[Senate Hearing 109-]
[From the U.S. Government Publishing Office]



 
  COMMERCE, JUSTICE, SCIENCE, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2007

                              ----------                              


                        WEDNESDAY, APRIL 5, 2006

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:02 p.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Richard C. Shelby (chairman) 
presiding.
    Present: Senators Shelby, Stevens, Mikulski, Leahy, Kohl, 
Murray, and Harkin.

                         DEPARTMENT OF JUSTICE

                     Office of the Attorney General

STATEMENT OF HON. ALBERTO R. GONZALES, ATTORNEY GENERAL


             opening statement of senator richard c. shelby


    Senator Shelby. The subcommittee will come to order.
    I want to welcome Attorney General Alberto Gonzales to the 
subcommittee. He has been here before. And also, my second 
panel, we will have the Federal Bureau of Investigation 
Director Robert Mueller, Drug Enforcement Administration 
Director Karen Tandy, Bureau of Alcohol, Tobacco, Firearms and 
Explosives Director Carl Truscott, and U.S. Marshals Service 
Director John Clark who will be appearing before the 
subcommittee this afternoon.
    Mr. Attorney General, in reviewing the Justice Department's 
budget request and anticipating the budget constraints weighing 
upon us due to the war on terror and the natural disasters that 
devastated the gulf coast, I believe it will take your unified 
leadership to make the tough choices regarding the allocation 
of scarce resources in this bill.


                    fiscal year 2007 budget request


    The fiscal year 2007 budget request for the Department of 
Justice is $20.8 billion and represents a 0.5 percent decrease 
over the fiscal year 2006 enacted level. While this request 
proposes increases for the FBI, the U.S. attorneys, and the 
U.S. Marshals Service, it proposes cuts to local law 
enforcement assistance programs and other critical areas that 
are troubling. In particular, it recommends a $1.6 billion 
decrease for State and local law enforcement programs. It 
proposes to rescind $142 million for the construction of two 
new Federal prisons and includes the same failed $120 million 
mandatory fee on explosives manufacturers to fund the day-to-
day operations of critical law enforcement activities.
    The budget request for the FBI provides $6 billion, an 
increase of 6 percent over the fiscal year 2006 enacted level. 
As the former chairman of the Senate Intelligence Committee, I 
know firsthand the challenges facing the Bureau's new national 
security branch, which is responsible for coordinating 
intelligence activities with the Director of National 
Intelligence. The Bureau's budget request seeks to permanently 
realign 300 special agent positions from criminal 
investigations to counterterrorism, to support the work of the 
NSB.
    This shift in resources signals the importance of 
reprioritizing funding and personnel to the threat of 
terrorism. However, this realignment may not go far enough, as 
the budget request only adds one new agent position for this 
upcoming year. Instead, the FBI budget funds a variety of 
technological improvements for intelligence infrastructure, 
information technology management, information technology 
infrastructure, and the next generation of the much-maligned 
Trilogy program.
    This subcommittee and the Bureau share the difficult task 
of targeting these resources in a manner that safeguards 
taxpayers' dollars while preserving public safety.
    The FBI's former $537 million technology initiative, 
Trilogy, while providing primitive functionality, was hardly a 
sound investment for the taxpayers. I was disappointed to learn 
that after spending in excess of $170 million, Trilogy's 
Virtual Case File system was basically a failure. This 
represents a devastating blow to the information technology 
needs of the FBI.
    The 2006 Government Accountability Office Trilogy report 
raises serious questions about the FBI's ability to oversee and 
to build any type of information technology system. The FBI's 
new technology initiative, Sentinel, like Trilogy, promises to 
bring the FBI into the 21st century. This new technology, I 
believe as you do, is critically important, but I remain 
concerned that the FBI does not possess the necessary project 
management expertise, nor do I feel that the FBI has applied 
lessons learned from past mistakes. We hope so.
    And while I support and realize the importance of 
information technology to the FBI's mission, as you do, I 
cannot support unlimited and unchecked resources. I do not 
believe this subcommittee would do that. We will not tolerate 
broken promises for results that were never realized or 
delivered, such as Trilogy.
    Given one failed attempt, Mr. Attorney General, I believe 
it is imperative that you proceed with caution to ensure that 
the FBI does not make the same mistakes. I expect results. We 
do here, and I will do everything we can to ensure there is a 
thorough congressional oversight for this program.
    The budget request for the Bureau of Alcohol, Tobacco, 
Firearms and Explosives imposes a $120 million tax on 
explosives manufacturers. I want to point out that even if 
Congress passed this proposal today, it would take the 
Department 2 years, I have been told, to begin collecting the 
fee. If this were true, I do not understand how the Department 
of Justice proposes to use the receipts from this fee to offset 
the 2007 ATF budget.
    This $120 million hole is just one example of many 
contained in this budget request. These shortfalls force the 
subcommittee to make extremely difficult choices that undermine 
our ability to fund critical budget increases for hard working, 
as you have, Department of Justice law enforcement agencies.
    While we believe that your new initiatives are extremely 
important, Mr. Attorney General, it will be difficult to give 
them consideration when the subcommittee must weigh this 
request with the numerous proposed rescissions, cuts, and 
eliminations of local law enforcement programs. State and local 
law enforcement agencies are the foundation of our Nation's law 
enforcement community. You know this as the former attorney 
general in Texas.
    These proposed cuts have the potential to significantly 
weaken the ability of these agencies to protect our communities 
from traditional crimes, to maintain vigilance in the war on 
terror and to prepare for catastrophic disasters. Continually 
proposing major reductions for local law enforcement assistance 
programs will cripple the police and sheriffs' departments 
which are fixtures in our Nation's communities.
    For the second year in a row, the Federal Bureau of Prisons 
has disregarded explicit congressional direction to construct 
new prisons in McDowell, West Virginia, and Burlington, New 
Hampshire. This year's proposed $142 million rescission, 
combined with last year's $314 million rescission, totals $456 
million in previously appropriated funding for the construction 
of additional correctional institutions. Not only are we facing 
significant prison overcrowding here in the country, but the 
Bureau of Prisons projects, according to what they tell us, 
approximately 8,500 new prisoners will enter the Federal system 
this year alone.
    I look forward to hearing from you, Mr. Attorney General, 
first, and then the others later about your visions and the 
challenges that you see.
    Senator Mikulski.


                STATEMENT OF SENATOR BARBARA A. MIKULSKI


    Senator Mikulski. Thank you very much, Mr. Chairman, and I 
once again, as we open our hearings on the Commerce, Justice, 
Science appropriations we look forward to working with you on a 
bipartisan basis to achieve important national goals in terms 
of public policy and yet be stewards of the Federal purse.
    We want to welcome the Attorney General and our top law 
enforcement team from the FBI, DEA, ATF, and of course, the 
Marshals Service. Mr. Attorney General, I know we are anxious 
to get to your testimony, but we want to welcome you. We know 
that you said your goal was to help secure the American dream 
for all Americans and to keep America safe. We want to work 
with you to do that.
    Your Department is responsible for protecting America, for 
your Department is one of the agencies responsible for 
protecting America from a predatory attack by international or 
even domestic terrorists and at the same time protect Americans 
from predatory attacks in our own neighborhood, whether they 
commit arson against those people in our community trying to 
buy a home for the American dream; whether they are the sexual 
predators stalking and betraying children on the Internet; or 
whether they are the drug kingpins coming into our community. 
We need to protect America.
    We are concerned, as we look at all of this and the 
national goals about some of the aspects of the budget, but 
before we get into the cuts that I am concerned about, we 
understand that when we look at counterterrorism, which we know 
is one of your priorities, the FBI does get the largest 
increase to pay for investigations and technology upgrades.
    I share the flashing yellow lights and flashing impatience 
that has been shared with you by the chairman. I have met with 
the director of the FBI on our new approach to the case 
management system, and we are satisfied that a framework has 
been put in place that we can begin to get the best value in 
technology and the best value for the taxpayers' dollar. I want 
to work with the chairman and with the director on important 
oversight of this system.
    At the same time, we do know that while we are upgrading 
the technology, we need to upgrade our agents and make sure 
that they have the best training. I am concerned that the 
facilities at Quantico are aging, that they are tattered; that 
while our agents are being brought in that we need to be sure 
that where we train them and how we train them is as modern as 
the mission that we have given them.
    In the areas of agreement, we agree with you on reducing 
gun violence, ridding our streets of gangs, and keeping the 
Internet safe for our children, and protecting our fair 
housing. Those are your national goals, and we want to work 
with you on that. Yet, what we are concerned about is the cuts 
to local law enforcement. In my time, I would just like to 
focus on that, because your national goals, I will get to in 
there, but no matter how great the FBI, ATF, DEA is, they have 
to rely on local law enforcement. There is just not enough 
agents. There will never be enough agents. They have to be the 
cops on the beat, and they have to be trained. They have to be 
equipped, and they have to be ready to work with the kind of 
talent that we are asking.
    In my own hometown in Maryland, because we are in the 
Capital region, we fear a predatory attack from terrorists, and 
at the same time, we have one of the highest heroin addiction 
rates in the country, and we need DEA, and ATF has come to our 
rescue in helping to find people who are trying to burn down 
the homes of African-Americans moving into new neighborhoods.
    So we worry, though, that because the people that were 
caught were caught by local law enforcement, we are concerned 
about the cuts of several hundreds of millions of dollars in 
the Byrne grants and in other local law enforcement areas. So 
we want to hear from you how you think that is going to work, 
because as I said to you privately, and I said to you publicly, 
all of these members will feel this pressure.
    We do not want to be into the mother of all earmarking. And 
we are concerned that if the communities cannot get their money 
for their policemen through a grant program that is peer 
reviewed, based on competition, granted on merit, they come to 
us to be able to do this, to fight crime, upgrade their 
technology, gang initiatives, and also deal with this 
horrendous challenge of meth that is sweeping this country.
    So we need to find a way and a wallet to really deal with 
the local law enforcement that is the underpinnings that 
support in many ways the efforts of our very talented Federal 
law enforcement and the variety of agencies that they have. So 
let us work on those national goals, but really, the gang 
fighting, so many of these things, are done at the local level.
    So, Mr. Chairman, we will follow this up in more extensive 
conversations.
    Senator Shelby. Thank you.
    Senator Stevens.


                    STATEMENT OF SENATOR TED STEVENS


    Senator Stevens. Well, thank you very much, and welcome, 
Mr. Attorney General. I have another committee meeting, as a 
matter of fact, but I came to emphasize what Senator Mikulski 
has already addressed, and that is this methamphetamine. The 
COPS meth hot spots program was authorized for $99 million. 
This is a scourge as far as rural America is concerned. And I 
have got a question I would like to submit for the record and 
appreciate your answers, Mr. Attorney General.
    Thank you very much.
    Senator Shelby. Senator Leahy.


                 STATEMENT OF SENATOR PATRICK J. LEAHY


    Senator Leahy. Mr. Chairman, I will put my whole statement 
in the record so we can go to the witnesses.
    Senator Shelby. Without objection.
    Senator Leahy. I would say that I am concerned, and I will 
raise this in my questions, about the budget cutting of funds 
for proven anti-crime and anti-drug and community safety 
efforts. They make a difference in your State, my State, 
Vermont and elsewhere. I see programs slated for elimination. 
Cuts include Byrne and the COPS grant, something every police 
department has benefitted from; the crime victims fund, the 
bullet proof vest partnership that Senator Ben Nighthorse 
Campbell and I started; the Violence Against Women Act 
programs; boys and girls clubs.
    We have unlimited amounts of money to build up everything 
that they want in Iraq. I think we should be worried more about 
crime victims and rank and file police in the United States.
    I will also ask questions about what, in heaven's name, we 
are allowing somebody as careless as ChoicePoint to get control 
of our data, but I will put my whole statement in the record, 
Mr. Chairman, and I will ask those questions.
    Senator Shelby. Without objection, so ordered.
    [The statement follows:]

             Prepared Statement of Senator Patrick J. Leahy

    Mr. Chairman, I join you, the ranking member and our colleagues in 
welcoming all of our distinguished witnesses who are here to testify 
before our subcommittee today on the Justice Department's fiscal year 
2007 budget. I particularly want to welcome Attorney General Gonzales 
and FBI Director Mueller, both of whom I see from time-to-time when 
they come before the Judiciary Committee for oversight hearings. Today, 
however, I am here to wear my appropriator's cap and listen to them 
describe and attempt to justify the Justice Department budget request 
for the coming year.
    During recent years, the Justice Department has confronted the 
daunting challenge of protecting our Nation against international 
terrorism in the wake of the attacks of September 11, 2001, the 
subsequent anthrax attack and other threats. All the witnesses before 
us today deserve credit for their efforts to assure the safety of the 
American people.
    I was disappointed to see, however, that the administration's 
fiscal year 2007 Justice Department budget request calls for deep cuts 
in crime prevention programs that State and local police and sheriffs' 
departments have long relied upon, including key efforts such as Byrne 
Grants, the Crime Victims Fund, the Bulletproof Vest Partnership 
Program, and the Violence Against Women Act programs. This budget would 
undermine proven anti-crime, anti-drug and community safety efforts 
that are making a difference in Vermont and in communities across the 
Nation. These budget priorities are out of whack. This budget puts more 
tax cuts for the rich at the front of the line, while leaving behind 
crime victims, local police and boys and girls clubs. This is simply 
irresponsible and wrong.
    In the wake of terrorist attacks, I recognize that the Justice 
Department focused much of its attention on the prevention of terrorism 
and the promotion of national security. Its top priorities continue to 
be the prevention, investigation and prosecution of terrorist 
activities against U.S. citizens and interests, which is evident in the 
request for $318.5 million in new investments for the FBI, including 
counterintelligence activities and justice information systems 
technology. Unfortunately, the FBI has not always been a good steward 
of those resources.
    It has been almost a year since the FBI announced it would have to 
scrap the $170 million IT project known as the Virtual Case File (VCF). 
I have repeatedly expressed my deep frustration and concern over the 
millions wasted on ``lessons-learned'' and the fact that more than 2 
years have passed since the original deadline; however, these 
technology goals are not yet met.
    In the year since the FBI announced the VCF's successor, the 
Sentinel program, I have seen nothing to boost my confidence in the 
Bureau's ability to manage the status and cost of this project. We 
learned recently that the FBI estimates that Sentinel will cost the 
American taxpayers $425 million to complete and that the full Sentinel 
system will not be deployed until 2009. The FBI has asked Congress to 
commit $197 million to the project between this year and the coming 
year, but it is already behind schedule and the FBI has yet to solidify 
its IT goals and plans for achieving them. The President's fiscal year 
2007 Budget proposes another $100 million for the Sentinel project. We 
must ensure that the FBI's technological capabilities keep pace. To do 
so requires an emphasis not just on providing funds, but also on 
effective use and implementation. I hope the latter is not neglected.
    No one will argue over the importance of counterterrorism programs. 
Nonetheless, I am concerned that the DOJ's traditional duties have 
recently garnered too little attention and support. The Justice 
Department must lead the Nation in deterring, investigating and 
prosecuting gun, drug and civil rights violations; incarcerating 
offenders; partnering with State, local and community groups to prevent 
crimes; and providing leadership and assistance in meeting the needs of 
crime victims. In recent years we have seen an end to the downward 
trend in violent crime, with rates leveling out instead of continuing 
to decrease. We must not allow daily responsibilities that keep our 
citizens safe to fall aside.
    The President claims that he wants to ensure that our State and 
local police receive the resources necessary to do the job the American 
public expects them to do. I am truly frustrated to see, however, that 
he proposes the elimination or reduction of funding by $1.31 billion, 
or 52 percent cut, for programs crucial to State and local law 
enforcement and terrorism prevention. As a Senator from a rural State 
that relies in part of Federal grants to combat crime, I am deeply 
concerned about these cuts.
    Under this budget, we would see an end to Byrne Memorial Justice 
Assistance Grants, which Congress recently reauthorized by law to 
provide vital grant funding to States to improve the functioning of the 
criminal justice system, as well as a $23.3 million cut COPS programs. 
Police departments nationwide would experience severe reductions in 
equipment and support staff grants to combat illegal drugs. In my home 
State, these programs have provided vital funding for the Drug Task 
Force, which combats the growing problem of heroin use and trafficking, 
as well as keeps the production and use of highly addictive 
methamphetamine from infiltrating Vermont's borders.
    The Bulletproof Vests Partnership Grant Program plays a vital role 
in distributing lifesaving bulletproof vests to law enforcement 
officers serving in the front lines nationwide. I am proud to have 
authored with our former colleague, Senator Campbell, the charter to 
create this program that saves lives and spares injuries of law 
enforcement officers nationwide by providing more help to State and 
local law enforcement agencies to purchase body armor. The Vests 
Partnership is authorized to allow for $50 million per year through 
fiscal year 2009 so that this successful program can continue to help 
protect the lives of State and local law enforcement officers. Indeed, 
it is so successful that since 1999 it has provided law enforcement 
officers in more than 11,900 jurisdictions nationwide with nearly 
450,000 new bulletproof vests.
    The President's budget, however, proposes to drastically reduce 
funding of this program by almost $20 million, or by 67 percent. This 
proposal comes at a time when the Bulletproof Vest Partnership Program 
is needed more than ever. Compounding the usual funding demand for help 
to purchase vests, concerns over the effectiveness of Zylon-based body 
armor vest have resulted in an estimated 200,000 of these vests needing 
to be replaced. Across our Nation, law enforcement agencies are 
struggling over how to find the funds necessary to replace defective 
vests that are less than 5 years old with ones that will actually stop 
bullets and save lives. We should be making sure that every police 
officer who needs a vest gets one.
    Two more points I would like to make: The Boys and Girls Clubs of 
America--a proven and growing success in preventing crime and 
supporting our children--would have its budget reduced by $25 million, 
a 30 percent cut. Finally, the President proposes to drain all amounts 
remaining in the Crime Victims Fund at the end of fiscal year 2007. 
This represents an estimated cut of $1.255 billion, and will place 
crime victim service programs in serious jeopardy. These cuts send the 
wrong message to our children and crime victims.
    Now is not the time to eliminate initiatives that we know to be 
effective in the prevention, enforcement and aftermath of crime. 
Strengthening security, information sharing and disaster response 
programs to combat terrorism must not totally overshadow the prevention 
of more traditional crimes.

    Senator Shelby. Senator Harkin.

                    STATEMENT OF SENATOR TOM HARKIN

    Senator Harkin. I just wanted to make one point. Mr. 
Attorney General, just echoing what Senator Mikulski and 
Senator Stevens were saying. Methamphetamine. I was looking 
through your statement, there are drastic cuts in the COPS 
program and in the Byrne grant program, and when my question 
comes around, that is what I want to focus on. Because I see no 
justification for this. We are just having the rug pulled out 
from underneath our local law enforcement by submitting a 
budget that zeroes out the Byrne grant program. I will have 
more to ask you about that when my question comes around.
    Thank you, Mr. Chairman.
    Senator Shelby. Senator Kohl.
    Senator Kohl. Mr. Chairman, in order to expedite getting to 
our witnesses, I will forego an opening statement.
    Senator Shelby. Without objection, so ordered.
    Senator Murray.

                   STATEMENT OF SENATOR PATTY MURRAY

    Senator Murray. Thank you, Mr. Chairman, and Ranking Member 
Mikulski for holding the hearing and Attorney General Gonzales 
and all the witnesses today. Like my colleagues, I just want to 
say that I have some serious concerns about the cuts to the 
Byrne grant and COPS programs. These programs really help 
reduce crime in communities all across this country, and Byrne 
grants in particular have allowed my State, the State of 
Washington, to take on the meth epidemic with some real 
resources. And I am proud to say that Washington State is now 
the national model in the fight against meth.
    You know, States from all over the country have been 
talking to leaders in law enforcement and education and 
treatment in my State about how to create similar comprehensive 
efforts to stop meth in their States. But Washington State got 
to be a leader in the fight on meth by showing that 
partnerships work, and not just partnerships between law 
enforcement and education and treatment community but 
partnerships at all three levels of the Government: Federal, 
State, and local jurisdictions. And there is no question that 
the Federal resources from COPS and the Byrne grant help these 
partnerships grow and become really a keystone in the fight 
against drugs.
    At the same time that police officers are retiring, and 
local funding has dried up for our drug task force, this 
administration wants to close the door on law enforcement, and 
I know that this subcommittee will hear about some newfound 
efficiencies and better partnerships. But let me be clear: any 
solution that lets the criminals win is not a win in my book.
    Speaking of meth, I want to just say that I am very 
concerned that the Department of Justice is not doing enough, I 
believe, to stop the spread of methamphetamine and other 
synthetic drugs. Although efforts in our States to increase 
precursor control and the passage of the Combat Meth Act are 
going to help, drug cartels are now flooding the market with 
meth.
    So just as we are now succeeding to stop some of the 
smaller mom and pop operations, we are now seeing these cartels 
use their immense resources and drug distribution chains to 
bring meth back into our neighborhoods and meet the demand that 
is out there. So I hope to hear this afternoon how you and 
Administrator Tandy are working on taking on those drug cartels 
to help stop this.
    Finally, I just want to mention, we have talked before, you 
and I, about the needs of local jurisdictions along our 
northern border. In Washington State, our northern border 
counties are spending millions of dollars on cases that are 
initiated by Federal agencies. Whether it is Customs or ICE, 
our Federal agencies are increasing the numbers of criminals 
that they bring into these local courts and detain in our local 
jails. And the U.S. Attorney's Office has been unable to meet 
the demand and often declines these cases and refers them 
directly to cities and counties for processing and prosecution.
    Whatcom County, which is on our northern border just across 
the border from Vancouver, British Columbia, is now spending 
over $2 million a year to process these federally initiated, 
declined, and deferred cases. So we have county sheriff offices 
who are unable to serve warrants now because their jails are 
full, and I hope that we can continue to work together to help 
the northern border communities so that our local communities 
are not forced to let their criminals go free because the 
Federal agencies are now forcing them to take more and more of 
these border related cases.
    This is really an equity issue, because as you know, along 
the southwest border, there is a program to reimburse those 
local costs associated with the criminals caught on the border, 
and I think it is time we fixed this problem and created a 
sister program to the Southwest border prosecution initiative 
to help States like mine and Alaska, New Hampshire, Vermont, 
Wisconsin, other northern border States that are facing the 
same problem.
    So I hope that we hear from all of you today about how your 
departments and agencies are finding better ways to partner 
with our local jurisdictions and working with our communities 
to help our neighborhoods be safe. And I think we can continue 
to create some success stories if we have increased law 
enforcement partnerships at the local, Federal, and State 
level.
    Thank you, Mr. Chairman.
    Senator Shelby. Attorney General, welcome again to the 
subcommittee. Your written testimony will be made part of the 
record. You may proceed as you wish.

             SUMMARY STATEMENT OF ATTORNEY GENERAL GONZALES

    Attorney General Gonzales. Good afternoon, Mr. Chairman, 
Ranking Member Mikulski, and members of the subcommittee. First 
of all, Senator Mikulski, congratulations on last night's great 
victory.
    The men and women of the Department of Justice are working 
every day to secure the opportunities of the American dream for 
all Americans. As Attorney General, I want to ensure that our 
neighborhoods are safe, secure, and prosperous. This is an 
enormous goal and one that we have made steady progress on over 
the past few years.
    Today, I present the President's fiscal year 2007 budget 
for the Department. Mr. Chairman, in an administration that is 
committed to controlling overall Government spending, this 
budget prioritizes our top public safety needs. This is a 
budget that builds on our expertise, launches new programs, and 
eliminates or cuts programs that have not met our high 
standards. It focuses State and local assistance on priorities 
established by the administration and by Congress.

                    COUNTERTERRORISM INVESTIGATIONS

    Included in this $19.5 billion budget are the Department's 
six major priorities for the coming year. Our highest priority 
is to stop the terrorists who seek to destroy the American 
promise of liberty and prosperity. Waging the war on terror has 
been among the most difficult challenges that the Justice 
Department and the Government have ever undertaken. But we have 
made great progress, as evidenced by the hundreds of 
convictions we have obtained in terrorism-related 
investigations and by the terror cells that we have located and 
broken up from coast to coast.
    Still, we know that al Qaeda remains a threat. I want to 
thank Congress for reauthorizing the PATRIOT Act and providing 
resources in the war on terror. I look forward to your support 
of our effort to stand up the new National Security Division, 
which will enable us to house our counterterrorism and 
counterintelligence prosecutors side by side, making it faster 
and easier to connect the dots.
    The threat of terrorism is not going to go away, and 
neither is our commitment to do everything we can to stop it. 
And so, we are requesting over $330 million for new and 
directed counterterrorism and intelligence programs to protect 
our Nation from this continuing threat.
    Every American deserves to live free from the fear of 
violent crime. The President's Project Safe Neighborhoods is 
taking criminals off the streets and reducing gun and gang 
crime. Our efforts are working. Crime has plunged to 30-year 
lows, resulting in thousands of Americans who have not been 
threatened, have not been harmed, and have not been violated by 
gangs with guns. However, gang violence is still a problem, and 
this budget requests over $22 million in enhancements and 
almost $163 million in State and local grants to further 
liberate our communities from gang and gun crime.
    Illegal drugs poison children, destroy lives, and threaten 
the safety and the prosperity of our communities. 
Methamphetamine is particularly destructive, and the Department 
has worked harder than ever to combat methamphetamine over the 
past year. We have successfully dismantled some of the most 
deadly drug organizations that dump drugs into our 
neighborhoods. This budget requests almost $235 million in 
enhancements to stem the supply of drugs from overseas and 
secure our homeland and shut down our borders to illegal 
aliens.

                          CHILDSAFE INITIATIVE

    The Internet should be a safe, crime-free place for all 
Americans, especially our children. Our new Project Safe 
Childhood Initiative is designed to complement our other 
efforts to secure for every child the most important gift that 
we can give: a safe environment in which to live, grow, and 
learn.
    Through this initiative, we will identify, prosecute, and 
lock up those who victimize our children through the production 
and distribution of child pornography and those who use the 
shadow of the Internet to lure minors into sexual activity. In 
this budget, we seek more than $186 million to end the sexual 
exploitation of children and the proliferation of obscenity.

                         CIVIL RIGHTS DIVISION

    Securing the American dream requires protecting individuals 
from illegal discrimination, and I am pleased that the 
Department prosecuted a record number of criminal civil rights 
cases in the last 2-year period, but I am asking the Civil 
Rights Division to do even more: to vigorously protect our 
citizens' right to vote, to work, and to buy or rent a home 
free from discrimination. We are seeking over $113 million for 
the Civil Rights Division to accomplish these goals. We have 
also launched a new initiative, Operation Home Sweet Home, 
which expands our Fair Housing Act testing program.

                           HUMAN TRAFFICKING

    The Division is also focused on eradicating the modern day 
slavery of human trafficking. Prosecutions of this crime have 
increased over 300 percent during this administration, but even 
one victim is too many. In the coming year, we will continue 
our efforts to locate and rescue the victims of this atrocity.
    The sixth and final priority I want to emphasize is the 
Department's fight against Government and corporate corruption. 
Honesty and integrity in Government and in business are 
essential for a strong America. Prosperity cannot flourish if 
taxpayers and investors lose their confidence in these 
institutions. As part of our anticorruption commitment, more 
than 200 new FBI agents have been added in the past 3 years to 
anticorruption squads across the United States.
    Now, virtually all of these priorities require our Federal 
prosecutors to do more. Over the past several years, Congress 
has been supportive in providing law enforcement more agents 
and investigators to detect crime. But now that we have more 
cops on the street, we need more prosecutors in the courtroom 
to make sure that the criminals we identify are brought to 
justice. Accordingly, I am asking that you fully fund the 
budget for the United States Attorneys, to provide additional 
prosecutors to ensure justice in communities across the Nation.
    The priorities I outlined today in no way reflect all of 
our many important responsibilities. The Department serves as 
the Nation's chief prosecutor and litigator, representing the 
people of the United States in court not just to prosecute 
crime but also to enforce immigration laws, protect 
intellectual property, safeguard the environment, defend the 
laws that Congress passes, and protect the National Treasury 
against fraud.
    The Department also protects our communities by safely and 
securely confining all of the people in Federal custody. These 
are all tremendous responsibilities and require sufficient 
resources as well.
    Securing the American dream for all Americans is an easy 
thing to say, but it is a very difficult thing to do. In the 
past few years, America has been a safer, more secure place 
than it was a decade ago. We have faced many challenges, and we 
have made great strides. Others are still before us. You have 
my commitment that the men and women of the Department of 
Justice will work hard every day with the resources you provide 
to make the communities that we both serve as safe, secure and 
prosperous as possible.
    Thank you, Mr. Chairman.
    [The statement follows:]

               Prepared Statement of Alberto R. Gonzales

    Good afternoon Chairman Shelby, Senator Mikulski, and Members of 
the Subcommittee: It is my pleasure to appear before you today to 
present the President's fiscal year 2007 Budget for the Department of 
Justice (``Department'' or ``DOJ''). My goal as Attorney General is 
simple: Secure the opportunities of the American dream for all 
Americans and for future generations. It is a goal I am sure this 
Committee supports. But it is no small task and requires the hard work 
of thousands of Department officials stationed around the country and 
the globe. With your continued support, I have established priorities 
and initiatives to guide the Department's efforts in the coming year.
    My highest priority remains keeping America safe by using every 
tool at our disposal, consistent with our Constitution, to prevent 
another terrorist attack on our Nation. At the same time, the 
Department continues to investigate, prosecute, detain, and incarcerate 
federal criminals. We are currently focusing on top initiatives such as 
an aggressive anti-gang program that will help combat some of the most 
violent gangs in the country.
    In pursuit of these and other priorities, for fiscal year 2007, the 
President's Budget requests $19.5 billion for DOJ, including $330.8 
million in new investments for preventing and combating terrorism. The 
fiscal year 2007 budget further strengthens counterterrorism efforts by 
investing in essential intelligence infrastructure and information 
technology. The budget also includes many new, critical investments 
that will continue to make America a safer place for law-abiding 
American citizens and a tougher place for criminals. An integral part 
of our funding need is support for the United States Attorneys' 
Offices. The budget prioritizes funding for our most important goals 
and proposes reductions to some programs, many of which have not shown 
effective results.
    I also want to thank the Congress for reauthorizing the USA PATRIOT 
Act. The USA PATRIOT Act is a vitally important tool for the 
Department, and its reauthorization will help us prevent another 
terrorist attack.

                   PREVENTING AND COMBATING TERRORISM

    In the 5 years since 2001, the Department has requested and the 
Congress has provided significant resources for counterterrorism and 
intelligence activities. With these resources, the Department has 
accomplished a great deal. But we must never forget we are under 
constant threat. Al Qaeda leaders continue to remind us of their desire 
to attack our homeland and murder our citizens. We must continue to 
work together to stop terrorists before they strike. To that end, the 
Department remains open to productive suggestions on how to improve our 
organizational capacity to accomplish our counterterrorism mission. 
With the passage of the USA PATRIOT Act reauthorization, the Department 
is moving quickly to make operational the new National Security 
Division. Yesterday, I sent up to the Congress a reprogramming request 
for the National Security Division. I hope the Congress will support 
this request.
    The National Security Division was created in response to the 
recommendations presented by the Commission on the Intelligence 
Capabilities of the United States Regarding Weapons of Mass Destruction 
(WMD Commission). This major organizational change reflects the 
Department's commitment to building a structure that best supports our 
national security mission. The fiscal year 2007 budget includes $67 
million to fund the new National Security Division. This Division will 
combine the Counterterrorism Section and the Counterespionage Section 
from the Criminal Division with the Office of Intelligence and Policy 
Review (OIPR). The Division will be led by a new Assistant Attorney 
General for National Security who will coordinate all of the 
Department's counterterrorism, counterespionage, and intelligence work. 
This new Assistant Attorney General will also serve as the lead conduit 
for our activities with the Intelligence Community and the Director of 
National Intelligence.
    The requested increase would add 21 attorneys to OIPR and 12 
attorneys to the Counterterrorism and Counterespionage Sections of the 
National Security Division. These additional resources will assist the 
new Division in meeting the increased workload of intelligence searches 
and surveillances, and will ensure that the Department aggressively 
pursues cases involving trade in weapons of mass destruction.
    Over the past 5 year's, the FBI has developed a distinct 
Intelligence Program and hired and trained thousands of new Special 
Agents and Intelligence Analysts who have contributed to our continuing 
safety. The fact that there has not been another major attack within 
the United States borders since September 11th is a credit to the hard 
work of those individuals, working alongside our prosecutors and 
partners in law enforcement and intelligence. With the support of 
Congress, the Department has realigned millions in base resources to 
support these efforts. This budget requests additional, critical 
resources to further enhance our counterterrorism efforts, while 
continuing to realign base resources to wage the war on terror. The 
Department will use these resources to remain on the offensive, 
detecting and disrupting the enemies' plans and bringing terrorist 
operatives to justice.
    As the lead federal law enforcement agency for counterterrorism, 
the FBI's critical mission requires a significant amount of personnel 
and infrastructure. To maximize the effectiveness of the additional 
personnel resources Congress has provided in recent years, this request 
stresses the FBI's infrastructure needs. The request provides a total 
of just over $6 billion for the FBI, with enhancements of $319 million 
to support the following objectives: the continued development of our 
intelligence infrastructure, including increasing the number of secure 
facilities to conduct intelligence analysis; enhanced intelligence 
collection systems and training for a growing and diverse workforce 
that can act upon intelligence information; the continued development 
of the SENTINEL case management system, which will improve productivity 
and information sharing; and upgraded fingerprint identification 
systems to improve screening activities and identify more criminals and 
terrorists.
    Since 2001, the Federal Government has added thousands of federal 
agents and analysts to the counterterrorism effort. The addition of 
these personnel has magnified the need for additional prosecutors in 
the field. For example, the criminal caseload for the United States 
Attorneys has increased by 18 percent in this same time frame. The 2007 
budget supports the ongoing activities for the United States Attorneys 
with over $1.6 billion in total resources, of which $92 million will 
support national security and terrorism-related prosecutions. I believe 
that it is very important that the President's budget request for 
United States Attorneys be fully funded.
    The United States Attorneys are vital to the Federal Government's 
counterterrorism effort. In the past year alone, the government has 
obtained convictions or guilty pleas in 40 terrorism-related cases 
across the Nation, continuing the successful record established since 
September 11th. For example, Ahmed Omar Abu Ali was convicted of 
terrorism charges, including conspiracy to assassinate the President of 
the United States; conspiracy to commit air piracy; and conspiracy to 
destroy aircraft. Ali Al-Timimi was convicted on all charges in 
connection with the ``Virginia Jihad'' case. In a domestic terrorism 
case, Eric Robert Rudolph pleaded guilty to charges related to deadly 
bombings in Birmingham, Alabama, and in the Atlanta area, including the 
bombing at the 1996 Olympics. Since the September 11th attacks, the 
Department has charged more than 400 individuals in matters arising 
from terrorism-related investigations and obtained convictions or 
guilty pleas in more than 220 of those cases to date. Some of those 
cases include the conviction of John Walker Lindh, Richard Reid and the 
disruption of terrorist cells in New York, Oregon, Ohio, Virginia, and 
North Carolina. This budget requests additional positions and $7.7 
million to enhance counterterrorism prosecution efforts by our United 
States Attorneys' Offices.
    This budget also supports other key intelligence initiatives within 
the Department. The Department is requesting an increase of $12 million 
for the Drug Enforcement Administration (DEA) to facilitate full 
coordination and information sharing with other members of the U.S. 
Intelligence Community. That coordination will enhance national 
security, combat global terrorism, and reduce the global supply of 
drugs. Even though DEA did not officially have capabilities in the 
Intelligence Community until February, it has been contributing to 
national security investigations for many years. In fiscal year 2005, 
DEA disrupted eight, and dismantled two, terrorist-linked Priority 
Target Organizations using information gathered during drug 
investigations. In support of our national security objectives, the 
fiscal year 2007 budget also provides resources to help the Executive 
Office for Immigration Review and the Civil Division's Office of 
Immigration Litigation address their expanded caseload.

                       PROJECT SAFE NEIGHBORHOODS

    In 2001, the Administration announced the Project Safe 
Neighborhoods (PSN) initiative to reduce gun crime in our communities. 
PSN brings together local, State, and Federal law enforcement 
officials, prosecutors, and community leaders to implement a multi-
faceted strategy to deter and punish gun criminals. This initiative is 
taking some of the most dangerous and violent offenders out of our 
communities. Today, federal firearms prosecutions are up nearly 73 
percent and violent crime is at its lowest level in 30 years. Since 
2001, the nonfatal firearm crime rate has dropped from 2.3 incidents 
per 1,000 residents to 1.4, and firearm incidents have dropped 40 
percent--from 467,880 to 280,890. With the support of Congress, the 
Department has dedicated over $1.5 billion to this important program. 
Those funds have provided necessary training, hired agents and 
prosecutors, and supported State and local partners working to combat 
gun crime. For 2007, the budget requests $395 million for PSN.
    In response to the danger that violent gangs pose to our 
neighborhoods, the Department recently developed a comprehensive 
strategy to combat gang violence as part of PSN. Building on the 
lessons learned fighting gun crime, this strategy coordinates 
enforcement, prosecution, and prevention resources to target gangs that 
terrorize our communities. The Violent Crime Impact Team (VCIT) 
program, part of the PSN initiative, helps reduce communities' homicide 
and firearms-related violent crime through the use of geographic 
targeting, aggressive investigation, and prosecution. This budget 
provides $16 million for ATF and the United States Attorneys to combat 
gang activity by expanding the VCIT program to 15 additional cities, 
for a total of 40 sites.
    The PSN request also includes enhancements of $44 million for DOJ's 
State and Local Gun Violence Assistance Program. This program is the 
State and local grant program that supports PSN in individual 
communities. This request also includes $15 million to initiate a new 
Gang Training and Technical Assistance Program that will provide 
assistance to States and localities in support of efforts to reduce 
criminal gang activity and reduce the threat of terrorism and violent 
crime through enhanced sharing of criminal intelligence; and a $29 
million increase for the National Criminal History Improvement Program, 
which provides grants to States to improve their criminal history and 
related records so that they are complete, accurate, and available for 
use by Federal, State, and local law enforcement.
    United States Attorneys' Offices across the country continue to 
work with law enforcement partners to develop strategies to make their 
communities safer. Thus, the fiscal year 2007 PSN request includes 
resources to prosecute gang members and gun criminals and to create new 
and strengthened partnerships with local agencies that are addressing 
gang violence and gun crime.

                  DRUG ENFORCEMENT AND BORDER SECURITY

    In February 2002, the President set an ambitious goal: ``To reduce 
the use of illegal drugs by 10 percent over 2 years, and by 25 percent 
over 5 years.'' To meet this goal, the Department announced a six-part 
drug enforcement strategy for DOJ. The Department focuses its drug law 
enforcement efforts on reducing the availability of drugs by disrupting 
and dismantling the largest drug supply and related money laundering 
networks operating nationally and internationally, including those on 
the Consolidated Priority Organization Target (CPOT) List. The CPOT 
list identifies the ``Most Wanted'' drug trafficking and money 
laundering organizations believed to be primarily responsible for the 
Nation's illicit drug supply. In fiscal year 2005, the Department 
dismantled 121 CPOT-linked drug trafficking organizations and severely 
disrupted another 204 CPOT-linked organizations. For example, DOJ 
arrested the two founders of the Cali Cartel and arrested two Afghan 
drug kingpins with ties to the Taliban. The fiscal year 2007 budget 
requests enhancements of $234.7 million for its drug enforcement 
efforts.
    The cornerstone of the Department's drug supply reduction strategy 
is the Organized Crime Drug Enforcement Task Force (OCDETF) program. 
Centrally managed within the Department, the OCDETF program combines 
the resources and expertise of DEA, the FBI, the Bureau of Alcohol, 
Tobacco, Firearms and Explosives (ATF), the U.S. Marshals Service, the 
Internal Revenue Service, the Bureau of Immigration and Customs 
Enforcement, the U.S. Coast Guard, and the litigating forces of DOJ's 
Criminal Division, Tax Division, and the United States Attorneys' 
Offices. The fiscal year 2007 Budget contains $706 million for OCDETF, 
which includes a $208 million transfer of the Office of National Drug 
Control Policy's High Intensity Drug Trafficking Area (HIDTA) Program. 
Transferring the HIDTA Program to the Department will facilitate 
strategic coordination with our other drug enforcement assets, 
eliminating duplication and ensuring the most effective use of limited 
resources.
    As the only federal agency with its sole focus on drug enforcement, 
DEA must have the necessary resources to invest in intelligence and 
operational requirements overseas to stem the supply of illegal drugs. 
This budget requests $13 million in additional funds to continue 
reducing the availability of illicit drugs and the diversion of licit 
drugs and precursor chemicals in the United States. The Department will 
achieve these goals by disrupting and dismantling significant drug 
trafficking and money laundering organizations as well as attacking the 
economic basis of the drug trade. DEA's drug trafficking and money 
laundering enforcement initiatives support and augment U.S. efforts 
against terrorism by denying both drug trafficking and money laundering 
routes to foreign terrorist organizations. DEA's work also helps stem 
the use of illicit drugs as barter for munitions to support terrorism. 
This request includes $4 million for Foreign Advisory Support Teams 
(FAST) to continue attacking drug trafficking and foreign terrorist 
organizations operating in Afghanistan, and $3.5 million for a new team 
to deploy in the Western Hemisphere. Focusing resources on a geographic 
area or group, like the FAST program, yields results: for example, DEA 
investigations have led to the indictment of 13 members and associates 
of the Colombian terrorist group, the Revolutionary Armed Forces of 
Colombia (FARC), on drug trafficking. In fiscal year 2005, two high 
ranking FARC officers were extradited to the United States to stand 
trial.
    After the drug arrests, searches, and seizures have been completed 
by DEA, the Federal Government also has the responsibility to clean-up 
the toxic chemicals left behind at methamphetamine labs. This budget 
provides $40 million to the Office of Community Oriented Policing 
Services for the clean-up of these toxic waste sites, an increase of 
$20 million over the enacted 2006 level. The additional funding would 
ensure that DEA is able to respond to the increased workload to clean 
up methamphetamine laboratories seized by State and local law 
enforcement agencies and fund the start up costs for State container 
programs.
    On November 28, 2005, President Bush outlined his plan to enhance 
America's homeland security through comprehensive immigration reform. 
Two major partners in this reform are the Department's Executive Office 
for Immigration Review (EOIR), and the Civil Division's Office of 
Immigration Litigation (OIL). The Department's fiscal year 2007 Budget 
requests significant increases to help EOIR and OIL keep pace with the 
growing workload resulting from DHS' increased border security efforts. 
A good portion of this workload is related to national security and is 
critical to the Department's mission to combat terrorism and violent 
crime.
    The EOIR request includes an increase of 120 positions and $8.8 
million to meet additional caseload requirements that have resulted 
from the increased resources DHS has received for immigration 
enforcement from 2003 to 2006. For example, EOIR caseloads increased by 
70,000 cases in 2005. In addition, the appellate caseload is expected 
to increase by approximately 4,000 cases annually. EOIR's requested 
increase is linked to DHS' increase of nearly 4,000 detention beds, 
which will be fully on-line by 2007.
    Established in 1983, OIL has jurisdiction over all civil 
immigration litigation and is responsible for the nationwide 
coordination of immigration matters before the federal district courts 
and circuit courts of appeals. Since fiscal year 2001, OIL's caseload 
has more than tripled as OIL attorneys defend the government's efforts 
to detain and remove illegal aliens, many of whom are criminals or 
suspected terrorists. This budget provides 114 positions and $9.6 
million in enhancements to assist OIL's vigorous defense of the cases 
that are critical to the safety of our communities.

                 CRIMES AGAINST CHILDREN AND OBSCENITY

    The Department is committed to fighting child pornography and 
obscenity as well as to protecting children from trafficking and other 
forms of exploitation. The Department works with other law enforcement 
agencies to target, dismantle, and prosecute predatory child molesters 
and those who traffic in child pornography. In 2005, the Department 
increased its efforts, charging 1,503 individuals and obtaining 1,220 
guilty pleas and convictions in criminal cases involving predation of 
children.
    The fiscal year 2007 budget request includes an additional $2.7 
million to combat crimes against children and obscenity, $23.9 million 
for the Office of Justice Programs to direct to State and local law 
enforcement, and an enhancement of 26 positions and $2.6 million for 
the United States Attorneys' Offices to bolster their efforts in 
combating child exploitation. These requests are complemented by $50.9 
million for the Missing and Exploited Children Program (MECP), which is 
the primary vehicle for building an infrastructure to support the 
national effort to prevent the abduction and exploitation of our 
Nation's children. The request includes support for the National Center 
for Missing and Exploited Children.
    To enhance this work, I recently announced a new Project Safe 
Childhood initiative. This effort will be implemented through a 
partnership of United States Attorneys, Internet Crimes Against 
Children Task Forces, and other Federal, State, and local law 
enforcement officials in each district. These partnerships will 
investigate and prosecute crimes against children that are facilitated 
through the Internet or other electronic media. Communities will be 
able to design and execute programs tailored specially for their 
individual needs, while maximizing national resources and expertise. In 
fiscal year 2006, DOJ will award more than $14 million to the Internet 
Crimes Against Children program, a national network of 46 regional task 
forces funded by the Department's Office of Justice Programs. In fiscal 
year 2005, federal prosecutors charged 1,447 child exploitation cases 
involving child pornography, coercion, and enticement offenses. The 
Criminal Division's Child Exploitation and Obscenity Section, in 
conjunction with the FBI's Innocent Images Unit, will fully integrate 
the Project Safe Childhood Task Forces by sharing local leads that 
develop from its major national operations.

                              CIVIL RIGHTS

    In 2005, the Civil Rights Division secured more convictions against 
human trafficking defendants, increased the number of trafficking cases 
filed by over 30 percent, and doubled the number of trafficking 
defendants charged from the previous year. We need to continue to 
support this concerted effort. The Civil Rights Division has also 
reported record enforcement of laws that protect the right to vote, 
ensure the disabled can fully participate in their communities, and 
provide the highest standard of care for institutionalized persons. It 
is my goal to build on these successes while supporting the 
reauthorization of the Voting Rights Act and renewing the Department's 
commitment to the principle of fair housing.
    In addition to an increased Civil Rights Division budget request of 
$113 million, the President's 2007 Budget envisions the creation of 
Operation Home Sweet Home. This initiative will focus on ensuring fair 
housing practices through improved targeting, increased testing, 
aggressive public awareness, and partnership with fair-housing 
organizations across the country. The initiative will include 
concentrated housing discrimination testing in areas recovering from 
the effects of Hurricane Katrina and bring to an all-time high the 
number of fair housing test investigations nationwide.
    All Americans should have the same chance to pursue their dreams by 
earning a job, finding homes for their families, voting for their 
representatives, and living safe from fear and servitude. We will 
continue to aggressively combat discrimination wherever it is found.

                    PUBLIC AND CORPORATE CORRUPTION

    Another priority for the Department is ensuring the integrity of 
government and business. Integrity in these institutions is the 
foundation for a strong America--both taxpayers and investors deserve 
nothing less. The Department is engaged in robust efforts to prosecute 
corruption, and I have called on Justice Department employees to 
preserve the integrity of our public institutions and corporations.
    With several high-profile convictions over the last year, the 
Department has made great strides in this area. For example, former 
public relations specialist Michael Scanlon pleaded guilty to 
participating in a conspiracy to commit bribery, mail and wire fraud, 
and honest services fraud, and 40 defendants pleaded guilty in 
connection with Operation Lively Green, a widespread bribery and 
extortion conspiracy.

