay. I understand.
        [The prepared statement of Hon. Wm. Lacy Clay follows:]
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        Chairman Tom Davis. I appreciate it. I hate to cut you
    short. A lot of this is Mr. Moran's district. Would you yield
    to him for 1 minute? If you have any questions for the record,
    you can submit them.
        I ask unanimous consent that Resolution 16677, passed
    unanimously by the Council of the District of Columbia,
    resolving that Homeland Security funding be targeted to the
    highest threat jurisdictions be put into the record.
        Without objection, so ordered.
        Mr. Moran.
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        Mr. Moran. I thank my good friend from Missouri and the
    chairman.
        We have had the hearing now, and you have explained and
    justified and excused your decisions. But what do we do now?
    Where do we go? Might you consider requesting a supplemental
    appropriation to address these needs? Are there other programs
    we could apply to? We need to know more than just an
    explanation. We need to know, what is the next step that we
    should pursue? You heard the needs, and I would like to get
    some guidance.
        The reason our first responders are in decent shape in
    northern Virginia, or at least were for the first couple years,
    Mr. Davis, Mr. Wolf and I earmarked money. Maybe that is what
    we need to do in the future, is just earmark the money to make
    sure it goes to our Nation's priorities.
        Can you give us a quick response? What you would do if you
    were us?
        Mr. Foresman. Congressman, three quick responses for you.
    First, we had $7.5 billion worth of requests for a both pot of
    money that was about $1.7 billion this year. That gives us some
    measurable level of understanding of the scope of the need out
    there.
        Second, we will hopefully, assuming the budget process goes
    forward, we will have the 2007 grant programs. I am committed
    to moving those out the door much quicker and much more
    effectively than we have done in the past. So I hope to have
    those out the door, assuming the budget process goes forward
    quickly, early in the fall.
        And there are other grant programs. We will continue to
    work with the folks here in the NCR to identify those other
    grant programs that may be able to help them address some of
    these issues.
        Chairman Tom Davis. That would be very helpful, if we can
    look at some of these other programs, given their reliance and
    the fact this is the first year we changed it.
        Mr. Moran, I appreciate the question.
        I want to thank you all for being up here.
        Mr. Foresman, thank you particularly for being up here and
    being the chief flak catcher today.
        The committee stands adjourned.
        [Whereupon, at 12:55 p.m., the committee was adjourned.]
        [The prepared statements of Hon. Edolphus Towns, Hon.
    Elijah E. Cummings, and Hon. C.A. Dutch Ruppersberger, and
    additional information submitted for the hearing record
    follow:]

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