                  ENFORCING FEDERAL LAW IN THE COURTS

    The Department of Justice serves as the Nation's chief prosecutor 
and litigator, representing the United States in court by prosecuting 
crime and enforcing federal civil laws. The Department's work includes 
protecting civil rights, safeguarding the environment, preserving a 
competitive market place, defending the national treasury against fraud 
and unwarranted claims, as well as preserving the integrity of the 
Nation's bankruptcy system.
    As Congress puts more law enforcement agents on the street, the 
number of cases referred for prosecution continues to rise and the 
number of criminals incarcerated will climb. The fiscal year 2007 
budget request includes enhancements of $20.2 million to fortify the 
United States Attorneys' immigration and intellectual property crime 
prosecutions; enhance the Criminal Division's ability to investigate 
and prosecute intellectual property crimes; and provide sufficient 
resources to the Tax Division to handle an increased number of tax 
cases referred by the Internal Revenue Service. Also, the fiscal year 
2007 budget includes additional resources for the United States 
Trustees to address new requirements imposed by the recently enacted 
Bankruptcy Reform legislation.

               JUDICIAL SYSTEM SUPPORT AND INCARCERATION

    As a result of successful law enforcement policies targeting 
terrorism, violent crime, and drug crimes, the number of criminal 
suspects appearing in federal court continues to grow, as does the 
number of individuals ordered detained and ultimately incarcerated. The 
fiscal year 2007 President's Budget requests significant resources to 
improve courtroom security and to provide for the detention and 
incarceration of those accused or convicted of violent crimes. During 
fiscal year 2005, the Nation's federal prison population rose 4 
percent, an increase of 7,499 inmates. During the same period, the 
federal prisoner detention population rose 7.8 percent, increasing by 
approximately 4,558 detainees per day. The request provides additional 
resources for the Bureau of Prisons (BOP) and Office of the Detention 
Trustee (OFDT) to manage this growth, including funds for additional 
contract beds. The fiscal year 2007 Budget requests $156.6 million in 
enhancements in these areas.
    The United States Marshals Service (USMS) provides protection to 
federal courthouses, members of the federal judiciary, and witnesses 
associated with federal court cases. The fiscal year 2007 budget 
provides 37 new positions and an increase of $4.6 million to enhance 
this mission. These resources will enable the marshals to detect, 
assess, and respond to potential threats in a timely manner and will 
strengthen threat analysis capability. This budget also provides new 
resources to make important upgrades to USMS information technology and 
financial management capabilities.
    The Department's BOP and OFDT protect American society by providing 
for the safe, secure, and humane confinement of persons in federal 
custody. This budget provides $1.3 billion for the OFDT and $5 billion 
for the BOP. The costs of federal incarceration and detention account 
for almost a third of DOJ's annual discretionary budget. At present, 
there are over 189,000 inmates in federal custody, of which 
approximately 11 percent were arrested on immigration-related charges 
and over 53 percent were arrested on drug-related charges. The BOP 
request will provide an additional $40.4 million to add contract beds 
at a new contractor-owned and operated low security prison in 
Philipsburg, Pennsylvania, to secure additional contract prison bed 
space and to begin the activation of a new housing unit at an existing 
correctional institution at FCI Otisville, New York, adding a total of 
1,962-beds. This budget also provides funds to house an average daily 
detainee population of 63,000. These funds will support the 
Department's goal of ensuring zero escapes from federal detention and 
secure BOP facilities.
    Criminals deserve to serve the time that they are sentenced in 
prison. However, once their time is served, they will re-enter society. 
The fiscal year 2007 Budget includes $14.9 million for a prisoner re-
entry initiative at the State and local level, designed to reduce 
recidivism and the societal costs of crime by helping released 
offenders find work and stable housing when they return to their 
communities.

                  STATE, LOCAL, AND TRIBAL ASSISTANCE

    State and local law enforcement agencies are critical partners in 
the war against terror and the fight against crime. The 2007 budget 
includes over $1.2 billion in discretionary grant assistance to States, 
localities and tribes. This funding includes $66.6 million to 
strengthen communities through programs providing services such as drug 
treatment; $44.6 million to fight terrorism; $409 million to assist 
crime victims; $88.2 million to combat crime, including enhancements to 
grant funding provided under Project Safe Neighborhoods; $214.8 million 
for law enforcement technology, including funding to continue and 
enhance the Administration's DNA initiative; and $209 million to 
support drug enforcement, including funding to continue the Southwest 
Border Drug Prosecution Program.
    In addition to the requested funding at DOJ, the Administration has 
continued its commitment to provide funding to State and local 
governments for homeland security by including $2.8 billion in funding 
for these programs in DHS' budget request for fiscal year 2007.
    The Department's fiscal year 2007 request provides enhancements to 
strengthen our communities, including $9.9 million for the Department's 
component of the Administration's offender re-entry initiative, which 
includes the participation of the Departments of Labor and Housing and 
Urban Development; $13.9 million for Capital Litigation Improvement 
grants that provide training to private defense counsel, public 
defenders, State and local prosecutors, and State judges to improve the 
competency of all participants connected with the trial of State 
capital cases; $59.3 million for Drug Courts; and $68.4 million for the 
President's DNA initiative.
    The fiscal year 2007 budget also contains $29.8 million for local 
prosecutor offices in the four Southwest border states--California, 
Texas, Arizona, and New Mexico. This funding would provide for payment 
of approved prosecution and pre-trial detention costs for cases 
referred to local prosecutors by the United States Attorneys' Offices, 
and cases diverted from federal prosecution by law enforcement pursuant 
to a locally-negotiated agreement.
    The fiscal year 2007 request for State and local resources also 
includes $40.7 million in support of activities authorized in the 
Justice For All Act, including funds for the enhancement of the federal 
victim notification system as well as legal counsel and support 
services for victims of crime.

           MANAGEMENT AND INFORMATION TECHNOLOGY IMPROVEMENTS

    The Department of Justice is committed to providing the management 
and information technology necessary to ensure that our resources are 
used efficiently and effectively. The fiscal year 2007 President's 
Budget requests $133.9 million in enhancements for critical Department-
wide initiatives that support the Department's Strategic Goals and the 
President's Management Agenda.

DOJ Financial Management
    The Department of Justice is committed to full accountability and 
continuous improvement in its financial operations, and we were 
extremely pleased to restore the unqualified audit opinion on our 
public financial statements this past year. However, independent 
auditors again identified material weaknesses in the Department's 
outdated financial systems, weaknesses that the planned Unified 
Financial Management System (UFMS) is designed to address. To that end, 
we greatly appreciated the funding provided by Congress in fiscal year 
2006 for the UFMS project. That funding permitted us to make a contract 
award to begin implementation of the new system in the first two 
components (DEA and the Assets Forfeiture Fund). To continue this 
critical project in 2007, we are requesting $25 million to complete the 
component implementations begun this year and begin implementation work 
for three additional components, including the FBI.

Other DOJ Information Technology Initiatives
    The fiscal year 2007 Budget request includes enhancements of $18.1 
million for the Justice Consolidated Office Network (JCON) to complete 
transition of the Bureau of Prisons to the JCON community. JCON 
provides a modern office automation system to multiple components using 
a common architecture for enhanced information sharing and 
interoperability. The request also includes $9 million and 29 positions 
for USMS audited financial statements and technology enhancements, 
including $3.9 million for the Justice Detainee Information System. The 
request also includes $83.7 million for FBI information technology 
enhancements, including $33 million for IDENT/IAFIS Interoperability 
activities.
    The Department continues to evaluate its programs and operations to 
improve management and stewardship. Our goal is to achieve both 
component-specific and Department-wide economies of scale, increased 
efficiencies, and cost savings/offsets to permit us to fund initiatives 
that are of highest priority. The Department is engaged in a multi-year 
process to implement a wide range of management and information 
technology improvements that will result in substantial savings. 
Enhancements in management and information technology will ensure all 
DOJ components are able to function in an interoperable environment, 
particularly with respect to preventing terrorist attacks on the United 
States.

Working for America Act Implementation
    The Working for America Act requires agencies to manage, develop, 
and reward employees effectively and to implement a new pay and 
performance system. Implementing this Act requires significant 
investments in training. The Department requests $2 million to support 
the Working for America Act through the training of managers and 
supervisors in performance management and in using the new pay and 
performance system.

                               CONCLUSION

    Mr. Chairman, Senator Mikulski, Members of the Subcommittee, I 
recently started my second year as Attorney General. I would like to 
take this opportunity to commend the people of the Justice Department. 
Each day I work with people who could be Chief Executive Officers in 
the private sector or partners at private law firms, but they all 
choose to serve their Nation by working for justice. They work for 
justice because they believe in the work we do to fight crime and 
safeguard the American people from terrorism. I am honored to work 
alongside them every day.
    I ask for your support in providing the resources requested in the 
2007 budget, so that we can fulfill our mission to safeguard the 
American people. I am honored to testify before you and look forward to 
working with you on this budget proposal and other issues.
    Thank you. I would be pleased to answer any questions you might 
have.

                        STATE AND LOCAL PROGRAMS

    Senator Shelby. Thank you, Mr. Attorney General.
    Just to touch on a few subjects, we have all brought them 
up, Mr. Attorney General, the Department of Justice, as I said 
earlier, is requesting a 51.6 percent funding cut for State and 
local law enforcement assistance programs. The Department 
expresses how critical State and local law enforcement 
partnerships are in homeland security and the war on terror but 
continuously proposes these cuts.
    When you visited the gulf coast area devastated by the 
hurricanes of the 2005 season, what was the number one thing 
that State and local law enforcement officials needed from the 
Department of Justice in support of their recovery efforts?
    Attorney General Gonzales. They needed resources. They 
needed training. They needed support. That is what they were 
asking for. Mr. Chairman, this budget does have cuts in certain 
programs----
    Senator Shelby. Sure.
    Attorney General Gonzales [continuing]. That have 
benefitted State and local law enforcement. But I think if you 
study the budget, you will see that there is a lot of 
assistance being provided through this budget to State and 
locals in a wide variety of areas. There is $1.2 billion in 
discretionary grants to State and locals, for example. There is 
$66 million to help communities with issues like drug 
treatment; $44 million to fight terrorism--these are grants 
directly to State and locals--$409 million to assist crime 
victims; $82 million to fight crime, including enforcement for 
Project Safe Neighborhood programs; $214 million for law 
enforcement technology, including funding for the DNA 
databases; $209 million to support drug enforcement, including 
funds for the Southwest border drug prosecution program.
    And so, there is a lot of assistance and support for State 
and local agencies in this budget. I want to emphasize that. We 
understand how important these partnerships are. As I travel 
around the country, and I talk to State and local officials, I 
emphasize to them my commitment to continue working with them 
as hard as I can.
    We have difficult decisions that have to be made in the 
budget. This budget represents the President's priorities. We 
think this budget does provide a large amount of assistance to 
State and locals, but it is targeted in a way that meets the 
President's priorities and ensures that we are accountable in 
the way these funds are spent, we are accountable to the 
taxpayers in this country.
    Senator Shelby. Mr. Attorney General, the budget also 
proposes a 44 percent cut from last year in juvenile justice 
programs. Why such a drastic cut on programs that impact our 
children?
    Attorney General Gonzales. We have reduced juvenile justice 
programs by $150 million; $98 million of that is for 
demonstration programs that were earmarked funding that we 
simply are not requesting, and $49 million of that was for the 
juvenile accountability block grant that did not fare well in 
our evaluation and analysis process of whether or not programs 
that we are funding are effective. There is insufficient 
accountability.
    But we still fund $188 million for juvenile justice, and I 
think we should also get credit for the amount of money that we 
spend on law enforcement to help kids in the area of gangs, 
prevention, reinforcement, and reentry; OJP programs focusing 
on child prostitution, the sex offender registry, the ICACs, 
which are the Internet crimes against children task forces; 
Amber Alert; the money we spend to fund for new prosecutors to 
go after people exploiting children, trafficking in children; 
money for drug courts.
    So there is a lot of money in the President's budget to 
focus on crime specifically related to juveniles.

                            SEXUAL PREDATORS

    Senator Shelby. Mr. Attorney General, the rate of 
recidivism among convicted sexual predators remains alarmingly 
high. According to the National Center for Missing and 
Exploited Children, there are approximately 550,000 registered 
sex offenders in the United States. It is estimated that nearly 
100,000 sex offenders have not registered or have failed to 
update their information. These people are normally obscure 
when living in our neighborhoods but have been convicted of 
preying upon families and children.
    Last year, the Department of Justice announced the creation 
of a National Registry website for sex offenders. Could you 
tell us about the registry, expand just a little on it, and any 
goals or successes the Department could share with us here? I 
think it is important.
    Attorney General Gonzales. We did announce a National 
Registry which would allow parents to go online to determine 
whether or not there were sex offenders living in their 
neighborhoods. The registry is dependent on the information 
provided by State records. To date, all the States but two are 
now part of this registry. So we have made good progress in 
getting States to participate in this program.
    There is, however, a problem, as I indicated. We are 
dependent on the records provided by the States and the upkeep 
of these records by the States, and we have discovered 
instances where some States are rather tardy in updating their 
records.
    Senator Shelby. Do they register them in different ways in 
different States?
    Attorney General Gonzales. It is different information. 
That is right. We did not want to impose upon the States a 
uniform method of providing the information. This was a way 
that we could provide information to parents fairly quickly, 
without a great deal of cost to the States. So that is why we 
took this approach. In my judgment, it has been effective, but 
again, we need to work with the States to ensure that they are 
updating their databases as often as possible so that we have 
the most current information for parents.
    Senator Shelby. How can you meet the challenge, that is, 
there are an estimated 100,000 sex offenders who are 
unregistered? How can you work with the Justice Department and 
local law people to get these 100,000 people to register?
    Attorney General Gonzales. Well, that is a very good 
question, Mr. Chairman. It is a challenge for the Department. 
As these offenders are, in fact, convicted, and first of all, 
we hope that there are requirements that they do register. If 
they do not register, there needs to be some kind of 
enforcement to ensure that there are consequences for it. But 
you are right. I do not have an answer for you, a good answer 
for you, Mr. Chairman. What I can tell you is that I am aware 
of the problem, and we will continue to work on it with State 
and local officials.

                             FEDERAL PRISON

    Senator Shelby. I want to get into the Bureau of Prisons. I 
mentioned that in my opening statement.
    Attorney General Gonzales. Yes.
    Senator Shelby. A couple of prisons that you recommended 
last year and this year, one in West Virginia, one in New 
Hampshire for rescission. How and under what statute could you 
justify ignoring the direction of Congress 2 years in a row by 
rescinding funding for two prison construction projects? Could 
this be clarified as an impoundment of funds, or what is it?
    Attorney General Gonzales. It is not an impoundment, Mr. 
Chairman, and it is not as a technical matter a rescission. No 
one has told the Bureau of Prisons or directed the Bureau of 
Prisons not to move forward with these two prisons. And in 
fact, with respect to the West Virginia prison, we expect that 
a contract for the design and planning will be let shortly and 
that there are sufficient funds in the budget for 2007.
    With respect to New Hampshire, we anticipate that that 
contract will be let sometime in the fall, and we will have a 
decision by this subcommittee as to whether or not funds will 
be available in 2007 for the design and plans of that facility. 
If the subcommittee makes the decision to not provide funds for 
the design and the planning of that facility for 2007, then 
what we will have to do is see if there are other resources 
within BOP, see if there are other resources within the 
Department.
    Again, if resources are not there, then what we will have 
to do is see whether or not we ought to look at--besides 
looking at building a new facility, is there a way we can 
renovate existing facilities? Is there a way that we can 
contract out for beds with State and local entities? We do need 
the beds, and the question is what is the most efficient way to 
obtain those beds? So that is my response to your question 
about the $142 million.
    Senator Shelby. Thank you.
    Senator Mikulski.

                       NATIONAL SECURITY DIVISION

    Senator Mikulski. Mr. Attorney General, the Justice 
Department is tasked with playing a very important role in the 
global war against terrorism. Under the PATRIOT Act, my 
question is going to go to the National Security Division that 
has been created through the PATRIOT Act.
    The 2007 budget includes the funding of $67 million for 
this National Security Division. Could you share with the 
subcommittee what this money will buy? Essentially, how does 
it--because we have now been through a look at the PATRIOT Act. 
How will this $67 million buy us more security, or is it buying 
us more bureaucracy?
    And how, then, does that differ from the national security 
branch that is going to be at the FBI? And how does it all fit 
together, and how do you fit in with the DNI? Let us start with 
what we buy for $67 million. That is a lot of money, and is 
this to stand up a new division? Is it to buy more gizmos and 
gear? Where are we heading here?
    Attorney General Gonzales. Well, currently, we are talking 
about consolidating three branches within DOJ: The Office of 
Intelligence Policy and Review, the counterespionage section 
and the counterterrorism section. So we are talking about 226 
individuals, 226 people with a budget of currently about $48 
million.
    And so, what we are asking for in 2007 is for an additional 
$19 million to add an additional 68 people to the National 
Security Division. You have to remember that part of what we 
are talking about is the branch that is responsible for 
preparing the applications for the Foreign Intelligence 
Surveillance Act (FISA). And there has been a lot of talk 
recently about FISA application and whether or not we have 
sufficient resources to continue to make FISA an effective tool 
not only in the war on terror but against other foreign powers.
    Senator Mikulski. You need $20 million more and 68 people 
just to do FISA applications?
    Attorney General Gonzales. Oh, no ma'am, that is not what I 
said, ma'am.
    Senator Mikulski. And does it cost $20 million to hire 68 
people? That is expensive even by some Government accounting.
    Attorney General Gonzales. Yes, ma'am. But in addition, of 
course, there are going to be startup costs in connection with 
consolidation of these units. It is going to require special 
technology. We want more secure technology so that they can 
communicate with each other and also communicate more 
effectively with the entire intelligence community.
    And so, these are some of the costs that are going to be 
incurred. I would like the opportunity, Senator, to give you a 
more detailed breakdown.
    Senator Mikulski. Is this an awkward place to have this, in 
an unclassified setting?
    Attorney General Gonzales. No, ma'am, I do not think it is 
that, quite frankly. I just do not have the detail in my head 
that you are asking for. Okay; technology, the Sensitive 
Compartmental Information Facility (SCIF), we need more SCIFs 
and more intel analysts. So these are some of the additional 
things that we would need in connection with the startup of 
this division.
    And you asked whether or not this is the creation of a new 
bureaucracy. You have to remember that this was one of the 
recommendations of the 9/11 Commission. They recognized that of 
all the departments, all the agencies that focus on the war on 
terror, here you have the Department of Justice claiming that 
terrorism is our number one priority, and yet, we had no 
central location, no central officer below the Attorney General 
and the DAG that was focused primarily on the national security 
of our country with respect to law enforcement matters.
    And so, my hope and certainly my intent--this is not the 
creation of a bureaucracy, but we will make the Department more 
effective.
    Senator Mikulski. If I could jump in, the FBI, first of 
all, I understand we are into the 9/11 Commission reforms. We 
recommended some essentially one-stop shops: the Office of DNI; 
now, this at the Justice Department. And I am not disputing the 
value. We want to implement the--absolutely passionate about 
implementing the 9/11 Commission's report. But then, it says 
the Criminal Division of Counterterrorism and Counterespionage. 
But does the FBI not also have this?
    Attorney General Gonzales. Yes.
    Senator Mikulski. And are you duplicating what the FBI 
does?
    Attorney General Gonzales. Of course, their focus is in the 
investigation. We will be focused primarily on the prosecution 
side of it, and so, we will have different functions. And 
obviously, there will be a lot of interaction, and we will be 
working closely together.
    Senator Mikulski. You mean the prosecution of terrorism?
    Attorney General Gonzales. Yes, ma'am, but not only the 
prosecution of cases but also detection and prevention. Working 
with----
    Senator Mikulski. Is that not what FBI is doing with 
detection and prevention?
    Attorney General Gonzales. Yes, ma'am, and they will 
certainly be doing that as well.
    Senator Mikulski. You see my question is are we all going 
to be bumping into each other.
    Attorney General Gonzales. No, ma'am, we are not going to 
be bumping into each other. We have been working very hard.
    Senator Mikulski. And I am not being sarcastic.
    Attorney General Gonzales. And I do not take your comment 
as that.
    Senator Mikulski. It has been 5 years since 9/11, 5 years, 
and I do not know if I feel safer. We in the Capital region 
still do not have a clear evacuation plan. We in the Capital 
region do not have interoperable communication. We do know in 
the Capital region local law enforcement talks with each other 
and works together, as we saw under the leadership of the FBI 
and ATF the way we handled the sniper, which is considered a 
national model of dealing with a crisis, for which we were very 
grateful and very proud. But----
    Attorney General Gonzales. You asked whether or not we were 
safe.
    Senator Mikulski. Do you see where----
    Attorney General Gonzales. Yes, ma'am.
    Senator Mikulski. And so, I am looking at whatever we do, 
it is not about new boxes and new bucks. It is about safety, 
security, and strength.
    Attorney General Gonzales. Senator, I believe that this 
will make us safer, and I think we are safer than we were 5 
years ago. We have taken tremendous steps with the assistance 
of Congress, and thank you for that, to give us additional 
tools to make America safer. I believe, and I think others 
believe, including the President of the United States, that 
having a National Security Division which focuses on our number 
one priority, which coordinates the law enforcement efforts to 
prosecute and to prevent terrorism, is something that is 
necessary for the Department of Justice and will make us safer.
    You ask a legitimate question as to whether or not we are 
going to be bumping into each other. My goal is that we 
recognize that that cannot happen, and obviously, it is 
something that we have to be sensitive to as we stand up the 
National Security Division and as the FBI moves forward with 
the national security branch.
    Senator Mikulski. Well, I know we will be pursuing this 
more when we talk to the FBI.
    I want to be very clear about what I said about feeling 
safer. I want to say hats off to the people who work in the 
intelligence community, to the FBI and others who are doing due 
diligence, that I believe have detected, derailed, destroyed 
the predatory attacks coming into the United States. So it has 
been 5 years since an attack. So I want to acknowledge that.
    But we have a lot more systemic reform that we need to do, 
and I sometimes am fearful that we get bogged down in boxes and 
charts and bureaucracy rather than safety and security. So I do 
not in any way doubt the energetic, dedicated work that people 
all over our country and all over the world who work for the 
Federal Government are doing to keep us safe, so I want to 
acknowledge that.
    That is why we want the best organization, the resources 
that they need along with the training and management and 
technology, that they do it right. So my time is up on this. I 
know that we will come back.
    Senator Shelby. Senator Leahy.

                              CHOICEPOINT

    Senator Leahy. Thank you, Mr. Chairman. As I indicated in 
my earlier statement, I am concerned that the FBI signed a 
multimillion dollar licensing agreement with data broker 
ChoicePoint. I consider them the poster child for lax identity 
protection. They want to expand the use of software to help the 
Bureau analyze criminal organizations.
    Just to put this into context, earlier this year, the FTC 
levied the largest civil penalty on record on ChoicePoint. They 
found that they had sold 160,000 consumer records to identity 
thieves. Last year in the Senate Judiciary Committee, we heard 
that because of this, hundreds of Americans were victims of 
identity theft, and people who have faced that sometimes can 
spend years and huge amounts of money to get out of it.
    So now, we take the same company that has done horrible 
damage to their customers already, and they are to expand the 
FBI's analysis of criminal organizations. How do you justify 
entering into a multimillion dollar contract with ChoicePoint 
to handle sensitive investigative data about criminal 
enterprise operations when we know they are so lax that they 
used terrible judgment before with nonsensitive data, just 
normal data?
    Attorney General Gonzales. Senator, obviously, there were 
mistakes made by ChoicePoint, and they have suffered the 
consequences for that. Let me just----
    Senator Leahy. Consequences, yes, they got a big fine, but 
why ChoicePoint? What is in their history that suggests that 
they know how to do this?
    Attorney General Gonzales. The decision was our 
determination that this was the best contract for the Bureau. 
It is a contract for technology and software only. It is not a 
contract for data services. It is a $12 million contract over 5 
years, and I think that it reflects the best judgment that this 
was the best contract for the Bureau.
    I want to emphasize that we understand the importance of 
respecting and protecting people's privacy, and we take those 
concerns very seriously. Those concerns were taken into account 
in connection with this contract.
    Senator Leahy. Well, you know, I want to beg to differ with 
you a little bit on taking the concerns of people's privacy 
seriously. Yesterday, the GAO found that the Justice 
Department, which uses private information services for law 
enforcement and counterterrorism and other investigations often 
does not even follow Federal rules. You do not even follow your 
own laws in protecting Americans' privacy.
    According to the report, the Department of Justice and 
three other Federal agencies spent about $30 million last year 
on companies such as ChoicePoint that maintain billions of 
electronic files about adults' current and past addresses, 
family members and associates, buying habits, personal 
finances, listed and unlisted phone numbers.
    I mean, this is going way beyond criminals or criminal 
organizations you are after. This is people in this room, 
tourists walking through this building or viewing the Grand 
Canyon or anything else. Now, what do you say about GAO? They 
say you are not even following the law. You are contracting out 
tens of millions of dollars. You are collecting a huge amount 
of data. Why should we feel more secure about this?
    Attorney General Gonzales. Senator, obviously, the 
allegation that we are not following the law is a serious one. 
I have not read the GAO report, but obviously, we are going to 
study it very, very carefully, and if we are not doing what we 
are supposed to be doing, there should be consequences. We take 
our responsibilities very seriously, but again, I have not seen 
the report. I have not studied the report. I am not saying the 
report is incorrect.
    Senator Leahy. Mr. Attorney General, understand that I am 
not suggesting that you as Attorney General want to go and hand 
out this private data to crooks any more than I do or any more 
than anybody here. What I am saying is what level of competence 
are you requiring so that does not happen? Because it is not 
enough for us just to say, whoops, too bad if you have had 
somebody's life or their business ruined or their children's or 
their spouse's, or their medical records are all over the 
place, and they have lost their privacy. You see my concern.
    Attorney General Gonzales. I do understand your concern, 
and I share your concern. There should be only one standard, 
and that is what the law requires to ensure that the personal 
data with respect to individuals is not compromised. You are 
correct: when that happens, it can be devastating to 
individuals. We have an obligation to ensure that we are doing 
everything we are legally required to do and perhaps beyond 
that to ensure the protection of this kind of information. If 
we are not doing that, Senator, I am going to--I want to know 
why and----
    Senator Leahy. Well, I have asked this question. I will be 
following up with you, and somebody should look carefully into 
it.
    Attorney General Gonzales. Yes, sir.
    Senator Leahy. I was glad to hear you say you want to keep 
FISA helpful in your answer to Senator Mikulski's question; I 
am glad to know that you consider it helpful. Next time you are 
down at the White House, you might want to mention it to them 
that it is helpful, because the word has not gotten there.

                           CRIME VICTIMS FUND

    I have one last question on the crime victims fund. I saw 
so many victims of crime when I was a prosecutor. It has gotten 
far worse now than it was then just because we have become a 
larger country, and crime has gotten even more vicious. The 
crime victims fund has been so helpful all over the country, 
and now I find the administration wants to raid it of roughly 
$1.25 billion by the end of the fiscal year. Last year, the 
administration tried to do that. Congress, in a bipartisan way, 
blocked it.
    Now, this is not money from American taxpayers. It comes 
from criminal fines----
    Attorney General Gonzales. And penalties.
    Senator Leahy [continuing]. And forfeitures. It has 
provided critical services: 4 million victims of domestic 
violence and sexual assault, child and elder abuse, drunk 
driving, all these other crimes, this is $1.25 billion, what we 
will spend between now and the end of the week in Iraq. But we 
are cutting this from people here in the United States who 
desperately need it. How can you justify that?
    Attorney General Gonzales. Well, Senator, there has been a 
cap on the use of this excess above what has been appropriated 
since, I believe, 2000 or 2001. And so, when you say how can 
you take this away from victims, the truth is we cannot even 
spend it on victims. There is an obligation cap on spending 
this money. What we are----
    Senator Leahy. Operation cap? This is going to leave it at 
zero going into 2008. I guarantee you, just go one dollar over 
zero, and we will spend that.
    Attorney General Gonzales. We begin collecting receipts for 
2008 in 2007. If we look at the record of the past few years, 
we can see the receipts will clearly reach a level of $625 
million, which is what both the administration and the Congress 
have indicated in the past few years is an appropriate level of 
expenditure with respect to----
    Senator Leahy. No, because last year, when you tried to cut 
it out, we put it back in, so now you are trying the same thing 
so we will put it back in?
    Attorney General Gonzales. But, Senator, you said you put 
it back in----
    Senator Leahy. Big spending Congress?
    Attorney General Gonzales [continuing]. We cannot spend it 
on victims. You characterize this as monies that are available 
for victims, and yet, you would not let us spend it. There is a 
cap.
    Senator Leahy. And drunk driving and child and elder abuse 
and a whole lot of other things. Maybe we are ships crossing in 
the night, but under your plan it is zeroed out by fiscal year 
2008. How many of these organizations that are using this are 
going to be able to plan for it?
    Attorney General Gonzales. We will commence collecting 
receipts for 2008 in 2007, and we will have a very good idea as 
to whether or not the receipts are going to be sufficient to 
meet the obligations.
    Let me just emphasize that again, this administration is 
very much committed to crime victims. That is why we support 
the $625 million to be spent on crime victims programs. What we 
are talking about is $1.2 billion, which represents a perpetual 
float. It is not appropriate--well, I am not an accountant, but 
it seems to me it seems an odd accounting--I do not want to say 
gimmick--but procedure to include this in the budget when, in 
fact, it cannot be spent for crime victims. And it simply rolls 
over year after year after year. We believe very strongly in 
ensuring that there is a large amount of money available for 
crime victims, and we believe $625 million----
    Senator Leahy. Well, I think it is going to come as a huge 
surprise to a lot of people who deal with crime victims around 
this country that, gosh, we have got too much money for you to 
use. I know so many crime victims organizations that are 
desperate for money for battered women----
    Attorney General Gonzales. But, Senator, you will not let 
us spend the money.
    Senator Leahy [continuing]. For abused children----
    Attorney General Gonzales. You will not let us spend the 
money.
    Senator Leahy. What?
    Attorney General Gonzales. You will not let us spend the 
money for crime victims above $625 million. So to say that 
the----
    Senator Leahy. Well, let me put it this way: you say the 
Congress, so it is Congress' fault. Has the administration ever 
asked us to put more money or lift these caps?
    Attorney General Gonzales. Well, I think the $625 million 
is sufficient to meet the needs of crime victims.
    Senator Leahy. Okay. Thank you, Mr. Chairman. I appreciate 
the time.
    Senator Shelby. Senator Harkin.
    Senator Harkin. Thank you very much, Mr. Chairman.

                          BYRNE GRANT PROGRAM

    Mr. Attorney General, I want to get back to the Byrne grant 
program. Funding has been eliminated in the budget. One of the 
rationales offered is that the program has not demonstrated a 
satisfactory level of performance results. You said in your 
opening statement that your budget cuts programs have not met 
our high standards.
    However, the people in Iowa tell me that there has never 
been any effort on the part of the Bureau of Justice Assistance 
to actually measure the performance results of this program. 
Mr. Attorney General, has there been a valid effort to 
determine if Byrne dollars are working nationally as well as 
they are in Iowa?
    Attorney General Gonzales. My understanding, Senator, is 
that with respect to the Byrne grant funds that are 
discretionary, they are all earmarked, and it is very, very 
difficult for us to determine whether or not they are being 
effectively spent. I do not know the answer to your question as 
to whether or not there has been some kind of effort by the 
Department to evaluate the effectiveness of these grants in 
your State, but I can certainly find out and get back to you.
    Senator Harkin. I am talking about nationally. I mean, you 
said that you cut these programs that do not meet your high 
standards and that have not demonstrated a satisfactory level 
of performance results. Well, how can you zero out the Byrne 
grant program when you do not know?
    Attorney General Gonzales. Well, Senator, I think that 
again----
    Senator Harkin. May I correct one thing?
    Attorney General Gonzales. Yes.
    Senator Harkin. You said that all the dollars were 
earmarked? Is that what you said?
    Attorney General Gonzales. Well, with respect to Byrne 
grants, some are based on formulas to States.
    Senator Harkin. Yes, $416 million was formula.
    Attorney General Gonzales. And some are discretionary.
    Senator Harkin. $167 million.
    Attorney General Gonzales. Which are earmarked.
    Senator Harkin. $167 million.
    Attorney General Gonzales. All of it is earmarked.
    Senator Harkin. $167 million.
    Attorney General Gonzales. As I understand it.
    Senator Harkin. Pardon?
    Attorney General Gonzales. As I understand, all of it is 
earmarked.
    Senator Harkin. $416 million went out by formula.
    Attorney General Gonzales. Exactly; some of it is by 
formula to the States, and a portion of it, which is 
discretionary, and all of that is earmarked.
    Senator Harkin. And that is $167 million. I said that.
    Attorney General Gonzales. Yes, sir, and part of the 
problem that we have with the earmarks is, quite frankly, it 
takes off the table the ability of nonprofit groups, faith-
based organizations to compete for these dollars. They can 
provide services, very important needy services to the 
community, but they are precluded from doing so because these 
programs----
    Senator Harkin. Can you name me one NGO or faith-based 
group that is doing the kind of work that the local law 
enforcement people are doing under Byrne in fighting 
methamphetamine?
    Attorney General Gonzales. Perhaps not on the law 
enforcement side, but of course, in fighting methamphetamine, 
we are focused well beyond law enforcement. We are looking at 
education; we are looking at prevention; we are looking at 
reentry, and so, clearly, there are NGOs and faith-based 
organizations that are involved in that effort.
    Senator Harkin. That is true, but that is in another 
funding packet. Where do you fund that? That is not funded 
under Byrne. Byrne is for law enforcement.
    Attorney General Gonzales. Well----
    Senator Harkin. I still want to get back. I mean, how can 
you say it has not met your high standards when there has not 
been any effort done to quantify performance results?
    Attorney General Gonzales. Senator, I did not say that 
there has not been an effort. Let me find out and confirm that 
with you.
    Senator Harkin. Well, I have reviewed the publicly 
available so-called performance assessment rating tool, PART 
analysis of the Byrne JAG program. It does not contain any 
feedback from any of the program participants or beneficiaries. 
Again, I would think that feedback and actual results, which I 
can compile, would be included in any type of review. Why would 
that not be included?
    Attorney General Gonzales. Well, Senator, let me just say 
this, and I would like the opportunity to get back to you to 
respond to your question. I want to make sure that I give you 
the most accurate information that I can. But in terms of while 
Byrne grants may have been zeroed out, we are giving a lot of 
money to States, to local communities on a wide variety of 
issues including drugs, $10 million for the prescription drug 
monitoring program; $70 million for drug courts.
    And so, the fact that Byrne may have been cut does not mean 
that State and locals are not receiving Federal dollars with 
respect to some of these programs. What we have done is 
identified those priority areas for this President and focused 
money on those priority programs.
    Senator Harkin. Well, all I can say is that just between 
2005 and this year, Iowa absorbed a $2 million cut, 42 percent 
of the funding. And again, this paid almost exclusively for 
drug task officers going to have to be laid off in the middle 
of a meth epidemic.
    And again, I recognize you have to have education. We need 
more money for rehabilitation. We do not have enough money in 
there for meth rehab. The recidivism rate is very high, because 
we know that to effectively get people over the hump on meth, 
it takes 6 months to 1 year. Yet, we are treating them for 6 
weeks, and then, we are wondering why they are showing back up 
in our jails and our prisons again. So we do not have enough 
money for that either. But I am really upset. As far as I have 
heard from law enforcement all over this country, the Byrne 
grant program has worked. It is working well.
    I just want to say one other thing for the record, Mr. 
Attorney General. On the issue of performance results, States 
are required to report the results of the Byrne grant program 
to the Bureau of Justice Assistance. Last year, my staff asked 
BJA about this reporting. They were told that 20 States had not 
met the deadline to turn in their reports. So we investigated 
that. We called these States. And then finally got back to BJA, 
and they conceded that, in fact, only Guam and American Samoa 
had failed to turn in their performance results. We were being 
told that 20 States had not.
    So again, this all calls into question your justification 
for eliminating the program. You say you are going to get back 
to me on it. I appreciate that. But what in the meantime do I 
tell law enforcement officers in Iowa and others when I see the 
budget eliminated? You know, again, I just see no justification 
for it whatsoever. And I still do not know the answer as to why 
it has been eliminated. But if you can get back to me on that, 
I would appreciate it.
    [The information follows:]

                       Cuts to Byrne JAG Program

    In order to focus departmental resources on 
counterterrorism, which is and must be the Department of 
Justice's (DOJ) overriding priority, the Administration was 
required to make difficult choices in this budget proposal.
    The President's fiscal year 2007 budget proposal recognizes 
the Federal government's responsibilities in regard to 
supporting effective law enforcement and improving the nation's 
criminal justice system. If approved as proposed, the 
President's fiscal year 2007 budget will provide over $1.2 
billion to State, local, and tribal law enforcement through the 
U.S. Department of Justice. This includes $66.6 million to 
strengthen communities through programs providing services such 
as drug treatment; $88.2 million to combat violence, including 
enhancements to Project Safe Neighborhoods; and $209 million to 
support drug enforcement, including funding to continue and 
expand the Southwest Border Drug Prosecution Program. The 
initiatives included in this proposal were selected by 
concentrating scarce resources on the highest priority criminal 
justice issues; promoting effective, evidence-based approaches 
to improving law enforcement and criminal justice system 
capabilities; and eliminating funding for programs that could 
not demonstrate results.
    The proposed elimination of the JAG Program in fiscal year 
2007 is based on this program's inability to clearly 
demonstrate its effectiveness. During the fiscal year 2005 PART 
assessment of the JAG Program and its predecessors (the Byrne 
Formula Grant Program and the Local Law Enforcement Block 
Grant), OMB concluded that these programs have not been able to 
clearly demonstrate through quantifiable performance measures 
that they had achieved nor were making progress toward their 
goals. In light of the broad array of assistance offered to 
State, local, and tribal law enforcement agencies through OJP, 
the Administration determined that the funds currently devoted 
to the JAG Program could be used more effectively elsewhere.

                       VIOLENCE AGAINST WOMEN ACT

    Senator Harkin. One last thing, Mr. Attorney General, and 
that is the Violence Against Women Act. The President hailed 
the reauthorization of it when he signed the bill in early 
January, but in February, the budget provided no funding for 
any of the new programs authorized by the Violence Against 
Women Act. That included $50 million in funding for victims of 
sexual assault. I was just visited in my office this morning by 
some people regarding that.
    It is the first time that sexual assault victims received 
dedicated funding. And again, if you have any information on 
that at your fingertips, I would like to know why there was not 
any funding for any of the----
    Attorney General Gonzales. Well, Senator, I believe that 
the President's budget does include $347 million for the Office 
on Violence Against Women. So perhaps I need to go back and 
check my figures, and I am happy to do that. If we need to give 
you more information about what we are doing for victims of 
violence, be happy to do that.
    Senator Harkin. Well, I would appreciate that, because I am 
told that there is no funding for any of the new programs, one 
of which is in funding for victims of sexual assault. It is the 
first time that they received dedicated funding, and there was 
no funding for it.
    Attorney General Gonzales. I would be happy to look at 
that.
    [The information follows:]

  Violence Against Women Act Funding Within the Department of Justice

    The 2007 President's budget for the Office on Violence 
Against Women (OVW) is $347,013,000. An additional $21,869,000 
is requested for victims of child abuse programs administered 
by the Office of Justice Programs. These amounts do not include 
increased funding or new initiatives based on the recently 
enacted reauthorization of the Violence Against Women Act 
(VAWA), due to the fact that the reauthorization was signed 
just prior to the release of the 2007 President's budget. As 
the Administration prepares future budget proposals, the 
reauthorization will be considered. In the interim, OVW is 
actively working on a plan to make the changes directed by the 
new legislation for the current VAWA grant programs.

    Senator Harkin. I appreciate that. Thank you, Mr. Attorney 
General.
    Thank you, Mr. Chairman.
    Senator Shelby. Senator Kohl.
    Senator Kohl. Thank you, Mr. Chairman.

                              BYRNE GRANTS

    Just to conclude the Byrne grant questions, Mr. Attorney 
General, if you talked to police chiefs or sheriffs all across 
my State, all across the country, they say that the Byrne grant 
program is the backbone of Federal aid for local law 
enforcement. Now, it has been for many, many years. They have 
always attested that it was a good program, that the funds were 
used carefully.
    As you know, the funds are appropriated down to the local 
level so that each dollar becomes very important. We are not 
talking about billions. We are talking about, you know, 
millions and thousands and hundreds of dollars so that they see 
that these dollars are used very efficiently. I think there is 
ample evidence that that is true.
    Now, you have not told us why you would see fit not to cut 
this program but to scrap it. Did I hear your explanation, or 
have you not given it?

                        STATE AND LOCAL PROGRAMS

    Attorney General Gonzales. Well, let me try to clarify what 
I have said. With respect to Byrne, this has been a difficult 
decision. The decision was made that we have got to be more 
focused on the priorities of the administration. And if you 
look at the money that is going to State and locals, there is a 
lot of money that is being spent for State and locals on areas 
like terrorism, $40 million for terrorism. And so, it may not 
be going through a Byrne grant, but there is $40 million going 
to State and locals regarding terrorism; to reduce crime, $16 
million for VCIT programs; $59 million for Project Safe 
Neighborhoods; $15 million for gang training and technical 
assistance; $10 million for prescription drug monitoring; $7 
million for drug courts; $15 million for ICACs; $22 million for 
trafficking; $2 million for sex offender registry; $347 million 
for Office on Violence Against Women; $106 million for DNA; $40 
million for the national criminal history improvement program 
(NCHIP); $30 million for Southwest border prosecution; $50 
million for the weed and seed program; $31 million for Indian 
country problems; $40 million for meth cleanup; $3.9 million 
for training.
    The point is, Senator, is there is a lot of money going to 
State and locals. We have simply decided that it is better--we 
have a responsibility to the taxpayers to ensure that the 
monies that are being allocated to the States are focused on 
specific programs which we believe are effective, which we 
believe affect the most pressing needs of our communities.
    And we believe it is a more effective way to provide monies 
out to deal with local issues. This does not reflect in any way 
a lack of commitment to working with State and local officials 
who we consider our partners. We want to continue to build on 
that relationship, but we have a responsibility, too, to the 
taxpayers, and we believe this is a more responsible way to get 
dollars down to State and local officials.
    Senator Kohl. Are you saying that these programs total up 
to as much as more than the Byrne grant program.
    Attorney General Gonzales. No, sir, I am not saying that.
    Senator Kohl. I see.
    Attorney General Gonzales. I am not saying that, no, sir.
    Senator Kohl. I think when we add up the dollars, Mr. 
Attorney General, we are talking about cuts, significant cuts.
    Attorney General Gonzales. But, sir, I am not sure that our 
service to our communities can be measured solely in the 
dollars. The dollars have to be spent efficiently and wisely, 
and I know as a businessman, you understand that and can 
appreciate that.
    And so, that is the question: are we spending the 
taxpayers' dollars efficiently and wisely on programs that are 
targeted on the greatest needs in our communities?
    Senator Kohl. But you have never assessed the program. You 
are apparently saying the money was not being spent 
efficiently. You are sort of winging it when you say that, and 
I do not want to use that word inappropriately.
    Attorney General Gonzales. Yes, sir.
    Senator Kohl. So we are just going to cut it.
    Attorney General Gonzales. No, Senator, what I am saying is 
that we have identified in this budget the President's 
priorities: the pressing needs within the communities, and the 
decision has been made that we ought to take the monies in the 
budget and target those needs and focus dollars on the programs 
that address the most pressing needs.
    Senator Kohl. That is fine, and I appreciate that. I think 
these scarce dollars that have been appropriated to local law 
enforcement should not have been cut; now, of course, we can 
have a difference of opinion on that, and it is very strongly 
felt out there at the local level, where I know you are 
focused.
    Attorney General Gonzales. Sir, I hear about it when I 
travel. Obviously, this is an important issue. But I think, and 
I may be wrong about this, but I think State and local 
officials, they care about the dollars. I am not sure that they 
care that they be funded through the Byrne program. If there is 
another way that the dollars are getting down to the State and 
local officials, obviously, that is what they care about.
    Senator Kohl. Just one other, and then, I will turn it over 
to Senator Murray.

                  COMMUNITY ORIENTED POLICING SERVICES

    The COPS program, as you know, was a brilliant program for 
several years. It was universally acclaimed as being 
successful. It was at $1 billion at its zenith, and now, it is 
basically zeroed out. Now, when Attorney General Ashcroft was 
here several years ago, and we asked him about it, I want to 
quote what he said: he said the COPS program was, quote, a good 
thing, quote, that it had worked very well, and quote, that it 
had been one of the most successful programs that we have ever 
had, quote.
    So now, we are talking about taking a program that did as 
much good around our country again at the local level, which is 
where it is all about, and we are just saying let us forget 
about it. Why would you do that?
    Attorney General Gonzales. Let me just echo General 
Ashcroft's comments about the importance of the COPS program. 
Putting more people on the streets, I think, is one reason we 
have had a reduction in violent crime across America. The COPS 
program in terms of hiring more cops was focused on getting 
100,000 cops on the street by a certain period of time.
    We met that goal. I do not believe it was ever intended 
that we would continue to make monies available to continue to 
fund more hiring of State and local police officers on the 
streets. Now, having said that, there is still $400 million in 
proposed appropriations for the COPS program. There is $102 
million for COPS-administered programs, including $31 million 
for Indian country issues, $40 million for meth cleanup, $3.9 
million for training of State and local officials.
    And so, this notion that we have zeroed out COPS, there is 
no money for hiring additional police officers, but that was 
reflected in last year's budget approved by Congress. There 
were no additional COPS dollars for hiring police officers. 
That is the budget that Congress passed. And so, this is 
consistent with what Congress did in 2006, and I would just 
again remind you that there is $400 million in proposed 
appropriations in the COPS program.
    Senator Kohl. Thank you, Mr. Chairman.
    Senator Shelby. Senator Murray.

                              DRUG CARTELS

    Senator Murray. Well, thank you very much, Mr. Chairman. 
Let me ask you about the meth program, because I am deeply 
concerned that--well, back in 2001, actually, a Drug 
Enforcement Administration estimate said drug cartels made up 
80 percent of the meth consumed in the United States, and that 
has probably increased since then because of the crackdown we 
have done on some of the home mom and pop production.
    But what we do know is that these cartels require about 200 
metric tons of ephedrine and pseudoephedrine every year, and it 
is about 10 percent of the world's output of those legal 
chemicals. I am very concerned that we may be missing an 
opportunity to work with chemical factories abroad to prevent 
the cartels from getting their hands on these chemicals, and I 
wanted to know what you and the administration are doing to go 
after these cartels and their suppliers to stop the flow of 
meth into our communities.
    Attorney General Gonzales. Those are all very good 
questions, Senator. I am sure Administrator Tandy will be able 
to amplify on what I have to say.
    We are working with countries like China, Germany, and 
India to restrict the import of precursor chemicals into 
Mexico, because you are right, it is a serious problem. And we 
are working closely with our counterparts in Mexico about this 
issue. I have had several meetings with the Mexican attorney 
general. He and I are attending an anti-meth conference in 
Dallas in May, because he understands how serious this issue 
that we can do, we can pass all the laws here at the Federal 
level and at the State level which have been successful with 
respect to reducing mom and pop labs, but if we do not have 
some help from Mexico and the law enforcement efforts there, it 
is a tough, tough battle.
    And so, I share your concern. We are focused on it. I know 
Administrator Tandy is working on this issue, and Mexico has 
already passed legislation to--maybe not legislation; could be 
regulations to deal with limiting access to precursor chemicals 
as well. But you are right: the problem is that we have to put 
limits or try to retard efforts to have precursor chemicals 
come in from other countries, and we are doing that.
    Senator Murray. Good, we do not want to miss that, because 
I think it is the gorilla in the room if we are not focused on 
these drug cartels and where they are getting their supplies, 
so I really encourage you to do that and want to hear more 
about that as we go along.

                            NORTHERN BORDER

    Let me ask you another question, because the importance of 
local law enforcement agencies having the ability to work 
closely with their Federal counterparts has never been more 
significant, and in my opening statement, I talked about the 
concern I have about the need to increase Federal, State, and 
local law enforcement partnerships.
    In my State, southwest Washington is an area where law 
enforcement continues to talk to me about the need for an 
increased Federal presence. Vancouver, Washington right on the 
border, Columbia River, is now the fourth largest city in 
Washington. It is projected to be the second largest by 2010, 
and as you probably know, Federal agents cannot cross over the 
Columbia River, because that represents the dividing line of 
Federal jurisdiction.
    What that means is that southwest Washington's primary 
offices for Federal assistance are located more than 100 miles 
away, and there is a lot of threats we are hearing about 
including organized crime and drug trafficking. So a Federal 
presence in Vancouver is really essential for our State.
    And I wanted to know, I know we got about six new staff a 
few years ago, but I would like to ask if you would be willing 
to work with my office and law enforcement stakeholders in our 
region to take a look at this situation and really help us find 
some solutions to this.
    Attorney General Gonzales. Senator, I am told, and I do not 
know how current this information is, that the Department has 
769 personnel in your State. We may only have two agents in 
Vancouver.
    Senator Murray. Correct.
    Attorney General Gonzales. Period; that may be the sole 
scope of our presence.
    I am not sure that that is right, and so I have asked our 
folks to look at this issue, and I would be happy to work with 
you on it.
    Senator Murray. I would really appreciate if we could get 
together and focus on that with some of the folks from 
southwest Washington. I think we need to come up with some 
solutions for them. It is really becoming more and more 
critical.
    I also wanted to talk to you about the challenges facing 
our northern border States with respect to some of the 
typically border related cases. You and I have talked about 
this before. We are seeing increased border apprehensions for 
drug smuggling, money laundering, other crimes because we have 
increased the number of people on the border.
    The southwestern States, as I said, have a Federal program 
for reimbursement. We do not have a similar program at the 
northern border, and this really puts a tremendous burden on 
our local officials. I know they have talked to you. I know 
Senator Cantwell and I have mentioned this many times.
    I wanted to find out would you support an effort to expand 
the southwest border prosecution initiative program to our 
northern border States?
    Attorney General Gonzales. I would be happy to talk with 
you about it. I worry about the fact that 70 percent of our 
immigration cases are on the southern border, and 30 percent 
are on the northern border.
    [The information follows:]

                       Northwest Border Security

    The Department does not support an effort to expand the 
Southwest Border Prosecution Initiative to the Northern Border 
at this time. A review of the Department's statistics indicate 
that 68 percent of all immigration cases occur on the Southwest 
Border (12,318 immigration cases were filed in the Southwest 
Border Districts out of a total of 18,147 immigration cases 
filed nationwide in 2005). Furthermore, the Department did an 
extensive study of this issue and determined that while both 
borders share some of the same vulnerability the security of 
the SW border requires significantly more resources and 
personnel to address the explosion of people crossing the 
border illegally.

    Senator Murray. But I would remind you that Ahmed Rassam 
came through the northern border.
    Attorney General Gonzales. No question about it. Obviously, 
we need to be concerned.
    Senator Murray. I believe there was an investigation a few 
weeks ago that showed that a dirty bomb could get through that 
came through the northern border in my State.
    Attorney General Gonzales. No question about it.
    My own view of reimbursement of costs of State and local 
officials is that quite frankly, the Federal Government needs 
to do its job. It needs to do a better job of securing the 
border so that you do not have the kinds of burdens that we see 
today on municipalities and State governments. So I think that 
should be our focus. In terms of focusing on reimbursement, I 
think we ought to be focusing on, quite frankly, the Federal 
Government doing its job, but I would be happy to talk to you 
about it.
    Senator Murray. Well, we had the same conversation 1 year 
ago. It feels like we are in the same spot; no changes.
    So I would really like to hear from you if you could get a 
response back to us how we are going to deal with this critical 
issue.
    Attorney General Gonzales. Yes, ma'am.
    Senator Murray. Thank you.
    Senator Shelby. Mr. Attorney General, we appreciate you 
appearing here today, and we appreciate your service to the 
Nation. We have a number of additional questions we will submit 
for the record, and we would appreciate your timely response if 
you can do it as soon as you can.
    Attorney General Gonzales. I will, Mr. Chairman.

                    Federal Bureau of Investigation

STATEMENT OF ROBERT MUELLER, DIRECTOR
    Senator Shelby. And at this time, we would like to call the 
second panel of witnesses. They are Director Robert Mueller, 
Director of the Federal Bureau of Investigation; Administrator 
Karen Tandy, Drug Enforcement Administration; Director Carl J. 
Truscott, Bureau of Alcohol, Tobacco, Firearms and Explosives; 
and Director John Clark, United States Marshals Service.
    Director Mueller, we will start with you. If you could just 
sum up briefly, because we have enough; your top points. We 
welcome you to the subcommittee, and we also appreciate your 
service, all of your service to the country.
    Mr. Mueller. Thank you, Mr. Chairman, and thank you for 
having me today, and thank you, Senator Mikulski, Senator 
Leahy, for being here. Thank you for the opportunity to testify 
today in front of you. I want to thank you also for the funding 
that was provided to the FBI in the Hurricane Katrina 
supplemental, and I understand yesterday that the 2006 war 
supplemental may also have passed through the Senate, and we 
thank you for your support there.

                        NATIONAL SECURITY BRANCH

    My testimony sets forth the details supporting the budget 
request of the over 31,000 positions and $6 billion, and I do 
not want to spend a great deal of time on that because it is in 
my written remarks. I will say, I want to spend a couple 
moments at the outset first of all talking about the national 
security branch that was approved in September. And the mission 
of the national security branch, as you are well aware, is to 
position the FBI to protect the United States against weapons 
of mass destruction, terrorist attacks, and foreign 
intelligence operations.
    With regard to the budget for the national security branch, 
we have asked for $25.8 million for resources to respond to 
terrorist threats and incidents such as those posed by weapons 
of mass destruction; $15 million for essential infrastructure 
enhancements; and $16 million to support our core intelligence 
processes.
    I do want to make the point that while national security 
efforts remain our top priority, we continue to fulfill our 
crime fighting responsibilities as well. Public corruption is 
the top criminal priority for the FBI. In the last 2 years, our 
investigations have led to the conviction of over 1,000 
Government employees involved in corrupt activities, to include 
177 Federal officials, 158 State officials, 260 local 
officials, and more than 365 police officers.
    At the same time, we continue to focus on implementing the 
national gang strategy along with ATF. This strategy is 
designed to identify the prolific and violent gangs in the 
United States and to investigate, disrupt, and dismantle their 
criminal enterprises.

                                SENTINEL

    Having made those two points, Mr. Chairman, I would like to 
spend a couple of moments to focus on Sentinel, which was 
raised in your opening remarks. As you are aware, as we have 
discussed, on March 16, we announced the award of a $305 
million contract to Lockheed Martin for the development, 
operation, and maintenance of the Sentinel program. And I would 
like to spend a couple of moments responding to anticipated 
questions and some of the remarks you made in your opening 
comments.
    As you are aware, the $305 million contract cost 
constitutes approximately $232 million for development of 
Sentinel, and this new information management system will be 
developed over a period of approximately 4 years and will be 
deployed in four phases. We anticipate completion of the first 
phase approximately 1 year from now. And as each phase is 
completed and deployed, we will begin to incur costs for 
operation and maintenance or O&M, as it is called.
    After completion of the final phase in 2009, we have the 
opportunity to exercise the option for Lockheed Martin to 
continue providing O&M for an additional 2 years, through 2011.
    With regard to these four phases, each phase will deliver a 
new standalone capability and will provide greater access to 
existing information and will, as importantly, facilitate the 
input of information into the system and the dissemination of 
information to others both inside the FBI as well as to our 
partners outside the FBI. In addition, Sentinel will provide 
the FBI a system that is flexible and adaptable to address 
future advances in technology and changes in our mission and 
the threat environment.
    I know that, Mr. Chairman, you are concerned as we are 
concerned about the success of this program, and to ensure the 
successful and the timely completion of Sentinel within budget, 
we have structured the contract with Lockheed Martin in such a 
way as to provide clear requirements, deliverables, and 
milestones. The contract is also structured so that each phase 
is an exercisable option. And in addition, we have invited 
close scrutiny of each phase of the Sentinel process through 
multiple venues, both internal and external.
    We have created a strong program management office for 
Sentinel and staffed it with skilled technical, programmatic, 
business management, and administrative subject experts. In 
fact, two of our program management employees have recently 
been honored by industry for their leadership and their 
accomplishments.
    We also have independent contractors who will conduct 
verification and validation reviews of the Sentinel program, of 
the management office, of the Lockheed Martin's performance and 
the performance of the subcontractors in order to ensure proper 
execution and delivery of Sentinel. We have asked the GAO and 
the inspector general to work with us as we undertake this 4-
year program to ensure that we are on the right track.
    We are aware of the GAO's recently released report to which 
you averted in your remarks, and we welcome that report, and we 
have established safeguards for Sentinel, as has been 
recommended in that report by GAO. The Justice Department 
inspector general will be conducting audits of Sentinel 
throughout the development and implementation of the program as 
well, and it recently released its first report on the preaward 
phase of Sentinel, which in part confirms that we are 
addressing the issues identified in the GAO report.
    The Deputy Attorney General, the Department of Justice 
Chief Information Officer, the Office of the Director of 
National Intelligence, the Office of Management and Budget, are 
all meeting periodically with the Sentinel program manager and 
senior FBI management to ensure that Sentinel is proceeding as 
planned.
    We have engaged as well outside experts to help us review 
and assess the implementation of Sentinel, and finally, 
Sentinel will be subject to close congressional scrutiny. We 
are committed to keeping this subcommittee and/or other 
oversight committees informed as we move ahead.
    Mr. Chairman, we believe that the extensive internal and 
external oversight I have just described will ensure the 
successful delivery of Sentinel, and even so, we are ever 
mindful of the challenges of the past, and I believe we have 
learned from what went right and what went wrong with Trilogy. 
And I know you have a number of concerns, and I would like to 
briefly address three of those concerns, which you mentioned in 
your opening statement.

                       VIRTUAL CASE FILE PROJECT

    First, the cost to the taxpayers of the Virtual Case File 
project as compared with this project: if you recall, sir, in 
the beginning of 2004, we were presented with Virtual Case File 
by the contractor. It did not work. We went into negotiations 
with that contractor. We were told that it would take $50 
million in addition to the $170 million to get a project or a 
product that would work.
    We employed outside independent contractors to come in and 
see whether it was worthwhile spending that money. They said 
no. That contract ultimately would have been around $220 
million if we were lucky. This is around $232 million for the 
same development, but it is a development of a product that 
will put us on a firm foundation in the future.
    Let me turn to the deficiencies in the GAO report. As I 
mentioned briefly, we have taken, we have looked at those 
deficiencies. We have established a new unit to address those 
deficiencies that were identified in the GAO report, and I 
believe that we, with that new unit, we will be on top of the 
matters that were pointed out to us by the GAO.

                                SENTINEL

    And last, Mr. Chairman, I know that there were concerns 
about two of the subcontractors on the Sentinel project. One of 
those subcontractors was involved in providing training to 
employees under the Trilogy project, but that was not an issue 
with regard to the successes and/or the failures of Trilogy. 
The other subcontractor acquired an entity that had previously 
performed work on the Trilogy project, but that division has 
nothing to do with providing work on the Sentinel project.
    Let me finish by summarizing and saying that we recognize 
that Sentinel is a large project and a large investment for the 
taxpayers of the United States.
    Senator Shelby. But an important one.
    Mr. Mueller. But a very important one, and it is important 
to the men and women of the FBI, who need this technology 
system, and I can tell you that we have learned from the 
mistakes of the past. We are intent in bringing this home, and 
we have, in Lockheed Martin, I believe, a partner who will get 
us across the finish line.
    And with that, I would be happy to respond to any questions 
on this or any other issues.
    Thank you, Mr. Chairman.
    [The statement follows:]

              Prepared Statement of Robert S. Mueller III

    Good afternoon, Mr. Chairman, Senator Mikulski, and Members of the 
subcommittee. I appreciate the opportunity to appear before you today 
to discuss the President's fiscal year 2007 budget for the Federal 
Bureau of Investigation (FBI). I also would like to thank you for 
passing the fiscal year 2006 Katrina supplemental which included $45 
million for the FBI. Our employees in the Gulf region endured great 
suffering and devastating property loss in the aftermath of Katrina. In 
addition to the horrific personal toll the storm took on the people of 
the Gulf region, the FBI offices in New Orleans, Beaumont, Gulfport and 
Pascagoula were either severely damaged or completely destroyed. 
However, your funding is helping to rebuild our offices, put our 
employees back to work, and enable us to bring our capabilities back to 
pre-Katrina levels.
    With this Committee's help, the FBI was able to establish Katrina 
Fraud Task Forces, in Lake Charles and Lafayette, Louisiana, to 
investigate and prosecute those unscrupulous individuals who seek to 
benefit from this national tragedy. We intend to continue this 
important work as the Gulf region recovers.

                          2007 BUDGET REQUEST

    The fiscal year 2007 budget totals 31,359 positions and $6.04 
billion. The net fiscal year 2007 program increases total 75 positions. 
Our fiscal year 2007 budget is focused on enhancing and improving our 
infrastructure. Since September 11th, the FBI has undergone significant 
reorganization and tremendous personnel growth. However, FBI 
Headquarters (HQ) facilities and infrastructure programs have not kept 
pace with our transformation from a law enforcement entity to a key 
player in the Government's war against terrorism.
    As an agency, we must find the proper balance between expanding our 
workforce and supporting on-board employees with the technology and 
infrastructure necessary to accomplish our dual mission as both a law 
enforcement and an intelligence entity. I believe the fiscal year 2007 
budget will go a long way in rectifying the gaps between our rapid 
growth in personnel and our current infrastructure.

                   IMPROVING PHYSICAL INFRASTRUCTURE

    The FBI's space for handling and storing classified information is 
currently inadequate. We are formulating a strategy to address 
Sensitive Compartmented Information Facility (SCIF) space requirements. 
The primary objective of the FBI's plan is to provide SCIF space and 
SCI connectivity to key national security field facilities by the end 
of calendar year 2007 which will be accomplished using resources 
requested in the fiscal year 2007 President's Budget.
    In fiscal year 2007, the FBI is requesting $33 million in 
construction funding for SCIF expansion. This funding would allow for 
information sharing between the FBI and our partners within the 
Intelligence Community (IC), as envisioned by the President and 
Congress. Without this SCIF expansion, the FBI cannot ensure an 
adequate intelligence infrastructure to achieve our strategic goals. In 
the fiscal year 2006 conference report you requested that we develop a 
plan to prioritize our SCIF expansion program. This report is currently 
under Administration review and we look forward to discussing it with 
the Committee once it is released.
    We are also requesting $8.8 million to acquire additional space for 
an FBI Headquarters Annex which would be located in the Washington, 
D.C. metropolitan area. Most of FBI's Headquarters components operate 
in fragmented and overcrowded office space. The FBI must secure an 
additional 150,000 square feet of useable space in order to accommodate 
the needs of new personnel coming on-board through fiscal year 2007.
    The current FBI Academy training facilities located at Quantico, 
Virginia are inadequate to address the training needs of our analysts 
and Special Agent personnel. Most of the Academy's facilities were 
designed in the late 1960s to accommodate small groups in a traditional 
classroom training setting. However, given the FBI's growth and dual 
mission requirements, the Academy can no longer support our expanding 
needs or provide us the forum to develop a world-class cadre of 
intelligence professionals.
    After the September 11th terrorist attacks, the FBI developed and 
implemented professional training for Intelligence Analysts (IA) 
throughout the FBI. In October 2001, the Center for Intelligence 
Training (CIT), formerly known as College of Analytical Studies, was 
established at the FBI Academy. The CIT was established to improve the 
FBI's analytical capabilities to meet our present and future 
investigative responsibilities. All courses delivered by the CIT are 
designed to support the FBI's Counterterrorism (CT), 
Counterintelligence (CD), and analytical missions. The CIT experienced 
significant growth during its first years of operation and, based on 
expected hiring levels of new IAs, the FBI expects the CIT to continue 
to expand its operational and training missions.
    In the fiscal year 2007 budget, we are requesting $6.3 million to 
upgrade our CIT facilities by beginning the process of designing the 
CIT training center at the FBI Academy complex in Quantico, Virginia. 
The CIT will be a major element in continuing to promote and develop 
the FBI's leadership training for FBI-wide, State/local, and 
international law enforcement personnel.
    We are also requesting $11.9 million for interim space at the FBI 
Academy for the FBI's Hostage Rescue Team (HRT). Although HRT's current 
space was built to accommodate only 50 employees, there are currently 
more than 200 staff members using this limited space. As with many FBI 
units, HRT's responsibilities have increased enormously since the 
September 11th terrorist attacks. Over the past 3 years, the HRT has 
been deployed on 159 occasions, of which over 62 percent were related 
to counterterrorism. The HRT was also utilized in support of search and 
recovery efforts in the aftermath of Hurricanes Katrina and Rita. Much 
of HRT's work is sensitive in nature and must be conducted in a secure 
area.

                         INFORMATION TECHNOLOGY

    We continue to upgrade and enhance our technological 
infrastructure. In our fiscal year 2007 budget, we are requesting $100 
million for Sentinel. Sentinel will leverage technology to reduce 
redundancy, eliminate inefficiencies, and maximize the FBI's ability to 
use the information in its possession. Our objectives for Sentinel 
include the following: (1) Deliver a set of capabilities that provide a 
single point of entry for investigative case management and 
intelligence analysis; (2) Implement a new and improved FBI-wide global 
index for persons, organizations, places, things and events; (3) 
Implement a paperless information management and work-flow capability; 
and (4) Implement an electronic records management system.
    I want to stress that the Sentinel program is not a reincarnation 
of the Virtual Case File. In the past few years we have struggled with 
our information technology programs. However, we have learned hard 
lessons from our missteps and we are doing things very differently this 
time. Each phase of the Sentinel contracting process is being closely 
scrutinized by a team of FBI technical experts, the Government 
Accountability Office (GAO), the Office of Management and Budget, and 
the Department of Justice's Chief Information Office and Inspector 
General. Furthermore, at this Committee's recommendation, we have also 
engaged outside experts to help us review and assess the implementation 
of Sentinel.
    On March 16, 2006, we announced the award of the contract for 
development of the Sentinel to Lockheed Martin. Under the terms of the 
$305 million, 6-year contract, Lockheed Martin and its industry 
partners will use proven commercial off-the-shelf technologies to 
produce an integrated system that supports processing, storage and 
management of the FBI's current paper-based records system. The program 
includes an incremental development and delivery of Sentinel 
capabilities including $73 million for operations and maintenance 
activities.
    Now that the contract has been awarded, we are moving forward with 
phase one of the development process. Each of the four phases will 
introduce new stand-alone capabilities and will be user-focused. As 
each phase is implemented, existing information will be transferred to 
new systems and old legacy systems will be retired. As a result, 
Sentinel will replace a number of legacy applications including: 
Automated Case Management System (ACS); ASSET; Criminal Informant 
Management System; Bank Robbery Statistical Application; and Financial 
Institution Fraud and Integrated Statistical Reporting Analysis 
Application (ISRAA).
    I will continue to update this committee on the progress of 
Sentinel and I expect and welcome your strong congressional oversight 
of this program.

                  NGI AND IAFIS/IDENT INTEROPERABILITY

    We are also requesting funding for major enhancements to our 
Integrated Automated Fingerprint Identification System (IAFIS). IAFIS 
is the ten-rolled fingerprint identification system that was 
successfully deployed in 1999 and is used by Federal, State, and local 
law enforcement and authorized non-criminal justice agencies to 
identify subjects with criminal history information. While IAFIS was a 
state-of-the-art system at its inception, technology has since 
advanced, and we must update IAFIS in order to meet the needs of our 
customers.
    The FBI intends to meet these new requirements by implementing a 
Next Generation Identification system (NGI). We are currently 
conducting a comprehensive requirements study that will produce an 
Implementation/Strategy Plan, baseline Systems Requirement Document 
(SRD), Functional Requirements Document, and Requirement Traceability 
Matrix.
    Once we have completed the planning effort, we will design, 
develop, and implement modular builds with each module providing 
improved functionality, such as improved accuracy and speed. The FBI is 
requesting $38 million to support development of NGI.
    Along with improvements to IAFIS, the FBI is developing 
interoperability with the Department of Homeland Security's (DHS) 
Automated Biometric Identification System (IDENT). DHS's IDENT program 
is a two-flat fingerprint identification system. Various legislative 
acts have required the FBI and DHS to ensure that the systems are 
interoperable and that the criminal and immigration information that 
they contain is accessible to, and shared among, other Federal, State, 
and local law enforcement agencies. In 2002, the FBI began providing 
DHS with extracted, partial data from IAFIS. This is a temporary 
solution until full interoperability can be achieved.
    Interoperability efforts between IAFIS and IDENT are advancing. A 
multi-agency Interoperability Integrated Project Team (IPT) was 
established to address the problem. In June 2005, FBI Criminal Justice 
Information Services (CJIS), DHS United States Visitor and Immigrant 
Status Indicator Technology (US VISIT) and the Department of State 
signed a charter which established cooperative guiding principles for 
IPT. IPT is aggressively pursuing different interoperability models to 
find a solution to the problem. For fiscal year 2007, the FBI is 
requesting $33 million to purchase hardware, software, and contract 
services to support this interoperability initiative.

                            HUMAN RESOURCES

    During fiscal year 2005, this Committee provided the FBI with the 
legislative authority and resources to help us compete with other 
homeland security and Intelligence Community (IC) organizations who 
often recruited employees away from the FBI. The funding allowed us to 
provide recruitment bonuses for potential new hires, retention and 
relocation bonuses to existing employees with job offers from other 
government entities, and increased funding for our University Education 
Program and student loan repayments. Thanks to your support, the FBI 
used approximately $22 million for these purposes during fiscal year 
2005, including almost $5 million on recruitment initiatives, $1.6 
million on employee retention and relocation bonuses, and $14.9 million 
on degree programs and student loan repayments.
    The additional funding this Committee provided as an extension of 
these authorities is allowing the FBI to extend relocation bonuses to 
agents assigned to high cost of living offices. Each of these 
incentives is providing us with the leverage to retain a high-caliber 
workforce to better serve the Nation in our fight against terrorism.
    Additionally, this Committee provided for the establishment of our 
Sabbatical Program. Last year, the FBI sent participants to the St. 
Andrews Program for International Security Studies and to Harvard's 
John F. Kennedy School of Government. This year, we added several new 
partners to our Sabbatical Program and are able to provide 
opportunities for FBI employees to attend Mercyhurst College; the 
George C. Marshall Center; the National Defense University; the Naval 
Postgraduate School; the Marine Corps University; and the Naval War 
College. Students will benefit from receiving various certificates and 
degrees ranging from Applied Intelligence to National Resource 
Strategy.
    The FBI is developing programs designed to recruit, train, develop, 
and retain professionals who have the skills necessary for the success 
of its national security missions. Among these workforce programs are 
the Special Agent career path and the Intelligence Career Service. 
These programs are designed to enhance the national security workforce 
and to create training and development opportunities for agents, 
analysts, linguists, and surveillance specialists in the FBI's national 
security programs. Last year, the FBI trained 589 new agents and over 
1,000 Intelligence Career Service professionals.
    The FBI will expand current in-service and virtual intelligence 
training initiatives for FBI employees and our partners in other 
Federal, State, local, and tribal agencies. Efforts are underway to 
assess our training and to develop the capabilities we need as we go 
forward. Revisions to New Agents and Cohort training programs are also 
underway. We are requesting $5 million in fiscal year 2007 to provide 
advanced intelligence training curriculum development and $1 million to 
establish our Intelligence Officer certification program.

                   NATIONAL SECURITY BRANCH--CT/CI/DI

    Over the past 4 years, the FBI has developed its intelligence 
capabilities and improved its ability to protect America from threats 
to national security. We have built on our established capacity to 
collect information and enhanced our ability to analyze and disseminate 
intelligence. Implementation of the National Security Branch (NSB) is 
the next step in the FBI's transformation.
    On June 28, 2005, in response to the findings of the Commission on 
the Intelligence Capabilities of the United States Regarding Weapons of 
Mass Destruction (WMD Commission), President Bush directed the FBI to 
create a ``National Security Service'' within the FBI. The FBI 
implemented this directive through the creation of a new entity--the 
National Security Branch (NSB)--that integrates the FBI's primary 
national security programs under the leadership of a single Executive 
Assistant Director, and through policies and initiatives designed to 
enhance the capability of the entire FBI to support its national 
security mission.
    The mission of the NSB is to optimally position the FBI to protect 
the United States against weapons of mass destruction (WMD), terrorist 
attacks, foreign intelligence operations, and espionage by integrating 
investigative and intelligence activities against current and emerging 
national security threats; providing useful and timely information and 
analysis to the intelligence and law enforcement communities; and 
effectively developing enabling capabilities, processes, and 
infrastructure, consistent with applicable laws, Attorney General and 
Director of National Intelligence guidance, and civil liberties.
    The FBI's NSB was established and is making significant progress in 
integrating the missions, capabilities, and resources of the 
Counterterrorism, Counterintelligence, and Directorate of Intelligence 
(DI) programs. The NSB builds on the success of the DI and other 
initiatives already underway by helping to integrate the FBI's 
intelligence mission more fully into the FBI and into the IC, so that 
the IC can better understand FBI operations, while enhancing the FBI's 
ability to protect the Nation.
    The NSB essentially puts one face on the FBI's intelligence mission 
to stakeholders, including Congress, other IC agencies, and the general 
public. The FBI is currently working with the Department of Justice 
(DOJ) and the Administration to ensure that the NSB meets the 
directives set forth by the President and is responsive to the Office 
of the Director of National Intelligence (ODNI).
    A major part of our counterterrorism work has been supporting the 
war on terror overseas in Iraq and Afghanistan. The FBI's 
responsibility there is to protect U.S. interests and persons from 
terrorist attacks by conducting investigations and acquiring 
intelligence that would prevent, disrupt, and defeat terrorist 
operatives targeting America. The U.S. military and IC are partners 
with the FBI in this mission.
    As a result of our intelligence gathering overseas, IC reports 
indicate Al-Qa'ida has declared its intent to execute a WMD attack 
against the United States. A successful attack using a WMD device 
consisting of a chemical, biological, radiological, or nuclear payload 
would have catastrophic consequences. Preventing the detonation of a 
WMD device through an effective, coordinated, and technically 
proficient response program is an FBI responsibility defined by 
Presidential Decision Directive-39. The FBI is requesting $25.8 million 
to provide resources to respond to terrorist threats and incidents such 
as WMD and other explosive devices.
    The DI oversees the Field Intelligence Groups (FIGs). FIGs are 
central to the integration of the intelligence cycle into field 
operations. The FIGs coordinate, manage, and execute all the functions 
of the intelligence cycle. FIGs include Special Agents and Intelligence 
Analysts as well as officers and analysts from other intelligence and 
law enforcement agencies. The establishment of FIGs in every field 
office during October 2003, and the issuance of initial guidance for 
their operations, laid the groundwork for enhancing the FBI's 
intelligence capability in the field. From January 2004 through January 
2006, Intelligence Analyst staffing increased on the FIGs 61 percent, 
from 617 to 995. Work will continue with the implementation of a plan 
to more fully integrate the intelligence cycle into FBI field 
operations through standardized processes, pilot implementation 
projects, specialized training, and refinement of roles and 
responsibilities. We have also assessed our field-wide intelligence 
collection capabilities to include human, technical, and physical 
collection posture. Our fiscal year 2007 budget request reflects our 
need for resources to close gaps identified in our Intelligence Program 
infrastructure.
    In addition to overseeing the national security operations of the 
CT, CD and DI, the NSB is also accountable for the functions carried 
out by the other FBI divisions that support the national security 
mission, such as language translation support and Field Intelligence 
Group program management.
    Today's FBI linguist cadre is 69 percent larger than it was on 
September 11th. The three languages with the largest growth are Somali, 
Pashto, and Turkish, each with an increase of over 400 percent. This 
growth was made possible by the resources provided by this Committee.
    Another way we are providing support to counterterrorism and 
counterintelligence investigations is through the West Virginia 
Translation and Analysis Center. The Center provides field offices with 
an alternative to processing their Foreign Intelligence Surveillance 
Act audio collections. Analysts at the Center listen for pertinent 
English conversation containing intelligence material and provide 
English summaries and occasional full transcripts.
    The National Virtual Translation Center (NVTC) is an excellent 
example of the continuous transformation efforts underway at the FBI: 
creative and aggressive recruiting; interagency resource sharing and 
collaboration; and streamlined methods for serving agencies across the 
United States government in support of the war on terrorism. The NVTC 
was established with Central Intelligence Agency (CIA) resources under 
the authority of the USA PATRIOT Act to provide accurate and timely 
translations of foreign intelligence material to the IC.
    During 2003, the CIA awarded the FBI executive agency authority 
over the NVTC. Together with the CIA, we have recruited translators 
from the military and colleges, and secured added assistance through 
civilian contract staff. We continue to benefit from the interagency 
sharing of translation resources, collaborative use of human and 
automated translation capabilities, and parity in translation workload 
across various IC elements.
    Additional fiscal year 2007 enhancements to the NSB include:
  --$15 million for Intelligence infrastructure requirements. This 
        funding will provide essential infrastructure enhancements for 
        the Intelligence Program including multi-media workstations, 
        FALCON notebook computers for language analysts, electronic 
        surveillance data management system development, expanded 
        SIPRNET access, and IC XML application, Intelligence website 
        support, and non-English web page postings.
  --$16 million for Intelligence Operations and Production. This 
        funding will support initiatives that comprise the core 
        intelligence processes that are aligned with the intelligence 
        production cycle. This would provide 5 positions for human 
        source validation, 52 positions for intelligence operations and 
        production, FBIHQ operations and maintenance funding for the 
        FBI's IIR Dissemination System [FIDS], a human source 
        validation system, and physical surveillance support.

                                 CYBER

    The cyber threat confronting the United States is rapidly 
increasing as the number of people with the tools and abilities to use 
computers against us is rising. The country's vulnerability is 
escalating as the United States economy and critical infrastructures 
become increasingly reliant on interdependent computer networks and the 
World Wide Web. Large scale computer attacks on the Nation's critical 
infrastructure and economy could have devastating results. The Internet 
knows no boundaries. A perpetrator can sit at his computer anywhere in 
the world and gain unauthorized access to systems throughout the globe 
with complete anonymity. This puts law enforcement at a severe 
disadvantage and we must leverage all of our existing resources to 
bring cyber investigations to successful conclusions.
    We must continue to increase our capability to identify and 
neutralize enterprises and individuals who illegally access computer 
systems, spread malicious code, or support terrorist or state-sponsored 
computer intrusion operations. Since fiscal year 2001, the FBI has seen 
a 906 percent increase in International terrorism, Counterintelligence, 
and Domestic Terrorism computer intrusion cases. The FBI's Legal 
Attaches are working closely with our international law enforcement and 
intelligence partners to combat this rising threat.

                         LEGAL ATTACHE PROGRAM

    The FBI continues to expand its Legal Attache (Legats) program. 
International cases have become the rule, rather than the exception, 
for the Bureau. Legats are a key component of our extraterritorial law 
enforcement effort and often provide the first response to crimes 
against the United States that have an international nexus. Legats also 
provide a prompt and continuous exchange of information with foreign 
law enforcement. But Legats are no longer just information conduits. 
Rather, these offices assist our counterparts overseas on joint 
investigations, intelligence-sharing, and the development of new 
methods to prevent terrorist attacks. Currently, we have 53 fully 
operational Legal Attaches offices, and 13 fully operational sub-
offices covering over 200 countries throughout the world.
    This year we plan to open six more offices, located in Afghanistan, 
Qatar, Sudan, South Africa, Algeria, and El Salvador, and convert two 
sub-offices, Port-of-Spain and Jakarta, to fully operational Legats. 
The San Salvador Legat office is being opened with the support and 
resources provided by this Committee for the intended purpose of 
working with El Salvador's law enforcement to target the MS-13 gang's 
leadership in one of its Central America strongholds.

                           CRIMINAL PROGRAMS

    Although much of my testimony has been geared toward a discussion 
of the FBI's national security efforts, we continue to take great pride 
in our criminal programs. As with all of our investigative efforts, 
these criminal programs are in concert with the Attorney General's 
priorities, as announced earlier this spring. Specifically, as I 
mentioned earlier, we are aggressively pursuing any Katrina-related 
criminal fraud. The Attorney General has asked the United States 
Attorneys' Offices to adopt a ``zero tolerance'' policy toward all 
cases involving hurricane relief related fraud. To date, over 150 
investigations have been initiated and over 100 individuals have been 
indicted on corruption and fraud related charges.
    Public corruption is the top criminal priority for the FBI. The 
FBI's highly sensitive public corruption investigations focus on all 
levels of government. The heightened focus has helped increase both the 
number and quality of the cases being investigated. Over the last 2 
years, FBI investigations have led to the conviction of more than 1,060 
government employees involved in corrupt activities, to include 177 
federal officials, 158 state officials, 360 local officials, and more 
than 365 police officers.
    We also continue our work refining and implementing the National 
Gang Strategy (NGS). Developed in 1993, the goal of the NGS is to 
identify the prolific and violent gangs in the United States and to 
aggressively investigate, disrupt, and dismantle their criminal 
enterprises through prosecution under the federal racketeering statutes 
and other appropriate laws.
    I know the escalation of gang violence is an area of particular 
concern to this Committee and the FBI appreciates the efforts and 
resources you have provided to law enforcement to attack this growing 
problem. With your help, in 2005, the National Gang Intelligence Center 
(NGIC) was formed to allow State, local and Federal agencies to share 
gang data across jurisdictions and identify trends related to violent 
gang activity and migration.
    This multi-agency center functions from the Washington D.C. area 
and has coordinated information sharing with other investigative and 
intelligence operations of local, State, and Federal criminal justice 
agencies, and has become a national center for case coordination and 
information. The gang information provided by Federal, State and local 
agencies is one of the most vital aspects of this center for the 
successful integration and sharing of data.
    Another area of concern for the FBI's Criminal Investigative 
Division is the escalating level of violence in the Southwest border 
region. The recurring violence on the Southwest border revolves around 
the Gulf Cartel drug trafficking organization, which has traditionally 
dominated the region and commanded smuggling operations along this 
stretch of the border.
    The FBI is taking proactive measures to assess and confront this 
threat to public safety on both sides of the border through 
participation in multiple bi-lateral multi-agency meetings, working 
groups, and enforcement operations. The FBI, along with DHS, the Drug 
Enforcement Administration (DEA), and the Department of State, are 
working with the Mexican Attorney General's Office to identify Gulf 
Cartel members and is using all available techniques to disrupt and 
dismantle this dangerous organization and reduce the violence in the 
Southwest border region.

                               CONCLUSION

    Mr. Chairman, Senator Mikulski, and Members of the subcommittee, 
today's FBI is part of a vast national and international campaign 
dedicated to defeating terrorism. Working hand-in-hand with our 
partners in law enforcement, intelligence, the military and diplomatic 
circles, the FBI's primary responsibility is to neutralize terrorist 
cells and operatives here in the United States and help dismantle 
terrorist networks worldwide. Although protecting the United States 
from terrorist attacks is our first priority, we remain committed to 
the defense of America against foreign intelligence threats as well as 
enforcing federal criminal laws while still respecting and defending 
the Constitution.
    This year will mark the 5-year anniversary of September 11. The FBI 
has changed dramatically since the terrorist attacks and we will 
continue to evolve to meet the emerging threats to our country. We have 
expanded our mission, radically overhauled our intelligence programs 
and capabilities, and have undergone tremendous personnel growth. With 
the fiscal year 2007 budget request, in order to capitalize on these 
changes and our past investments in personnel, we intend to bridge the 
gap between our growth and infrastructure by focusing on updating our 
technology and facilities.
    Once again, I thank you for your continued support of the FBI. I am 
happy to answer any questions you may have.

                    Drug Enforcement Administration

STATEMENT OF KAREN TANDY, ADMINISTRATOR
    Senator Shelby. Administrator Tandy.
    Ms. Tandy. Good afternoon, Chairman Shelby, Ranking Member 
Mikulski, and members of the subcommittee. It is my pleasure to 
appear before you this afternoon to present and discuss the 
President's 2007 budget request for the Drug Enforcement 
Administration (DEA).
    I want to thank this subcommittee for its support and 
guidance to DEA, also for your passage of the supplemental 
yesterday affecting DEA as well. Our enforcement efforts have 
been successful, and they have contributed to the 19 percent 
overall reduction in drug use over the past 5 years. As 
Congress appreciates and certainly this subcommittee, the 
devastation of drugs knows no bounds and takes an enormous toll 
on both human lives and our country's economy. It takes victims 
as young as the 10-month-old baby who died in January from 
ingesting a massive amount of his parents' heroin to 90-year-
old nursing home patients who are hospitalized from exposure to 
methamphetamine that was being cooked in their nursing home.

                            METHAMPHETAMINE

    Meth labs have now been found in every State in this 
country. Last year, about 35 percent of the meth consumed in 
America was homemade. Thanks to congressional leadership and 
new State laws, the number of small toxic labs in America has 
decreased, but meth use still remains high.
    Today, about 20 percent of meth consumed in America is made 
here. The balance is manufactured and distributed by Mexican 
trafficking organizations operating in the United States and 
Mexico. DEA and the government of Mexico have joined together 
to combat that threat by redirecting our resources to 
specifically target Mexican meth manufacturing and trafficking 
both here and in Mexico.

                           GLOBAL DRUG TRADE

    The global drug trade is a continuing and serious national 
security threat to Americans at home and to our interests 
abroad. Colombia produces about 90 percent of the cocaine that 
is smuggled into the United States. DEA is attacking that trade 
at its source and transit zones. Just 2 weeks ago, we charged 
50 leaders of the FARC, a State Department-designated foreign 
terrorist organization. We charged those 50 leaders with 
supplying more than 60 percent of the cocaine in the United 
States that is valued at $25 billion.
    Through our DEA operations in Afghanistan, DEA seeks to 
prevent that country from returning as a major U.S. supplier of 
heroin, as it was in the 1970s and 1980s and to help stabilize 
the Afghanistan government. Last year, DEA-led investigations 
resulted in the first ever extradition from Afghanistan to the 
United States.

                     DRUG FLOW PREVENTION STRATEGY

    DEA's drug flow prevention strategy, which targets 
transportation choke points, focuses on disrupting the flow of 
drugs, money, and chemicals between the source and transit 
countries and America. We are requesting a budget enhancement 
to fund this strategy, which already has resulted in record 
seizures and disrupted trafficking in the western hemisphere, 
actually forcing them to suspend drug operations, change their 
modes of drug transport, and even jettison loads of drugs.
    With this request, we can expand our foreign-deployed 
advisory support teams, the FAST teams that are in Afghanistan, 
to include one of those FAST teams in the western hemisphere 
and solidify as well the base for funding of our five existing 
FAST teams that are operating in Afghanistan.
    DEA's drug flow prevention strategy, as I mentioned, 
included a 65-day interagency operation late last year that 
targeted the transit zones both in the eastern Pacific and in 
the Caribbean, and it was during that 65-day operation that 46 
metric tons of cocaine were seized under our strategy. It 
included among those seizures the largest eastern Pacific 
seizure in the history of the Joint Interagency Task Force-
South for that period. A temporary reduction in the ability of 
cocaine in the United States also appears to have resulted from 
this operation under this strategy.
    DEA continues our assault on drug traffickers' illegal 
proceeds as well, and last year, I am very pleased to say that 
we stripped domestic and foreign drug traffickers of a record 
breaking $1.9 billion in drug proceeds and in the denial of 
drug revenue. This exceeds internal goals in DEA, aggressive 
goals that were set for 2005, where we had a goal of $1 billion 
to be seized in 2005; it exceeded our goal by 90 percent and 
got us one step closer to the point where the risk of seizure 
will begin to outweigh the financial gains for drug 
traffickers.

           DRUG ENFORCEMENT ADMINISTRATION INTELLIGENCE ROLE

    The second, the other budget enhancement, supports DEA's 
recent reentry to the intelligence community in order to 
provide DEA with the infrastructure required to function in the 
community and to increase our contribution to national security 
while at the same time protecting the primacy of the agency's 
law enforcement functions.
    Nearly half of all State Department foreign terrorist 
organizations have ties to the drug trade. DEA is poised to 
make valuable and lasting contributions in the intelligence 
arena, and the President's 2006 supplemental request that you 
passed last night included $5 million to enable DEA to 
jumpstart that initiative this year, while the 2007 budget 
requests for funding remain so that we can continue this 
initiative through 2007.
    The men and women of the Drug Enforcement Administration 
thank you for your support as we continue to score major 
victories and protect America against drugs. Thank you, and I 
look forward to your questions.
    Senator Shelby. Thank you.
    [The statement follows:]

                  Prepared Statement of Karen P. Tandy

    Mr. Chairman and Members of the subcommittee: Good afternoon, and 
thank you for the opportunity to testify on behalf of the President's 
Fiscal Year 2007 Budget request for the Drug Enforcement Administration 
(DEA). I appreciate your strong and continued support for the important 
work of DEA--reducing the availability of illicit drugs in the United 
States. Every single day, DEA's brave men and women combat the world's 
drug trafficking organizations. We wage the battle on every front. It 
begins with the cultivation or manufacturing of drugs, complete with 
the movement of chemicals, carries on through the transit zones and 
final distribution in our Nation's communities, and concludes with the 
laundering of the distribution proceeds. Furthermore, the battle 
extends well beyond our borders into foreign lands and into cyberspace. 
To this end, DEA continues to be an active partner in the war against 
global terrorism and protecting the homeland.
    While we have made great strides over the years and continue to 
adapt to the increasingly complex challenges that face modern-day law 
enforcement, much work remains to be done. The resources that Congress 
provides are critical to our success and all of us at DEA are grateful 
for the chairman's and the subcommittee members' leadership.
    In my statement, I will summarize some of our important successes 
of 2005, summarize the President's request for DEA, and discuss some of 
the challenges that lie ahead. An attachment for the hearing record 
that provides additional mission-related data also is included.

                    FISCAL YEAR 2005 ACCOMPLISHMENTS

    Through continuous strategic thinking and planning, DEA is able to 
meet the ever-changing demands of contemporary drug enforcement. Ours 
is an organization that has had to be agile and resourceful in order to 
combat those whose criminal methods become more and more refined and 
complicated. Our successes in fiscal year 2005 are in those areas that 
are the agency's foremost priorities:
    Financial and Money Laundering Operations.--DEA focuses on the 
dismantlement of the financial infrastructures of drug trafficking 
organizations, and the payoff has more than met expectations. In fiscal 
year 2005, DEA stripped domestic and foreign drug traffickers of nearly 
$1.9 billion in drug proceeds and revenue denied, which included $1.4 
billion in asset seizures and $477 million in drug seizures. This, Mr. 
Chairman, exceeds DEA's fiscal year 2005 $1 billion goal for asset and 
drug seizures by 90 percent. Furthermore, DEA's seizures nearly match 
DEA's fiscal year 2006 enacted appropriation for our Salaries and 
Expenses Account. We have developed a 5-year plan with an ultimate goal 
of taking $3 billion away from all drug trafficking organizations by 
fiscal year 2009, and we are committed to meeting our goal. In fiscal 
year 2006, DEA will transform its current temporary staffing in Dubai, 
United Arab Emirates, into a permanent presence, with a commitment of 
four positions (including two agents). These positions will serve as a 
liaison for all drug enforcement matters, including financial 
investigations. We also are in the process of standing up a financial 
investigations team that will be staffed in Bogota and Cartagena, 
Colombia, and we anticipate establishing a money laundering group in 
Mexico City. It is our goal by adding offices in these regions, that we 
will be able to bolster our efforts to take potentially billions in 
drug profits away from trafficking organizations, and inflict enough 
damage to leave them unable to reconstitute their operations.
    Since the launch of our ``Money Trail Initiative'' in July 2005, 
more than $36.2 million in proceeds that traffickers attempted to 
smuggle from the United States have been seized. An investigation 
during fiscal year 2005 by a DEA-led multi-jurisdictional Organized 
Crime Drug Enforcement Task Force (OCDETF) of a Colombian-based money 
laundering operation resulted in 81 arrests and the seizure of $7.8 
million. During fiscal year 2005, DEA continued to be a key leader in 
the multi-jurisdictional law enforcement effort that targeted the 45 
``Most Wanted'' drug trafficking and money laundering organizations, 
commonly referred to as CPOTs (Consolidated Priority Organization 
Target). As a result of this critical supply reduction strategy, 6 
CPOTs have been dismantled and removed from the list of 45, and the 
operations of another 6 were significantly disrupted. In addition, in 
fiscal year 2005, 121 CPOT-linked drug trafficking organizations were 
dismantled and 204 CPOT-linked organizations were severely disrupted.
    Fighting Methamphetamine.--DEA has redoubled its efforts to fight 
methamphetamine and continues to turn the tide against the use, 
trafficking, and manufacture of the drug. DEA takes a comprehensive 
approach to combating a problem that poses a unique and deadly threat 
to communities across America--enforcement, domestic and international 
precursor chemical control, and the identification and cleanup of the 
large number of small toxic laboratories. As trafficking patterns have 
changed, so has DEA. We have shifted our focus from the super labs in 
the United States, to the small toxic labs that spring up as a result. 
This is in addition to targeting precursor chemical control and 
increasing our focus on the Mexican organizations that conduct the vast 
majority of the methamphetamine trade. In fiscal year 2005, DEA spent 
an estimated $176 million to combat methamphetamine, including $18.8 
million to administer 8,897 clandestine laboratory cleanups.
    In August 2005, DEA wrapped up ``Operation Wildfire''--a nationally 
coordinated law enforcement initiative that was designed to target all 
levels of the methamphetamine manufacturing and distribution chain in 
the country. Two hundred cities took part in the operation and the 
results were unprecedented--427 arrests and the seizure of 95 kilograms 
of methamphetamine, 201,035 tablets of pseudoephedrine, 153 kilograms 
of pseudoephedrine powder, and 224,860 tablets of ephedrine. In 
addition, 56 clandestine laboratories were seized and 30 children were 
rescued. A second operation in August, ``Operation Three Hour Tour'', 
resulted in 170 arrests and the dismantlement of three major drug 
transportation rings with international ties, as well as 27 United 
States distribution groups. We estimate that these groups were capable 
of transporting enough methamphetamine into the United States to 
provide product for over 22,700 methamphetamine users every month. 
1,634 kilograms of cocaine, 159 pounds of methamphetamine, 9 ounces of 
crack, 7 kilograms of heroin, 216 pounds of marijuana, and 22,000 
dosage units of MDMA were seized in the operation.
    In addition to these large scale operations, DEA's Mobile 
Enforcement Teams (METs) continued their methamphetamine focus. Since 
1995, METs have significantly increased the number of methamphetamine 
deployments. At the end of the first quarter of fiscal year 2006, 66 
percent of MET deployments initiated targeted methamphetamine 
trafficking organizations. This compares to 21.8 percent in fiscal year 
2003, 27 percent in fiscal year 2004, and 41 percent in fiscal year 
2005.
    DEA also has continued its work with our global partners including 
Canada, Hong Kong, and Mexico to target international methamphetamine 
traffickers and to increase chemical control efforts abroad. For 
example, the United States and Mexico have obtained a commitment from 
Hong Kong not to ship chemicals to the United States, Mexico, or Panama 
until Hong Kong authorities have received an import permit or 
equivalent documentation. Hong Kong officials also agreed to provide 
advance notice to a receiving country before a shipment is made. On the 
training side, in fiscal year 2005, DEA trained 105 Mexican officials 
in the areas of chemical control and clandestine laboratory cleanup. In 
partnership with Mexican law enforcement, DEA targets Mexican 
methamphetamine manufacturers, distributors and sources of supply based 
in the western United States and Mexico. One operation that culminated 
in March 2006, included the seizure of nearly 200 pounds of 
methamphetamine.
    Internet Drug Trafficking.--In fiscal year 2005, DEA initiated 100 
new internet investigations involving the online sales of 
pharmaceutical controlled substances. Over the course of fiscal year 
2005, DEA arrested 62 individuals and seized $44 million in cash, 
property, computers, and bank accounts from individuals who had been 
selling prescription drugs via the Internet. As a result of one 
internet drug trafficking investigation, Operation Cyberchase, DEA 
identified approximately 200 web sites that illegally sold prescription 
drugs and arrested 25 individuals who had been operating in the United 
States, India, Asia, Europe, and the Caribbean. DEA also led a 21-month 
OCDETF investigation that concluded with criminal charges against the 
principal Mexican steroid manufacturers, whose U.S. sales totaled an 
estimated $56 million annually. DEA has arrested nine individuals, one 
of whom was the owner of three of the world's largest anabolic steroid 
manufacturing operations. Eighty percent of the steroids seized in the 
United States last year originated from Mexican manufacturers.
    War on Terror.--DEA is well-placed to identify those threats posed 
by international terrorism funded by drug proceeds. The case of Afghani 
Bashir Noorzai, who was arrested in the United States in April 2005, 
illustrates the link that exists between drug trafficking and terrorist 
organizations. Noorzai was the leader of the largest Central and 
Southwest Asia-based heroin drug trafficking organization known to DEA. 
Noorzai is charged with providing explosives, weaponry, and personnel 
to the Taliban in exchange for protection for his organization's opium 
poppy crops, heroin laboratories, drug transportation routes, and 
members and associates. Noorzai was also a close associate of a member 
of the Taliban leadership. During fiscal year 2005, DEA operations also 
included the deployment of 5 Foreign-deployed Advisory and Support 
Teams (FAST) to Afghanistan and the disruption of 8 and dismantlement 
of 2 terrorist-linked Priority Target Organizations (PTO).
    Currently, Afghanistan is not a major heroin supplier to the United 
States; only about 8 percent of the United States supply comes from 
that country. However, DEA operations in Afghanistan serve a dual 
purpose--preventing the country from returning as a major supplier of 
heroin to the United States, as it was in the 1970s and 1980's, and 
helping stabilize the Afghanistan government as it battles the powerful 
drug warlords for control of portions of the country.
    Mr. Chairman, I also am very proud to report that the FASTs have 
played a pivotal role in protecting the lives of both our U.S. military 
and our coalition partners in Afghanistan. The teams have identified 
narcotics traffickers involved in targeting U.S. forces with improvised 
explosive devices (IEDs) and have provided critical information 
obtained from DEA Human Intelligence (HUMINT) sources to U.S. Special 
Forces Teams. In fact, on several occasions after DEA shared its source 
information, the Special Forces have successfully intervened and seized 
IEDs, other bomb making materials, and weapons caches.
    Assisting Local Law Enforcement.--This year, we had an additional 
mission in our longstanding support of state and locals--rescue and 
cleanup in the Gulf Region following Katrina. Our office in New Orleans 
sustained some damage and our Gulfport office was uninhabitable. Our 
operational assets had to be temporarily moved to Baton Rouge. With the 
funding DEA was provided in the fiscal year 2006 supplemental 
appropriation, repairs have been made and we have been able to return 
to our New Orleans office. Currently, we are operating in temporary 
space in Gulfport until repairs can be made for safe occupancy at our 
permanent location. In the aftermath of the storm, 251 DEA personnel, 
including Special Agents, Special Agent pilots, Intelligence Analysts, 
and other technical and logistical staff were deployed to provide law 
enforcement and rescue/humanitarian assistance to 13 law enforcement 
agencies in Louisiana, Mississippi, and Alabama. We established and 
manned mobile command posts and communications systems, and assisted 
with the rescue of 3,340 stranded victims using DEA helicopters, which 
included 70 senior citizens from a nursing home that had been flooded. 
DEA also assisted with patrol assignments, transported medicine to law 
enforcement personnel to combat hepatitis, and worked with Texas and 
Arkansas pharmacy boards on emergency refill procedures to serve 
Louisiana, Mississippi, and Alabama residents. I am very proud of the 
many members of the DEA community who gave so selflessly at a time of a 
national tragedy. You may be sure that we will continue to support the 
recovery efforts in the stricken areas in any way we can.
    In addition to Katrina assistance, DEA remained dedicated to our 
critical state and local partners. For example, in fiscal year 2005, 
DEA led 217 State and Local Task Forces, with an on board strength of 
2,096 Task Force Officers and 1,253 DEA Special Agents. We also have 
provided drug enforcement training to 41,000 state and local police 
officers in fiscal year 2005. DEA's Jetway Program, which instructs 
state and local law enforcement officers how to address interdiction 
issues in airports, bus and train stations, and hotel/motel 
environments, conducted nine schools in cities across the country 
during fiscal year 2005. Our Pipeline/Convoy Program, which teaches 
highway patrol officers how to address commercial and passenger vehicle 
interdiction issues, conducted 16 seminars in fiscal year 2005. These 
two important programs trained a total of more than 3,000 officers. DEA 
has trained drug unit commanders, DEA and other federal, state and 
local law enforcement intelligence analysts, and international 
narcotics leaders. Furthermore, we trained 1,100 police officers in the 
enforcement areas of clandestine labs and diversion.
    Outreach and Public Awareness.--9,000 people have received victim, 
witness, and drug-endangered awareness training in fiscal year 2005. We 
also launched a public website (justthinktwice.com) in fiscal year 
2005, designed for young people that provides information on topics 
such as methamphetamine, prescription drugs, drugged driving, 
marijuana, and drug legalization. Since the launch of the site, there 
have been an average of 200,000 hits per month, and many Governors have 
written to the Attorney General to express how useful they have found 
the website to be and have pledged to publicize the website widely in 
their states.

                    FISCAL YEAR 2007 BUDGET REQUEST

    For fiscal year 2007, the President's Budget requests $1.9 billion 
for DEA ($1.7 billion under the Salary and Expenses Account and $212 
million under the Diversion Control Fee Account). A total of 9,310 
positions, of which 4,066 are Special Agent positions, will be funded. 
This request represents an increase of $72 million over fiscal year 
2006. I would like to call attention to a few highlights of the 
President's request.

Salaries and Expenses Account
    The request includes a $24.8 million investment to fund two 
initiatives:
    Drug Flow Prevention Initiative ($12.8 million and 10 positions) 
involves multiple agencies in multiple countries targeting major drug 
trafficking organizations (CPOTS). This initiative is designed to 
disrupt the flow of drugs, money, and chemicals between the source 
zones and the United States. The strategy DEA employs is to attack the 
organizations' vulnerabilities in their supply, transportation systems, 
and financial infrastructures. The program supports the Department of 
Justice's Strategic Goal of preventing terrorism and promoting the 
nation's security and enforcing federal laws and representing the 
rights and interests of the American people.
    As part of this program, $7.5 million is requested for our very 
valuable FAST operations. With this request, DEA has the necessary 
resources, coupled with Department of Defense funds, to permanently 
support the five FAST teams now operating in Afghanistan. In addition, 
one new team will be created whose initial focus will be on Western 
Hemisphere operations. Under the Drug Flow Prevention program, 10 
positions and $5.3 million also are requested to expand a successful 
multi-agency cocaine interdiction program known as ``Operation Panama 
Express.'' Since its inception in February 2000, Operation Panama 
Express has seized 356 metric tons of cocaine, which averages almost 
4\1/2\ tons per month for the past 6 years. The Country Offices in 
Venezuela, Guatemala, Honduras, and Ecuador and the Caribbean Field 
Division would receive additional Special Agent positions. Resources 
will be used to recruit additional HUMINT sources to provide 
information to DEA regarding drug smuggling operations involving the 
transit of drugs through Central America, and the Caribbean and Eastern 
Pacific zones. The information from these sources will provide an early 
warning against narcotics and terrorist threats, which will ensure that 
our southwest border strategy has a defense-in-depth capability.
    I would add, Mr. Chairman, that this initiative follows a 
successful DEA 2005 international Drug Flow Prevention initiative 
(``Operation All Inclusive I-2005'') that targeted the Eastern Pacific 
and Western Caribbean transit zones of Central America and the Central 
America land mass. By concentrating law enforcement efforts in this 
corridor, multi-ton bulk drug shipments were interdicted before 
reaching Mexico. All Inclusive's success with respect to seizures was 
unprecedented. Over 46 metric tons of cocaine was seized in transit 
zones during the 65-day operation, and included the largest EASTPAC 
seizures for the month of August in JIATF South's history, 21.3 metric 
tons. At the same time, DEA's domestic seizures decreased by 29 percent 
compared to the 65-day period prior to the operation. DEA's domestic 
cocaine seizures for the three-month period following the operation 
decreased by 27 percent compared to the three-month period preceding 
the operation, and by 36 percent compared to the same three-month 
period in 2004. Although other explanations are possible, preliminary 
analysis suggests that All Inclusive may have resulted in a temporary 
reduction in the availability of cocaine in the United States. Other 
All Inclusive seizures included: the largest ever cocaine seizure in 
Belize--2,376 kilograms; the largest ever currency seizure in 
Nicaragua--$1.2 million; 3.9 metric tons of cocaine and $5.7 million in 
currency seized in Panama; 21 metric tons of marijuana seized in 
Mexico. Furthermore, as a result of All Inclusive, we found that 
traffickers were forced to delay or suspend their drug operations, 
divert their routes, change their modes of transportation, and even 
jettison loads.
    Intelligence and National Security ($11.9 million and 57 
positions--including one Special Agent and 42 Intelligence Analysts). 
In February of this year, Director of National Intelligence John 
Negroponte and Attorney General Alberto Gonzales signed a joint 
memorandum designating an element of DEA's Intelligence Division to be 
a member of the Intelligence Community (IC). IC membership will allow 
DEA to expand and strengthen its existing relationships with our 
nation's intelligence agencies. With 86 offices in 62 countries--the 
largest law enforcement presence abroad--DEA is poised to make valuable 
and lasting contributions in the intelligence arena. In DEA, 
intelligence drives enforcement strategies and operations. This 
approach has yielded impressive results: since the terrorist attacks of 
September 11, 2001, DEA's Special Operations Division has produced 
26,499 counterterrorism products for United States law enforcement 
agencies with counterterrorism missions; during fiscal year 2005, the 
El Paso Intelligence Center responded to more than 260,000 
counterterrorism inquiries from federal, state, and local law 
enforcement agencies, of which 12 percent were directly related to 
counterterrorism. Moreover, as of December 31, 2005, DEA has identified 
48 percent (21 of 44) of the organizations on the Department of State's 
Foreign Terrorist Organizations list as having possible ties to the 
drug trade.
    This request will fund DEA's entry into the IC. $4 million and 20 
positions (including one Special Agent and 9 Intelligence Analysts) 
will create a National Security Intelligence Section (NN) within DEA's 
Intelligence Division. Through DEA's newly designated element, DEA will 
pass to the IC any counterterrorism or national security information it 
obtains during the course of its Title 21 drug enforcement mission. The 
NN objective will be to maximize DEA's contribution to national 
security, while protecting the primacy of the agency's law enforcement 
functions. $7 million and 37 positions (including 33 Intelligence 
Analysts) will fund the development of a Central Tasking Management 
System (CTMS)\1\ at DEA. The CTMS will track the acquisition of law 
enforcement investigative information and the dissemination of this 
information to other law enforcement and IC elements; establish 
policies and procedures for information acquisition and dissemination; 
produce acquisition plans, and establish an interface with acquisition 
management elements in the law enforcement community. Finally, $1 
million will establish base funding to continue the Reports Officer 
Program, which began as a pilot project in June 2004. The Reports 
Officers have proven beneficial in extracting and passing in a timely 
manner, DEA law enforcement information that is relevant to IC 
requirements. Specifically, the Reports Officers review DEA law 
enforcement intelligence reporting and develop reports based on that 
information which responds to IC taskings.
---------------------------------------------------------------------------
    \1\ The CTMS is formally the Collection Requirement Management 
System (CRMS) as discussed in the fiscal year 2007 President's Budget.
---------------------------------------------------------------------------
Program Offsets
    In order to fund the Drug Flow Prevention and Intelligence and 
National Security initiatives, the President's Budget includes the 
following three offsets:
    Regional Enforcement Teams (RET).--DEA proposes to eliminate the 
RET program, for a reduction of $9 million and 34 positions (23 Special 
Agents). DEA's remaining resources would continue to target the drug 
trafficking organizations having the most significant impact on the 
United States. RET was seen as a program that did not tie as closely to 
DEA's core focus on international drug trafficking organizations.
    Demand Reduction Program.--DEA proposes to eliminate all positions 
dedicated to this program for a reduction of 40 positions (including 31 
Special Agents) and $9.2 million. This proposal would allow DEA to 
focus on its core mission of drug law enforcement. When possible, 
however, Special Agents would participate in demand reduction 
activities on a collateral duty basis.
    Mobile Enforcement Teams (MET).--DEA proposes to reduce by 151 
(including 132 Special Agents) the number of positions dedicated to the 
MET program, for a reduction of $30.2 million. The remaining $20.5 
million and 83 positions (including 80 Special Agents) would continue 
to support the MET program, with priority focus on methamphetamine 
investigations. In addition to MET deployments targeting 
methamphetamine organizations, in the areas of the county where the 
number of clandestine labs has declined but methamphetamine use still 
remains high, I have directed DEA's Clandestine Laboratory Enforcement 
Teams (CLET) to begin investigating United States domestic networks 
that are distributing Mexican produced methamphetamine. At the same 
time, CLETs will continue their investigations of synthetic drug labs 
and will continue to assist state and local law enforcement agencies 
with laboratory, precursor, and distribution investigations. Finally, 
DEA would continue to administer funds from the Community Oriented 
Policing Services (COPS) program for clandestine laboratory cleanups.
Diversion and Control Fee Account (DCFA)
    As I stated earlier, the President's request includes $212 million 
under the DCFA, a $10.4 million increase over fiscal year 2006. Of the 
total requested amount, DEA proposes funding of $3.4 million for DCFA 
program improvements. This funding would allow DEA to boost 
intelligence support (33 Intelligence Analysts) needed for diversion 
investigations. This request is a continuation of the fiscal year 2006 
Diversion Intelligence Initiative, whose goal is to place one 
Intelligence Analyst in every Field Division Diversion group.

Base Transfer
    Since 2002, the Federal Bureau of Investigation (FBI) has annually 
reimbursed DEA approximately $6 million to DEA for providing 
counterterrorism related information to multiple federal agencies. The 
President's Budget proposes that these resources (which fund 45 
positions, including 11 Special Agents) would be permanently 
transferred from the FBI to DEA.

                          OPPORTUNITIES AHEAD

    Mr. Chairman, DEA continues to make steady progress in all facets 
of its mission and has seen some encouraging trends, particularly as it 
relates to drug use among our nation's children. In fact, the Office of 
National Drug Control Policy reports that since 2001, teen drug use is 
down by 19 percent and on track to decline by a total of 25 percent by 
2007 to meet the President's drug use reduction goals. We are a key 
partner in the effort through the DEA mission to reduce the drug supply 
in America. Drug prevention will not take hold and treatment will not 
succeed if Americans are surrounded by cheap and plentiful drugs. DEA 
implements the President's National Drug Control Strategy by disrupting 
the supply of illegal or diverted drugs, through national and 
international attacks to dismantle the entire infrastructure of the 
most significant drug trafficking and money laundering organizations 
that supply our nation's illicit drug market.
    As you know, the devastation of drugs knows no bounds and takes an 
enormous toll on both human lives and our country's economy. Moreover, 
we are seeing that the global drug trade continues to be an evolving 
national security threat to Americans at home and to our interests 
abroad. To address these disturbing facts, DEA takes a proactive and 
aggressive approach. In addition to the fiscal year 2007 initiatives I 
have outlined, we will use our existing resources to focus on the 
following areas during fiscal year 2006:
    Establishing a Methamphetamine Task Force.--The fiscal year 2006 
Department of Justice Appropriations Act directs the Attorney General 
to establish a Methamphetamine Task Force (MTF) within DEA. The purpose 
of the Task Force will be to improve and target the federal 
government's policies related to the production and trafficking of 
methamphetamine. The MTF is comprised of three DEA Special Agents, two 
Diversion Investigators, one Program Analyst, and attorneys from DEA's 
Office of Chief Counsel, and the Justice Department's Office of Legal 
Policy and the Criminal Division's Narcotics and Dangerous Drugs 
Section. These are veteran personnel with extensive experience and 
knowledge in the field, who will acquire and analyze investigative and 
intelligence information from numerous sources. Their analysis will 
focus on trends in: chemical trafficking and manufacturing methods; 
clandestine laboratory cleanup issues; changes in trafficking routes 
and patterns; regional abuse and distribution patterns; chemical and 
equipment sources and methods of procurement; foreign and domestic 
precursor sources, and smuggling and methods of financing. The MTF will 
propose recommendations for addressing issues identified from the 
analysis, and forward them to the National Synthetic Drugs Interagency 
Working Group for review and action.
    Implementing the Combat Methamphetamine Epidemic Act of 2005.--As 
you know, President Bush recently signed the USA PATRIOT Improvement 
and Reauthorization Act of 2005, which includes the provisions of the 
Combat Methamphetamine Epidemic Act. These provisions provide law 
enforcement with the necessary tools to address the spread of 
methamphetamine manufacture and abuse across the country and the 
devastating effects that this drug is having on society. With these 
much needed chemical control measures, clandestine laboratory operators 
will have more difficulty in obtaining large quantities of 
pseudoephedrine and ephedrine products at retail outlets for use in 
methamphetamine manufacture. The Act also closes a loophole that 
allowed importers to sell pseudoephedrine to companies that were not 
identified on the original import notice, and enhance criminal 
penalties for methamphetamine traffickers. These measures are part of a 
comprehensive national approach toward controlling this growing problem 
and protecting our nation's children.
    Increasing Internet investigations and halting the diversion and 
abuse of legal controlled substance pharmaceuticals.--The Internet has 
increased the opportunities for diversion and is the means by which 
many abusers are now purchasing Schedule III and Schedule IV drugs. 
DEA's plan to target and dismantle online pharmacies, builds on the 
successes of our online pharmacy strategy, which combines enforcement, 
regulatory, and technological efforts to detect and prevent diversion. 
The strategy calls for DEA to coordinate its Internet investigations 
with Federal, State, and local agencies, and provide training for 
investigators, prosecutors, the pharmaceutical industry, and DEA 
registrants. We have supported legislative and regulatory initiatives 
aimed at curtailing and preventing online diversion of controlled 
substances. Finally, DEA has taken a leadership role in the development 
and use of new technologies as investigative tools.
    Improving the measures of effectiveness for DEA programs and 
operations.--DEA is developing a management information tool, the Drug 
Enforcement Strategic Target Analysis Review (DrugSTAR), to establish 
links between a Priority Target's disruption or dismantlement and its 
impact on drug availability. It will be a key component of the agency's 
overall strategic management system. Using DrugSTAR, DEA will be able 
to identify our challenges and best practices, focus on performance and 
accountability, and demonstrate results in compliance with the Office 
of Management and Budget's management requirements.
    Under DrugStar, DEA also has been piloting the Significant 
Investigation Impact Measurement System (SIIMS), which collects and 
analyzes enforcement, public health, and social service statistics both 
before an organization is taken down and for the 6 months that follow. 
This analysis will determine whether DEA targeting and enforcement 
operations had real impact and, if not, enable DEA to redirect 
resources and revise operations to achieve great impact. The SIIMS 
system has generated assessments of three takedown operations in 2005. 
For example, a SIIMS assessment of a successful New Orleans operation 
involving pain clinics and pharmacies revealed that the operation had 
significant impact on the availability of diverted drugs in that area, 
lasting for months after the enforcement operation. Specifically, SIIMS 
analysis revealed that, among other things, there were no seizures by 
DEA New Orleans of three illegally prescribed medications in the two 
months following the operation. This type of information can be useful 
when evaluating DEA's performance in reducing drug availability and for 
reporting purposes for the Attorney General, Congress, and the Office 
of National Drug Control Policy.
    Mr. Chairman, this concludes my remarks. I would be pleased to 
answer any questions.
                                 ______
                                 
                               Attachment

                   DRUG THREATS TO THE UNITED STATES

Methamphetamine
    Methamphetamine is the most widely abused and most frequently 
clandestinely produced synthetic drug \1\ in the United States. 
Methamphetamine appeals to people across all genders, ages, and socio-
economic levels. Methamphetamine has a high rate of addiction, a low 
rate of sustained recovery, and is cheap to manufacture. It has become 
a problem of epidemic proportions in the United States, devastating 
users, their families, and local communities. According to the 2004 
National Survey on Drug Use and Health (NSDUH), 583,000 persons 12 and 
older used methamphetamine during the past 30 days (a 4 percent 
decrease from 2003) and 1.4 million have used it in the past year, a 10 
percent increase from 2003. The estimated number of past year 
methamphetamine users is three times the number of estimated past year 
heroin users.
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    \1\ The term ``synthetic drugs'' refers to controlled substances 
such as methamphetamine, MDMA ``ecstasy'' (and its analogues), GHB (and 
its analogues), ketamine, and other substances, which are not of 
primarily organic origin and are usually associated with clandestine 
manufacture.
---------------------------------------------------------------------------
    By effectively targeting and arresting the main suppliers of bulk 
precursor chemicals, DEA has successfully reduced the number of ``super 
labs'' \2\ in the United States. As a consequence, operators of ``super 
labs'' have shifted their production to Mexico. Current drug and lab 
seizure data suggest that 80 percent of the methamphetamine consumed in 
the United States comes from larger labs, for the most part in Mexico, 
and that approximately 20 percent of the methamphetamine consumed comes 
from the small, toxic laboratories (STLs) in the United States. STLs 
generally are unaffiliated with major drug trafficking organizations, 
but nevertheless present enormous environmental challenges.
---------------------------------------------------------------------------
    \2\ ``Super labs'' are those labs that are capable of producing at 
least 10 pounds of methamphetamine per cycle.
---------------------------------------------------------------------------
    In recent years, the proliferation of STLs has been fueled by the 
ready availability of pseudoephedrine, the key ingredient in 
methamphetamine and by the fact that the manufacturing process is 
simple, inexpensive, and recipes can be found easily on the Internet. 
In 1990, there were 2 States with 20 or more clandestine laboratory 
seizures. In 1996, this number increased to 10 States. In 2004, there 
were over 40 States where 20 or more seizures of clandestine 
laboratories occurred. From 2002 through 2005, more than 55,000 STLs 
were discovered and seized.
    According to the Clandestine Laboratory Seizure System database 
located at the DEA's El Paso Intelligence Center (EPIC), 11,746 labs, 
dumpsites, and chemicals, glass, and equipment were seized in the 
United States in calendar year 2005. Of those seized, 5,308 labs were 
capable of producing only up to one pound of methamphetamine per cycle. 
In fiscal year 2005, DEA domestic seizures of methamphetamine totaled 
3.1 metric tons, which is the equivalent to approximately 367 million 
dosage units. Fiscal year 2005 seizures increased by 24 percent from 
fiscal year 2004, when 2.5 metric tons were seized.
    The most promising means of eliminating STLs is to choke off the 
sources for ephedrine and pseudoephedrine. DEA has removed a number of 
distributors of grey market drug products (those that can be purchased 
at truck stops, party/liquor stores, etc.) from the marketplace. 
Following DEA's success with removing grey market distributors, STLs 
have become heavily reliant on obtaining precursor chemicals from cold 
and asthma drug products (usually packaged in blister packs) from 
traditional retail outlets, such as chain drug stores. Based on 
clandestine lab seizure statistics, those States restricting the 
availability of methamphetamine precursor chemicals, like 
pseudoephedrine, have seen a dramatic decrease in the number of small 
toxic labs. With the enactment of Federal and State legislation 
limiting the sale of products containing pseudoephedrine and ephedrine, 
further reduction in the number of STLs is anticipated.
    Once a STL has been identified, it must be dismantled. DEA assists 
State and local law enforcement by providing hazardous waste contractor 
clean-up services administered through Community Oriented Policing 
Services (COPS) grant funding. In fiscal year 2005, DEA administered 
8,678 State and local clandestine clean ups. This is a decrease from 
fiscal year 2004 when 9,474 clean ups were administered. In addition, 
DEA has trained nearly 12,000 Federal, State, and local law enforcement 
personnel since 1998 to conduct investigations and dismantle seized 
methamphetamine labs to protect the public from methamphetamine lab 
toxic waste.
    At the end of the first quarter of fiscal year 2006, there were 298 
active DEA Priority Target Organization (PTO) investigations with 
methamphetamine as the primary drug type. Seven (7) of the 44 
organizations (16 percent) on the fiscal year 2006 Consolidated 
Priority Organization Target (CPOT) list are engaged in methamphetamine 
trafficking. At the end of the first quarter of fiscal year 2006, there 
were 157 active PTO investigations linked to those seven CPOTs. Since 
the inception of the PTO program, DEA has disrupted or dismantled 427 
methamphetamine PTOs.

          Operational Highlight: Operations Cold Remedy and Aztec 
        Flu.--From March 2003 to March 2005, as part of DEA's 
        Operations Cold Remedy and Aztec Flu, more than 5 metric tons 
        of 60 milligram tablets of pseudoephedrine were seized in the 
        United States, Mexico, and Panama--which could have yielded an 
        excess of 3 metric tons of methamphetamine. The seizures were 
        conducted by DEA with Mexico's Organized Crime Prosecutor's 
        Office and Hong Kong law enforcement authorities. Operations 
        Cold Remedy and Aztec Flu are investigations run under the 
        auspices of Project Prism, an international initiative aimed at 
        assisting governments in developing and implementing 
        cooperating procedures more effectively control and monitor 
        trade in amphetamine-type stimulant precursors to prevent their 
        diversion. Participants of Project Prism include 95 countries 
        and 5 international organizations.
          Operational Highlight: MET Case Against Street Gang ``Satan's 
        Disciples''.--On March 7, 2006, the DEA Dallas Field Division 
        MET concluded a 9 month deployment and OCDETF/PTO investigation 
        that resulted in the dismemberment of seven methamphetamine 
        trafficking organizations and two crack cocaine organizations. 
        The investigation targeted Rocky Salazar who headed a street 
        gang named Satan's Disciples, responsible for distributing 
        methamphetamine in the Gainesville, Texas area. The Satan's 
        Disciples also distributed narcotics and laundered money in 
        three separate casinos located on Indian Reservations in nearby 
        Oklahoma. The investigation culminated with the arrest of 93 
        individuals (81 State and 12 Federal), including priority 
        target Salazar, and the seizure of 0.6 kilograms of crack 
        cocaine, 0.2 kilograms of powder cocaine, 2.5 kilograms of 
        marijuana, 8.8 kilograms of methamphetamine, 0.6 kilograms of 
        GHB, 65 firearms, $167,000 in U.S. currency, $70,000 in real 
        property, and four vehicles. DEA conducted this enforcement 
        operation together with ATF, BIA, the Chickasaw Indian Nation, 
        and State and local officers from Texas and Oklahoma.

Marijuana
    Marijuana continues to be a significant threat because today's 
potent marijuana causes more teens to be dependent on it. This is 
supported by the following data: (1) More teens seek treatment for 
marijuana dependency than for all other drugs combined including 
alcohol. (2) Marijuana was involved in 79,663 emergency department 
visits \3\ in calendar year 2003, second only to cocaine among drug-
related visits.\4\ (3) The 2004 NSDUH found that marijuana was the most 
commonly used illicit drug with 14.6 million users (6.1 percent of the 
population 12 and older) during the past month in calendar year 2004--
the same as in calendar year 2003.\5\ (4) Past year use of marijuana 
remained unchanged statistically between calendar year 2003 and 
calendar year 2004 at 10.6 percent.
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    \3\ A visit to the emergency room is referred to as an episode, and 
every time a drug is involved in an episode it is counted as a mention.
    \4\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. Detailed Emergency 
Department Tables from DAWN: 2003. December 2004.
    \5\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. (2005). Overview of Findings 
from the 2004 National Survey on Drug Use and Health.
---------------------------------------------------------------------------
    Marijuana trafficking is prevalent across the Nation, with both 
domestic and foreign sources of supply. The most recent supply 
availability estimates indicate that between 10,000 and 24,000 pure 
metric tons of marijuana are available in the United States \6\ and 
that Americans spend more than $10.4 billion every year on 
marijuana.\7\ Since the demand for marijuana far exceeds that for any 
other illegal drug and the profit potential is so high, some cocaine 
and heroin drug trafficking organizations traffic marijuana to help 
finance their other drug operations.
---------------------------------------------------------------------------
    \6\ Drug Availability Steering Committee, Drug Availability 
Estimates in the United States, December 2002.
    \7\ Executive Office of the President, Office of National Drug 
Control Policy. What Americans Spend on Illegal Drugs 1988-1998. 
December 2000.
---------------------------------------------------------------------------
    Mexican drug trafficking organizations dominate the transportation 
and wholesale distribution of the majority of foreign-based marijuana 
available in the United States and cultivate marijuana on U.S. public 
lands throughout California. High grade marijuana from Canada, commonly 
referred to as ``BC Bud,'' also is available in every region of the 
United States.
    At the end of the first quarter of fiscal year 2006, there were 146 
active PTO investigations with marijuana as the primary drug type. 
Twelve (12) of the 44 organizations on the fiscal year 2006 CPOT list 
(27 percent) are engaged in marijuana trafficking. At the end of the 
first quarter of fiscal year 2006, there were 385 active DEA PTO 
investigations linked to these 12 CPOTs. Since the inception of the PTO 
program, DEA has disrupted or dismantled 208 marijuana PTOs.

          Operational Highlight: Operation Falling Star.--As of the end 
        of 2005, this Organized Crime Drug Enforcement Task Force 
        (OCDETF)/SOD coordinated operation targeting a Detroit and 
        Phoenix-based marijuana drug trafficking organization (DTO), 
        resulted in 63 arrests, and the seizure of $13.7 million in 
        cash, 16.4 metric tons of marijuana, 305 kilograms of cocaine, 
        14 properties, 22 vehicles, and 42 weapons, leading to the 
        dismantlement of the drug trafficking organization. The Detroit 
        target, Quasand Lewis, has been targeted for approximately 10 
        years by State and local law enforcement agencies for his 
        suspected involvement in several homicides and extensive drug 
        trafficking and witness intimidation. The focal point of the 
        investigation, Giovanni Ruanova, coordinated multi-million 
        dollar currency transportation routes and pick-ups from 
        Detroit.

Non-medical use of prescription drugs
    Non-medical use of addictive prescription drugs has been increasing 
throughout the United States at alarming rates. In calendar year 2004, 
an estimated 6.0 million \8\ Americans age 12 and older reported past 
month use of prescription drugs for non-medical purposes compared to 
3.8 million in calendar year 20009 \9\--a 58 percent increase in 4 
years. Nationally, the misuse of prescription drugs was second only to 
marijuana in calendar year 2004.
---------------------------------------------------------------------------
    \8\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. (2005). Overview of Findings 
from the 2004 National Survey on Drug Use and Health.
    \9\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. (2002). National Household 
Survey on Drug Abuse: Vol 1. Summary of National Findings.
---------------------------------------------------------------------------
    Individual users can easily acquire prescription drugs through a 
variety of means, generally dependent on type of drug. DEA and other 
data sources reveal that OxyContin and other Schedule II drugs are 
most commonly obtained illegally through ``doctor shopping'' or are 
sold illegally by registrants (e.g., doctors/pharmacists). On the other 
hand, Schedule III and Schedule IV drugs (e.g., anti-anxiety 
medications, hydrocodone, and anabolic steroids) are often purchased 
through the Internet. Many of these e-pharmacies are foreign-based and 
expose the purchaser to potentially counterfeit, contaminated, or 
adulterated products.

          Operational Highlight: An Advanced Pain Management Case.--In 
        April 2005, DEA culminated a 5 year OCDETF and Priority Target 
        investigation that resulted in the dismantlement of a major 
        prescription drug trafficking organization and the seizure of 
        $1.6 million in cash, $4.7 million in financial and 
        approximately $4.8 million in real assets. Five individuals, 
        including three physicians, were arrested and charged with the 
        distribution of pharmaceutical controlled substances, 
        distribution of drugs to a minor, conspiracy, and money 
        laundering. The physicians prescribed a cocktail of 
        hydrocodone, Xanax and Soma to approximately 100-300 patients 
        per day under the guise of ``pain management''. To date, this 
        investigation has resulted in Immediate Suspensions of DEA 
        Registrations of the doctors and four pharmacies were also 
        issued.

    DEA, in collaboration with its State and local law enforcement 
counterparts, investigates registrants and non-registrants who 
intentionally divert prescription drugs. DEA has made pharmaceutical 
investigations a priority and continues to focus its drug enforcement 
efforts toward the most important members of the drug supply chain. In 
fiscal year 2005, DEA opened 1,672 investigations focused on the 
diversion of pharmaceutical controlled substances by registrants and 
non-registrants, an approximate increase of 11 percent over fiscal year 
2004 (1,508). DEA's fiscal year 2005 Priority Target pharmaceutical 
investigations of key drug supply organizations (59) represents a 
dramatic increase (168 percent) over fiscal year 2004 (22).
    Combating the diversion of OxyContin remains a priority within 
DEA. Of the 1,668 open investigations in fiscal year 2005, 117 were 
open OxyContin investigations involving 48 doctors. Of those 117 
OxyContin investigations, 25 were Priority Target investigations.
    The illicit sale of controlled pharmaceutical substances, including 
narcotics, anti-anxiety medications, steroids, and amphetamines, is a 
serious global problem and the Internet has become one of the most 
popular sources for these products. DEA targets its investigations on 
domestic Internet pharmacies using data from available data bases (such 
as the Automated Reporting of Completed Orders System--ARCOS) to 
determine which retail pharmacies are most likely involved in 
distribution of large quantities of controlled substances over the 
Internet. In fiscal year 2005, 11.2 percent of investigative work hours 
dedicated to open diversion cases were Internet cases. This is an 
increase of 30 percent from fiscal year 2004 when Internet cases 
represented 8.6 percent of the investigative work hours dedicated to 
open diversion cases. In fiscal year 2005, as a result of online 
pharmacy investigations, DEA seized over $32 million in financial and 
property assets. This is a 184 percent increase from fiscal year 2004 
when asset seizures totaled $11 million.

          Operational Highlight: Operation Cyber Chase.--In April 2005, 
        a 1-year, multi-jurisdictional OCDETF investigation (Operation 
        Cyber Chase) was concluded with the dismantlement of the Bansal 
        drug trafficking organization and the arrest of 20 individuals 
        in New York, Philadelphia, India, Costa Rica, Austria, and 
        Hungary. Those arrested were distributing drugs worldwide using 
        rogue Internet pharmacies to dispense controlled substances 
        directly to customers without a medical evaluation by a 
        physician. The Bansal organization used over 200 websites to 
        distribute 2.5 million dosage units of Schedule II through IV 
        pharmaceutical controlled substances per month. Electronic mail 
        communications among the co-conspirators included: ``It's not 
        easy to get rich. My goal is towards the upper echelon of 
        economic independence. All things considered, it should only 
        take about 800 million. That's um, 3,000 packs of valium sold a 
        day for 5 years. Well, that's actually about 921 mill, but I'm 
        not sure there'll be a few costs in there somewhere.'' As of 
        September 30, 2005, Operation Cyber Chase has resulted in 26 
        arrests, the seizure of 5.8 million dosage units of Schedule 
        II--IV controlled substances, 105 kilograms of Ketamine, and 
        $8.6 million.

Cocaine
    Cocaine remains a major illegal drug of concern throughout the 
United States based upon abuse indicators, violence associated with the 
trade, and trafficking volume. After marijuana and prescription drugs, 
cocaine continues to be the most widely used illicit drug among all age 
categories. The 2004 NSDUH found that 2 million people used cocaine 
within the past 30 days and that over 5.6 million people used it within 
the past year. According to the 2003 DAWN report, cocaine is the most 
frequently reported illegal drug in hospital emergency department 
visits, accounting for 1 in 5 (20 percent) drug related emergency room 
visits in calendar year 2003.\10\
---------------------------------------------------------------------------
    \10\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. Detailed Emergency 
Department Tables from DAWN: 2003. December 2004.
---------------------------------------------------------------------------
    Although Columbia is the principal supplier of cocaine to the 
United States, most of the wholesale cocaine distribution in the United 
States is controlled by Mexican drug trafficking organizations and 
criminal enterprises. Even in areas dominated by Colombian and 
Dominican drug trafficking organizations, such as the Northeast and 
Caribbean regions, the influence of Mexican drug trafficking 
organizations is increasing.
    At the end of the first quarter of fiscal year 2006, there were 
1,028 active DEA PTO investigations with cocaine as the primary drug 
type. Thirty-nine (39) of the 44 organizations on the fiscal year 2006 
CPOT list (89 percent) are engaged in cocaine trafficking. At the end 
of the first quarter of fiscal year 2006, there were 514 active PTO 
investigations linked to these 39 CPOTs. Since the inception of the PTO 
program, DEA has disrupted or dismantled 1,208 cocaine PTOs.

          Operational Highlight: Operations Firewall and Panama 
        Express.--DEA's multi-agency cocaine interdiction programs--
        known as Operation Firewall and Operation Panama Express--
        combine investigative and intelligence resources to interdict 
        and disrupt the flow of cocaine from the northern coast of 
        Colombia to the United States. Since the July 2003 commencement 
        of Operation Firewall, 29.2 metric tons of cocaine have been 
        directly seized. In addition, Operation Firewall has provided 
        assistance in Operation Panama Express seizures of 33.2 metric 
        tons of cocaine, and in other foreign countries with the 
        seizure of 25.7 metric tons of cocaine. Since the February 2000 
        implementation of Operation Panama Express to December 31, 
        2005, 356 metric tons of cocaine have been seized, 109.2 metric 
        tons of cocaine have been scuttled, and 1,107 individuals 
        arrested. As of December 31, 2005, these combined operations 
        have resulted in total seizures of 410.9 metric tons of 
        cocaine.

Heroin
    The overall demand for heroin in the United States is lower than 
for other major drugs of abuse such as cocaine, marijuana, 
methamphetamine, and MDMA.\11\ However, one cause for concern is the 
recent increase in heroin use. According to the 2004 NSDUH, 166,000 
people aged 12 and older (0.1 percent) reported using heroin during the 
past 30 days in calendar year 2003 compared to 119,000 (0.1 percent) in 
calendar year 2003.\12\ Heroin remains readily available in major 
metropolitan areas and is the third most frequently mentioned illegal 
drug reported to DAWN by participating emergency departments after 
cocaine and marijuana, accounting for 47,604 mentions in calendar year 
2003.\13\
---------------------------------------------------------------------------
    \11\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. (2005). Overview of Findings 
from the 2004 National Survey on Drug Use and Health.
    \12\ Ibid.
    \13\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. Detailed Emergency 
Department Tables from DAWN: 2003. December 2004.
---------------------------------------------------------------------------
    Most of the heroin entering the United States is produced in South 
America and Mexico. Although heroin production in these areas has 
decreased in recent years, the production capacity remains sufficient 
to meet U.S. demand for the drug.\14\ In 2004, Afghanistan produced 
more than 90 percent of the worldwide heroin produced.\15\ However, 
Afghanistan is not currently a major heroin supplier to the United 
States; only about 8 percent of the U.S. supply comes from that 
country.
---------------------------------------------------------------------------
    \14\ U.S. Department of Justice, National Drug Intelligence Center. 
(2006). 2006 National Drug Threat Assessment.
    \15\ Ibid.
---------------------------------------------------------------------------
    At the end of the first quarter of fiscal year 2006, there were 240 
active DEA PTO investigations with heroin as the primary drug type. 
Fourteen (14) of the 44 organizations on the fiscal year 2006 CPOT list 
(32 percent) are engaged in heroin trafficking. At the end of the first 
quarter of fiscal year 2006, there were 514 active PTO investigations 
linked to these 14 CPOTs. Since the inception of the PTO program, DEA 
has disrupted or dismantled 357 heroin PTOs.

          Operational Highlight: Operation Containment and FAST.--
        Through Operation Containment, DEA is working with a coalition 
        of 19 countries from Central Asia, the Caucasus, Europe, and 
        Russia, to reduce the flow of Afghan heroin into world markets, 
        prevent Afghanistan from becoming a major heroin supplier to 
        the United States, and disrupt drug related terrorist 
        activities that could hamper the long term stabilization of the 
        Afghanistan government. In fiscal year 2005, Operation 
        Containment resulted in the seizure of 11.5 metric tons of 
        heroin, 1.3 metric tons of morphine base, 43.9 metric tons of 
        opium gum, 14.2 metric tons of precursor chemicals, and 248 
        clandestine opium, morphine, and heroin conversion 
        laboratories. By comparison, just 3 years prior, .47 metric 
        tons of heroin was seized, representing a 2,300 percent 
        increase in fiscal year 2005. Operation Containment also 
        resulted in the initiation of 146 investigations and led to the 
        disruption of two CPOTs, including the Haji Bashir Noorzai and 
        Haji Baz Mohammad organizations in fiscal year 2005. DEA's 
        Foreign-deployed Advisory Support Team (FAST) Program augments 
        Operation Containment. Since being deployed in April 2005, the 
        FAST program has trained over 100 Afghan officers who work bi-
        laterally with DEA's FAST teams. One successful FAST operation 
        occurred on June 18, 2005, when the DEA Kabul Country Office, 
        FAST, United Kingdom forces, and the U.S. trained Afghan 
        officers raided and destroyed four fully operational 
        clandestine heroin laboratories. One of the four opium-to-
        morphine base conversion laboratories destroyed was one of the 
        largest seized in Afghanistan. Approximately 4.4 metric tons of 
        opium, hundreds of gallons of chemicals, four opium presses, 
        six opium vats, and 500 kilograms of soda ash were destroyed.

Transit Zones
    The Southwest Border area is the principal arrival zone for most 
illicit drugs smuggled into the United States. From that area, the 
smuggled drugs are distributed throughout the country.
    Most cocaine is transported from South America, particularly 
Colombia, through the Mexico-Central America Corridor via the Eastern 
Pacific transit zone (50 percent) and the Western Caribbean zone (40 
percent). Most of the cocaine transiting these two areas is ultimately 
smuggled into the country via the Southwest Border. The remaining 10 
percent of cocaine transported from South America mostly transits the 
Caribbean zones to Florida and the Gulf Coast.\16\
---------------------------------------------------------------------------
    \16\ U.S. Department of Justice, National Drug Intelligence Center. 
(2006). 2006 National Drug Threat Assessment.
---------------------------------------------------------------------------
    According to the 2006 National Drug Threat Assessment, 
methamphetamine seizures increased from 1.12 metric tons in calendar 
year 2002, to 1.73 metric tons in calendar year 2003, to 1.98 metric 
tons in calendar year 2004. Most of the foreign-produced marijuana 
available in the United States is smuggled into the country from Mexico 
via the Southwest Border by Mexican drug trafficking organizations and 
criminal groups, as evidenced by calendar year 2004 seizures of 1,103 
metric tons on the Southwest Border versus 9.2 metric tons on the 
Northern Border.
    In calendar year 2004, seizures for Southwest Border points of 
entry included 22.4 metric tons of cocaine, 388 kilograms of heroin, 
1,070 metric tons of marijuana, and 2.3 metric tons of methamphetamine. 
By comparison, seizures in the Florida/Caribbean arrival zone for the 
same time period included 10.5 metric tons of cocaine, 481 kilograms of 
heroin, 4.9 metric tons of marijuana and no methamphetamine.

          Operational Highlight: Discovery of Narcotics Smuggling 
        Tunnel.--Acting on intelligence from a confidential source, in 
        January 2006, a joint investigation between DEA, Immigration 
        and Customs Enforcement, United States Border Patrol, and the 
        Mexican Policia Federal Preventia culminated in the discovery 
        of a narcotics smuggling tunnel. The tunnel spanned the United 
        States/Mexican border just east of the Otay Mesa, California 
        Port of Entry and resulted in the seizure of approximately two 
        tons of marijuana. The discovery of the tunnel followed an 
        extensive investigation resulting from DEA and ICE confidential 
        source information. The tunnel, approximately 86 feet deep and 
        nearly three-quarters of a mile long, originated inside a small 
        warehouse in Otay Mesa, Mexico, and exited inside a vacant 
        warehouse in San Diego, California.

                        FINANCIAL INVESTIGATIONS

    Drug trafficking organizations are motivated by one thing--money. 
According to the 2006 National Drug Threat Assessment, between $13.6 
billion and $48.4 billion is generated annually by wholesale-level drug 
distribution.\17\ To truly dismantle drug enterprises, we must attack 
the drug trafficking organizations' ability to collect proceeds from 
the drug trade.
---------------------------------------------------------------------------
    \17\ U.S. Department of Justice, National Drug Intelligence Center. 
(2006). 2006 National Drug Threat Assessment.
---------------------------------------------------------------------------
    DEA has reenergized and refocused its attack on the financial 
infrastructure of drug cartels. DEA's Office of Financial Operations 
and specialized Money Laundering Groups in DEA's 21 domestic field 
divisions principally target the drug money laundering systems and the 
drug profits that flow back to the sources of drug supply. In fiscal 
year 2005, DEA established a 5-year plan with annual milestones through 
fiscal year 2009. The plan calls for DEA to increase seizures until we 
seize drug profits at a level each year that will actually destroy drug 
networks rather than being viewed by traffickers only as an expected 
cost of doing business. To do this, DEA must seize $3 billion from drug 
trafficking organizations each year. In the first year under this plan, 
DEA denied drug traffickers $1.9 billion in revenue in fiscal year 
2005--including $1.4 billion in seized assets and $477 million in drug 
seizures--exceeding DEA's first year goal of $1 billion in seizures by 
90 percent.
    The smuggling of large sums of cash across our borders continues to 
be the primary method used to expatriate drug proceeds from the United 
States to the source countries. To address this increasing threat, the 
DEA has initiated a bulk currency program to coordinate all U.S. 
highway interdiction money seizures. Bulk currency cash seizures in 
fiscal year 2005 totaled $407 million, a 28 percent increase over the 
$317 million seized in fiscal year 2004.

          Operational Highlight: Arrest of Martin Tremblay.--On January 
        20, 2006, Martin Tremblay, a Canadian national and President 
        and Managing Director of the Bahamas-based investment firm 
        ``Dominion Investments, LTD'' was arrested by the DEA and other 
        Federal and State law enforcement agencies. Tremblay was 
        indicted for conspiracy to launder narcotics proceeds in a 
        long-term money laundering scheme from approximately 1998 
        through December 2005. Tremblay conspired to launder $1 billion 
        in illegal drug proceeds for ``Dominion Investment'' clients in 
        exchange for a substantial commission. Dominion Investment was 
        used by Tremblay to create shell companies and fictitious 
        entities to launder the drug proceeds he received to offshore 
        accounts in the United States, Canada, Switzerland, and 
        elsewhere around the world. Tremblay's activities as a money 
        launderer were first identified in an international DEA drug 
        investigation targeting subjects distributing GHB over the 
        Internet (Operations Webslinger and Black Goblin). Other 
        Federal and State law enforcement agencies involved in this 
        case include the Internal Revenue Service, Criminal 
        Investigations Division (IRS/CID) the New York State Police, 
        and the Organized Crime Drug Enforcement Strike Force in New 
        York, New York.
          Operational Highlight: Operations Dirty Dinero/Common 
        Denominator.--On March 2, 2006, in a joint action between the 
        Colombian National Police and the Drug Enforcement 
        Administration, Financial CPOT Ricardo Mauricio BERNAL-
        Palacios, his brother Juan BERNAL-Palacios and Tier 1 Money 
        Broker Camillo ORTIZ-Echevi were arrested in Bogota, Colombia. 
        These arrests were based on provisional arrest warrants filed 
        against the three in relation to a February 2006 indictment in 
        the Southern District of Florida charging 48 counts of money 
        laundering, 18 USC 1956(h) and one count of conspiracy to 
        distribute cocaine, 21 USC 846.

                                 GANGS

    Gangs have become an increasing threat to our nation's security and 
the safety of our communities. Seventy-five percent of the United 
States Attorneys report that parts of their districts currently have a 
moderate or significant gang problem. Gangs commonly use drug 
trafficking as a means to finance their criminal activities. 
Furthermore, many have evolved from turf-oriented entities to profit-
driven, organized criminal enterprises whose activities include not 
only retail drug distribution but also other aspects of the trade, 
including smuggling, transportation and wholesale distribution.
    Criminal street gangs, outlaw motorcycle gangs, and prison gangs 
are the primary retail distributors of illegal drugs on the streets of 
the United States and the threat of these gangs is magnified by the 
high level of violence associated with their attempts to control and 
expand drug distribution operations. Gangs primarily transport and 
distribute cocaine, heroin, marijuana, and methamphetamine. Authorities 
throughout the country report that gangs are responsible for most of 
the serious violent crime in the major cities of the United States.
    DEA is committed to combating the gang problem within the United 
States. As of February 7, 2006, approximately 12 percent (239) of DEA's 
total active Priority Target investigations target gangs. In addition, 
DEA's Mobile Enforcement Teams (METs) target violent drug trafficking 
organizations in areas where State, local, and Tribal law enforcement 
is challenged by limited resources to counter the threat. Often, these 
MET deployments target violent gangs involved in drug trafficking 
activity, such as the Hell's Angels, Latin Kings, Bloods, Crips, 
Mexican Mafia, and Gangster Disciples. In fiscal year 2004, 
approximately 27 percent (11 of 40) of MET deployments targeted gangs. 
Gang related MET deployments increased to 38 percent in fiscal year 
2005, when 15 of 39 MET deployments initiated targeted gangs. Through 
the second quarter of fiscal year 2006, 5 of 14 deployments (35 
percent) targeted gangs.
    DEA also recognizes the value of an integrated, collaborative and 
comprehensive approach to multi-faceted gang organizations and their 
operations. DEA participates in a number of anti-gang initiatives with 
other law enforcement components, including Violent Crime Impact Teams, 
Project Safe Neighborhoods, Weed and Seed Program, Safe Streets and 
Safe Trails Task Forces and the Attorney General's Anti-Gang 
Coordination Committee.

          Operational Highlight: Operation Motor City Mafia.--Operation 
        Motor City Mafia was a Special Operations Division-supported, 
        OCDETF and PTO investigation of the Black Mafia Family (BMF). 
        DEA and the Internal Revenue Service identified the BMF as a 
        major cocaine and crack cocaine distribution organization with 
        cells in major metropolitan cities including Detroit, Atlanta, 
        Los Angeles, Miami, St. Louis, Orlando, and Louisville. The BMF 
        uses the rap music industry to distribute hundreds of kilograms 
        of cocaine and to launder millions of dollars in drug proceeds. 
        The BMF has used intimidation, violence, and murder to maintain 
        their strong presence among their urban drug trafficking 
        organizations. As of January 27, 2006, Operation Motor City 
        Mafia resulted in the arrest of 53 defendants and the seizure 
        of 385 kilograms of cocaine, 1.2 metric tons of marijuana, $4.6 
        million, and other assets valued at over $16 million.

                       STATE AND LOCAL ASSISTANCE

    DEA provides direct assistance to State and local law enforcement 
agencies through its State and Local Law Enforcement Officer Training 
program, State and Local Task Force program, and Mobile Enforcement 
Team (MET) program. In addition, DEA provides clandestine laboratory 
clean up assistance to State and local law enforcement agencies.
    State and Local Training.--DEA trained 22 percent more State and 
local officers in fiscal year 2005 (41,853) than fiscal year 2004 
(34,183), including training in responding to clandestine laboratories, 
drug diversion, and law enforcement intelligence. &
    State and Local Task Forces.--DEA's partnerships with Federal, 
State, local, and international law enforcement entities serve as force 
multipliers in our efforts to reduce the availability of illicit drugs 
in America. As of the end of first quarter fiscal year 2006, DEA's 
State and Local Task Forces numbered 214 and included over 2,500 
authorized Task Force Officers with more than 1,100 authorized DEA 
Special Agents.
    Mobile Enforcement Teams.--In April 1995, DEA created the MET 
Program to assist State, local, and Tribal law enforcement in the 
disruption or dismantlement of violent drug trafficking organizations 
and gangs. Since March 2005, METs have prioritized deployments on 
methamphetamine, targeting repeat meth offenders and clandestine 
laboratory operators in areas of the United States that have a limited 
DEA presence. Since the re-direction of MET, 44 percent (20 out of 45) 
of new MET deployments opened in fiscal year 2005 were methamphetamine 
deployments. This is nearly double the methamphetamine deployments by 
METs from fiscal year 2003 to fiscal year 2004. During this period, an 
average of 24 percent of new MET deployments were focused on 
methamphetamine.
    Hazardous Waste Program.--Established in 1990 to address 
environmental concerns from the seizure of clandestine drug 
laboratories, DEA's hazardous waste program promotes the safety of law 
enforcement personnel and the public by using highly qualified 
companies with specialized training and equipment to perform the 
removal of the methamphetamine-related wastes at seized laboratories. 
In fiscal year 2005, DEA administered 8,678 State and local clandestine 
clean ups. In addition, DEA has trained nearly 12,000 Federal, State, 
and local law enforcement personnel since 1998 to conduct 
investigations and dismantle seized methamphetamine labs to protect the 
public from methamphetamine lab toxic waste. To accelerate the clean up 
process and reduce costs borne by State and local governments 
associated with seized sites, DEA has developed a hazardous waste 
container program that will allow for the central collection of waste 
products, reducing the time and expense of lab clean ups. A pilot 
program in Kentucky produced savings of $800,000 in fiscal year 2005 
and approximately $500,000 in fiscal year 2004.

          Bureau of Alcohol, Tobacco, Firearms and Explosives

STATEMENT OF CARL J. TRUSCOTT, DIRECTOR
    Senator Shelby. Mr. Truscott.
    Mr. Truscott. Mr. Chairman, Ranking Member Mikulski, 
distinguished members of the subcommittee, I am pleased to 
appear before you today to discuss the President's fiscal year 
2007 budget for the Bureau of Alcohol, Tobacco, Firearms and 
Explosives. I appreciate very much the support----
    Senator Leahy. Mr. Chairman?
    Senator Shelby. Yes, Senator Leahy.
    Senator Leahy. And I apologize, you know, you are my 
favorite chairman the way you run things. I just got called. I 
have to go back for the immigration bill. Would it be possible 
to ask Administrator Tandy just a couple of short questions? I 
may get stuck on the floor.
    Senator Shelby. Can you just submit them for the record, 
where we can keep it going? If you would submit them for the 
record.
    Senator Leahy. Well----
    Senator Shelby. I would rather you just submit them for the 
record.
    Senator Leahy. Okay, I will try to come back, because I 
find when I submit them, I never get the answers.
    Senator Shelby. We will lose our rhythm otherwise.
    Senator Leahy. All right.
    Senator Shelby. I appreciate it, Senator Leahy, but we've 
got to keep the subcommittee going.
    Mr. Truscott. Mr. Chairman, I appreciate very much the 
support that this subcommittee has given to ATF and the 
interest it has demonstrated in ATF's missions and programs. 
Thanks to the leadership and support of this subcommittee and 
the dedication and diligence of the men and women of ATF, we 
are improving the lives of Americans.
    Your investments in our efforts produce real results, safer 
neighborhoods where all of us can live without fear. The 
statement I provided for the record goes into great detail on 
ATF's programs and accomplishments, so I will use the time I 
have today to briefly highlight our budget request, which 
includes expansion of our violent crime impact team program, 
one of ATF's most effective initiatives. I will also provide a 
brief overview of our response to the recent church fires in 
rural Alabama and our activities in support of the coalition 
forces in Iraq.

               ALCOHOL, TOBACCO, FIREARMS BUDGET REQUEST

    The President's budget for fiscal year 2007 requests $860 
million and 5,030 full-time equivalent positions for ATF. The 
President's request also includes $120 million from a fee on 
explosive industry operations, which would bring our total 
resources to $980 million. I believe these investments will 
provide essential benefits to the American people.

                       VIOLENT CRIME IMPACT TEAMS

    Our fiscal year 2007 request includes new funds for the 
VCIT program. VCIT is a focused and cooperative law enforcement 
component of the President's Project Safe Neighborhoods 
Initiative. Through VCIT, ATF-led teams work with local law 
enforcement to identify and arrest the most violent offenders, 
including gang members in specific geographic locations with 
high crime rates. The program began in 15 selected communities 
and since has expanded to a total of 23, and because VCIT has 
proven so successful, the administration has requested $16 
million and 44 FTEs to support the initiative and offer more 
Americans the opportunity to enjoy safer neighborhoods.

                   ALABAMA CHURCH FIRES INVESTIGATION

    Mr. Chairman, I want to inform you and the subcommittee of 
the steps that we have taken, including my colleagues here at 
the table, to respond to the church fires in rural Alabama in 
early February. We view the intentional burning of a place of 
worship as a violent attack on the community's well being. Upon 
learning of the fires, ATF immediately activated our national 
response teams to investigate the fires. The teams include 
special agents, forensic chemists, fire protection engineers, 
accelerant detection canines, geographic and criminal 
profilers.
    ATF's partnership with Federal, State, and local law 
enforcement was vital to this effort. I am pleased to report 
that through law enforcement's hard work, this investigation 
was brought to a successful conclusion. Three individuals were 
indicted in connection with the church fires and are being 
charged with one count of conspiracy and nine counts of arson.

                  ALCOHOL, TOBACCO, FIREARMS AND IRAQ

    With respect to Iraq, ATF is contributing the expertise of 
our special agents and our explosive enforcement officers to 
the combined explosives exploitation cells. In cooperation with 
the U.S. Army, we are training Army explosive units at our 
National Center for Explosives Training and Research, and we 
are doing that prior to their deployment to Iraq. In addition, 
ATF provides post-blast training for U.S. and coalition forces 
in Iraq and for the Iraqi National Police. ATF-trained 
explosive detection canines are also deployed there. ATF has 
special agents assigned to the Regime Crimes Liaison Office to 
investigate in the investigation and the prosecution of war 
crimes. ATF personnel are also working in support of the newly 
established U.S. Embassy in Iraq.
    I have referenced several of our activities in support of 
our mission to prevent terrorism, reduce violent crime, and 
protect our Nation. We are committed to working directly and 
through partnerships to investigate and reduce crime involving 
firearms and explosives, acts of arson, and illegal trafficking 
of alcohol and tobacco products.
    Once again, Mr. Chairman, ranking member Mikulski, members 
of this subcommittee, on behalf of ATF, I thank you for your 
support of our crucial work. I also thank you for this 
opportunity to testify before you today, and I look forward to 
answering any questions you may have.
    [The statement follows:]

                 Prepared Statement of Carl J. Truscott

    Mr. Chairman, Senator Mikulski, and distinguished members of the 
subcommittee, I am pleased to appear before you today to discuss the 
accomplishments of the Bureau of Alcohol, Tobacco, Firearms and 
Explosives (ATF) and the President's fiscal year 2007 Budget for ATF.
    As you know, ATF is a principal law enforcement agency within the 
United States Department of Justice dedicated to preventing terrorism, 
reducing violent crime, and protecting our Nation. The men and women of 
ATF perform the dual responsibilities of enforcing Federal criminal 
laws and regulating the firearms and explosives industries. We are 
committed to working directly, and through partnerships, to investigate 
and reduce crime involving firearms and explosives, acts of arson, and 
illegal trafficking of alcohol and tobacco products.
    I appreciate very much the support the subcommittee has given to 
ATF and the interest it has demonstrated in ATF's missions and 
programs. Thanks to the leadership and support of this committee, and 
the dedication and diligence of the men and women of ATF, our efforts 
are producing real results: safer neighborhoods, where all of us can 
live without fear.
    With your support during the fiscal year 2006 appropriations 
process, ATF received funding to expand its Violent Crime Impact Teams 
(VCIT), participate in the Terrorist Explosive Device Analytical Center 
(TEDAC), and plan a permanent facility for the National Center for 
Explosives Training and Research (NCETR). These investments are in 
direct support of ATF's core mission.
    The President's budget request for fiscal year 2007 builds on your 
fiscal year 2006 investments with $16 million to further enhance VCIT, 
a focused and cooperative law enforcement component of the President's 
Project Safe Neighborhoods (SN) initiative.

                     RESPONSE TO HURRICANE KATRINA

    Before I give an overview of ATF programs and our fiscal year 2007 
budget request, first I would like to briefly inform the committee of 
the resources we deployed to the Gulf Region and the efforts we 
undertook as part of the Federal response to Hurricane Katrina.
    In the week proceeding Katrina making landfall in New Orleans, we 
prepared by identifying resources and personnel to send to the affected 
areas and held daily meetings and teleconferences of our Emergency 
Management Working Group. On August 30, one day after Katrina made 
landfall, we activated our Continuity of Operations (COOP) site in 
Mandeville, Louisiana, and established an alternative division office 
in Shreveport, Louisiana. At that time, we also began planning forward 
command posts in Mandeville, New Orleans, and Biloxi, Mississippi, and 
decided to establish a Critical Incident Management Response Team 
(CIMRT) in Baton Rouge, Louisiana. ATF field offices from across the 
Nation immediately began moving manpower and equipment to the region, 
while personnel in the affected areas made locating missing ATF 
employees their top priority. In the following days, we deployed two 
Special Response Teams (SRTs) to New Orleans to address, in 
coordination with the New Orleans Police Department, the looting and 
violence in the aftermath of the storm.
    Despite catastrophic damage to our facilities, the onerous 
logistics of re-establishing operations, and the severe personal 
hardships endured by our personnel, I am proud to point out that ATF 
was able, without interruption or a reduction in effectiveness, to 
continue our mission of enforcing Federal law and safeguarding the 
public. By September 22, less than 4 weeks after the levee breaches in 
New Orleans, ATF had assisted with over 600 law enforcement actions. 
Twelve arrests were made by ATF, including the September 5th arrest of 
a suspect who was observed by ATF SRT members firing on a helicopter 
conducting relief efforts. This arrest was the first of many Federal 
arrests, both by ATF and other Federal partners, for firearms 
violations in New Orleans after Hurricane Katrina.
    ATF was given primary jurisdiction in the 1st and 8th Police 
Districts in New Orleans, responded to firearms-related calls, stopped 
looting, assisted in rescue operations, provided surveillance, assisted 
in the establishment of a detention center, and provided security to 
Assistant United States Attorneys. During that time, ATF also 
proactively reached out to all Federal Firearms Licensees (FFLs) and 
Federal Explosives Licensees (FELs) in affected areas. As an extension 
of those efforts, we established a toll-free number for FFLs and FELs 
to contact ATF regarding the status of their premises, records, and 
inventory; and we instituted a plan to systematically inspect all 742 
FFLs and 182 FELs where looting and flooding occurred.
                                  iraq
    I would also like to provide the committee with a brief overview of 
our activities in support of the coalition forces in Iraq before I move 
on to a discussion of ATF programs. I would like to thank the committee 
for its support for ATF's fiscal year 2006 Iraq Supplemental request. 
Currently, ATF is contributing the expertise of its special agents and 
Explosives Enforcement Officers to the Iraq Combined Exploitation Cells 
(CEXCs). This participation has been praised by the Department of 
Defense. In cooperation with the U.S. Army, we are training Army 
explosives units at our National Center for Explosives Training and 
Research (NCETR) prior to their deployment to Iraq. In addition, ATF 
provides post-blast training for United States and coalition forces in 
Iraq and for the Iraqi National Police, and ATF-trained explosives 
detection canines are deployed in Iraq. ATF also has special agents 
assigned to the Regime Crimes Liaison Office in Iraq to assist in the 
investigation and prosecution of war crimes.

              FISCAL YEAR 2007 PRESIDENT'S BUDGET REQUEST

    ATF's mission supports the priorities of the administration and the 
Department under the Department's Strategic Goals 1 and 2, to ``Prevent 
Terrorism and Promote the Nation's Security'' and ``Enforce Federal 
Laws and Represent the Rights of the American People.''
    The President's 2007 budget request for ATF is 5,030 FTE and 
$860,128,000 for salaries and expenses and for program enhancements, 
offset by a $20,000,000 reduction in the firearms decision unit and a 
$120,000,000 explosives user fee.
    The fiscal year 2007 request includes funds for the expansion of 
the VCIT program. VCIT is one of ATF's most effectively designed 
initiatives and is an important part of PSN. The President's budget 
requests $16,000,000 and 44 FTE to further enhance the initiative and 
offer more Americans the opportunity to live in safer neighborhoods. 
This initiative would increase the number of VCIT teams from 25 to 40 
in the coming fiscal year.

                                FIREARMS

    ATF enforces Federal firearms laws and provides requested support 
to Federal, State, and local law enforcement officials in their fight 
against crime and violence. Our agents investigate a broad range of 
firearms violations that can be generally divided into three 
categories:
  --investigations of those persons who are prohibited by law from 
        possessing firearms, such as felons, illegal aliens, and drug 
        traffickers;
  --investigations of persons possessing firearms that are generally 
        prohibited, such as machineguns and sawed-off shotguns; and
  --investigations of firearms trafficking.
    From these types of investigations, ATF agents concentrate on 
firearms traffickers diverting firearms out of lawful commerce into the 
hands of criminals. Firearms trafficking investigations can be complex 
and time-consuming. They can involve illegal straw purchases of 
firearms for those unable to legally possess firearms, illegal dealing 
at gun shows or other locations, robberies of gun stores, and thefts 
from interstate shipments.
    We are a major participant in the administration's PSN initiative, 
which began in 2001. This cooperative program builds upon the 
enforcement efforts of the past, and includes the use of advanced 
technology and effective sharing of intelligence and information. Law 
enforcement, prosecutors, and community leaders work together on 
deterrence and prevention. Agencies develop focused enforcement 
strategies to investigate, arrest, and prosecute violent offenders, 
prohibited possessors of firearms, domestic and international firearms 
traffickers, and others who illegally attempt to acquire firearms. ATF, 
local law enforcement, U.S. attorneys, and local prosecutors evaluate 
cases and seek the most appropriate venue for firearms prosecution. The 
Department filed 10,841 federal firearms cases in fiscal year 2005--a 
73 percent increase since PSN's inception. ATF-related firearms 
investigations resulted in over 8,300 convictions in fiscal year 2005.

                       VIOLENT CRIME IMPACT TEAMS

    In June 2004, former Attorney General Ashcroft, former Deputy 
Attorney General Comey, and I announced the VCIT initiative, a new 
program to reduce violent crime in specific geographic locations with 
high crime rates. Through VCIT, ATF-led teams work with local law 
enforcement to identify and arrest the most violent offenders in each 
area. The program began in 15 selected communities and has since 
expanded to a total of 23. VCITs are now in place in: Albuquerque, New 
Mexico; Atlanta, Georgia; Baltimore, Maryland; Baton Rouge and New 
Orleans, Louisiana; Camden, New Jersey; Columbus, Ohio; Fresno and Los 
Angeles, California; Greensboro, North Carolina; Hartford, Connecticut; 
Houston and Laredo, Texas; Las Vegas, Nevada; Miami and Tampa, Florida; 
Minneapolis, Minnesota; Philadelphia and Pittsburgh, Pennsylvania; 
Richmond, Virginia; Tucson, Arizona; Tulsa, Oklahoma; and the 
Washington, DC/Northern Virginia area. We plan to expand to 25 cities 
in this fiscal year and 40 cities in fiscal year 2007.
    ATF-led VCIT teams in these cities bring the targeted area's 
Federal, State, local and Tribal law enforcement officials together. 
The VCIT strategy counsels each team to create an individualized 
strategy, then to work together to remove those responsible for violent 
crime. Civic leaders and law enforcement officials have praised VCIT's 
positive impact on their communities. I am proud to note that, in 
August 2005, six ATF personnel received the Attorney General's 
Outstanding Contributions to Community Partnerships for Public Safety 
Award, honoring them for developing, organizing, and implementing VCIT.

                           ANTI-GANG EFFORTS

    We have developed expertise in working against criminal groups, 
particularly gangs. As such, ATF played an integral role in the 
development of the Department of Justice's Gang Strategy Report for the 
House Appropriations Committee. This reflects our years of experience 
in working against violent gangs, including outlaw motorcycle 
organizations active in firearms and narcotics trafficking. In fact, 
ATF oversees a comprehensive gang strategy, combining education, 
prevention, training, and a variety of criminal enforcement tactics to 
take violent gang members and their organizations off the streets. As 
part of the strategy, ATF shares investigative information with other 
law enforcement agencies on gangs nationally through its case 
management system. This system allows every agent and task force member 
the ability to access information about other cases in order to 
coordinate efforts.
    Our efforts have resulted in ATF referring more than 7,750 gang 
members and their associates to Federal and State prosecutors for 
prosecution during the past 5 years--3,100 of them during fiscal year 
2005 alone--for charges including firearms violations, continuing 
criminal enterprise violations, Racketeer Influenced Corrupt 
Organization Act (RICO) violations, and arson and explosives 
violations. During this same 5-year period, as a result of our 
investigations, more than 3,000 gang members have been convicted of 
firearms offenses. In the past 2 fiscal years, we also traced more than 
12,000 firearms linked to gang activity to assist in developing 
investigative leads for law enforcement.
    The Regional Area Gang Enforcement (RAGE) unit, an ATF led task 
force, was established in June 2003 to contend with the growing Latino 
gang problems in the Maryland portion of the Washington, DC 
Metropolitan region. RAGE has had contact with and identified 
approximately 1,000 members of various Latino gangs in this area. RAGE 
is currently comprised of investigators from ATF, ICE, FBI, Prince 
George's County Police, Maryland National Capital Park Police, Howard 
County Police, Montgomery County Police, Hyattsville City Police, 
Fairfax County (VA) Police and Maryland State Police. RAGE 
investigators have identified three Mara Salvatrucha 13 (MS-13) cliques 
which are the most violent and involved in criminal activity, and 
consequently present the greatest threat to the public and law 
enforcement. MS-13 is an extremely violent street gang with documented 
involvement in homicides, rapes, aggravated assaults, carjacking, 
citizen robberies, prostitution, firearm trafficking, extortion, 
witness intimidation, auto theft, burglaries and other crimes.

                      SOUTHWEST BORDER INITIATIVE

    In October 2005, the Attorney General established an ATF-led VCIT 
in Laredo, Texas, to address increased violent crime along the border 
between the United States and Mexico. The Laredo VCIT serves as the 
focal point for ATF's Southwestern Border Initiative. This Initiative 
coordinates resources from four field divisions and previously 
established VCITs in Tucson, Albuquerque, and Houston. The initiative 
fights regional and cross-border violence and firearms trafficking by 
employing the tools of the VCIT strategy--geographic targeting, 
partnership and technology. ATF is working closely with the Laredo 
Police Department to identify targeted geographical areas and the worst 
offenders. ATF also is working in a reciprocal partnership with 
Immigration and Customs Enforcement [ICE] lending support to Operation 
Community Shield and Operation Blackjack while ICE supports VCIT to 
ensure the full use of the expertise and resources of both agencies. 
Through its International Programs Branch, ATF is working closely with 
the Mexican government to ensure that U.S.-sourced firearms recovered 
in Mexico are properly identified and documentation is submitted to ATF 
for tracing. ATF uses the trace results to identify and investigate 
firearms traffickers who illegally divert firearms to drug traffickers. 
Other technologies being used include crime gun mapping and ballistic 
tracing.

                        NATIONAL TRACING CENTER

    ATF's National Tracing Center (NTC) is the largest operation of its 
kind in the world. This facility conducts traces of firearms recovered 
at crime scenes for any Federal, State, local, or international law 
enforcement agency. In fiscal year 2005, the NTC traced over 260,000 
firearms. The NTC stores information concerning multiple sales of 
firearms, suspect guns, and firearms with obliterated serial numbers, 
and is also the only repository for all records of FFLs that have gone 
out of business. The NTC provides ATF personnel and other law 
enforcement agencies with crime gun data specific to their geographic 
areas, and helps them identify emerging trends and patterns in 
firearms-related criminal activity.
    In the conference report accompanying the Consolidated 
Appropriations Act for fiscal year 2005, Congress expressed support for 
the NTC Program known as Access 2000 and encouraged us to emphasize and 
expand it. I am pleased to inform the committee that we have done so. 
Under the Access 2000 initiative, which benefits both ATF and our 
industry partners, servers supplied by ATF have been installed at 49 
firearms manufacturers and major wholesale distributors, all of them 
FFLs, who have voluntarily partnered with ATF in this effort. FFLs 
enter firearms information into the servers; the NTC connects to these 
servers remotely and can obtain information on a firearm's disposition 
in the course of a crime gun trace. This program substantially reduces 
administrative costs to the FFL and the time it takes ATF to trace a 
firearm.
    In order to reduce violent crime, ATF will continue to develop and 
employ technology that will help law enforcement at all levels. Through 
the National Integrated Ballistic Information Network (NIBIN) Program, 
ATF has installed automated ballistic comparison equipment at 230 sites 
in participating forensic laboratories in the continental United States 
and its territories, giving these State and local law enforcement 
agencies the opportunity to identify ballistic links between crimes not 
otherwise known to be connected.

                               EXPLOSIVES

    In addition to our investigative efforts against firearms 
trafficking and violent firearms crime, ATF agents investigate 
bombings, unlawful distribution of explosives, thefts of explosives, 
and other violations of explosives laws. ATF industry operation 
investigators (IOIs) ensure that the manufacture, importation, and 
commerce in explosives are conducted lawfully. Other programs combine 
advanced technology with ATF's years of expertise, providing critical 
intelligence for Federal, State, and local law enforcement to use in 
investigating explosives incidents in their areas.
    As part of the Department of Justice's efforts to ensure the 
coordination of explosives investigations, explosives information 
sharing, and other related explosives matters amongst its law 
enforcement components, the Department of Justice reviewed the 
explosive programs of ATF, FBI, and others and on August 11, 2004, 
issued a policy memo outlining roles and responsibilities as they 
relate to explosives issues. Former Attorney General Ashcroft's policy 
memorandum regarding coordination of explosives investigation and 
related matters helped to clarify the responsibilities of ATF, and a 
few of the decision points are as follows:
  --Mandated that ATF would control the investigation of all explosives 
        incidents except those related to terrorism and those where the 
        FBI has traditionally exercised jurisdiction [bank robberies, 
        organized crime, etc].
  --Tasked ATF to maintain all DOJ arson and explosives databases 
        currently maintained by other DOJ components.
  --Mandated the consolidation within ATF of all budget, curriculum, 
        teaching, and scheduling functions related to DOJ post-blast 
        explosives training for Federal, State, local, and 
        international entities.
  --Directed ATF to establish standards to certify all explosives 
        detection canines used by DOJ components.
    I am honored by the confidence that the Attorney General placed in 
ATF when he made these decisions. Mr. Chairman, I believe that these 
policies will be responsible for significant financial efficiencies.
    ATF strives to investigate each and every report of theft or loss 
of explosives in the United States in order to ensure that these 
explosives do not fall into the hands of terrorists or criminals. In 
fiscal year 2005 alone, ATF's diligent investigative efforts have led 
to the recovery of more than 15,000 pounds of high explosives, in 
addition to 1,533 pounds of low explosives, 5,280 blasting agents, 
14,356 detonators, and 6,859 grenades. Mr. Chairman, the recovery of 
these items has made our Nation a safer place.
    At the end of last year, the theft of a large quantity of 
explosives and detonators garnered significant public attention. On 
December 18, 2005, ATF, the Albuquerque Police Department, the 
Bernalillo County Sheriff's Department, the New Mexico State Police, 
and the FBI began investigating the theft of approximately 400 pounds 
of explosives from a Federal Explosive Licensee (FEL) located just 
outside Albuquerque, New Mexico. Five subjects have been subsequently 
arrested and charged with Federal explosives- and firearms-related 
violations. All of the stolen explosives have subsequently been 
recovered with the exception of one or two detonators.
    While all ATF special agents receive substantial explosives-related 
training, special agents who qualify as certified explosives 
specialists (CESs) are among the most experienced, best-trained 
explosives experts in the Federal Government. They conduct explosives 
crime scene examinations, lend expertise in support of security 
measures implemented at special events, and assist ATF's law 
enforcement counterparts at the Federal, State, local, and 
international levels in their efforts to investigate explosives-related 
incidents. CESs are highly trained in all aspects of explosives 
handling, instruction, identification, demonstration, and destruction. 
Because of their proficiency in explosives investigation, CESs are used 
regularly as instructors for explosives-related training throughout the 
United States and at the International Law Enforcement Academies in 
Budapest, Hungary; Bangkok, Thailand; and Gaborone, Botswana.
    ATF has other experts in the field of explosives. ATF's explosives 
enforcement officers (EEOs) provide technical assistance and support in 
explosives matters. These bomb technicians have between 12 and 35 years 
of experience in explosives and bomb disposal. EEOs render explosive 
devices safe, disassemble explosive and incendiary devices, prepare 
destructive device determinations, and render expert testimony in 
support of such determinations in State and Federal criminal court 
proceedings. EEOs also provide expert analysis and onsite investigative 
technical assistance at bombing and arson scenes and other scenes where 
explosions of an undetermined nature have occurred. They provide 
assistance and training in all aspects of explosives handling, usage, 
and destruction; threat vulnerability assessments; and all other 
explosives-related matters for ATF and State and local law enforcement 
agencies. EEOs use a full range of bomb disposal equipment including 
such robotic equipment as the All-purpose Remote Transport System 
(ARTS), which is designed to remotely disrupt car and truck bombs that 
are too large to disarm by traditional methods--ATF is one of the few 
Federal agencies with ARTS capability.
    To comply with the Attorney General's 2004 August memorandum, ATF 
has transferred the Arson and Explosives National Repository (AENR) to 
the United States Bomb Data Center (USBDC). The information maintained 
within the USBDC is this country's most comprehensive set of data 
describing fire/explosion incidents. The incidents are divided into 
specific categories such as targets, locations, motives, and victims. 
Trends, patterns, and criminal methodologies, as well as the identities 
of known previous offenders, can be derived from the data set. Most 
importantly, ATF agents or other law enforcement officials can contact 
USBDC to query the construction characteristics of an explosive device, 
and match the device to others with similar characteristics.
    ATF is now using the latest information management technology to 
make case information available to law enforcement nationwide through 
the Bomb Arson Tracking System (BATS). This program facilitates and 
promotes the collection and dissemination of fire, arson, and 
explosives incidents and information among participating agencies. Law 
enforcement agencies are able to enter their case information and query 
information entered by others, both locally and across agencies. BATS 
benefits its users by providing real-time incident-based information, 
records management functions, and there are plans to incorporate a 
feature providing spatial representation of incidents via an integrated 
Geographical Information System--all within a secure law enforcement 
environment. Eventually, the wealth of case information available 
through the USBDC will also be accessible through BATS.
    ATF is sharing its expertise by training Federal, State, local, 
military, and international bomb technicians and investigators in 
explosives disposal and investigation techniques at NCETR, currently 
located at Fort A.P. Hill, Virginia. ATF offers numerous advanced 
courses related to explosives disposal and post-blast investigation 
techniques at NCETR, which was authorized in the Homeland Security Act 
of 2002. As previously noted, we are currently training Army explosives 
units prior to their deployment to Iraq. In addition, ATF provides 
post-blast training to members of the Department of State, the Naval 
Criminal Investigative Service, and the Air Force Office of Special 
Investigations. Since ATF began holding training classes at Fort A.P. 
Hill in 2000, we have provided training to more than 4,000 Federal, 
State, local, and international bomb technicians and investigators. The 
fiscal year 2006 conference agreement (Public Law109-108) provides $5.0 
million in funding for site selection, architectural design, site 
preparation for the construction of a permanent site for NCETR. In 
considering site selection, ATF is directed to consider a site co-
located with other law enforcement and Federal government entities that 
provides similar training and research. The dynamic of these collective 
resources will provide a unique opportunity to leverage assets, 
knowledge, and expertise in the field, providing Federal, State and 
local law enforcement explosives expertise at a single location.

                                 ARSON

    ATF's arson investigative work includes two recent high-profile 
arson cases. In December 2004, fires were set in a new housing 
development in Charles County, Maryland, resulting in damage to over 30 
homes--a number of which were completely destroyed. Our agents 
investigated and our state-of-the-art Forensic Science Laboratory 
analyzed all of the evidenced gathered. The results of our efforts were 
two guilty pleas and a conviction. The second example is the District 
of Columbia (D.C.) serial arsonist investigation. From June 2003 
through April 2005, ATF, with other law enforcement organizations, 
investigated over 50 fires in the District of Columbia and adjoining 
Prince Georges County, Maryland. These fires caused considerable loss 
of property for residents, and in the District of Columbia, were 
responsible for the deaths of two people. We examined more than 1,000 
leads and 1,300 suspects and were ultimately able to identify the 
person responsible using DNA evidence. In June, the defendant pled 
guilty to 50 arsons and two counts of murder. In subsequent interviews, 
he has acknowledged setting as many as 350 additional fires. By 
investigating and solving these crimes with our State and local 
partners, we are also helping to prevent future arsons.
    ATF's arson enforcement efforts are an integral part of ATF's 
overall violent crime reduction strategy, and are directed toward 
preventing the crime of arson, providing effective post-incident 
response, and reducing the community impact of crimes involving fire. 
ATF investigative efforts are generally focused on arsons of Federal 
interest, including those at houses of worship, commercial buildings, 
and reproductive health clinics. In fiscal year 2005, ATF opened nearly 
2,000 fire investigations. I would like to address some of ATF's arson 
program areas and assets, including the certified fire investigator 
(CFI) program, ATF's response to animal-rights and environmental-rights 
extremism, the ATF Church Arson Task Force, and the ATF Fire Research 
Laboratory.
    After fire departments extinguish the flames, the work begins for 
cause and origin investigators who must determine whether the fire was 
intentionally set and whether a crime was committed. The agents 
participating in ATF's CFI program are at the forefront of fire 
investigation. The special agents who participate in this program are 
the only federally trained and federally certified cause and origin 
investigators in the Federal Government. These CFIs are able to qualify 
as expert witnesses, that is, opinion witnesses, in fire cause and 
origin determinations. Each CFI has participated in hundreds of 
investigations and has undergone hundreds of hours of training to 
qualify in giving expert testimony. The CFI program is the only one of 
its type in Federal law enforcement and has received national and 
international acclaim. ATF currently has CFIs who are based in 39 
States and provide support to the entire United States and its 
territories.
    ATF also investigates bombings and crimes of arson by environmental 
and animal rights extremists, such as the Animal Liberation Front (ALF) 
and the Earth Liberation Front (ELF). Because of ATF's expertise in 
these areas, we have made these investigations a priority and will 
continue to do so. In the last several years we have initiated about 
100 explosives and arson investigations believed to be linked to ALF 
and ELF. Most recently, 11 defendants were indicted by a Federal grand 
jury on 65 counts including arson, conspiracy and destruction of an 
energy facility for allegedly participating in a criminal campaign in 
five western states on behalf of ELF and ALF. In the past, many of the 
fires set by these extremists have been set utilizing a particular 
methodology, and the USBDC--which has records and intelligence on these 
acts spanning decades--stands ready to assist fire investigators in 
determining the methodology used in future incidents, linking events, 
and identifying suspects.
    One of the most painful and destructive crimes that ATF 
investigates is arson directed at houses of worship. In fiscal year 
2005, ATF responded to approximately 223 such fires and explosives 
incidents. Out of that number, 108 of the fires were determined to be 
incendiary, that is, set by human hands. Those 108 arsons caused over 
$23 million in damage.
    In addition to the Forensic Science Laboratory, one of ATF's newer 
fire investigation resources is the Fire Research Laboratory (FRL). The 
FRL houses a one-of-a-kind fire test center with the capability of 
replicating initial fire scenarios approaching a quarter acre in size, 
to scale, and under controlled conditions allowing for detailed 
analysis. This facility is the only such facility in the United States 
that is dedicated to providing case support in fire investigations 
using forensic fire science, and the facility will support ATF's 
investigative requirements well into the future.

               CRIMINAL DIVERSION OF ALCOHOL AND TOBACCO

    ATF is engaged in ongoing efforts to reduce the rising trend of the 
illegal diversion of alcohol and tobacco products by criminal gangs, 
organized crime, and terrorist groups. In fiscal year 2002 we had 61 
defendants, 35 arrests, and 18 convictions relating to tobacco 
diversion. In fiscal year 2005, we had 314 defendants, 162 arrests, and 
73 convictions, increases of 515 percent, 463 percent, and 406 percent 
respectively. From the hijacking of tractor trailer loads and cargo 
containers of cigarettes, to the armed robbery of tobacco retailers, 
wholesalers, and distributors, to traditional smuggling conspiracies, 
ATF has successfully investigated and prosecuted the criminals 
involved. Current investigations have identified several instances of 
terrorist groups forming alliances with tobacco traffickers to generate 
funding to support their organizations and activities. We have built 
complex cases against individuals and organizations that have used 
proceeds from the illegal sales of cigarettes to fund organized crime 
and terrorism, and these cases have been successfully prosecuted. ATF 
also works in partnership with other Federal, State, and local agencies 
to enforce the laws under their jurisdiction. Where a terrorism nexus 
is present, ATF works with the local Joint Terrorism Task Force.
    Illegal trafficking of ATF-regulated commodities using the Internet 
is a growing problem, particularly with tobacco products. The illicit 
sale of tobacco products via the Internet is increasing and causing a 
substantial loss of excise tax revenue to Federal and State 
Governments. ATF utilizes laws such as the Contraband Cigarette 
Trafficking Act and Wire Fraud, Mail Fraud, and money laundering 
statutes to interdict illicit interstate cigarette distribution via the 
Internet and the mail.

                  INDUSTRY OPERATIONS: ATF'S DUAL ROLE

    ATF's role in Federal firearms and explosives laws, with both 
regulatory and enforcement responsibilities, is unique. ATF industry 
operations investigators ensure that the manufacture, import, and sale 
of firearms and explosives are conducted lawfully. Through education 
and industry partnerships, we work to keep firearms and explosives out 
of the wrong hands.
    According to the Institute of Makers of Explosives, over 5.6 
billion pounds of commercial explosives are used every year in the 
United States in mining and other applications. ATF ensures compliance 
with explosives laws and regulations through its explosives regulatory 
program. The purpose of this program is to protect interstate and 
foreign commerce against interference and interruption by reducing 
hazards to persons and property arising from the misuse and unsafe or 
unsecured storage of explosive materials. This is accomplished through 
the explosives field inspection effort; through the development, 
implementation, and evaluation of regulatory enforcement procedures and 
policy; through the screening of prospective and current explosive 
licensees/permittees and their employees; and through regular and open 
communication with the explosives industry and its representatives. 
ATF's field inspection program includes the thorough review of records 
and inventory to ensure product accountability, as well as the visual 
inspection of explosives storage facilities to ensure safe and secure 
product storage to prevent theft and misuse of explosives and 
accidents. Investigators verify that explosives storage magazines meet 
Federal construction and location requirements, including the required 
distance from explosives storage areas to roads or residential areas.
    The Safe Explosives Act (SEA) enhanced ATF's unique statutory 
mission of regulating the explosives industry. With the passage of this 
act in 2002, ATF assumed a significant additional workload such as 
continued issuance of renewal licenses/permits for nearly 13,000 
explosives-related businesses; increased inspection efforts and more 
thorough license application processing, including background checks 
for all employees who possess explosives. Further, the SEA decreed that 
ATF physically inspect every new explosives licensee applicant to 
ensure public safety. ATF's proposed explosives user fee will offset 
the explosives industry inspections that are currently carried out by 
ATF in furtherance of its mission.
    ATF's investigators are also responsible for firearms licensee 
inspections. Day in and day out, these investigators ensure that FFLs 
follow appropriate guidelines and procedures. Their work helps to 
prevent the acquisition of firearms by prohibited persons. Further, by 
promoting proper recordkeeping and business practices, they help ensure 
effective firearms tracing in critical investigations by the Nation's 
law enforcement community. Cooperative programs such as ``Don't Lie for 
the Other Guy,'' a joint venture between ATF and the National Shooting 
Sports Foundation, provide essential education for FFLs. In addition, 
our Federal Firearms Licensing Center in Atlanta screens all FFL 
applicants by coordinating background checks on persons responsible for 
firearms operations. I would like to note that, consistent with the 
Consolidated Appropriations Act for fiscal year 2005 (Public Law 108-
447), we are in the process of moving the licensing center to the site 
of our National Tracing Center in Martinsburg, West Virginia. Co-
locating these facilities will result in increased efficiencies and 
improved service to the public.

                        INTELLIGENCE/TECHNOLOGY

    ATF recognized the opportunity to improve intelligence support 
internally and externally, and created an Office of Strategic 
Intelligence and Information (OSII) in 2003. The new directorate, 
headed by an assistant director, provides timely, accurate, and focused 
intelligence through the collection and analysis of information which 
enhances decision-making for all Bureau customers. Thus, it ensures 
that our special agents and investigators receive the necessary 
information to disrupt criminal organizations and individuals that 
threaten public safety. The creation of OSII was a big step toward 
enabling ATF to put its information to the best possible use. The 
dynamic exchange of intelligence information between headquarters and 
field offices allows ATF to leverage data collection and analytical 
expertise to aid in providing accurate and timely intelligence support. 
I would also like to note that ATF has committed resources to all Joint 
Terrorism Task Forces (JTTFs) nationwide. The ultimate outcome of these 
efforts will be better information to investigators, which will, we 
hope, help prevent future incidents.
    ATF's Forensic Science Laboratories are an invaluable resource in 
perfecting ATF cases and in serving as a resource for State and local 
law enforcement. ATF's Forensic Science Laboratory system is composed 
of the National Laboratory Center (NLC) in Ammendale, Maryland, and the 
regional laboratories in Atlanta, Georgia, and San Francisco, 
California. The laboratories are equipped with state of the art 
forensic and scientific technologies. ATF laboratory personnel perform 
fire debris analysis, tool mark comparisons, explosives scene evidence 
examinations, searches for the presence and comparison of identifiable 
latent fingerprints, and examine trace evidence from crime scenes such 
as hair, paint, or fibers.
    ATF is a participant in the Terrorist Explosive Device Analytical 
Center, or TEDAC, operated at the FBI laboratory in Quantico, Virginia. 
At this center, ATF and other partners analyze explosive devices from 
Iraq and Afghanistan in an effort to identify bombers and to prevent 
further attacks. Experts work to evaluate improvised explosive device 
(IED) components to identify similarities and potential bomb makers, 
provide timely intelligence to military and law enforcement, and 
collect latent prints and DNA from terrorist IEDs to link the same 
person to similar devices. Four ATF employees work full-time at the 
center--including an ATF special agent who serves as TEDAC's Deputy 
Director--providing their technical expertise in identifying components 
of IEDs. TEDAC has provided assistance to U.S. military and 
intelligence personnel in preventing fatal detonations of IEDs and in 
tracking down bombing suspects. This is an example of how we are 
working within DOJ to prevent terrorism, and contributing our knowledge 
to a common goal.
    I have worked closely with Federal Bureau of Investigation Director 
Robert Mueller to strengthen interagency collaboration on a number of 
international efforts, including TEDAC. Under Director Mueller's 
leadership, and with the assistance of an ATF special agent serving as 
deputy director, TEDAC's device component analyses has more than 
doubled. ATF is incorporating this information on terrorist IEDs in 
State and local training programs to better equip local investigators 
and bomb technicians in recognition and investigative skills to alert 
on potential criminal and terrorist IEDs.

                            SPECIAL PROGRAMS

    Several of ATF's programs, such as the National Response Team 
(NRT), Special Response Team (SRT), and the canine program, strengthen 
our efforts in firearms, explosives and arson, and alcohol and tobacco 
diversion. They contribute to our missions of preventing terrorism, 
reducing violent crime, and protecting our Nation.
    In the wake of a major fire or explosives incident, law enforcement 
investigators can rely on the expertise and advanced technology of 
ATF's NRT. The NRT augments the investigative expertise of special 
agents in each field office and are capable of responding within 24 
hours to major explosives or fire incidents. NRT members--consisting of 
highly trained special agent CFIs as well as CESs, EEOs, chemists, 
intelligence and audit support, legal advisors, and others--work 
alongside State and local officers in reconstructing the scene, 
identifying the seat of the blast or origin of the fire, conducting 
interviews, sifting through debris to obtain evidence related to the 
explosion and/or fire, assisting with the ensuing investigation, and 
providing expert court testimony. Since the NRT was created in 1978, it 
has been activated 601 times. In fiscal year 2005 alone there were 13 
activations. The effectiveness of this response capability and the 
expertise of the team members were evident in the NRT's responses to 
incidents, such as the 1993 World Trade Center and 1995 Oklahoma City 
Federal Building bombings and the 2001 attack on the Pentagon.
    One of ATF's major assets in the fight against violent criminals is 
our SRTs consisting of some of the bravest, most dedicated, and most 
professional special agents in Federal law enforcement. The special 
agents on these teams conduct high-risk tactical operations such as the 
execution of arrest warrants, search warrants, and buy/bust operations. 
In fiscal year 2005, the SRT planned 150 operations and executed 101 of 
these high risk enforcement actions. In addition, two SRT Teams were 
assigned to New Orleans for 60 days to assist in the law enforcement 
response in the aftermath of Hurricane Katrina.
    In September of last year, ATF had the privilege of providing a 
demonstration of our explosives and accelerant detection canine program 
to the House Homeland Security Subcommittee on Management, Integration 
and Oversight. After the demonstration, the branch chief for the canine 
training program testified before the subcommittee regarding the status 
of ATF's program and progress made on establishing a National Odor 
Recognition Standard for all explosives canines. ATF's unique training 
methodology enables its 35 explosives detection canines to find 
explosives and gunpowder residue, IEDs, post-blast debris, firearms, 
ammunition, bulk explosives, and spent shell casings. By breaking down 
the thousands of known explosive compounds into five recognizable and 
consistent chemicals, the canines can detect explosives used in up to 
19,000 known explosives compounds. It is important to note that ATF is 
the only agency systemically training canines on peroxide explosives 
such as those used in the July 2005 terrorist attacks on the London 
transportation system.
    Our canine program trains and certifies explosives detection 
canines for State, local, and Federal agencies as well as foreign 
countries. To date, we have trained 621 canines for the use of our 
agents and our domestic and international law enforcement partners. In 
compliance with former-Attorney General Ashcroft's mandate, we have 
established standards to certify all canines used by DOJ components 
which will ensure that these components have an efficient tool to 
identify and locate explosives. Because there are so many other 
providers of explosives detection canines that are trained under a 
variety of standards and conditions, the National Bomb Squad Commanders 
Advisory Board, which represents State and local bomb squads, asked ATF 
to implement a National Canine Basic Odor Recognition Standard for all 
explosives canine teams domestically. While ATF shares the concern of 
the advisory board that explosives detection canines used domestically 
should be trained to a national odor recognition standard, this cannot 
currently be accomplished within existing resource levels. ATF is 
evaluating ways to further implementation of the standard within 
existing resource levels. Moreover, our 60-accelerant detection canines 
help to identify potential points of origin at a fire scene. In 
addition to supporting local authorities, the accelerant detection 
canines respond with the NRT and are used by ATF field offices on a 
case-by-case basis.
    Although the original goal of the explosives detection canine 
program was to locate explosive devices, these canines have also proven 
themselves to be a valuable asset in firearms investigations through 
their ability to locate hidden firearms and ammunition. Using this 
existing asset in a new way has been invaluable during search warrants 
and following shootings when other means of locating firearms, 
ammunition, and spent shell casings have failed. On October 20, 2002, 
following a shooting connected to the District of Columbia sniper 
investigation, an ATF canine team searching the woods surrounding the 
crime scene found a .223 shell casing. This ballistics discovery also 
led investigators to a note tacked to a nearby tree which had been 
placed by the suspects in an effort to communicate their demands. The 
shell casing was analyzed by the ATF National Laboratory and was 
eventually matched to the Bushmaster rifle recovered at the arrest 
site.

                             INTERNATIONAL

    Law enforcement agencies worldwide use our firearms tracing 
capabilities to gain additional information about crime guns. In fiscal 
year 2005, Congress provided ATF's National Tracing Center with a $1 
million increase to cover the cost of increased international trace 
requests. In that fiscal year, ATF traced over 12,000 firearms for 
foreign law enforcement representing 56 foreign countries. Our 
international activities enhance public safety in many countries 
worldwide, and in so doing, they protect American interests.
    ATF provides extensive support to America's diplomatic activities. 
Regional Security Officers from the Department of State's Diplomatic 
Security Service (DSS) participate in post-blast training led by ATF. 
The training focuses on explosives crime scene processing, management 
and preservation, and includes explosives identification and effects. 
Other countries have benefited from ATF's expertise in training 
explosives detection canines: through a partnership with the Department 
of State, ATF has trained approximately 375 canines for international 
law enforcement agencies since the program's inception in 1990. Also, 
our International Response Team (IRT) deploys in support of DSS 
investigative responsibilities and foreign government requests. The IRT 
has been deployed 25 times in response to fire and explosives incidents 
since its inception in 1991, most recently to investigate a deadly fire 
in Granada.
    ATF works with agencies worldwide to prevent firearms from reaching 
the hands of organized criminal gangs, drug traffickers, terrorist 
organizations, and other criminals. ATF enforces provisions of the Arms 
Export Control Act (AECA), and has primary jurisdiction over permanent 
firearms and ammunition imports. The Department of State administers 
the temporary import and export provisions of the AECA, and the 
Department of Homeland Security enforces all AECA provisions at U.S. 
ports and borders.

                              PARTNERSHIPS

    At ATF, we believe that working together is not just a good idea--
it is a matter of national security. Our agency has a long history of 
collaborating effectively with other enforcement agencies, industry, 
and the scientific and academic communities. Our successes are directly 
related to our ability to work effectively with our colleagues.
    As part of our robust support for joint efforts to counter the 
grave threat of terrorism, we share our expertise in firearms, 
explosives, and alcohol and tobacco diversion. As noted previously, ATF 
contributes to the Department of Justice's fight against terrorism 
through the JTTF program. ATF personnel assigned to JTTFs function as 
in-house experts on firearms and explosives violations and on tobacco 
diversion act as liaisons between the FBI and ATF at the local level on 
intelligence matters, and are a vital part of the joint investigative 
team. ATF has 43 full-time and 17 part-time personnel assigned to JTTFs 
around the country with an additional 42 personnel designated to 
liaison with the remaining JTTFs not located in proximity to an ATF 
field office--therefore, ATF has committed resources to all JTTFs 
nationwide.
    ATF works closely with other Federal agencies and with the academic 
and scientific communities, to conduct research and monitor 
developments in explosives research, blast mitigation, and explosives 
detection. ATF representatives also serve as a subgroup co-chair and as 
task managers on several research efforts funded through the Technical 
Support Working Group (TSWG). The TSWG, administered by DOD under the 
auspices of the National Security Council, conducts rapid research, 
development, and prototyping of multiple use technologies for law 
enforcement and military purposes. ATF also has collaborative research 
partnerships with the U.S. Army Engineer Research and Development 
Center, and has partnerships with Oak Ridge National Laboratory; 
Lawrence Livermore National Laboratory; University of Missouri, Rolla; 
and University of Massachusetts, Lowell. Also, ATF closely and 
regularly collaborates with representatives of foreign governments, 
including the United Kingdom, Israel, and Canada.
    ATF leverages its resources to better inform, advise, and educate 
its stakeholders and customers. For instance, ATF has partnered with 
The Fertilizer Institute to launch voluntary campaigns to raise the 
awareness of industry, law enforcement, and the public on the sale, 
security, storage, and transportation of ammonium nitrate, the chemical 
that was mixed with fuel oil in the Oklahoma City bombing.
    ATF employees hold key positions in many prestigious professional 
organizations. I am a member of the executive committee of the 
International Association of Chiefs of Police (IACP) and, since 1990, 
an ATF agent has chaired the IACP Arson and Explosives Committee. 
Similarly, ATF has maintained outstanding relationships with the 
International Association of Bomb Technicians and Investigators, the 
International Association of Arson Investigators, the International 
Association of Explosives Engineers, the National Sheriff's 
Association, Major Cities Chiefs Association, Police Research Forum, 
and the National Bomb Squad Commanders. Also, as stated previously, ATF 
has a partnership with the National Shooting Sports Foundation in 
conducting the ``Don't Lie for the Other Guy'' program which provides 
essential education for FFLs.

                               MANAGEMENT

    Mr. Chairman, ATF is a well-managed and effective organization, and 
external evaluations of our abilities confirm this. In the last 2 
years, the Office of Management and Budget has evaluated ATF's 
explosives and arson programs and our firearms programs. In each 
review, we received a rating of ``moderately effective,'' one of the 
higher ratings received by Federal law enforcement programs. Also, as 
part of the President's Management Agenda, the Office of Personnel 
Management sponsored a survey of 115 Federal subcabinet agencies. On 
this survey of employee satisfaction, I am proud to say that ATF ranked 
15th. With the continued support of the Department and this 
subcommittee, we will continue to provide innovative management and 
personnel.
    The ATF Headquarters building is being constructed here in 
Washington, DC. The vision for this high-tech, environmentally friendly 
building is threefold: it fulfills Congress' intention to move ATF 
employees and mission to safer and more secure facilities; it will 
serve as a landmark facility for the Federal government; and it will 
support the revitalization efforts of the city. ATF is scheduled to 
move to its new Headquarters this fiscal year.

                               CONCLUSION

    Chairman Shelby, Senator Mikulski, Members of the subcommittee, on 
behalf of the men and women of ATF, I thank you for your support of our 
crucial work. In the last year, we have worked to stop those whose 
violent and criminal behavior threatens the peace of our communities. 
We have investigated explosives incidents and arsons. We have helped to 
ensure that the firearms and explosives industries operate safely and 
lawfully. And we have shared our knowledge with other law enforcement 
personnel through extensive training programs and effective 
partnerships. Yet I believe that our greatest achievements are still to 
come. We have made much progress--but we know there is much more to do. 
We are determined to succeed in our mission of preventing terrorism, 
reducing violent crime, and protecting our Nation. We look forward to 
working with you to pursue this goal.

                     United States Marshals Service

STATEMENT OF JOHN F. CLARK, DIRECTOR
    Senator Shelby. Director Clark.
    Mr. Clark. Thank you, Chairman Shelby, Senator Mikulski, 
and members of the subcommittee. I appreciate the opportunity 
to appear before you today to discuss the President's fiscal 
year 2007 budget request for the United States Marshals 
Service. I am also honored to appear before the subcommittee 
today as the first career employee of the Marshals Service and 
also with my distinguished colleagues.

             UNITED STATES MARSHALS SERVICE ACCOMPLISHMENTS

    I just want to briefly outline some of our most recent 
accomplishments to set the stage for our 2007 budget request. 
Protecting the American judicial system continues to be a top 
priority for the Marshals Service. Last year, we protected 
2,200 Federal judges, 5,500 U.S. attorneys and their staff, as 
well as numerous juries and other people associated with the 
American judicial system. We provided the safekeeping for 
nearly 55,000 pretrial prisoners, produced prisoners for 
650,000 court proceedings, provided protection for over 200 
individuals who had received threats; we analyzed and 
investigated over 950 threats to those protectees.

                     FUGITIVE REGIONAL TASK FORCES

    In the area of violent crime, we continued to use our 
fugitive regional task forces. Last year, we apprehended over 
77,000 Federal fugitives and 52,000 State and local fugitives. 
We safely handled 673 international extraditions, a record high 
for fiscal year 2005. We increased our fugitive efforts in 
foreign field offices, most notably in Mexico. We conducted 
several major fugitive roundups, such as Operation Falcon, 
which netted an unprecedented 10,000 fugitives in a single 
week. And we continue to manage over $1 billion in seized 
assets.

               SUMMARY OF FISCAL YEAR 2007 BUDGET REQUEST

    For the sake of time, I will move into our 2007 budget 
request. Our fiscal year 2007 budget request addresses the 
Marshals Service highest priority needs. In total, we are 
requesting 66 additional positions and $13.6 million to address 
critical needs related to judicial security, information 
technology, and audited financial statements. We are also 
proposing $9.4 million in program offsets.

                           JUDICIAL SECURITY

    In the area of judicial security, in order to keep pace 
with a growing workload and to improve judicial security, we 
are requesting 37 positions and $4.6 million. The requested 
resources will allow the Marshals Service to hire 28 additional 
deputy marshals and nine administrative support staff for our 
district offices as well as fund the ongoing costs associated 
with the home security monitoring systems.

                         INFORMATION TECHNOLOGY

    In the area of information technology, in order to maximize 
the agency's use of new technologies and strengthen the 
information technology infrastructure, we are requesting 14 
system administrators and $7.2 million. The Marshals Service 
has made significant progress in the information technology 
area, but more is needed to successfully accomplish our mission 
and support the Department's Federal initiatives.

                      AUDITED FINANCIAL STATEMENTS

    In the area of the audited financial statements, we are 
requesting 15 positions and $1.8 million to correct material 
weaknesses and reportable conditions identified in the 2005 
financial audit and to address the increased financial 
oversight and internal control workload associated with the 
Sarbanes-Oxley Act of 2002.
    With regard to the offsets mentioned previously, in 2006, 
the Congress generously provided resources in addition to our 
request. The Marshals Service needs to reduce the levels of 
these programs by $9.4 million in fiscal year 2007 to ensure 
that adequate resources are available for judicial security.
    I appreciate again the opportunity to appear before the 
subcommittee, and I look forward to taking your questions now.
    [The statement follows:]

                  Prepared Statement of John F. Clark

    Chairman Shelby, Senator Mikulski, and Members of the subcommittee, 
I appreciate the opportunity to appear before you today to discuss the 
President's fiscal year 2007 budget request for the United States 
Marshals Service.
    Since September 11, the Marshals Service has had an integral role 
in the Nation's efforts to combat terrorism. We were among the first 
responders at the World Trade Center and the Pentagon on September 11. 
Our primary mission is to protect the judicial process, and in doing 
so, we have taken aggressive measures to protect courthouses and secure 
courtrooms in order to handle the many high threat trials involving 
suspected terrorists, violent gang members, and drug traffickers.
    Most recently, the Marshals Service sent hundreds of deputies to 
Alabama, Mississippi, Louisiana, and Texas to assist in rescue, 
recovery, evacuation, and law enforcement activities in the aftermath 
of Hurricanes Katrina and Rita. I would like to thank this subcommittee 
for its support of the Marshals Service and for the supplemental 
funding we received to repair our courthouses and replace damaged 
equipment.

                    FISCAL YEAR 2005 ACCOMPLISHMENTS

    The legal proceedings of Zacarias Moussaoui have been ongoing 
through all of fiscal year 2005. The USMS has continued to provide 
security for this high-profile trial. Thankfully, we have been 
successful in producing the defendant safely and securing the judicial 
proceedings. On April 22, 2005, Mr. Moussaoui pleaded guilty to all of 
the charges against him. The trial is now in the penalty phase and we 
expect this phase to last 2 to 3 months.
    As the former U.S. Marshal in the Eastern District of Virginia, I 
can speak firsthand about the planning and resource requirements 
necessary to prepare for a high threat trial. The Moussaoui case is 
just one example. Agency-wide, our personnel produced prisoners for 
650,000 court proceedings; all without one escape or injury to a judge, 
witness, or prosecutor. Last year, we investigated over 950 potential 
threats to Federal judges and prosecutors. Our Deputy Marshals provided 
200 personnel protective details and another 300 event protective 
details. All were completed without a single incident of violence.
    The increase in gang-related trials also presents many challenges 
for us. For example, in Santa Ana, California, we are securing the 
largest capital murder case in United States history. Forty defendants 
affiliated with the Aryan Brotherhood are on trial for a variety of 
violent crimes including conspiracy to commit murder and drug 
trafficking. At least 8 gang members face the death penalty. Not only 
are the defendants part of this gang, but so are the witnesses. At 
least 12 former gang members are expected to testify.
    In addition to the Aryan Brotherhood gang, the Mara Salvatrucha 
gang, referred to as MS-13, is expanding its influence internationally. 
Last year in Alexandria, several members of the MS-13 gang were 
successfully convicted of a brutal murder. That trial included 
producing participants from the Witness Security Program which required 
additional security precautions. Providing protection for witnesses who 
testify against a gang known for its viciousness is a daunting task. I 
would like to thank this subcommittee for its continued support of the 
Witness Security Program and for recognizing their role in stopping 
gang violence.
    Outside of the courtroom, the Marshals Service is working 
diligently to achieve the offsite security initiative funded through 
the 2005 Emergency Supplemental Appropriations Act for Defense, the 
Global War on Terror, and Tsunami Relief. We are grateful for the 
support provided by Congress. The funds will allow the Marshals Service 
and the Judiciary to install home intrusion detection systems in the 
homes of federal judges. After planning the implementation of this 
system, we have hired a contractor to provide and install the systems. 
The four pilot sites concluded successfully and systems are being 
ordered and installed throughout the country.
    Over 4 days in August 2005, the Marshals Service conducted a unique 
fugitive apprehension initiative, Operation Fugitive Safe Surrender, in 
the Northern District of Ohio. This operation combined the efforts of 
the Marshals Service, State and local law enforcement, local 
prosecutors, and community leaders in creating an environment where 
fugitives were encouraged to surrender under circumstances that 
guaranteed their safety and the safety of the surrounding community. 
This innovative, faith-based initiative resulted in the peaceful 
surrender of 850 fugitives, of which 350 were fugitive felons. Later 
this year, we will expand this initiative into 6 cities including: 
Albuquerque, New Mexico; Camden, New Jersey; Louisville, Kentucky; 
Phoenix, Arizona; Richmond, Virginia; and Washington, DC.
    The Marshals Service continues to improve strategies used to 
apprehend fugitives. In April of 2005, the Marshals Service conducted 
the largest fugitive roundup undertaken by any law enforcement agency 
in the United States. By working with law enforcement officers from 
Federal, State, county, and city agencies, Operation FALCON (Federal 
and Local Cops Organized Nationally) apprehended over 10,000 violent 
fugitives and cleared 14,000 warrants. Agency-wide, our Deputy Marshals 
apprehended over 77,000 Federal fugitives and another 52,000 State and 
local fugitives.
    We have also made a substantial impact on the fugitive workload in 
Mexico, Jamaica, and the Dominican Republic. The placement of deputy 
marshals in these foreign field offices led to 673 extraditions in 
2005; a record-high number for the Marshals Service. One of these 
extraditions from last February involved deputy marshals working with 
Mexican authorities on the return to the United States of a sex 
offender who had kidnapped a 15-year-old girl and taken her to Mexico. 
Once in Mexico, the offender abused the girl for 2 weeks before she 
managed to escape. Criminal acts of this nature must be investigated 
vigorously and immediately. We thank our Mexican counterparts for their 
diligence and continued cooperation.

                         CHILDREN'S SAFETY ACT

    The protection of the nation's children from those who would prey 
upon them is important to our nation's future. For that reason, I would 
like to thank you, Mr. Chairman, and other members of this subcommittee 
for co-sponsoring the Children's Safety Act of 2005 (H.R. 3132). This 
important piece of legislation would establish a comprehensive national 
system for the registration of sex offenders. Failure to register would 
make it a federal crime which in turn would generate additional federal 
fugitives. We would welcome the opportunity to become involved in this 
vital effort to keep our children and families safe.

                    FISCAL YEAR 2007 BUDGET REQUEST

    Our fiscal year 2007 budget request addresses the Marshals 
Service's highest priority needs. In total, we are requesting 66 
additional positions and $13.6 million to address critical needs 
related to judicial security, information technology, and audited 
financial statements. We are also proposing $9.4 million in program 
offsets.

                           JUDICIAL SECURITY

    Protection of the judicial process--with a heavy emphasis on 
judicial security--remains the primary mission of the United States 
Marshals Service. The workload associated with judicial and courthouse 
security has significantly increased in the last 5 years due to the 
Nation's heightened awareness of possible threats. The murder of Judge 
Lefkow's husband and mother in retaliation for her rulings demonstrates 
why judicial security is vital in maintaining the Federal judicial 
process. To keep pace with a growing workload and to improve judicial 
security, we are requesting 37 positions and $4.6 million. The 
requested resources would allow the Marshals Service to hire 28 
additional deputy marshals and 9 administrative support staff for 
district offices, as well as fund the ongoing costs associated with 
home security system monitoring.

                         INFORMATION TECHNOLOGY

    In order to maximize the agency's use of new technologies and 
strengthen the information technology infrastructure, we are requesting 
14 systems administrators and $7.2 million. The Marshals Service has 
made significant progress in the information technology area but more 
is needed to successfully accomplish our mission and support 
departmental and Federal initiatives. We will use the requested 
resources to enhance the Justice Detainee Information System, purchase 
replacement servers and software, and provide additional systems 
administrators to district offices. JDIS is a critical law enforcement 
tool because it marries our judicial threat data with warrant, criminal 
history, prisoner scheduling, and booking information into a single 
database. Our long term goal is to share this information with other 
agencies, including the Federal courts, so we all can take advantage of 
this law enforcement information. These resources will ensure that the 
Marshals Service is working not only harder but smarter and taking full 
advantage of available technologies.

                      AUDITED FINANCIAL STATEMENTS

    Finally, we are requesting 15 positions and $1.8 million to correct 
material weaknesses and reportable conditions identified in the 2005 
financial audit and to address the increased financial oversight and 
internal control workload associated with the Sarbanes-Oxley Act of 
2002. In the 2005 financial audit of the Marshals Service, auditors 
provided an unqualified opinion on our financial statements; however, 
they also identified three material weaknesses and one reportable 
condition. The requested program increase will ensure that the 
auditors' recommendations are addressed and that we continue to provide 
appropriate financial oversight, policy compliance, and delivery of 
timely, accurate and reliable financial statements.

                                OFFSETS

    In 2006, Congress generously provided resources in addition to our 
request. Though appreciated, the Marshals Service needs to reduce the 
levels of these programs by $9.4 million in fiscal year 2007 to ensure 
that adequate resources are available for judicial security. The 
proposed offsets reduce funding for courthouse renovations and fugitive 
apprehension.
    Thank you for the opportunity to present the Marshals Service 
budget request for fiscal year 2007. We appreciate your ongoing support 
and hope to prove efficient stewards of the resources entrusted to us. 
I would be happy to answer any questions you may have at this time.

    Senator Shelby. Thank you. We will start with the FBI, Mr. 
Director. We will have a number of questions for the record, 
but we will try to move this.

                                SENTINEL

    We are both--we all were interested in Trilogy. We wanted 
it to work. We want the next one, Sentinel, to work. Last week, 
I wrote a letter to you requesting answers to a lot of the 
questions the staff is interested in regarding the procurement 
and the FBI's new $500 million procurement of Sentinel. I have 
a copy of this that we will make part of the record here, but I 
know there are lots of questions here, Mr. Director.
    Can you assure us you will get those answers as soon as 
possible just for our information of the subcommittee?
    Mr. Mueller. Again, Mr. Chairman, we are working. We are 
working. I think there are something like 85 questions.
    Senator Shelby. It is a lot of them.
    Mr. Mueller. And a number of them go back to Trilogy.
    Senator Shelby. They do.
    Mr. Mueller. Which was two-thirds of it was successful, 
one-third not successful.
    Senator Shelby. We know.
    Mr. Mueller. And what we are focusing on is making certain 
that Sentinel is successful. We would be happy to brief your 
staff at any time and in addition to take suggestions from your 
staff or others on the Hill on how we can do it better. We have 
always come up and said we are open to any suggestions that you 
might have in terms of how we can make sure this is successful, 
because I know we both want to make it successful.
    Senator Shelby. I know you do, and I believe that you have 
probably learned things. We have all learned. But we have that 
responsibility on money, even if it is a dollar. But in this 
case, it was a lot of money, and we know the FBI has to have 
the modern technology. You know it better than I know, and 
Senator Mikulski knows it very, very well herself.
    Mr. Mueller. I can use your help in one area, Mr. Chairman.
    Senator Shelby. Yes.
    Mr. Mueller. And that is we have welcomed oversight both 
within Congress but also outside in terms of GAO and the 
inspector general and the like. We have persons who are 
dedicated to Sentinel, and to the extent that we can 
consolidate requests and briefings, it would be helpful in 
terms of freeing up the personnel to work on the project.
    Senator Shelby. I understand.
    Mr. Mueller. And so, we are working on those questions now, 
but we also ask your assistance in helping us to consolidate 
the requests so that our personnel can respond to the 
legitimate requests but also spend time on the project.
    Senator Shelby. Absolutely. We want you to be successful. 
And our interest in oversight is to be constructive. If we are 
being critical, it is because we have a job to do. But we know 
the ultimate goal is to modernize the technology that you have 
at the FBI; is that correct?
    Mr. Mueller. Yes, sir.
    Senator Shelby. And we want to help you do that, want to 
make sure.

    DRUG ENFORCEMENT ADMINISTRATION INVOLVEMENT IN THE INTELLIGENCE 
                               COMMUNITY

    Administrator Tandy, the 2000 budget includes $12 million 
for the DEA to formally become part of the intelligence 
community. How will this funding change DEA's current 
contributions to the intelligence community? Do you have 
sufficient intelligence sources in your foreign offices to help 
with this transition? I know you have good people, but for the 
record, we are interested in this.
    Ms. Tandy. Thank you, Mr. Chairman.
    First of all, DEA is reentering the intelligence community 
with a lapse since 1980.
    Senator Shelby. We know.
    Ms. Tandy. We have the largest law enforcement presence in 
foreign countries around the world, and from that standpoint, 
we are extremely well positioned with our 80-plus offices in 62 
countries to contribute to the community and the flow of 
intelligence to protect our national security. DEA did not 
receive additional authorities, so we continue with our primary 
drug enforcement function. But what you should see as a 
difference with DEA in the community is the flow of 
intelligence. First of all, DEA has rich intelligence and 
sources around the world. We----
    Senator Shelby. Great resources.
    Senator Mikulski. And sources.
    Ms. Tandy. Thank you.
    Senator Shelby. And sources; she is right, Senator 
Mikulski, resources and sources.
    Ms. Tandy. We have tremendous people developing those.
    But as a result of that, we will now know what is important 
to the intelligence community, and as we speak to our sources 
during the course of our normal drug enforcement work, we will 
be able to expand those areas that we are covering with our 
sources to include the areas that are important to this country 
in the intelligence community. I think that is the principal 
benefit, and we hope there will be a two-way street as well.
    Senator Shelby. I think it is something you have got to 
mine. It will be very rich for the intelligence community.
    Director Truscott, I want to welcome you back. You are no 
stranger to the Appropriations Committee.
    Mr. Truscott. Thank you, Mr. Chairman.
    Senator Shelby. You have worked here with us before.
    I appreciate personally the work that you explained a few 
minutes ago, the professionalism of your organization in 
dealing with the church burning in my home State of Alabama.
    Mr. Truscott. Thank you.
    Senator Shelby. You did a good job; so did the Bureau, you 
know, working there. And you are to be commended not only one 
time but many times, especially by we who help fund you.

              ALCOHOL, TOBACCO, FIREARMS USER FEE PROPOSAL

    I commented earlier on my serious concerns with the $120 
million fee proposal included in your budget request. I am 
told, as I said earlier, that it would take nearly 2 years for 
the ATF to implement this proposal if it were enacted into law 
by the Congress. Is the ATF ready to implement this fee? And if 
the fee does not become law, what would be the impact on your 
agency?
    Mr. Truscott. Mr. Chairman, thank you for your comments 
regarding our efforts.
    With regard to the $120 million user fee, ATF has the 
statutory responsibility to regulate the explosives industry. 
And there are approximately 12,000 licensed explosives entities 
throughout the United States. And this user fee would be an 
offsetting receipt for the work that we do.
    There are approximately 6 billion pounds of explosives, 
both imported and domestic, that this user fee would apply to 
at the rate of 2 cents per pound. And so, the intent is that 
this would serve as a mechanism to offset the expenses that we 
have, the regulatory effort that we have to undertake this 
requirement that we have.
    In terms of if it were not able to be funded in some sort 
of way, it would have a very significant impact on the agency; 
$120 million is well over 10 percent of ATF's budget, so it 
certainly would impact our ability to regulate the explosives 
industry, but it also would roll into our ability to enforce 
explosives related statutory authority as well as the Federal 
firearms licensees that we also have the regulatory authority 
for, because it is the same industry operations investigators 
who do the explosives and the firearms regulatory work.
    Senator Shelby. Thank you.

                           JUDICIAL SECURITY

    Director Clark, judicial security, that is a big issue with 
the Marshals. A March 2004 inspector general review showed that 
the Marshals Service assessment of threats against members of 
the Federal judiciary were deficient in several respects. The 
report found that the threat assessments are often untimely and 
of questionable validity. Further, the Marshals Service has 
limited capability to collect and share intelligence on 
potential threats, so its said, the report.
    The inspector general also found that the Marshals Service 
lacks adequate standards for determining the appropriate 
measures that should be applied to protect the judiciary 
against danger.
    Do you agree with the inspector general's finding? Do you 
take issue with it? And second, what is the status of the 
Marshals Service's efforts to protect judicial security in this 
country?
    Mr. Clark. Thank you, Senator, yes; as I said earlier, 
judicial security remains a top priority for me and for the 
Marshals Service. Since serving as the Acting Director and more 
recently being appointed as Director, we have taken several 
steps to improve some of the findings that were brought forward 
by the inspector general's report. Most notably, we have 
established a 24/7 or are in the process, I should say, of 
establishing a 24/7 threat analysis and intelligence center. 
This will help us speed up the process for analyzing threats 
against the judiciary and investigating them.
    We plan on increasing the number of staff at this center 
with analysts and deputy marshals.
    Senator Shelby. Will you be working with the FBI on this?
    Mr. Clark. Most certainly. We in fact use their joint 
terrorism task forces as one of the avenues to collect and 
gather intelligence that we might need to protect the 
judiciary.
    We are also in the process of conducting security awareness 
training for the members of the judiciary as well as retraining 
a number of the members of our staff in the Marshals Service on 
protective operations. We have been working very, very closely 
with the Judicial Conference and the Judicial Security 
Committee as an avenue to solicit their input on how we can 
best serve and protect them.
    Most notably recently, you may be aware that we are working 
diligently to install the home intrusion alarms in many of the 
judges' residences around the country.
    Senator Mikulski. The what?
    Mr. Clark. We have been working to install the home 
intrusion alarms.
    Senator Shelby. Home intrusion.
    Mr. Clark. Yes, within----
    Senator Shelby. No, home intrusion alarms.
    Mr. Clark. That is correct, yes.
    Senator Mikulski. No, it is the arm of the Marshals, but--
--
    Mr. Clark. And using that as an additional security 
enhancement to protect them.
    Senator Shelby. Senator Mikulski.
    Senator Mikulski. Thank you very much, Mr. Chairman. And I 
just have a few questions, but I do want to say something about 
the agencies that are represented before us and truly how much 
they are appreciated, Mr. Chairman, and I know you feel the 
same way from your own State of Alabama, but we in Maryland are 
part of the Capital region. We in Maryland, when we are 
fighting drugs, are an intersect for several States, whether it 
is Virginia or West Virginia, whether it is Pennsylvania or 
Delaware, and we are also a high threat area.
    And it is the people of my State, both its citizens and its 
law enforcement as well as those around the Beltway that turn 
to these people. Whether it is the sniper that is now indicted 
on which the ATF and the FBI were the lead agencies, but we did 
not federalize continuing to rely on local law enforcement. We 
had our fires in a community where African-Americans who had 
worked hard to be able to afford $500,000 saw the American 
dream go up in smoke.
    So we want to thank all of the people who work in these 
agencies. They work 24/7; lots of times, when we are having 
Thanksgiving dinner, or we are off to church to hear the melody 
of ``Silent Night'', they are out there working to protect us. 
And I think everybody who works at these agencies are an agent, 
whether they are people like Agent Perkins, who is now at the 
Budget Office, but over there in the FBI, Mr. Chairman, there 
is a lady who worked for the FBI as a secretary for 50 years 
who went to the same high school Nancy Pelosi and I did. She 
has trained more FBI agents and could run this Sentinel program 
better than anybody else, and we could go down the line.
    Senator Shelby. You might need to find her.
    Senator Mikulski. Yes, I think we do. So I just want to say 
thank you, and I mean that very, very, very sincerely, and we 
are safer because of the work that has been done.

                    DRUG TRADE FUNDING AND TERRORISM

    Let me go on, though, to the questions, first of all, on 
terrorism. Ms. Tandy, you talk about the fact that DEA is now 
coming back into the intel business, and I am delighted to hear 
that, because in your testimony, you talk about nearly half of 
the State Department's listed foreign terrorist organizations 
have ties to the--nearly half of the State Department's listed 
terrorist organizations have ties to the drug trade.
    That is a stunning statement, stunning. Are we saying that 
it is the drug trade that is one of the primary sources of 
revenue for terrorism?
    Ms. Tandy. Senator, I am not sure I could say it is the 
primary revenue for each of them, although it certainly is for 
many of them. For others, it may be part of not just the money 
flow but trading drugs for munitions.
    Senator Mikulski. What do you mean by munitions? Is that 
everything from a handgun to a Stinger?
    Ms. Tandy. Yes, it could be a Stinger missile, an anti-
aircraft missile. It could be weaponry, ammunition, all kinds 
of munitions used by terrorists.
    Senator Mikulski. But what would be the range of its lethal 
character? I mean, do they have it to buy an ICBM? I mean, are 
they talking about weapons that would just be used in small 
areas, in kind of urban guerilla terrorist attacks, or are we 
talking about somebody who could take down an aircraft or 
someone who could have the capability of launching a weapon of 
mass destruction?
    Ms. Tandy. I do not have any information about weapons of 
mass destruction, but certainly, as you have noted, Stinger 
missiles are capable of shooting down aircraft. That is what 
they are there for. There are examples of undercover 
investigations that DEA on the one hand, and the FBI on the 
other, were involved in where there were two different drug 
trafficking organizations, two different locations in the 
United States, San Diego and Houston, where the organizations 
were trading cocaine on the one hand for a Stinger missile, and 
on the other, it was heroin for a Stinger missile, one out of 
Colombia and one out of Pakistan. So you do have some of that 
associated with those foreign terrorist organizations on the 
State Department list.
    Senator Mikulski. Well, I know Senator Leahy will have some 
of his own questions in that area, but I think we would like 
very much to be kept posted on that and also particularly on 
the DEA efforts on Afghanistan.
    We do not have the time to go into this, but in our hearing 
with Secretary Rice, she told us at the State Department 
approps hearing that literally, if we do not get a handle on 
the drug traffic in Afghanistan, it would have a severely 
destabilizing effect on Afghanistan's permanent move to 
democracy. So we think what you are doing is really important 
in that area.

                       NATIONAL SECURITY DIVISION

    Director Mueller, on terrorism, you heard the questions 
that I was asking the Attorney General. Can you tell us, 
though, what is your new national security office, and is this 
the beginning of like what the Brits have, an MI-5 agency 
within the FBI? What will it do, and how is it not bureaucracy 
but an antiterrorist effort?
    Mr. Mueller. Well, for our national security branch, it 
consolidates counterintelligence, counterterrorism, and 
intelligence under one authority so that you eliminate overlap; 
you make certain that we are addressing the same targets.
    And one thing that cannot be lost, I do not think, when you 
raise the specter of an MI-5 is the importance of our criminal 
programs in terms of training, in terms of providing us the 
capabilities to do an effective job in addressing terrorism or 
counterintelligence. We also see that the criminal programs are 
an abundant source of intelligence, because many of those who 
support terrorism are involved in criminal matters in a variety 
of ways and it may not be just supporters of terrorism but may 
be recruiting individuals or the gaining funds that would 
support terrorism through their criminal activities.
    So it is my belief that it is important to establish a 
national security branch so we have recruiting, training and 
executive development in these specialized areas, but it has to 
be part of the FBI.
    Your questions directed to the Attorney General were also 
directed to the establishment of the National Security Division 
in the Department of Justice. And the differentiation I would 
make is between our investigative responsibilities and 
intelligence development and gathering responsibilities through 
our collectors, agents, and analysts to, on the other hand, the 
role of the Department of Justice in taking that information 
and prosecuting those individuals who are found guilty of 
violation of any one of the statutes.
    One of the prime components of the new National Security 
Division at the Department of Justice is the office that 
handles the FISA process. And I do believe it is important to 
focus on the FISA process to eliminate any holdups, glitches, 
giving it the support that it needs so that we have an 
effective, swift FISA response in that area.
    So the development of the National Security Division, I 
believe, replicates what is being done in the FBI but does it 
in a way that focuses on the legal side of the house as opposed 
to the investigative side of the house.
    Senator Mikulski. Well, I think that is a very important 
clarification, and we would like to look at it. They are 
talking about $67 million to, I would hope, do more than the 
legal side. That is a lot of money and a lot of people to 
implement FISA. If FISA needs it, then, we would like to know 
about it, because you, Ms. Tandy, said you have got a 
supplemental here of $5 million to get your agency back in this 
very important antiterrorism, and I think you are going to be 
an important linchpin; exactly what the Director said. You all 
are abroad. You are abroad. You are abroad, Director Truscott. 
You are picking up this information as much as any intel 
collection source.

                 DRUG ENFORCEMENT AGENCY ANTI-TERRORISM

    Is that going to be enough money? I mean, you have got $67 
million over there at Justice to stand up a new agency. You are 
talking about a supplemental--I would hope that what you are 
talking about is more than $5 million.
    Ms. Tandy. It is, Senator. The $5 million in the 
supplemental is just to get us through the rest of 2006.
    Senator Mikulski. What is it that you need, and is it in 
here?
    Ms. Tandy. It is in there in the 2007 budget to get us 
through the 2007 fiscal year. It includes analysts to establish 
the infrastructure at DEA in order to have the collection, the 
intel taskings to go out from headquarters. It expands our 
existing SCIF to accommodate this additional load of intel 
collection and taskings from the community. So between the 
supplemental for the rest of this year and the 2007 budget, 
that will get us started.
    Senator Mikulski. Well, you know, each one of you, we could 
ask several more questions, and Director Mueller, we will be 
following up to just see how this goes as well as the Sentinel 
and this.

                         LOCAL LAW ENFORCEMENT

    I am going to have one last question that really goes down 
the line. You have heard from our colleagues their intense 
feelings about the cut in the COPS and the Byrne program. We 
feel that in addition to the superb work that you all do, it is 
really the cops out there on the beat that you work with. 
Certainly, we saw that in the snipers. You did not federalize 
that. And we could go on.
    My question is how would the cuts proposed by the President 
to State and local law enforcement grant programs do you think 
will affect your respective agencies? Director Clark, why do we 
not start with you and just go down? But please be brief. I 
know Senator Leahy returned, and he has got to return to the 
floor.
    Mr. Clark. Sure, thank you, Senator.
    As you may know, we work very, very closely with our State 
and local partners, particularly in the area of fugitive 
apprehension. And we have been able to work with them and help 
fund, particularly with the regional task force efforts, one of 
which covers suburban Maryland, with some of the resources they 
need.
    Senator Mikulski. But how will the cuts affect your 
operation? How do you think the cuts in local law enforcement 
could impact on you? Will you have more work? Less work? Are 
you going to be less effective? Thank you for your work in 
Maryland.
    Mr. Clark. Yes, thank you, Senator, yes. I do not see it 
having a direct impact on our operations, and the funding that 
we are able to provide them with regard to violent crime 
initiatives I think, right now, is very adequate, as we have 
used it very successfully to do a lot of our fugitive roundups, 
particularly in this Capital region, for example. So I do not 
think it will have a significant impact.
    Senator Mikulski. Thank you.
    Mr. Truscott.
    Mr. Truscott. Senator, like the Attorney General indicated, 
I have heard anecdotally from some of the State and local 
representatives from law enforcement that I speak to from time 
to time about their concerns. But I do not think that 
necessarily, it is going to have a negative impact on their or 
our ability to do our job. I think it forces us to work 
smarter, to leverage our resources; certainly, the DOJ 
component agencies that are represented here today, I think we 
partner and share our expertises to the best extent possible to 
benefit not only the Department of Justice but the American 
people.
    So it will just force us to work a little bit harder in 
that regard.
    Ms. Tandy. Senator, I think the area where it will be felt 
the most is in our mobile enforcement teams with our assistance 
to police chiefs and sheriffs in oftentimes remote areas.
    Senator Mikulski. That is what we are hearing from Prince 
Georges, yes.
    Ms. Tandy. It is about a two-thirds cut to that program. We 
will still have 80 agents, but it will affect the timing of our 
ability to respond to requests for our mobile enforcement 
teams, and we will probably have to move to a regional concept 
of our MET team deployments.
    On the other hand, Senator, I think it is important to add 
to this that DEA shared $176 million with our State and local 
partners last year. We have a very aggressive strategy, policy, 
and priority to go after the money and to turn that back around 
to State and local law enforcement as well as----
    Senator Mikulski. That has been one of the more successful 
efforts then to get money out of hard work, money goes back to 
fight even more crime.
    Ms. Tandy. We are very proud of the success we have had. 
When I came through the door in 2003, our receipts from seized 
assets were below $500 million. As I said in my statement, we 
are at well over $1 billion last year and climbing.
    For our participation in the HIDTA, we lead 54 HIDTA groups 
with State and local law enforcement. That will not change. The 
work that we do in training State and local law enforcement 
will not change. We trained 42,000 State and local law 
enforcement officers last year, and we will continue to do 
that.
    I think it really is going to be in the MET area, which is 
where we serve Indian country, gangs, and methamphetamine.
    Mr. Mueller. And let me reiterate what I think was said by 
many. We are a small agency compared to the 800,000 State and 
local law enforcement around the country. And in order to be 
successful against the threats of the future, there is no one 
agency that can do it alone. We have to leverage our resources 
both on the Federal level as well as with our partners at State 
and local law enforcement.
    That said, the adverse impact for us may be down the road 
if police departments are less willing to participate in task 
forces because of the crunch in terms of persons. I am 
sympathetic and supportive to the argument of the Attorney 
General that we need to focus the funds for State and local law 
enforcement. We have not seen that diminution of interest in 
the joint terrorism task forces or other task forces, but that 
is a possible consequence.
    The only other observation I would make is, as you talk to 
State and local law enforcement, they are concerned about the 
grants, but they are also concerned about the balance between 
funds going to first responders and funds going to law 
enforcement.
    The argument being made that you want to prevent the 
attack, and it is the police officers on the street; it is 
those that know the community that can prevent the attack, and 
when you are looking at the balance between those monies going 
to the first responders and those going to law enforcement, the 
argument is made that perhaps we ought to be focusing more of 
those funds on law enforcement as opposed to more of the 
balance going to the first responders.
    Senator Mikulski. Well, I appreciate all of those answers 
and your candor.
    Just a word about first responders. The Federal program for 
first responders was created by Senator Bond and myself with 
many members here at this table, and it was at $900 million. It 
has now been cut down to $274 million. So it never reached over 
$1 billion when Byrne grants were $2.2 billion.
    But it is not meant to be a zero sum game. Each has what 
they need to be needed for. But we thank you for your candor; 
we thank you for your dedication. We look forward to working 
with you.
    Mr. Chairman.
    Senator Shelby. Senator Leahy.
    Senator Leahy. Thank you, Mr. Chairman.
    I would note that as I am sure we all realize, among those 
first responders are a lot of law enforcement, and we 
anticipate that in many cases, they will be. I realize Homeland 
Security is the first responder when we get these unexpected 
emergencies like the hurricane that we expected for 1 week or 
more, and I know that they are going to have their homes down 
there rebuilt any year now. So it is not a zero sum game.

                          COCAINE TRAFFICKING

    Administrator Tandy, I find interesting the successes you 
have had, and all of us want you to be successful. I am just 
curious: has the supply of cocaine, is it any more difficult to 
get cocaine in the United States than it was, say, 3 years ago? 
I am told by local law enforcement that it is not.
    Ms. Tandy. Senator, I think that has varied over time with 
the increase in eradication efforts.
    Senator Leahy. Is it any more difficult, if someone is a 
cocaine user, if they wanted to go, say, a few hundred yards 
from this building or 200 yards from the State house in pick 
whatever State you want, would they have any more difficulty 
getting cocaine today than they would have 3 years ago?
    Ms. Tandy. I have seen impact on the availability of 
cocaine. I cannot tell you that it is sustained. With our drug 
flow prevention strategy, which is part of our request, we saw 
impact there.
    Senator Leahy. I understand that, but I am told that the 
prices have not gone up, and the availability is about the same 
as it was 3 years ago. I realize it is a bit of a 
generalization, but would you disagree with that 
generalization?
    Ms. Tandy. There have been some changes in areas with the 
price of cocaine where----
    Senator Leahy. Significant?
    Ms. Tandy. It has been statistically significant. It is 
measurable, and that is in certain areas of the country which 
would follow from market changes with the eradication, with 
record-breaking----
    Senator Leahy. How about here in the District of Columbia?
    Ms. Tandy. Excuse me?
    Senator Leahy. What about right here in Washington, the 
Nation's Capital?
    Ms. Tandy. I do not know the answer to that. I would have 
to get back to you on that one.
    [The information follows:]
                   Price of Cocaine in Washington, DC
Price
    DEA data reveal that cocaine prices in Washington, DC, have 
remained stable over the past five years, as have cocaine availability 
and abuse patterns. Cocaine price data for 2005 indicate the sale price 
for cocaine powder (cocaine hydrochloride) ranged between $650 and 
$1,250 per ounce in the D.C. metropolitan area. Data for 2005 indicate 
the sale price for crack cocaine ranged between $550 and $1,250 per 
ounce in the D.C. area.
    Price data was derived from undercover buys, confidential source 
information, and defendant information. Much of this information is 
anecdotal, and thus the data cannot be validated by DEA through any 
scientific methodology. Since DEA does not often purchase kilogram 
quantities, price estimates for kilograms are less accurate than 
estimates for smaller quantities. Furthermore, in DEA's experience 
price data is not a completely accurate indicator of supply and demand.
    The following chart provides 2001 to 2005 cocaine prices for 
Washington DC, as well as the national price range for comparison.

                                     POWDER COCAINE (COCAINE HYDROCHLORIDE)
----------------------------------------------------------------------------------------------------------------
                           Year                                 Kilogram            Ounce             Gram
----------------------------------------------------------------------------------------------------------------
                WASHINGTON, DC PRICE RANGE

2001......................................................   $16,500-$35,000       $900-$1,250          $50-$100
2002......................................................   $17,500-$35,000       $600-$2,000           $30-$80
2003......................................................   $17,000-$35,000       $825-$1,300          $50-$100
2004......................................................   $24,000-$25,000       $900-$1,100              $100
2005......................................................   $23,000-$27,000       $650-$1,250           ( \1\ )

                   NATIONAL PRICE RANGE

2001......................................................   $13,000-$35,000       $400-$1,600          $20-$200
2002......................................................   $10,000-$35,000       $400-$3,500          $24-$150
2003......................................................   $10,000-$35,000       $375-$1,800          $25-$150
2004......................................................   $10,000-$35,000       $350-$1,800           $9-$200
2005......................................................           ( \2\ )           ( \2\ )           ( \2\ )
----------------------------------------------------------------------------------------------------------------
\1\ N/A.
\2\ Pending.

Source: Quarterly Trends in the Traffic Report--DEA Washington Division.


                                          CRACK COCAINE (COCAINE BASE)
----------------------------------------------------------------------------------------------------------------
                           Year                                 Kilogram            Ounce             Gram
----------------------------------------------------------------------------------------------------------------
                WASHINGTON, DC PRICE RANGE

2001......................................................   $28,000-$34,000       $900-$1,300          $80-$100
2002......................................................           $30,000       $900-$1,750          $80-$100
2003......................................................   $28,000-$34,000     $1,000-$1,300          $80-$100
2004......................................................   $28,000-$34,000     $1,000-$1,200           ( \1\ )
2005......................................................   $28,000-$34,000       $550-$1,250           ( \1\ )

                   NATIONAL PRICE RANGE

2001......................................................   $13,000-$50,000       $300-$2,800          $10-$200
2002......................................................   $13,000-$35,000       $325-$2,800          $10-$130
2003......................................................    $7,500-$35,000       $325-$2,000          $10-$130
2004......................................................    $7,500-$60,000       $325-$2,000          $18-$200
2005......................................................           ( \2\ )           ( \2\ )           ( \2\ )
----------------------------------------------------------------------------------------------------------------
\1\ N/A.
\2\ Pending.

Source: Quarterly Trends in the Traffic Report--DEA Washington Division.

Availability
    In determining the availability of drugs DEA looks at various 
indicators, such as price and purity, defendant and confidential source 
debriefings, and the professional judgment of colleagues in the law 
enforcement community. Source information, such as the source of 
cocaine supplied to the D.C. area, is gathered as a normal course of 
investigations. For example, whenever drug traffickers are arrested, 
they will be asked for information such as, ``Who hired you to pick up, 
transport, deliver, and sell the drugs?''
    According to the Washington, D.C. Metropolitan Police Department 
(MPD), cocaine availability has remained stable over the past several 
years. The MPD also reports that drug-related violence remains static, 
with the exception of homicides, which have decreased over the past 
four years.
    Kilogram quantities of cocaine hydrochloride (HCl) continue to 
arrive in the Washington, DC area. Powder cocaine sold at the mid- to 
retail level remains widely available. The quantities of cocaine HCl 
available in any given area greatly depend on abuse patterns and the 
level of distribution at which a particular dealer conducts business. 
Cocaine HCl most commonly is found in gram and ounce quantities for 
resale in suburban and rural areas, but in larger quantities (i.e., 
quantities appropriate for redistribution after conversion to crack) in 
urban areas of the D.C. area.
    Crack cocaine is available throughout the D.C. area in quantities 
ranging from small quantities up to one kilogram. Most of the crack 
cocaine distributed within the D.C. area originates as cocaine HCl and 
is subsequently converted to crack. Generally, significant quantities 
of crack cocaine are not stockpiled and are manufactured according to 
demand.
    The main change in cocaine trafficking in the D.C. metropolitan 
area pertains to cocaine sources of supply. Over the past years, 
cocaine smuggling from the Southwest Border (especially Texas and 
Arizona) to the D.C. area has increased. The flow of cocaine through 
North Carolina has also increased. This mainly impacts southern 
Virginia but also affects the northern Virginia area, including 
Washington, DC. However, drug trafficking organizations in New York 
City still appear to be the principal cocaine suppliers for the 
Washington, DC. area.

    Senator Leahy. I think you would be shocked to hear the 
answer that the price, availability is roughly the same, the 
price is roughly the same. I believe if you took a general view 
of the country, you would find that the availability is roughly 
the same, and the price is roughly the same. Of course, there 
are fluctuations in everything. We are paying three times more 
for gasoline now than we were 5 or 6 years ago.
    And now, you said 2 weeks ago you charged 50 leaders of 
FARC, a State Department designated foreign terrorist 
organization, with supplying 60 percent of the cocaine in the 
United States. In the last 5 years, how many FARC members that 
your administration has indicted have actually been extradited 
and brought to trial?
    Ms. Tandy. There actually are two high-ranking members of 
the FARC that are here in the District of Columbia who are 
facing trial this year. One was a financial officer----
    Senator Leahy. That is two out of how many that have been 
indicted over the last 5 years?
    Ms. Tandy. I would have to get you the actual numbers. 
Fifty was an extraordinary number for us. And that was----
    Senator Leahy. Would you agree that most of the kingpins 
that we have indicted, and I certainly would want you to 
indict, but most of the kingpins, we have not been able to 
extradite from Colombia? Would you disagree with that 
statement?
    Ms. Tandy. Actually, I would differ with that statement. We 
have had tremendous success with President Uribe's 
administration and extraditions out of Colombia.
    Senator Leahy. Of kingpins. I am talking about Major----
    Ms. Tandy. Absolutely.
    Senator Leahy. I had a discussion with President Uribe 
about this just 1 month ago, and I want to see if your answer 
in any way relates to what his is. How many of the kingpins, 
some of the major paramilitary, some of the others that we have 
indicted, how many have actually been extradited, have actually 
been sent to the United States?
    Ms. Tandy. I would have to get you the actual numbers, but 
I can give you some examples that are significant. The founders 
of the Cali cartel who were extradited in the time that you are 
talking about are here on U.S. soil facing trial. We have, as I 
recall, about 20 percent of the most wanted drug trafficking 
organizations on the consolidated priority organization target 
list who have been extradited.
    Senator Leahy. So one out of five have been extradited to 
the United States. That would be a large number. Would that not 
be about 50, 60 people?
    Ms. Tandy. The CPOT list, which is the one I just referred 
to, is actually one that varies over the years, but it is about 
44 on the list right now, and so, 20 percent, about 80 percent 
of the targets, the targeted organizations have been indicted 
on that list, and about 20 percent of them, as I recall, I want 
to get you the exact figure.
    [The information follows:]
               Indictments and Extraditions From Colombia
    Since 2002, 360 individuals have been extradited from Colombia to 
the United States. The Department of Justice Criminal Division 
estimates that approximately 94 percent of these extraditions have been 
for drug charges.

                      EXTRADITIONS FROM COLOMBIA TO THE UNITED STATES (AS OF JUNE 2, 2006)
----------------------------------------------------------------------------------------------------------------
                      Extraditions by Year                         2002    2003    2004    2005    2006    Total
----------------------------------------------------------------------------------------------------------------
Total Extradited from Colombia..................................      40      68      91     134      27     360
----------------------------------------------------------------------------------------------------------------

    Because Colombians are indicted by grand juries in various federal 
districts and a single indictment may charge multiple individuals, DOJ 
does not know the exact number of Colombians indicted since 2002.
    Over the past two years, several key traffickers have been 
extradited to the United States from Colombia, including members of the 
Revolutionary Armed Forces of Colombia (FARC), the Norte Valle Cartel, 
and the Cali Cartel. Some of these key extraditions include the 
following:
2006
            Julio Cesar Lopez Pena
    In March 2005, Julio Cesar Lopez Pena was extradited to face 
racketeering and drug charges. According to a May 2004 indictment, 
Lopez Pena operated a cocaine laboratory under the control of the Norte 
Valle Cartel beginning in 1998.
2005
            Jairo Aparicio Lenis
    In October 2005, Jairo Aparicio Lenis was extradited to the United 
States to face racketeering and drug charges. According to an April 
2004 indictment, Aparicio Lenis was a member of the Norte Valle Cartel 
responsible for laundering the cartel's cocaine proceeds.
            Elias Cobos Munoz
    In April 2005, Consolidated Priority Organization Target (CPOT) 
Elias Cobos Munoz was extradited from Colombia to face cocaine 
conspiracy and money laundering conspiracy charges. Cobos Munoz is 
allegedly responsible for importing more than three metric tons of 
cocaine per month from Colombia into the United States since 2000, 
which is approximately 10 percent of the cocaine available in the 
United States. Cobos Munoz was extradited along with two co-defendants, 
Florentino Riviera-Farfan, aka ``Tarzan,'' and Jorge Ivan Lalinde-
Lalinde, aka ``El Mono.''
            Nayibe Rojas Valderama
    In March 2005, FARC Commander Nayibe Rojas Valderama, aka 
``Sonia,'' was extradited from Colombia to the United States to face 
drug trafficking charges in the U.S. District Court for the District of 
Columbia. Prior to her arrest, Rojas Valderama was allegedly the 
finance officer for the FARC's 14th Front. Rojas Valderama is charged 
in an indictment together with the leader of the 14th Front, Jose 
Benito Cabrera Cuevas, aka ``Fabian Ramirez.'' Cabrera Cuevas is 
allegedly a member of the Central General Staff, the second highest 
governing body of the FARC, and he is the second-in-command of the 
Southern Block which is composed of 12 fronts containing approximately 
600-700 FARC members. Rojas Valderama, Cabrera Cuevas, and two 
international drug traffickers were indicted in December 2003.
            Rodriguez Orejuela Brothers
    Colombian CPOT Miguel Rodriguez Orejuela was extradited from 
Bogota, Colombia, to Miami, Florida, in March 2005. His brother, CPOT 
Gilberto Jose Rodriguez Orejuela, was extradited to the United States 
in December 2004. The Rodriguez Orejuela brothers were allegedly the 
heads of one of the largest cocaine and money laundering organizations 
in Colombia and were key figures in the establishment of a 
sophisticated cocaine trafficking consortium known as the Cali Cartel, 
which has operated since the 1980s. They remain two of the most 
significant Colombian drug traffickers extradited to the United States 
to date.

    Senator Leahy. So eight or nine have been extradited?
    Ms. Tandy. That is my recollection, but I will confirm 
that. I was also told, Senator Leahy, that at 1:30 this 
afternoon, Mexico put on the plane 1 of our top 25 fugitives 
who they have extradited to the United States.
    Senator Leahy. As you know, Colombia is one of the largest 
recipients of U.S. aid. Of the 50 leaders that you have 
charged, the most successful, of course, would be if you get 
all 50 up here. What if you got 40? Would that still be a 
success?
    Ms. Tandy. That would be a tremendous success.
    Senator Leahy. What if you got 30?
    Ms. Tandy. It would be a tremendous success, and I will 
tell you why.
    Senator Leahy. What if you got 20?

 FUERZAS ARMADAS REVOLUCIONARIAS DE COLOMBIA--EJERCITO DE PUEBLO--FARC

    Ms. Tandy. The 50 members of the FARC who are indicted 
decimate the entire leadership of the FARC. So how ever many of 
those----
    Senator Leahy. Only if they are in jail. But if they go 
into an amnesty program and are in Colombia and are allowed to 
go right back out, how does that decimate the FARC? I mean, I 
can see it would decimate it if we bring them up here and put 
them in jail, but that is what I am asking: of that 50, I mean, 
we will probably come back to this next year, but of that 50, a 
year from now, how many do you expect to actually see in the 
United States?
    Ms. Tandy. I cannot answer that, Senator. We certainly have 
had success with our partners in Colombia of getting two major 
FARC members arrested and extradited and here now facing trial. 
I have confidence that we will get more, but I could not 
possibly give you a number.
    Senator Leahy. How many would you expect at this time next 
year if you would consider it to be a success? And I will let 
you designate what a success is. Of the 50, how many would you 
want to see here this time next year so that you could consider 
it a success?
    Ms. Tandy. I would like to see all 50 of them, but I would 
not anticipate that we will succeed in getting all 50 arrested 
and extradited to the United States before I see you next year. 
I just could not give you a number, Senator. Any one of these 
50 are leaders.
    Senator Leahy. Suppose we only had three or four. Would 
that be a success?
    Ms. Tandy. We would consider any one of these 50 leaders of 
the FARC being extradited to the United States a success.
    Senator Leahy. Would it be a success if a large number of 
them went into the amnesty program and were returned to society 
in Colombia?
    Ms. Tandy. I know that those are issues that are 
principally related to the other terrorist organization, one of 
the other two remaining in Colombia, the United Self-Defense 
Force of Columbia (AUC). Those are issues that the State 
Department and the government of Colombia are addressing in 
terms of the parameters of that amnesty.
    Senator Leahy. Well, the parameters of amnesty is a nice 
term, but the fact is every time the Appropriations Committee 
tries to put any kinds of controls on our large amount of 
foreign aid that we actually have to get some of these people 
to come here and not just be given amnesty and turned back, 
your administration objects to that.
    And more and more of these people, the members of the drug 
cartels, the members of the terrorist organizations, the 
members involved with human rights violations, are told they 
can turn over some weapons and rejoin society.
    So I am trying to--and it is like Hotspur in Shakespeare. 
You know, I can call them from the vasty depths; well, so can 
I; so can anybody, but will they come when you call? And it is 
a nice statement. It has been my experience many times with all 
administrations that when law enforcement officials come here 
for appropriations hearings there are usually indictments 
shortly before so they can talk about success.
    I want to know how many are going to come here. Now, of 50, 
you indicted 50. But I wonder if only half a dozen of those 50 
actually come here to face justice, because one does not see 
them really facing it down there.
    Ms. Tandy. Senator, I can tell you that this is not an easy 
case to make. It is very complicated to penetrate the FARC and 
to identify the leaders and to amass the evidence that was put 
together against these 50.
    The counterparts of ours in Colombia have been partners for 
us in this effort, and I have a great deal of confidence that 
if these members of the FARC can be located and arrested that 
we will see them here. The demobilization that you are talking 
about has not been extended to the FARC, to the best of my 
knowledge. DEA is very pleased, very proud of this effort, as 
we were with the return of the founding heads of the Cali 
cartel earlier this year, not before this hearing, as well as 
the other two members of the FARC who were returned and facing 
trial, not before this hearing.
    Senator Leahy. Well, will you have your staff keep me 
informed of when they do come here?
    Ms. Tandy. Yes.
    Senator Leahy. I have been supportive of President Uribe. I 
think he has tried very hard. I have a great deal of admiration 
for him. He and I meet several times a year. But I do worry 
that sometimes, the claims we make are not borne out by the 
facts, and certainly, when I watch what is happening with 
cocaine and meth and all, prices do not go up. Availability 
does not go down, which would be the best example that this 
effort is paying off with the billions upon billions of dollars 
we are spending down there.
    Director Mueller, you and I have discussed the case 
management system. You have expressed your concern to me that 
you feel I have been critical when I should not be. I get 
critical of anybody spending the taxpayers dollars if I do not 
see the results I think I would like to see. I have been just 
as critical of a Democratic administration as a Republican 
administration.

                         VIRTUAL CASE FILE COST

    You scrap the Virtual Case File. It is not just the money 
that was lost, and I realize you recaptured some of it, but it 
was the time that was lost. I still think back, and this was 
not your fault; this came from your predecessors, but I 
remember being down there right after 9/11, and people figured 
out how they could fly pictures of the hijackers around the 
country, and everybody is writing down information on pieces of 
paper, putting them in one file, which is written down by 
somebody else and put in another file, and kids in my 
neighborhood would just e-mail those pictures back and forth to 
each other.

                             SENTINEL COST

    Now, we understand your estimate is that Trilogy's 
successor Sentinel is going to cost the American taxpayers $425 
million to complete. It will not be ready until the end of this 
decade. You set aside $97 million for it this year. You are 
asking for another $100 million for fiscal year 2007. Are you 
confident about the final cost estimate of this program?
    Mr. Mueller. Yes, Senator; let me say at the outset that 
nobody is as harshly critical as I am of the mistakes that were 
made in the past. My concern is that we do not focus on the 
successes of Trilogy in terms of the networks and the modern 
computers that were put on the desks.
    Great work has been done since September 11 in putting 
together the investigative data warehouse, where you have in 
excess of 250 million documents searchable by the latest tools. 
Also, my concern exists because we all want to make this work 
in Sentinel and we will need to have an open mind toward what 
we have undertaken to assure not only the success of this but 
visibility into what we are doing every step of the way.
    And when it comes, then, to your question with regard to 
the cost, the cost is $425 million.
    Senator Leahy. Is that the FBI's estimate, or is that 
Lockheed Martin's estimate?
    Mr. Mueller. No, it is not. It is our estimate. But the 
contract with Lockheed Martin is $305 million. Of that, $232 
million is the development contract, which if you ask, if you 
add the $50 million to $170 million, it is comparable to what 
we were going to spend on Virtual Case File.
    The other monies go to exactly what the GAO, the Inspector 
General, and Congress wants us to do. Preaward was $4 million. 
Program management operations, the program management that we 
have to put into place to make this successful is almost $75 
million. The independent validation and verification is $6 
million.
    Senator Leahy. Who does that?
    Mr. Mueller. Risk management.
    Senator Leahy. Who does that?
    Mr. Mueller. Those are independent contractors who are 
doing that aspect of it. That is not Lockheed Martin. We have 
an independent contractor.
    Senator Leahy. Do you know off hand who that is?
    Mr. Mueller. I do not know off hand.
    Senator Leahy. Could somebody give me that?
    Mr. Mueller. Assuredly.
    Senator Leahy. Thank you.
    [The information follows:]

  Independent Verification and Validation of Sentinel's Implementation

    The FBI is establishing a multi-award Independent 
Verification & Validation (IV&V) contract. At the Department of 
Justice's (DOJ) request, this contract will be made available 
DOJ-wide. The FBI's Financial Division is currently managing 
the preacquisition effort and eventual contract award.
    Until this DOJ-wide contract award is in place, the Office 
of Information Technology Program Management's (OIPM) Program 
Oversight Unit will provide interim IV&V services.

    Mr. Mueller. And so, the package will cost down the road 
$425 million, but the pieces of it are that which we have put 
into place to make certain that it will be successful down the 
road.
    Senator Leahy. So will there be additional funding or 
reprogrammed funds that the FBI will need to complete it?
    Mr. Mueller. Yes, down the road, 2008-2009.
    Senator Leahy. If a reprogramming is required, do you have 
any idea which programs you would shift funds out of?
    Mr. Mueller. No, and my problem last year is that you had 
asked what is the cost of the Sentinel going to be? I could not 
tell you until we had the contract, until we had the bids in 
and identified the ultimate cost for that bid. Now that we have 
the bids in, now that we have the monies, we put aside $97 
million for this year that we had to reprogram. We are asking 
for $100 million next year, and we will be asking in 2008 for 
those sums we need to complete this package.
    Now, the other point I make as well is that we are now part 
of the intelligence community. We are not just law enforcement; 
we are part of the intelligence community. That which we are 
putting together, whether it be Sentinel or any number of our 
other programs that are meant to develop the domestic 
intelligence capacity of the Bureau should be treated as part 
of the intelligence community and perhaps looked to for dollars 
in terms of supporting our intelligence side of the house.
    And so, we will be looking for additional funds for 
Sentinel down the road, but we will also be asking for the 
Congress and others to look at us as not just a law enforcement 
entity but also as an intelligence entity.

                              CHOICEPOINT

    Senator Leahy. There has been a great deal of criticism up 
here by both Republicans and Democrats in both bodies about 
ChoicePoint, and you have entered into a multimillion dollar 
contract with them to handle sensitive investigative data about 
criminal enterprise systems. Did you or anyone in the FBI have 
any discussion with any of the Members of Congress who had been 
raising these concerns, the various chairmen and others, about 
ChoicePoint before entering into that contract?
    Mr. Mueller. I do not believe so, but let me, if I could, 
clarify exactly what we have from ChoicePoint.
    At the outset, let me say that I share your concerns about 
any breaches of privacy by ChoicePoint. As you point out in 
your recent press release, ChoicePoint has been fined by the 
FTC. I have no doubt that the fine was appropriate, that to the 
extent that ChoicePoint----
    Senator Leahy. Trust me, they would have fought it like 
hell if they thought it was too much.
    Mr. Mueller. All I have to say is that to the extent that 
ChoicePoint is liable for those fines or breaches privacy, 
then, they should be treated like any other corporation.
    What we have bought from ChoicePoint is a software package 
that will help our analysts do their jobs. It is a software 
package that has been used not by us but by other 
organizations. It is not a data package. It is a software 
package. It helps our analysts do the job. We would be remiss 
if we did not look at this software package, evaluate it along 
with other software packages and use it if it was the best 
software package----
    Senator Leahy. Who services that?
    Mr. Mueller. I will have to get back to you on that.
    [The information follows:]

             Purchase of Software Package From ChoicePoint

    The FBI awarded a 5-year, fixed-price contract with i2, 
Inc., a subsidiary of ChoicePoint, on 12/1/05. The contract is 
serviced by ChoicePoint.

    Senator Leahy. Would it be ChoicePoint?
    Mr. Mueller. I do not know. I would have to get back to you 
on that. But let me give you another aspect----
    Senator Leahy. You understand the reason I am asking that 
question.
    Mr. Mueller. I do not know, and I will have to get back to 
you on that.
    But let me also indicate that we do seek data from 
ChoicePoint because ChoicePoint has public source data that it 
accumulates, and it is one of those entities that we would be 
remiss if we did not use that capability in certain 
circumstances to identify persons whom we need to locate within 
the United States.
    Go back to the 9/11 Commission report. I have this vague 
memory of it. Midhar and Alhamzi were in the United States, and 
if I am not mistaken, when the 9/11 Commission said we should 
have been on them and utilized tools such as ChoicePoint to 
identify those persons in the United States before they 
undertake this attack. So to the extent that we use ChoicePoint 
or other data accumulation companies, we would again, I would 
say, be remiss if we did not utilize those tools when they are 
accumulating public source data, not private data.
    Senator Leahy. Mr. Chairman, both the Administrator and the 
Director are going to get back to me on a number of things, and 
I will have, if you do not mind, I will have follow up 
questions for them once I have heard their answers.
    Senator Shelby. We will leave the record open.
    I think what the Director is saying, and I believe he is 
right on this, ChoicePoint did have a big breach, but they are 
also known for doing some good things in some certain areas. Is 
that not what you are basically saying?
    Mr. Mueller. They along with other companies----
    Senator Shelby. Right, absolutely.
    Mr. Mueller [continuing]. Have consolidated open source 
data----
    Senator Shelby. Absolutely.
    Mr. Mueller [continuing]. That gives us an easy way to 
obtain information that comes from open sources relative to 
particular investigative leads that we have.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Shelby. We appreciate your cooperation from the 
subcommittee today. I know it has been a long afternoon, but we 
will have some other Senators, Senator Leahy and others, who 
will be asking questions for the record, and we hope you could 
respond to them by May 5.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]

               Questions Submitted to Alberto R. Gonzales
            Question Submitted by Senator Richard C. Shelby

            NATIONAL MOTOR VEHICLE TITLE INFORMATION SYSTEM

    Question. We know that by congressional direction the Justice 
Department has funded the NMVTIS (National Motor Vehicle Title 
Information System) program in the past but the funding stream stopped 
in 2004 leaving the majority of states unconnected to a system which 
could dramatically assist law enforcement in their efforts to track 
stolen vehicles. This is a mission which again is gaining attention as 
stolen U.S. cars have surfaced in terrorist bombings in Iraq, a 
particular concern when it comes to protecting our troops in the Green 
Zone.
    NMVTIS could also be helpful in tracking more than a half million 
vehicles, including school buses, flooded or damaged by hurricanes 
Katrina and Rita. Some of these have been driven to other states, re-
titled as ``clean vehicles'' and sold to unsuspecting customers.
    Has the Justice Department given any thought or consideration to 
reviving the NMVTIS program in order to connect all the states, so we 
have a better way to stop these vehicles from falling into the wrong 
hands?
    Answer. The Department of Justice (DOJ) shares your concern 
regarding the continuing problem of auto theft. This past March, the 
Department's Bureau of Justice Assistance (BJA) convened a focus group 
to discuss this issue. The group, which was comprised of 
representatives from federal, State, and local law enforcement, 
insurance corporations, and NMVTIS staff, agreed that the NMVTIS 
program is an important asset in reducing auto theft.
    While the Attorney General delegated responsibility to the Federal 
Bureau of Investigation (FBI) to oversee the implementation of the 
NMVTIS system, BJA has provided over $12 million in funding for NMVTIS 
since fiscal year 1997. BJA has been working closely with anti-fraud 
components within DOJ and with the FBI to assess the status and need 
for NMVTIS. Additionally, BJA engaged the Integrated Justice Systems 
Institute (IJIS) to assess NMVTIS' current technological architecture 
and has discussed with States how the system could be improved to 
encourage greater participation. These discussions and reviews are now 
complete and BJA will be working closely with the American Association 
of Motor Vehicle Administration, the FBI, and other law enforcement 
entities to make any necessary changes to the system, to improve the 
administration of the overall title information sharing effort, and to 
increase State and local law enforcement participation. A key aspect of 
any new approach will be to implement the ``self-sustaining'' aspect of 
the original authorizing legislation, which called for the States to 
support the system through user fees.
    BJA will also continue to address the costly problem of auto theft 
through various other efforts. This month, the FBI and BJA are 
convening a meeting of southwestern federal, State, and local law 
enforcement agencies to discuss the problem of vehicles being stolen in 
the United States and taken to Mexico. Intelligence and recent arrests 
indicate that Mexico is a prime location for cloning (replacing vehicle 
identification numbers of stolen vehicles with those of legal vehicles 
for resale), chopping (vehicles dismantled for parts), and foreign 
order fulfillment. We anticipate that this meeting will foster closer 
working relationships among agencies working the Mexico border and 
identify areas where the Department can provide assistance.
                                 ______
                                 
            Questions Submitted by Senator Pete V. Domenici

                JUDICIARY NEEDS ON INTERNATIONAL BORDERS

    Question. Federal Judges serving in districts located on the 
southern international border have caseloads with an increasing number 
of immigration related matters. According to the Administrative Office 
of the Courts, for fiscal year 2004 my home state of New Mexico had 
1,502 immigration filings and 2,497 total criminal filings. Compare 
that to a northern border district--the Western District of Washington 
had 78 immigration filings and 539 total criminal filings.
    As we continue to work to secure our nation, we must be sure that 
we adequately equip all of the agencies involved in this fight, 
including the federal courts that must prosecute immigration related 
charges. I fear that we are not focusing on agencies outside of the 
Department of Homeland Security and their need for funding, as I have 
heard from New Mexico judges that their resources are insufficient to 
meet their increasing immigration-related caseloads.
    Additionally, I am afraid our Southwest border district courts will 
be unable to handle the increased immigration caseload that is sure to 
result from increased enforcement efforts without new judges.
    Can you speak to the crisis southwest border courts like Arizona 
and New Mexico face?
    Answer. The five judicial districts that comprise the Southwest 
border make up a significant percentage of the total workload for 
Department of Justice components such as the U.S. Marshals Service 
(USMS) and the U.S. Attorneys' Offices (USAOs). In the USAOs, 68 
percent of all immigration cases occur on the Southwest border--12,318 
immigration cases were filed in the Southwest border districts out of a 
total of 18,147 immigration cases filed nationwide in 2005.
    In fiscal year 2005, 31 percent of all prisoner productions 
(transporting a prisoner to a judicial proceeding) by the USMS were in 
the five Southwest border districts; there are 94 districts nationwide. 
Ten percent of all USMS prisoner productions were in Arizona and New 
Mexico in fiscal year 2005. In addition to court proceedings, the 
Southwest border districts have an enormous warrant workload. In fiscal 
year 2005, 21 percent of all Class I fugitive warrants (federal felony 
warrants and DEA warrants) were issued by federal judges working in 
Southwest border districts. Six percent of all Class I fugitive 
warrants were issued by federal judges in Arizona and New Mexico in 
fiscal year 2005.
    Question. What resources are being marshaled by the Department of 
Justice to assist federal courts faced with increasing caseloads due to 
our successful efforts to secure our country?
    Answer. Judicial security is one area where the Department of 
Justice can directly assist federal courts. The USMS strives to place 
its personnel in those districts with the greatest amount of workload. 
In fiscal year 2005, the USMS received 94 new Deputy U.S. Marshals for 
judicial security work in the districts. Of this amount, 34 percent (or 
32 Deputy U.S. Marshals) were allocated to the five Southwest border 
districts. The Department of Justice is providing significant 
resources, in the form of judicial security, to assist federal courts 
along the Southwest border. The Department has approved significant 
resource allocations to the United States Attorneys Offices along the 
Southwest border in recognition of increasing workload demands in a 
number of areas, most notably antiterrorism (border security), 
immigration and narcotics enforcement.
    Question. What other needs does the Department of Justice have on 
our international borders--is there a need for more Assistant U.S. 
Attorneys, Deputy U.S. Marshals, and/or Bureau of Prisons personnel?
    Answer. The 2007 President's Budget for the Department of Justice 
requests resources to fund additional Assistant U.S. Attorneys (AUSAs) 
and Deputy U.S. Marshals:

                         [Dollars in thousands]
------------------------------------------------------------------------
   Requested Fiscal Year 2007 Program
               Increases                 Positions     FTE       Amount
------------------------------------------------------------------------
U.S. Attorneys.........................        149         75    $23,205
U.S. Marshals Service..................         66         33     13,619
------------------------------------------------------------------------

    In addition, the budget request for the USAOs and USMS include 
$58.6 million and $57.7 million respectively for adjustments-to-base 
increases to cover rising pay, benefits and overhead costs. These 
additional resources, if fully funded, will be allocated based on 
Departmental priorities, and the latest workload and budgetary data 
available at the time of enactment.
    By way of background, the USAOs in the five districts along the 
Southwest Border are at the forefront of the Department's efforts to 
stem the tide of illegal immigration and drug trafficking. Between 
fiscal year 1998 and fiscal year 2005, a total of 97 new Assistant 
United States Attorneys positions were allocated to the five Southwest 
Border districts. These additional resources have helped to play a part 
in increasing the number of criminal immigration cases filed in the 
five Southwest Border districts by over 55 percent between fiscal year 
2000 and fiscal year 2005--from 7,942 to 12,318 cases filed.
    Question. Besides creating new district judgeships for border 
courts and providing more funding for these courts, what else can 
Congress do to assist the federal border courts that are in a situation 
the Judicial Conference has called a crisis?
    Answer. From time to time, the Department of Justice submits 
legislative proposals to the Congress that address a wide range of 
legal issues including those affecting the courts. Those proposals are 
the most effective avenue for responding to such a question. However, 
it is clear that as the judicial staffing and workload of the courts 
expand, the space, personnel and funding resources needed for 
Department of Justice components such as the USMS, USAOs and Bureau of 
Prisons also expands.

                       MENTAL HEALTH COURT NEEDS

    Question. The Department of Justice has estimated that 16 percent 
of all inmates in local and State jails suffer from a mental illness, 
and the American Jail Association estimates that as many as 700,000 
persons suffering from a mental illness are jailed each year. In New 
Mexico, we know the impact that such persons can have; on August 18, 
2005, a diagnosed schizophrenic shot five people to death in the space 
of 16 hours, including the two police officers who were sent to pick 
him up for a mental evaluation.
    In response to cases like this, America's Law Enforcement and 
Mental Health Project Act created Mental Health Courts with separate 
dockets to handle cases involving individuals with mental illnesses. 
Bernalillo County's Mental Health Court in New Mexico was created in 
2003 and ninety-two percent of its graduates are not arrested again. 
The $500,000 Congress provided for this court in fiscal year 2006 is 
expected to double the number of people the Bernalillo County Mental 
Health Court serves over the next two years.
    With success rates like this for such small sums of money, I 
believe this is an innovative approach to address the needs of those 
individuals suffering from mental illnesses that come into contact with 
the judicial system.
    How much does the Department of Justice propose spending on mental 
health courts in fiscal year 2007?
    Answer. There is not a dedicated funding line for Mental Health 
Courts in the fiscal year 2007 budget. The Office of Justice Programs 
(OJP) is working with federal partners, including the National 
Institute of Corrections, to develop a coordinated strategy for the $5 
million appropriated in fiscal year 2006 for the Mentally Ill Offender 
Act.
    Question. Do you have any suggestions on how we might otherwise 
help individuals who are charged with a non-violent crime and who 
suffer from a mental illness?
    Answer. Partnerships with criminal and juvenile justice agencies 
provide mental health agencies unique opportunities for early 
identification, diversion from prosecution to treatment, enhanced 
supervision and case management. Recent innovations in collaborative 
approaches, the use of assessment tools, targeted approaches, and 
appropriate interventions have shown promise in the areas of law 
enforcement, courts, and corrections. Mental health courts, an example 
of this innovative and collaborative approach, provide the voluntary 
opportunity for non-violent offenders to participate in court-
supervised, community-based treatment. As in Bernalillo County, these 
efforts include continued judicial supervision and the coordinated 
delivery of health and social support services. Initial evaluations of 
mental health courts have shown that they result in fewer jail bookings 
and jail time, a greater number of treatment episodes, an increase in 
the frequency and volume of treatment services, and a reduction in drug 
use and psychological distress in participants, as compared to 
traditional misdemeanor defendants.
    During the last few years, OJP has been engaged in collaboration 
with other federal agencies to coordinate activities related to 
offenders with mental health issues. Many activities have been 
consistent with the recommendations of the President's New Freedom 
Commission and have also been formed in relation to the recommendations 
developed in OJP's Bureau of Justice Assistance's (BJA) Mental Health 
Consensus Project. Current areas of collaboration include coordination 
of Substance Abuse and Mental Health Services Administration's Targeted 
Jail Diversion program and BJA's Mental Health Courts Program. In 
fiscal year 2005, OJP expanded efforts into training law enforcement to 
assess and build partnerships in mental health.
    In fiscal year 2006, BJA received a $5 million appropriation to 
begin implementing the Mentally Ill Offender Treatment and Crime 
Reduction Act (Public Law 108-414). This funding supports critical 
efforts to build State, local and tribal capacity to better understand 
and address individuals with mental illness, who also often face 
substance abuse and other public health issues. This program is 
designed to increase public safety through innovative cross-system 
collaboration for individuals with mental illness who come into contact 
with the criminal and juvenile justice systems. It will encourage early 
intervention for system-involved individuals with mental illness; 
provide new and existing mental health courts with various treatment 
options; maximize diversion opportunities for non-violent offenders 
with mental illness and co-occurring disorders; promote training for 
justice and treatment professionals on court processes and mental 
health and substance abuse issues; and facilitate communication, 
collaboration, and the delivery of support services among justice 
professionals, treatment and related service providers, and 
governmental partners. These efforts will help individuals who are 
charged with a non-violent crime and who suffer from a mental illness.
                                 ______
                                 
          Questions Submitted by Senator Kay Bailey Hutchison

                      INTERGOVERNMENTAL AGREEMENTS

    Question. It is my understanding that some of the local West Texas 
communities, who stand to lose their contracts under the CAR 6 Project, 
issued long term municipal bonds to pay for expansion of their jails 
when the DOJ's sought additional bed-space years ago. It is also my 
understanding that Texas law required these local communities and then 
Texas Attorney General--my Senate colleague Senator John Cornyn--to 
first perform a ``due diligence'' review of the need for the issuance 
of these bonds. Did the DOJ assure these local communities that the 
Federal government's need was long term?
    Answer. Each Intergovernmental Agreement (IGA) is for three years 
only. There has been no contractual commitment by the Bureau of Prisons 
(BOP) beyond the IGA terms.
    Question. Further, it is my understanding that this Subcommittee, 
the CJS Appropriations Subcommittee, directed the Government 
Accountability Office (GAO) in the fiscal year 2006 CJS Appropriations 
Report to conduct a cost benefit study of agreements with local 
governments to house federal inmates. Has that study been completed? If 
not, why is it not more prudent to renew the agreements with these West 
Texas communities pending the results of the GAO cost study? 
Furthermore, the 2006 Appropriations Conference Report encouraged the 
Bureau of Prisons to expand the use of Intergovernmental Agreements. 
Why is DOJ moving to eliminate these large Intergovernmental Agreements 
in Texas, contrary to the directives of Congress and the President?
    Answer. The GAO study has not begun. All four agreements expire in 
early 2007 (January-April), and provide the opportunity to conduct a 
full and open competition for contracts in order to provide for the 
best value for the BOP and taxpayers. The BOP uses IGAs when 
appropriate and when the need exists. As of April 2006, BOP has 68 IGAs 
with State, county, and local governments throughout the country to 
provide about 800 beds. The fiscal year 2006 Conference Report also 
states: ``The BOP is encouraged to solicit proposals in a manner that 
allows for an optimal level of competition so that BOP's [bedspace] 
requirements can be met and the best value achieved.''
    The four agreements with the Texas local governments differ from 
other IGAs in that they are for the entire facility and are all managed 
by private companies; in one case the private company owns the prison 
facility. The private contractors hire and fire staff and are 
responsible for the daily operations of the prison. Each local 
government is like a ``silent partner'' generally removed from the 
daily operations at the facilities.
    Question. It is also my understanding that the CAR 6 Project will 
not result in any new bed-space for the DOJ, is this correct? As a 
follow up, if the CAR 6 Project will not result in new bed-space, why 
is the CAR 6 Project a prudent use of federal tax dollars?
    Answer. The CAR 6 Project will not result in any new BOP bed-space. 
However, by conducting a full and open competition, the BOP 
requirements can be met and the best value achieved including price and 
quality of service. In addition, the contracts will be for up to ten 
years which allows the BOP to ``lock-in'' pricing for the next ten 
years, thus assisting with budget projections and avoiding 
renegotiation of terms every three years. Full and open competition 
provides for a competitive market that assists in controlling prices.
    Question. Finally, has DOJ considered the long-term impact of the 
CAR 6 Project? Other agencies in your Department, including the U.S. 
Marshals Service, as well as the Department of Homeland Security 
utilize local governments agreements for correctional or detention 
purposes. If the CAR 6 Project causes these local Texas communities to 
go bankrupt or suffer significant financial hardship, I imagine other 
local governments will avoid partnering with the Federal Government, 
for fear of suffering the same fate as these West Texas local 
governments.
    Answer. Yes, the DOJ has considered the long-term impact of CAR 6 
and its benefits to both the Bureau and the taxpayers. All current 
providers under the Texas IGAs have the opportunity and have been 
encouraged to submit competitive proposals under the CAR 6 
solicitation. The BOP will consider multiple awards under the CAR 6 
solicitation. The BOP has an outstanding relationship with state and 
local governments throughout the United States using their available 
bed space for short-term needs, and we plan to maintain that working 
relationship.
                                 ______
                                 
            Questions Submitted by Senator Patrick J. Leahy

                  COMPETITION AND INTERNATIONAL TRADE

    Question. There is a great deal of concern across the country that 
some of our trading partners don't always play fair, and that the U.S. 
Government needs to do more to protect the interests of U.S. businesses 
and workers. One issue that is of growing concern is the prospect of 
foreign countries using their competition laws to advance industrial 
policy goals in ways that prevent U.S. companies from competing fairly, 
or penalizing U.S. firms for conduct that is entirely legal under U.S. 
law. This problem is only going to grow as countries such as China ramp 
up their antitrust enforcement while looking for new ways to insulate 
local industries from U.S. competition.
    I know the United States has antitrust cooperation agreements with 
a few of our trading partners, but problems persist, and I don't see 
things getting any better without a more active role by your 
Department. Is the Antitrust Division prepared to step up its efforts 
to dissuade foreign governments from pursuing competition policies or 
imposing penalties that create barriers to trade? Do you agree that the 
time has come for the Administration to establish a standing 
interagency committee to address these problems as they arise?
    Answer. The Department, through its Antitrust Division, advocates 
around the world for antitrust enforcement based on rigorous legal and 
economic analysis, with the goal of promoting consumer welfare by 
preserving competition. We oppose any agency misusing antitrust to 
defend a country's own home companies or exclude competitors from other 
nations. The Division aggressively pursues international coordination 
and cooperation and substantive and procedural convergence around these 
principles, and these efforts will continue to be an important 
priority. The Division is working in international fora, including the 
International Competition Network and the Organization for Economic 
Cooperation and Development, as well as on a bilateral level with many 
foreign antitrust authorities, including the European Commission, both 
generally and on specific matters.
    The Department also takes an active role in negotiating free trade 
agreements. Beginning with NAFTA in 1994, the United States has 
negotiated provisions relating to antitrust enforcement and to conduct 
of official monopolies and state enterprises in a number of free trade 
agreements--including those with Chile, Singapore, and Australia--where 
we have taken the lead role in negotiating such provisions. These 
provisions help to ensure that the opportunities created by trade 
liberalization are supported by competitive domestic markets. The 
Department of Justice works with other parts of the Administration, 
including the United States Trade Representative (USTR) and the 
Departments of State and Commerce, on these agreements and other 
competition issues as appropriate, and at this stage I believe that it 
is the most effective way to handle these competition issues.
    Question. I am aware that the Department of Justice has competition 
comity agreements with several of our trading partners, including the 
EU. Nonetheless, it remains the case that EU authorities sometimes 
reach results or impose penalties that conflict with our own--the 
proposed GE/Honeywell merger and the Microsoft case are two recent 
examples. Beyond the immediate impact on U.S. companies operating in 
Europe, I worry that competition authorities in other countries, such 
as China, will view this divergence as a justification to pursue even 
more radical measures against U.S. multinationals, particularly if they 
can give a helping hand to their own industries by doing so.
    Can you assure this Committee that the Department will put more 
effort into promoting U.S. antitrust policies around the globe and 
avoiding situations where U.S. companies are subject to one set of 
rules or remedies here, and an entirely different set elsewhere? Is the 
Department prepared to engage more energetically with the European 
Commission to resolve ongoing disputes and divergence in this area?
    Answer. With the globalization of markets, it is increasingly 
important that antitrust enforcers around the world base their 
enforcement decisions on sound legal and economic analysis. Antitrust 
laws should protect competition, not competitors. Antitrust laws should 
not be used to defend a country's own home companies or to try to 
exclude competitors from other nations. We are working with many 
foreign antitrust agencies in a variety of contexts, including the 
International Competition Network and the Organization for Economic 
Cooperation and Development, to achieve international consensus on 
sound antitrust enforcement. Those efforts are important, and we will 
continue to devote significant resources to those efforts.
    The Department also works closely with foreign antitrust agencies, 
particularly the European Commission, in order to achieve the greatest 
possible coordination with them on particular matters. Divergent 
outcomes can sometimes occur due to different legal regimes or 
different factual circumstances in different countries. When divergent 
outcomes do occur, we work with our foreign counterparts to minimize 
that divergence and to lessen the possibility of divergence in the 
future. The Department will continue to place a high priority on 
pursuing greater coordination and substantive and procedural 
convergence on antitrust issues with foreign antitrust agencies, at 
both the staff and policy levels, to limit the risk of significantly 
divergent outcomes in particular cases.
    Much of the work of minimizing duplication and divergence will 
continue to be done bilaterally, often on a case-specific basis. Cases 
like GE/Honeywell and Microsoft, though rare, understandably attract 
public attention and concern. But in most instances, we are succeeding 
in working very well with dozens of antitrust agencies around the world 
on particular merger and cartel matters with the goal of getting sound 
and consistent results. In the particular case of the European 
Commission, close collaboration has enabled us to achieve consistent 
results in several recent matters on both the determination of a 
violation and, where necessary, the remedy.
    In fact, there has been considerable convergence in recent years in 
both civil and criminal antitrust enforcement around the globe. Many 
jurisdictions are now making increasing efforts to combat cartels, 
which the U.S. Supreme Court has called ``the supreme evil of 
antitrust.'' Many jurisdictions have revised their merger process and 
enforcement policies, reducing complexity and business costs and 
bringing them into closer harmony with the U.S. merger review 
practices. These are good starts, but this is an ongoing effort, and it 
will remain a high priority for the Department.
    Question. U.S. antitrust policy is one of the principal tools used 
to promote free and open markets. Antitrust law should play the same 
role internationally by opening markets and removing barriers to trade. 
In nations where free market principles are not as fully developed as 
in the United States, however, competition law can play a more 
equivocal role--sometimes opening markets, but sometimes protecting 
local firms from U.S. competition. I understand that U.S. industry has 
raised precisely this concern with respect to Korea, where the 
competition authority has been aggressive in pursuing leading U.S. 
firms, even while local Korean conglomerates, or chaebol, continue to 
restrict competition in certain markets. Similar concerns have been 
voiced with respect to China, which is well on its way to adopting an 
anti-monopoly law that many fear will be used as a weapon against U.S. 
exports, technology, and investment.
    American companies and workers need the Department of Justice's 
help to prevent our trading partners from using competition law as a 
trade tool. Is the Department prepared to become more active in 
advancing U.S. interests in this area? Will the Department support 
adopting stronger competition commitments in U.S. free trade 
agreements?
    Answer. Antitrust laws should promote competition; they should not 
be used to defend a country's own home companies, or to try to exclude 
competitors from other nations. That is why it is critical that we work 
to ensure that other enforcers around the world rely on sound economics 
as the basis for antitrust enforcement. This is a priority in building 
our relationship with the South Korean antitrust agency, as in all our 
international competition policy efforts. It is important that burdens 
and inefficiencies that divergences in competition policy and antitrust 
enforcement create for United States companies operating in 
international markets be as low as possible, and the Department is 
working hard to achieve that end. Coordination and substantive and 
procedural convergence on antitrust must continue to be a high priority 
for the Department. The Department has been working with many foreign 
antitrust agencies in a variety of contexts, including the 
International Competition Network, the Organization for Economic 
Cooperation and Development, and bilaterally, both generally and on 
particular matters.
    The Department also supports strong competition commitments in free 
trade agreements. The United States has negotiated provisions relating 
to antitrust enforcement and to conduct of official monopolies and 
state enterprises in a number of free trade agreements, including those 
with Chile, Singapore, and Australia. These provisions help to ensure 
that the opportunities created by trade liberalization are supported by 
competitive domestic markets in foreign countries. The Department of 
Justice works cooperatively with other parts of the Administration, 
including the United States Trade Representative (USTR), the Department 
of State, and the Department of Commerce, on these agreements.
 office of the inspector general cops methamphetamine initiative audit
    Question. In March 2006, the Department of Justice (DOJ) Office of 
the Inspector General (OIG) released its final audit report on the 
Community Oriented Policing Services (COPS) Methamphetamine (Meth) 
Initiative grant program. One of the targets of the audit was the 
Vermont State Police and the Vermont Drug Task Force. I am deeply 
concerned that DOJ is now attempting to contest how the Task Force used 
funds from the grants.
    The COPS Office has consistently approved the Vermont State Police 
grant applications to the COPS Methamphetamine Initiative grant program 
each year since 2001 with explicit knowledge that the money would be 
used primarily for fighting heroin abuse. I therefore object to DOJ now 
contesting how the funds were used and requesting that the contested 
sum be returned. The loss of $1.2 million would have a devastating 
effect on a small state such as Vermont and undo the progress and 
successes that have been accomplished in the last five years.
    I request that the Department of Justice stand behind its grant 
decisions and allow funds that have been used in the way the COPS 
Office approved them to be used to remain in the state. I further 
request your cooperation in resolving this situation.
    What are your suggestions for reaching a satisfactory solution?
    Answer. The COPS Office has been working closely with the Vermont 
State Police to obtain additional documentation surrounding the 
contested costs. The Vermont State Police have not been asked to return 
any grant funding, and COPS currently has no intention of making such a 
request. The COPS Office will continue to work with the Vermont State 
Police to close all audit recommendations as quickly as possible and 
work to ensure that expenditures made by the agency have been 
consistent with guidance issued by the COPS Office. If any expenditures 
are ultimately determined to be unallowable, whenever possible the COPS 
Office remedies such situations by allowing the grantee to use the 
funds in a manner which furthers the purposes of the grant, rather than 
through repayment of grant funds.
    Question. What steps will you take to work with the Vermont State 
Police and my office in achieving this goal?
    Answer. The Vermont State Police is currently in the process of 
compiling information requested by the COPS Office to demonstrate the 
expenditures under their grants. Once documentation has been submitted, 
the COPS Office will work closely with the agency to remedy the current 
situation, and will always remain available to address any questions or 
concerns regarding this audit. The COPS Office will be sure to inform 
your office of any significant developments that may arise during the 
process.

                          JUSTICE FOR ALL ACT

    Question. In the fiscal year 2006 CJS Appropriations conference 
report, Congress appropriated $1 million for improving the quality of 
representation in state capital cases authorized under the Innocence 
Protection Act (IPA), which was including as Title IV of the Justice 
for All Act, Public Law 108-405. The final authorizing language for the 
IPA reflects nearly five years of work--there were multiple hearings in 
both Houses, we studied the problem, we considered the alternatives, we 
agreed on a result. The program is aimed at helping states establish 
effective systems for appointing counsel in death penalty cases, and 
incorporates essential elements of the ABA's guidelines.
    What has the Justice Department done to date to administer this 
program, as authorized?
    Answer. In fiscal year 2006, Congress appropriated $1 million for 
capital litigation-related programs. Given this level of funding, it 
was not possible for OJP to enact the full range of activities outlined 
in the Innocence Protection Act (which provides authorization for up to 
$75 million to carry out the programs outlined in these sections).
    The Office of Justice Programs' Bureau of Justice Assistance (BJA), 
which administers the Capital Litigation Improvement Program, convened 
a multi-disciplinary focus group of national, state, and local 
practitioners in early 2005 to develop a program plan for more 
effective systems for death penalty cases. This group identified a 
substantial need for sound curriculums, training, and technical 
assistance as an important priority for any effort to improve capital 
case litigation at the State and local level.
    Based on these findings, BJA determined that the most effective way 
to advance the goals underlying the Innocence Protection Act in regard 
to capital case litigation was to focus the limited resources available 
on the development of model training programs for capital case 
prosecutors, defense counsel and judges. Accordingly, awards were made 
to three organizations--the National District Attorneys Association 
(NDAA), National Judicial College (NJC), and National Legal Aid and 
Defenders Association (NLADA)--to develop appropriate training programs 
for prosecutors, judges and defense attorneys (respectively).
    Program deliverables completed include: (1) the development and 
implementation of curriculums at the State level, one for each of the 
three disciplines (prosecution, judiciary and defense); (2) sub-grants 
for curriculum delivery; and (3) technical assistance at the national 
level for death penalty inquiries from the states. The curricula--
adaptable to incorporation of state statutes and death penalty 
constitutional law--focus on investigation techniques; pretrial and 
trial procedures, including the use of expert testimony and forensic 
science evidence; advocacy in capital cases; and capital case 
sentencing-phase procedures.
    During fiscal year 2006, the NDAA has provided training to 
approximately 125 prosecutors in Arkansas, Florida and Georgia; an 
upcoming training for 30 prosecutors will be held in Nevada. The NJC 
has trained approximately 150 judges in Arkansas, Virginia, North 
Carolina, Texas and Pennsylvania. The NLADA has sponsored training 
events in California, Texas, South Carolina, and Illinois which have 
reached approximately 140 defense attorneys. NDAA, NJC, and NACDL will 
continue to support the delivery of additional state trainings in 
fiscal year 2006. The program will also help maintain clearinghouses 
and websites offering capital case litigation materials.
    Question. If the Justice Department has not yet acted to administer 
this program, then what is the delay? Is the Department trying to 
reinvent the wheel with a new training program rather than following 
through on the bipartisan program that Congress worked out and 
President Bush signed into law?
    Answer. Implementation of the full capital litigation improvement 
program outlined in the Innocence Protection Act (IPA) is not possible 
without a significant increase in funding or the diversion of 
significant resources from other high-priority OJP programs through 
reprogramming. With only $1 million available, BJA determined that 
development of model training programs was the most realistic and 
practical option for advancing the goals of the IPA.
    Question. Secondly, on several occasions when you have testified 
before both this subcommittee and the Judiciary Committee, you assured 
me that you would work to ensure the successful implementation of the 
Justice For All Act. However, in the President's budget request for 
fiscal year 2006 and again for fiscal year 2007 the President has 
proposed funding a capital litigation program vastly different than 
that authorized by law.
    So once again I must ask the following: Will you pledge to work 
with me and the Appropriations Committees to ensure not only adequate 
funding but also the successful implementation of the Innocence 
Protection Act, as authorized by the Justice For All Act?
    Answer. The President and the Department share the goal of behind 
the Justice For All Act of ensuring that the best possible lawyers are 
available to litigate capital cases, but we believe the President's 
training initiative is more cost-effective, better at building 
capacity, and far less expensive than the authorized program. Under the 
authorized program, before any training could take place, States would 
have to qualify for the program, and to do so most would have to enact 
changes to their laws, delaying the onset of training. In addition, 
because of the burdens imposed by the law on States in order for them 
to receive the funds, we do not believe many States would opt to seek 
the funds, especially given the relatively modest sums that would be 
available to each participating State. While the sums available to each 
State would be relatively modest, the overall authorize level of 
funding under the Justice For All Act is beyond the Department's 
budgetary capacity at this time. Therefore, the Department will 
continue to seek to implement the capital-counsel training program 
announced by the President.
    Question. A report issued by the Government Accountability Office 
on April 4, 2006, found that the Justice Department, which uses private 
information services for law enforcement, counterterrorism and other 
investigations, often does not follow federal rules to protect 
Americans' privacy. According to the report, the Justice Department, 
and three other federal agencies examined by the GAO spent about $30 
million last year on companies--such as Choicepoint--that maintain 
billions of electronic files about adults' current and past addresses, 
family members and associates, buying habits, personal finances, listed 
and unlisted phone numbers, and much more.
    Do you agree with the GAO's findings in this report?
    Answer. The Department of Justice (DOJ) recognizes the important 
issues presented by the Government Accountability Office (GAO) report 
and agrees that additional measures could be taken regarding its use, 
in the form of revised or additional guidance and policy. However, the 
DOJ already places great importance on compliance with existing federal 
rules aimed at protecting Americans' privacy, namely the Privacy Act of 
1974 (5 U.S.C.  552a).
    When Congress enacted the Privacy Act, it recognized the fact that 
government operations are widely varied (including such activities as 
law enforcement and intelligence). Therefore, the Privacy Act 
incorporated some, but not all, of the Fair Information Practices by 
allowing agencies to exempt themselves from certain requirements of the 
Privacy Act. (The Fair Information Practices were first proposed in 
1973 by a U.S. government advisory committee and were widely accepted 
as including collection limitation, data quality, purpose 
specification, use limitation, security safeguards, openness, 
individual participation, and accountability.) For example, pursuant to 
regulations, criminal law enforcement records may be exempted from the 
Privacy Act's requirement that an agency make reasonable efforts to 
assure that a record is accurate, complete, timely, and relevant for 
agency purposes before disseminating that record to someone other than 
an agency or pursuant to FOIA. Therefore, the GAO should not have 
focused on whether agencies were satisfying all of the Fair Information 
Practices, because not all of the Fair Information Practices are 
incorporated into the Privacy Act. The more appropriate metric should 
be whether an agency has met the requirements of the Privacy Act.
    For this reason, DOJ believes that prior to the issuance of any new 
guidance or policy, a careful analysis and assessment of the degree of 
need for any new guidance should be conducted. That assessment should 
take into account agency resources, competing mission priorities, and 
the privacy protections already in place as a result of DOJ's 
compliance with the Privacy Act of 1974 (5 U.S.C.  552a).
    Question. What steps is the Justice Department taking to address 
the privacy concerns raised in this report and to protect the privacy 
interests of law-abiding Americans?
    Answer. As indicated in response to subpart A, above, DOJ complies 
with the requirements of the Privacy Act, which prohibits the 
disclosure of protected information in the absence of a statutorily 
provided exception. In addition, DOJ has appointed its own Chief 
Privacy and Civil Liberties Officer (CPCLO) and the CPCLO has 
established a Privacy and Civil Liberties Board with three 
subcommittees: Outreach; Data Collection, Aggregation, and Maintenance; 
and Law Enforcement and National Security. The Data Collection 
Subcommittee has held its first meeting and established its initial 
task, which is to survey the Department's use of reseller data and then 
to develop a policy for the DOJ that will be informed by the 
Department's use of that information and by existing legal protections. 
Such a policy will include appropriate oversight mechanisms. The CPCLO 
has also mandated DOJ-wide compliance with the Privacy Impact 
Assessment (PIA) process established by the E-Government Act and will 
be the final approving authority for PIAs on all major record systems. 
The CPCLO recently issued guidance to the DOJ regarding PIAs. This 
guidance requires components to consider the privacy concerns of all 
information in identifiable form, including information received on a 
systematic basis from data resellers, in developing and maintaining 
computer systems that collect such information.
    The FBI has also appointed a Privacy and Civil Liberties Officer 
and uses the E-Government PIA process to evaluate privacy in major 
record systems prior to system implementation. The PIA process requires 
that the system sponsor or developer conduct a thorough, written 
analysis of the impact on privacy that will result from the creation of 
a proposed system prior to the system's implementation. The FBI 
assesses both impacts attributable solely to the proposed system and 
the cumulative impacts arising from the proposed system's interface 
with existing systems. The PIA provides senior FBI management officials 
with an assessment of a major new system's impact on privacy before the 
system becomes operational. The FBI PIA process includes a review of 
major systems by the FBI Privacy Council, a group composed of 
representatives from several FBI divisions, as well as the FBI Senior 
Privacy Official.

           CUTS TO STATE AND LOCAL LAW ENFORCEMENT ASSISTANCE

    Question. States, counties and communities nationwide continue to 
be overwhelmed by increasing homeland security mandates from the 
Federal government. The President often says that he wants to ensure 
that our State and local police receive the resources necessary to do 
the job the American public expects them to do, but then he goes and 
proposes a $1.309 billion, or 52 percent, in overall cuts to funds for 
assistance programs that have a proven track record and are primarily 
designed to assist state and local law enforcement agencies carry out 
their day-to-day public safety duties.
    The Administration proposes to slash funding for Community-Oriented 
Policing Services (COPS) by $161.2 million, or 61 percent, leaving it 
at $102.1 million. Programs targeted for elimination included the COPS 
Law Enforcement Technology Program, as well as drastic reductions in 
equipment and support staff grants that State and local police 
departments depend on to carry out their crime-fighting duties. This 
budget would also reduce by $23.3 million, or 37 percent, COPS 
Methamphetamine Enforcement and Clean-Up for state and local law 
enforcement programs to combat methamphetamine production and 
distribution, to target drug ``hot spots,'' and to remove and dispose 
of hazardous materials at clandestine methamphetamine labs.
    The President's proposed budget would eliminate all Byrne JAG 
funding. This grant program, which Congress funded at $327.2 in fiscal 
year 2006, provides vital funding to States to improve the functioning 
of the criminal justice system, with emphasis on violent crimes and 
serious offenders, and to enforce State and local drug laws. In the 
recently enacted Violence Against Women and the Department of Justice 
Reauthorization Act of 2005 (Public Law 109-162), which the President 
signed into law on January 5, 2006, Congress codified the Byrne 
Memorial Justice Assistant Grant Program, and authorized funding for it 
at over $1 billion.
    Given the President's rhetoric expressing support for our State and 
local law enforcement, how does DOJ justify cutting funds to the highly 
successful and effective COPS Program and the Byrne Memorial Justice 
Assistance Grants?
    If the President's budget were followed, how would the Justice 
Department propose to address the needs of State and local police 
departments that are currently met by the COPS Program and the Byrne 
Memorial Justice Assistance Grants?
    Answer. In order to focus departmental resources on 
counterterrorism, which is and must be the Department of Justice's 
(DOJ) overriding priority, the Administration was required to make 
difficult choices in this budget proposal.
    The President's fiscal year 2007 budget proposal recognizes the 
Federal government's responsibilities in regard to supporting effective 
law enforcement and improving the nation's criminal justice system. If 
approved as proposed, the President's fiscal year 2007 budget will 
provide over $1.2 billion to State, local, and tribal law enforcement 
through the U.S. Department of Justice. This includes $66.6 million to 
strengthen communities through programs providing services such as drug 
treatment; $88.2 million to combat violence, including enhancements to 
Project Safe Neighborhoods; and $209 million to support drug 
enforcement, including funding to continue and expand the Southwest 
Border Drug Prosecution Program. The initiatives included in this 
proposal were selected by concentrating scarce resources on the highest 
priority criminal justice issues; promoting effective, evidence-based 
approaches to improving law enforcement and criminal justice system 
capabilities; and eliminating funding for programs that could not 
demonstrate results.
    Drug enforcement continues to be one of the most significant 
criminal justice priorities of both the Administration and the 
Department of Justice. In addition to supporting drug enforcement and 
treatment initiatives, the fiscal year 2007 President's budget includes 
$706 million for the Organized Crime and Drug Enforcement Task Force 
(OCDETF) program and $208 million for the High Intensity Drug 
Trafficking Area (HIDTA) Program. These programs support drug 
enforcement efforts undertaken by task forces made up of Federal, 
State, local, and tribal law enforcement agencies and enhance the 
coordination of efforts against drug trafficking and drug-related crime 
at all levels of government.
    The Administration applied the same principles it used to select 
initiatives for inclusion in the fiscal year 2007 budget to make 
decisions regarding reductions in or elimination of funding for 
existing programs. While these choices are often difficult, they are 
unquestionably necessary. Due to the fiscal pressures resulting from 
the need to fund an effective response to terrorism at home and abroad, 
reduce the Federal deficit and address the growing financial burdens 
created by Social security and health care entitlement programs, 
discretionary spending must be reduced.
    The proposed elimination of the JAG Program in fiscal year 2007 is 
based on this program's inability to clearly demonstrate its 
effectiveness. During the fiscal year 2005 PART assessment of the JAG 
Program and its predecessors (the Byrne Formula Grant Program and the 
Local Law Enforcement Block Grant), OMB concluded that these programs 
have not been able to clearly demonstrate through quantifiable 
performance measures that they had achieved nor were making progress 
toward their goals. Concerns were also raised about the broad range of 
the 29 purpose areas allowed under the JAG Program, making it difficult 
for the program to develop meaningful performance measures or focus its 
efforts on priority concerns. In light of the broad array of assistance 
offered to State, local, and tribal law enforcement agencies through 
OJP, the Administration determined that the funds currently devoted to 
the JAG Program could be used more effectively elsewhere.
    While the COPS grant programs have achieved a number of noteworthy 
successes, the primary mission of the Office of Community Oriented 
Policing Services--to hire 100,000 community policing officers to serve 
in law enforcement agencies throughout the nation--has been achieved. 
COPS has dedicated $12 billion to add 118,000 community policing 
officers to America's streets and schools. The Administration's 
decision to restructure the COPS grant programs and reduce overall COPS 
funding reflect the policy of directing Federal resources to the areas 
of greatest need.
    In fiscal year 2007, the President's budget request redirects COPS 
funding toward training and technical assistance in support of efforts 
to implement community policing strategies and provide increased grant 
assistance to tribal law enforcement agencies to meet the unique needs 
of Native American communities. Funding for interoperable 
communications technology, provided through the COPS Program in past 
years, is now requested in the budget of the Department of Homeland 
Security to ensure efficient coordination throughout the first 
responder community. Training, technical assistance and funding to 
support the clean-up of methamphetamine labs by State, local and tribal 
law enforcement agencies will be administered in partnership with the 
Drug Enforcement Administration (DEA), the recognized leader in this 
area. The President's fiscal year 2007 budget request seeks $40 million 
for methamphetamine lab clean-up efforts, doubling the level of funding 
appropriated for this purpose in fiscal year 2006.
    Consistent with its standing policy of not requesting continued 
funding for earmarked projects, the administration is not requesting 
funding for the Byrne Discretionary Grant Program administered by the 
Office of Justice Programs (OJP) or the Crime Identification Technology 
Act (CITA) and Methamphetamine Enforcement and Clean-up (Meth Hot 
Sports) Grants administered by the COPS Office.
    Communities and law enforcement agencies receiving grants under the 
programs being proposed for elimination will be encouraged to look to 
other OJP and DOJ programs to fund their ongoing efforts. For instance, 
an interagency drug task force receiving funding from a JAG grant may 
be eligible for funding from a number of other OJP and DOJ programs, 
such as Project Safe Neighborhoods or the Organized Crime and Drug 
Enforcement Task Force (OCDETF) Program. The Department will continue 
to work closely with Congress to ensure that State, local, and tribal 
law enforcement and criminal justice agencies receive appropriate 
Federal support for efforts to protect America's citizens from crime 
and terrorism and strengthen the criminal justice system.

                VICTIMS OF CRIME ACT CRIME VICTIMS FUND

    Question. I am greatly troubled by the Administration's proposal to 
raid at the end of fiscal year 2007 all amounts remaining in the Crime 
Victims Fund, projected to be more than $1.25 billion.
    Year after year, the Crime Victims Fund--financed by criminal 
fines, forfeitures and assessments; not the American taxpayers--plays 
an essential role in helping thousands of agencies provide critical 
services annually to nearly four million victims of domestic violence, 
sexual assault, child abuse, drunk driving, elder abuse and all other 
crimes.
    Despite the fact that Congress blocked this same proposal last year 
and has continued to express its intention that all deposits remain in 
the Fund to ensure its future, the Administration has once again 
proposed in its fiscal year 2007 budget proposal to siphon off all 
amounts remaining in the Fund at the end of the coming fiscal year to 
help offset the budget deficit that it has created. Such a move would 
leave the Fund with a balance of zero going into fiscal year 2008, 
jeopardizing the ability of thousands of agencies to staff and operate 
programs vital to victims' well-being.
    Attorney General Gonzales, how can the Administration justify 
expunging amounts from the Crime Victims Fund?
    Answer. The cap enables Congress to determine the appropriate level 
of expenditures required to maintain viable victims' programs. Excess 
balances above the cap remain in the fund and ``roll over'' from year 
to year. Significant rollover balances have existed in the fund since 
2000, creating what has been characterized as a perpetual float in the 
account well in excess of $1 billion. This float is not required to 
fund the enacted level of victims' programs, nor is it money that can 
be made available for other use. These balances have become fodder for 
temporary scoring proposals. This tactic undermines the budget process 
because the same offset is counted each year. As the fiscal year 2007 
President's budget proposes to rescind and permanently cancel the 
excess balance, returning the funds to the general fund of the 
Treasury, as a more straightforward approach to budgeting.
    Question. Just how does the Administration expect victims and 
victims' services to sustain themselves in the interim while the Fund 
is replenished in fiscal year 2008?
    Answer. While we do not believe that the proposal included in the 
President's budget would create an interim funding problem, we would be 
happy to work with you to develop language that both eliminates the 
budget gimmick and ensures uninterrupted funding availability for crime 
victims.
    Question. How long do you estimate it will take for the Fund to be 
replenished in any given year after the remaining monies are drained?
    Answer. Given recent history, our expectation is that the crime 
victims programs will be self-financing based on the fines and 
penalties paid into the Crime Victims Fund in any given year.
    Question. How will the Office for Victims of Crime determine how 
much money would become available in the course of any given fiscal 
year to allocate to each of the 50 states?
    Answer. The Department of Justice has not proposed to modify the 
formulas under which the bulk of the funds are distributed to the 
states each year for victims' compensation and crime victims programs. 
The amount of money distributed would be determined by the amount 
collected in the fund at time of disbursement.
    Question. Additionally, how could local agencies apply for funds 
when each state would have no idea how much money would come to them 
that year?
    Answer. Funding made available in the President's budgets and via 
the appropriations process has remained markedly stable in recent 
years. We are not anticipating at this point any dramatic departures 
from past funding levels. The Administration's fiscal year 2007 
proposal is intended to preserve $625 million in spending for crime 
victims programs while ending the budget gimmick that allows $1.3 
billion in balances to roll forward each year to be used as an offset 
for other spending. We certainly are willing to have some flexibility 
in working with the Congress to meet both of these objectives.
    Question. When faced with times when collections from fines and 
forfeitures are low or if we are faced with a national victims 
emergency, such as we were with the September 11 terrorist attacks or 
Hurricane Katrina, where do you propose to find the funds for victims' 
services and compensation, seeing how the Administration will have 
drained the Fund?
    Answer. If criminal fine collections decline in future years, the 
Administration would request additional appropriations, or in the event 
of a catastrophe, such as 9/11, request emergency supplemental funding 
to help offset those costs and restore the balance to sustainable 
levels.

              BULLETPROOF VESTS PARTNERSHIP GRANT PROGRAM

    Question. The Bulletproof Vest Partnership (BVP) Grant Program has 
been vital to distributing lifesaving bulletproof vests to law 
enforcement officers serving in the front lines across the country. 
However, DOJ's budget for fiscal year 2007 proposes to slash funding 
for this program by almost $20 million, or by 63 percent. On January 5, 
2006, the President signed into law the Violence Against Women and 
Department of Justice Reauthorization Act of 2005 (Public Law 109-162), 
which reauthorized the BVP Grant Program with funding levels at $50 
million per year through fiscal year 2009.
    Compounding the usual funding demand for help to purchase vests, 
concerns from the law enforcement community over the effectiveness of 
body armor surfaced over two years ago when a Pennsylvania police 
officer was shot and critically wounded through his relatively new 
Zylon-based body armor vest. In August 2005, DOJ announced that test 
results indicate that used Zylon-containing body armor vests may not 
provide the intended level of ballistic resistance. Unfortunately, an 
estimated 200,000 Zylon-based vests have been purchased--many with BVP 
funds--and now need to be replaced. The Justice Department has adopted 
new interim requirements for its body armor compliance testing program 
and also provided an additional $10 million at the end of fiscal year 
2005/beginning of fiscal year 2006 to assist agencies in their 
replacement of Zylon-based body armor vests.
    Vests cost between $500 and $1,000 each, depending on the style. 
The extra $10 million released by the Justice Department, while 
appreciated, is only a drop in the bucket when compared to the need.
    Across our nation, law enforcement agencies are struggling over how 
to find the funds necessary to replace defective vests that are less 
than five years old with ones that will actually stop bullets and save 
lives. How does DOJ justify cutting the BVP grant program by 63 percent 
in the face of needing to match costs for new vests, as well as to 
assist in the replacement of defective vests in fiscal year 2007?
    Answer. The Administration continues to support the Bullet Proof 
Vest Partnership (BVP) program administered by the Bureau of Justice 
Assistance (BJA), which utilizes federal funds to assist State and 
local law enforcement to purchase stab- and bullet-resistant vests that 
meet National Institute of Justice (NIJ) standards.
    The Attorney General, recognizing the crisis in the law enforcement 
community, added an additional $10 million to the $24.6 million 
appropriated for BPV in fiscal year 2005. This additional funding was 
made through a special BPV solicitation and resulted in 1,343 awards to 
State and local law enforcement agencies to replace 72,711 vests made 
with Zylon. In addition, through BJA's regular BPV process, in fiscal 
year 2005, BJA made $23.6 million in BPV payments to over 4,000 
agencies. These funds supported the purchase of more than 181,000 vests 
(over the next four years) for law enforcement officers across the 
country. In fiscal year 2006, $29.6 million is appropriated for BPV.
    Currently, there is over $70 million available for the BPV program, 
including the fiscal year 2005 appropriation of $24.6 million; $7.8 
million in reprogrammed funds; $10 million at the request of the 
Attorney General; and the fiscal year 2006 appropriation of $30 
million. The fiscal year 2007 President's budget request of $9.82 
million will sustain the program and should adequately fund the 
anticipated demand for new vests.
    Funding for BVP is also being allocated to support NIJ research on 
ballistic materials and armor performance under the Attorney General 
Body Armor Safety Initiative. The NIJ voluntary compliance testing 
program for bullet-resistant body armor has been revised to take into 
account performance of used armor.
                                 ______
                                 
                Questions Submitted by Senator Herb Kohl

                OFFICE OF INTELLIGENCE POLICY AND REVIEW

    Question. Do you believe this increase is sufficient to meet OIPR's 
needs? What information can you provide us with to demonstrate that 
this number will be sufficient to meet the needs of OIPR? Is this what 
OIPR told you they needed? Is that what they requested?
    Answer. The President's fiscal year 2007 budget includes an 
increase of 30 positions, of which 21 are attorneys, for functions 
performed by OIPR. This increase--20 percent over the 2006 position 
level--will help allow the Department to address the growth in Foreign 
Intelligence Surveillance Act (FISA) applications that are a key 
element in our fight against terrorism. If FISA-related workload 
continues to grow, additional resources for OIPR may be necessary. 
These additional needs would be reflected in future budget requests.
   eliminating the byrne grant program in the face of a meth epidemic
    Question. Local law enforcement officials back in Wisconsin have 
warned us that the meth epidemic could get even worse as the drug moves 
into our urban areas. Instead of being home-made in rural labs, meth is 
increasingly being mass-produced and trafficked by large drug cartels. 
What this all means is more meth will be on the streets and law 
enforcement is very worried that we may experience a meth epidemic even 
worse than the crack epidemic of the 1980s.
    In order to better combat the spread of crack cocaine which 
devastated our cities some 20 years ago and fight drug trafficking in 
general, Congress created the Edward J. Byrne Memorial Grant Program. 
The Byrne Grant Program provided federal funds to State and local 
police agencies to form regional drug task forces which coordinated law 
enforcement's efforts to fight drug crimes. By several accounts, the 
Byrne Grant Program was and remains successful--and it has become the 
backbone of federal aid for local law enforcement.
    We created the Byrne Grant Program twenty years ago to fight the 
rising tide of drugs in this country. Why now--when law enforcement is 
warning us that meth will be the new crack epidemic in our cities--is 
the Administration eliminating this program? We did not eliminate, we 
created, a federal program to help our local police fight drugs when 
crack exploded in the 80s. We should not be eliminating the Byrne Grant 
Program when we face the challenge of meth.
    Answer. Due to the limited resources available to the Department of 
Justice (DOJ), both the Administration and the Department have been 
forced to make many difficult choices while preparing the fiscal year 
2007 President's budget proposal. The decision to eliminate funding for 
the Byrne Justice Assistance Grant program (JAG) was a difficult choice 
necessitated by the Department's need to focus available resources on 
its top priorities, such as antiterrorism efforts, and ensure that 
existing programs make the best possible use of the federal funds 
dedicated to them. We are actively working with Congress and State and 
local officials to help ensure that law enforcement needs are addressed 
nationwide.
    In fact, a number of critical and important investments for state 
and local law enforcement exist in the fiscal year 2007 budget--areas 
where funding is requested to target specific priority problems. In 
recent years, both the President and Congress have tended to focus 
funding on initiatives in key priority areas, where we have the best 
chance of making a difference, in lieu of funding large, broad-based 
programs that are not targeted and have not been able to show the same 
level of results. JAG represents less than one percent of all State and 
local spending in law enforcement.
    If the President's fiscal year 2007 budget request is approved, 
over $1 billion will be available to State, local and tribal law 
enforcement through the U.S. Department of Justice for many of the same 
purposes that JAG funded, such as training and equipment that logically 
cross-cut crime and drug issues. The DOJ fiscal year 2007 President's 
budget request includes $66.6 million to strengthen communities through 
programs providing services such as drug treatment; $88.2 million to 
combat violence, including enhancements to Project Safe Neighborhoods; 
and $209 million to support drug enforcement, including funding to 
continue and expand the Southwest Border Drug Prosecution Program.
    During its fiscal year 2005 PART assessment of the Byrne JAG 
Program and its predecessors (the Byrne Formula Grant Program and the 
Local Law Enforcement Block Grant), OMB concluded that the JAG Program 
has not been able to clearly demonstrate through quantifiable 
performance measures that it is achieving its goals. Concerns were also 
raised about the broad range of purpose areas allowed under the JAG 
Program; JAG funded efforts in a total of 29 different purpose areas, 
making it difficult for the program to develop meaningful performance 
measures or focus its efforts on priority concerns. Much of the 
justification for such assistance has diminished in comparison to other 
priority needs, such as increasing federal counterterrorism efforts.
    The Administration and the Department of Justice are committed to 
supporting interagency drug enforcement efforts. The fiscal year 2007 
President's budget includes $706 million for the Organized Crime and 
Drug Enforcement Task Force (OCDETF) program and $208 million for the 
High Intensity Drug Trafficking Area (HIDTA) Program. These programs 
support drug enforcement efforts undertaken by task forces made up of 
Federal, State, local and tribal law enforcement agencies and enhance 
the coordination of efforts against drug trafficking and drug-related 
crime at all levels of government. The Department will continue to work 
with Congress and State and local officials to address the many threats 
that methamphetamine and other illegal drugs pose to America's 
communities.

                        JUVENILE JUSTICE FUNDING

    Question. Once again, juvenile justice and delinquency programs are 
cut in half in the President's fiscal year 2007 budget proposal. These 
programs, housed at the Office for Juvenile Justice and Delinquency 
Prevention (OJJDP), are allocated $176 million, which is about half of 
what was appropriated last year (nearly $343 million).
    Juvenile justice programs have suffered during the Bush 
Administration. Just four short years ago, these programs received 
approximately $556 million, with more than $94 million for the Title V 
Local Delinquency Prevention Program and nearly $250 million for the 
Juvenile Accountability Block Grant (JABG) program. The 
Administration's proposed level of $176 million for juvenile justice 
programs represents more than a two-thirds cut from fiscal year 2002. 
The downward spiral of juvenile justice funding is a disturbing budget 
trend with ugly real world implications. Juvenile crime is an ongoing 
challenge and it is not a problem that is going to solve itself. 
Boosting funding for successful juvenile justice programs is the first 
step in addressing this challenge.
    Though we were able to increase that funding here in Congress last 
year, we wonder why this Administration targets reductions for juvenile 
justice programs year after year? Can you provide us some idea of 
whether or not this sort of funding will be a priority of yours, as it 
is to many of us here?
    Answer. In fiscal years 2006 and 2007, the Office of Justice 
Programs (OJP) proposes the elimination of the Juvenile Accountability 
Block Grant (JABG) Program, which received a ``results not 
demonstrated'' rating due to the lack of key information required by 
the Office of Management and Budget Program Assessment Rating Tool 
(PART) in fiscal year 2002. In an effort to increase accountability 
without undermining State juvenile justice programming, the OJP budget 
requests $33.5 million for the recently-authorized Part C: Juvenile 
Delinquency Prevention Block Grants Program from which State and local 
governments can fund similar activities.
    Funding for the Title V Incentive Grants Program is proposed for an 
overall reduction due to the elimination of two initiatives whose 
funding is carved out of this program at approximately $25 million 
each--Underage Drinking and Gang Resistance Education and Training. 
However, OJP is requesting an increase of $14.7 million in 
discretionary funding compared to the fiscal year 2006 enacted level 
for the Title V Program. Beginning in fiscal year 1995 (the second year 
of the Program), Congress allocated an increasingly larger portion of 
total Title V funds to earmarked programs which has resulted in fewer 
dollars being allocated to communities to formulate, implement, and 
evaluate comprehensive delinquency prevention plans through the 
Incentive Grants, the original intent of the Program.
    In addition, the fiscal year 2007 budget request includes an 
increase of $14.2 million for the Formula Grants Program which supports 
State and local efforts to develop and implement comprehensive State 
juvenile justice plans. Funds may be used for research, evaluation, 
statistics and other informational activities, and training and 
technical assistance. Funding is also available for training and 
technical assistance to help small, non-profit organizations, including 
faith-based organizations, with the federal grants process.

                        WHIRLPOOL-MAYTAG MERGER

    Question. Last week many of us were surprised when the Antitrust 
Division decided not to challenge Whirlpool's acquisition of Maytag. It 
was widely reported in the press that the Antitrust Division staff had 
recommended that the Justice Department should file suit to block this 
deal, because of the possibility that the deal could lead to injury to 
competition and higher prices for consumers. The merger will result in 
the combined company controlling about 70 percent of the washing 
machine market.
    The Justice Department's decision on this deal was contrary to the 
predictions of many antitrust experts. Diana Moss of the American 
Antitrust Institute argued that the combined company's market power 
would ``substantially lessen competition by impairing the ability of 
rivals to compete effectively.'' Even the Wall Street Journal--usually 
not an advocate of aggressive antitrust enforcement--reported that 
``under traditional antitrust analysis, the deal would probably be 
rejected or reshaped because of the combined companies' majority share 
of the U.S. market for washers and dryers.''
    Why did you ignore the recommendation of the Antitrust Division 
staff in approving this merger?
    Answer. After thoroughly investigating Whirlpool's proposed 
acquisition of Maytag, the Antitrust Division determined that the 
proposed transaction was not likely to reduce competition 
substantially. We came to this conclusion because Whirlpool will likely 
achieve large cost savings and efficiencies, which would allow the 
combination of strong rival suppliers not to harm consumer welfare.
    Based on the evidence obtained during its extensive investigation, 
the Division found that this merger is not likely to give the merged 
entity market power in the sale of any of its products in the United 
States. The Division found that, despite the two companies' relatively 
high share of laundry appliance sales in the United States, any attempt 
to raise prices likely would be unsuccessful. Whirlpool and Maytag 
represent two well-known brands in the industry, but rival appliance 
brands such as Kenmore, General Electric and Frigidaire are also well 
established, and newer brands such as LG and Samsung have quickly 
established themselves in recent years. LG, Samsung, and other foreign 
manufacturers could increase their imports into the United States; 
rival U.S. manufacturers have excess capacity and could increase their 
production. Further, the large retailers through which the majority of 
these appliances are sold--Sears, Lowe's, The Home Depot and Best Buy--
have alternatives available to help them resist any attempt by the 
merged entity to raise prices. Also, the parties substantiated large 
cost savings and other efficiencies that should benefit consumers.

                           TUNNEY ACT REVIEW

    Question. Two years ago I sponsored an amendment to the Tunney Act, 
the law which governs the manner in which the courts review government 
antitrust settlements with the government. My amendment was enacted 
into law. This amendment heightened the scrutiny that courts must give 
to such settlements. We intended to halt the practice of courts merely 
``rubber stamping'' these settlements, but instead to ensure that the 
courts scrutinized these consent decrees to insure that the settlements 
were in the public interest.
    In the Justice Department's recent court filings in the SBC/ATT 
merger Tunney Act proceedings, the Department has asserted that these 
amendments ``did not materially affect the scope or standard of review 
courts are to apply in reviewing antitrust settlements.'' This 
assertion is contrary to the plain words and legislative intent of our 
Tunney Act amendments.
    Why has the Justice Department taken the position that our Tunney 
Act amendments have not changed the standard of review that courts are 
to follow in reviewing antitrust settlements? What basis do you have 
for ignoring the plain language and legislative history of our 
amendments that was intended to strengthen the court's review?
    Answer. The text of the 2004 amendments to the Tunney Act modified 
the list of factors a court is to consider in making its public 
interest determination and made judicial consideration of each factor 
mandatory rather than discretionary. The quotation in the filing you 
cite was in the context of that case, in which it was claimed that the 
2004 Tunney Act amendments somehow gave the court the authority to 
review a consent judgment on the basis of allegations that were not 
included in the underlying complaint. The 2004 Amendments do not in any 
way suggest that they altered the Tunney Act's fundamental purpose or 
standard in that respect.
    Section 221(a) contains a ``finding'' that ``it would misconstrue 
the meaning and Congressional intent in enacting the Tunney Act to 
limit the discretion of district courts to review antitrust consent 
judgments solely to determining whether entry of those consent 
judgments would make a `mockery of the judicial function.' '' Antitrust 
Criminal Penalty Enhancement and Reform Act of 2004, Public Law 108-
237,  221(a)(1)(B), 118 Stat. 661, 668 (2004). Senator DeWine stated 
that ``this bill makes clear that the Tunney Act requires what it has 
always required, and that mere rubber-stamping is not acceptable.'' 150 
Cong. Rec. S3610-02, *S3618 (Apr. 2, 2004) (statement of Sen. DeWine). 
The Department agrees. Both the statute and the case law make clear a 
court's Tunney Act role: far from applying a rubber-stamp, the court is 
to examine the proposed antitrust consent decree and determine whether 
that judgment addresses the harms alleged in the complaint and 
therefore falls within the reaches of the public interest based on the 
factors enumerated in the statute.
                                 ______
                                 
             Questions Submitted by Senator Byron L. Dorgan

                   ANTITRUST MODERNIZATION COMMISSION

    Question. The Antitrust Modernization Commission recently held a 
hearing that discussed the risks that U.S. businesses face as a result 
of the growing number of competition authorities around the world. 
These authorities can impose requirements or remedies on U.S. companies 
that conflict with our own. As one witness testified, this situation 
``has created the potential for a variety of adverse consequences, 
including increased transaction costs and heightened uncertainty for 
businesses, and instances of friction and conflict across 
jurisdictional boundaries.''
    Would the Department support efforts to deal with these issues, so 
that foreign antitrust authorities are more likely to defer to the 
rulings of the Department and FTC where the United States' interests in 
a transaction or conduct are paramount?
    Should the United States also seek to strengthen existing antitrust 
cooperation agreements to address this issue?
    Answer. The potential for foreign competition authorities to impose 
burdensome conflicting requirements and uncertainties on companies from 
other nations, or even to misuse enforcement to bolster a country's own 
home companies, has been an ongoing concern of the Antitrust Division 
for a number of years. The Division has actively worked to promote 
antitrust enforcement around the world based on sound economic and 
legal analysis. In this regard, one of the principles we have urged as 
part of international comity in antitrust enforcement is that, where 
appropriate, deference be given to the enforcement authorities in the 
country with the most significant relationship to the transaction or 
conduct.
    At the same time, the Department recognizes that there are numerous 
instances in which both the United States and a foreign antitrust 
authority have a significant interest in a particular course of conduct 
or a particular transaction. It is therefore critical that the 
Department work closely in a variety of contexts to achieve 
international consensus on sound antitrust enforcement, thereby 
limiting the risk of significantly divergent outcomes in particular 
cases. In recent years the Department has actively engaged antitrust 
enforcers around the world through the International Competition 
Network, the Organization for Economic Cooperation and Development, 
competition working groups, and bilateral and trilateral meetings. Our 
goal is to strengthen international cooperation, minimize unnecessary 
burdens on companies doing business globally, and promote convergence 
on sound antitrust principles. This will continue to be a priority for 
the Department.

                         SEX OFFENDER DATABASE

    Question. Mr. Attorney General, I met with you in February of 2005, 
and urged you to implement a national sex offender database that the 
public could access through the internet, along the lines of what I 
have proposed in Dru's Law. I appreciate the fact that the Justice 
Department has begun implementation of such a database.
    The database currently allows users to search for offenders by 
multiple zip codes, but not by a radius defined by users, as proposed 
by Dru's Law. I think the database would be far more useful if it 
allowed the user to ask for a list of offenders within, say, a 10-mile 
radius--rather than having to sit down with a map and figuring out the 
intricacies of the zip code system. Would you be willing to look into 
that?
    Answer. A zip code radius search has been a sought after function 
of the National Sex Offender Public Registry (NSOPR) since the 
inception of the program. After the initial release of NSOPR, the 
original zip code function was modified from single zip code search 
capability to the current search capability that allows users to search 
multiple known adjacent zip codes. With the final two states scheduled 
to participate in the program this summer, work is underway to develop 
zip code radius style searches.

     EDWARD BYRNE MEMORIAL JUSTICE ASSISTANCE GRANTS (JAG) PROGRAM

    Question. The President's fiscal year 2007 budget would eliminate 
funding for Edward Byrne Memorial Justice Assistance Grants program 
that was developed to help states and local law enforcement control 
violent crime and drug-related crime as well as improve operations and 
coordination.
    The Byrne grant program helps to fund the South Sakakawea Narcotics 
Task Force that services the southwest counties of North Dakota. Prior 
to having this task force, the Dickinson Police Department and Stark 
County Sheriff's Department combined to investigate narcotics. It was 
on a part time basis because it utilized detectives who had to work 
criminal cases as well and it was not effective enough to deter the 
dealers moving into our area.
    According to the Dickinson Chief of Police, the task force this 
past year handled 181 cases and made a total of 233 arrests. They also 
have confiscated about $29,000 in asset forfeitures.
    In eliminating funding, the Administration says the Byrne program 
is ``unable to demonstrate results'' and that there is ``little 
justification for continued funding.'' How can you justify cutting this 
program? What methods did the Department of Justice use to evaluate 
this program? Did you reach out directly to local law enforcement 
officials in North Dakota to gather facts and results?
    Answer. Due to the limited resources available to the Department of 
Justice (DOJ), both the Administration and the Department have been 
forced to make many difficult choices while preparing the fiscal year 
2007 President's budget proposal. The decision to eliminate funding for 
the Byrne Justice Assistance Grant program (JAG) was a difficult choice 
necessitated by the Department's need to focus available resources on 
its top priorities, such as antiterrorism efforts, and ensure that 
existing programs make the best possible use of the federal funds 
dedicated to them. We are actively working with Congress and state and 
local officials to help ensure that law enforcement needs are addressed 
nationwide.
    In fact, a number of critical and important investments exist in 
the fiscal year 2007 budget--areas where funding is requested to target 
specific priority problems. In recent years, both the President and 
Congress have tended to focus funding on initiatives in key priority 
areas, where we have the best chance of making a difference, in lieu of 
funding large, broad-based programs that are not targeted and have not 
been able to show the same level of results. JAG represents less than 
one percent of all state and local spending in law enforcement.
    If the President's fiscal year 2007 budget request is approved, 
over $1 billion will be available to State, local and tribal law 
enforcement through the U.S. Department of Justice for many of the same 
purposes that JAG funded, such as training and equipment that logically 
cross-cut crime and drug issues. The DOJ fiscal year 2007 President's 
budget request includes $66.6 million to strengthen communities through 
programs providing services such as drug treatment; $88.2 million to 
combat violence, including enhancements to Project Safe Neighborhoods; 
and $209 million to support drug enforcement, including funding to 
continue and expand the Southwest Border Drug Prosecution Program.
    During its fiscal year 2005 PART assessment of the Byrne JAG 
Program and its predecessors (the Byrne Formula Grant Program and the 
Local Law Enforcement Block Grant), OMB concluded that the JAG Program 
has not been able to clearly demonstrate through quantifiable 
performance measures that it is achieving its goals. Concerns were also 
raised about the broad range of purpose areas allowed under the JAG 
Program; JAG funded efforts in a total of 29 different purpose areas, 
making it difficult for the program to develop meaningful performance 
measures or focus its efforts on priority concerns. Much of the 
justification for such assistance has diminished in comparison to other 
priority needs, such as increasing federal counterterrorism efforts.
    The Administration and the Department of Justice are committed to 
supporting interagency drug enforcement efforts. The fiscal year 2007 
President's budget includes $706 million for the Organized Crime and 
Drug Enforcement Task Force (OCDETF) program and $208 million for the 
High Intensity Drug Trafficking Area (HIDTA) Program. These programs 
support drug enforcement efforts undertaken by task forces made up of 
Federal, state, local and tribal law enforcement agencies and enhance 
the coordination of efforts against drug trafficking and drug-related 
crime at all levels of government. The Department will continue to work 
with Congress and State and local officials to address the many threats 
that methamphetamine and other illegal drugs pose to America's 
communities.
                                 ______
                                 
              Question Submitted by Senator Robert C. Byrd

NSA'S DOMESTIC SURVEILLANCE PROGRAM AND ITS POSSIBLE UNDERMINING AFFECT 
                      ON COUNTERTERRORISM EFFORTS

    Question. The Administration has been very vocal about its disdain 
for the information leaked concerning domestic wiretapping program. Is 
it possible, that by ignoring FISA, as well as the FISA court, the 
Administration has encouraged intelligence gatherers and analysts to 
engage in constitutionally-suspect activities, and that the leaks that 
have resulted have come about not through any dereliction of duty, but 
from a real concern that individuals have been asked to conduct 
domestic surveillance outside the rule of law?
    If this is in fact true, then not only has the NSA's domestic 
surveillance program been conducted illegally, it has placed 
counterterrorism agents beyond the law, and possibly caused the leaks 
it now condemns. What is the Administration's response to its possibly 
undermining counterterrorism efforts by its brazen indifference to FISA 
and the Constitution?
    Answer. Thank you for the opportunity to address these questions, 
which I believe reflect several misunderstandings. We hope our response 
will allay your concerns.
    First, the care that the Administration has taken in establishing, 
implementing, and overseeing the Terrorist Surveillance Program 
described by the President bears emphasis. The Administration has gone 
to extraordinary lengths to ensure that, even while it protects the 
American people from another catastrophic terrorist attack, it observes 
the constitutional protections that we, as a Nation, cherish. For this 
reason, the Administration sought and received the legal advice of the 
Department of Justice and of the career attorneys who specialize in 
this area of law at the National Security Agency (NSA) before the 
program was first authorized, and it continues to seek such advice when 
appropriate. The Program is narrowly focused, targeting only 
international communications for which a trained intelligence 
professional concludes there is probable cause to believe at least one 
of the parties is a member or agent of al Qaeda or an affiliated 
terrorist organization. The need for the Program is reevaluated 
approximately every 45 days to minimize the risk of any unnecessary 
interception of communications. Finally, from the very beginning, the 
Administration has kept Congress informed through appropriate briefings 
of the Intelligence Committees and leadership.
    Second, the Administration has not ``circumvent[ed] procedures 
required by Foreign Intelligence Surveillance Act (FISA) and the 
Constitution,'' nor has it ``ignored'' FISA. As explained in the 
Department's January 19, 2006 paper, the Terrorist Surveillance Program 
is fully consistent with FISA. FISA expressly recognizes that 
electronic surveillance can be authorized by statutes other than FISA. 
See 50 U.S.C.  1809(a)(1) (providing that electronic surveillance is 
not prohibited if it is ``authorized by statute''). The Authorization 
for the Use of Military Force of September 18, 2001 (``Force 
Resolution'') is just such a statute. The Supreme Court has explained 
that the Force Resolution must be understood to have authorized 
``fundamental and accepted'' incidents of waging war. Hamdi v. 
Rumsfeld, 542 U.S. 507, 518 (2004) (plurality opinion); see id. at 587 
(Thomas, J., dissenting). As explained at length in the January 19th 
paper, the use of signals intelligence is a fundamental incident of the 
use of military force. Consistent with this traditional understanding, 
other Presidents, including Woodrow Wilson and Franklin Roosevelt, have 
interpreted general force authorization resolutions to permit 
warrantless electronic surveillance to intercept suspected enemy 
communications. Cf. generally Curtis A. Bradley & Jack L. Goldsmith, 
Congressional Authorization and the War on Terrorism, 118 Harv. L. Rev. 
2048, 2091 (2005) (explaining that, with the Force Resolution, 
``Congress intended to authorize the President to take at least those 
actions permitted by the laws of war''). The Force Resolution thus 
authorizes the President to conduct the Terrorist Surveillance Program 
against al Qaeda and affiliated terrorist organizations, and does so in 
a way explicitly contemplated by FISA. At the same time, as we have 
explained repeatedly, the Administration understands and appreciates 
FISA's value. It and the Foreign Intelligence Surveillance Court have 
been of enormous assistance in protecting the Nation from terrorist 
attacks and other threats to the national security. The Administration, 
accordingly, makes full use of the FISA.
    Third, we do not agree that concerns about the legality of the 
Terrorist Surveillance Program caused the unauthorized leak that 
publicly revealed the existence of the Program. Even if an employee 
were concerned about the legality of the program, although the program 
has been, from the beginning, subject to legal review at several 
levels, there has long been a mechanism in place--the Intelligence 
Community Whistleblower Protection Act of 1998--that would allow an 
employee to bring such concerns to the attention of the relevant 
Inspector General and, if that did not resolve his concerns, the 
Intelligence Committees of Congress. This act provides a mechanism to 
address concerns while protecting sensitive intelligence sources and 
methods. No concern for the legality of the Program could have impelled 
someone to break the law and cause irreparable harm to the national 
security by leaking highly classified information when this alternative 
was open.
    Finally, the Terrorist Surveillance Program has been critical to 
protecting the Nation from a subsequent al Qaeda attack and is in no 
way ``undermining counterterrorism efforts.'' We hope these 
clarifications allay your concerns.
                                 ______
                                 
              Questions Submitted to Robert S. Mueller III
                Questions Submitted by Senator Herb Kohl

                              FBI ANALYSTS

    Question. Director Mueller, since 9/11, you have tried to transform 
the FBI into an intelligence agency, one that actively prevents 
terrorist attacks instead of just responding to them. Last year, we 
talked about an Inspector General report that criticized the FBI for 
its inability to recruit, train, and retain qualified intelligence 
analysts. Connecting the dots, of course, is crucial to that 
transformation. The FBI fell well short of its analyst hiring goals in 
2004, but you assured me that you would get that back on track in 2005, 
and that you would meet your goals. What goals did the FBI set for 
2005, and were they met? What sorts of people did you hire as analysts? 
Are you fully satisfied with the qualifications of the applicants?
    Answer. The FBI has worked hard to recruit the best possible 
candidates to move us forward during our transformation. This work is 
exemplified by our effort to hire intelligence analysts (IAs); through 
an extremely aggressive recruiting effort, we have increased our total 
on-board IA complement over the 9/11/01 level by 108 percent.
    Throughout this period, we have set very high IA hiring goals, and 
achieving these goals has been quite challenging. The FBI's goal in 
fiscal year 2005 was to hire 780 analysts and, with the benefit of 
streamlined pre-employment procedures and a hiring ``blitz,'' we hired 
678 analysts. (Of these, 170 IAs counted against our fiscal year 2004 
goal, so that the total IAs hired against our fiscal year 2005 goal of 
780 was 508). Both our efforts and our challenges are continuing; in 
the first two quarters of fiscal year 2006, we hired 233 IAs.
    While the hiring of skilled and motivated federal employees in such 
large numbers is always challenging, the hiring of IAs in adequate 
numbers is made more challenging by the fact that the same backgrounds 
and expertise we are seeking are also being sought by other 
intelligence organizations. In order to close the gap created by hiring 
shortfalls, the FBI has established a team that consists of 
representatives from the Directorate of Intelligence, Administrative 
Services Division, Security Division, and Training and Development 
Division, who meet weekly to address hiring and training needs 
throughout the FBI. We will sustain our vigorous hiring effort until we 
meet our hiring goals.
    The FBI has established policies and procedures designed to ensure 
we have the highest quality IAs, and the qualifications of the IAs 
hired in fiscal year 2005-2006 have been outstanding. For example, 48 
percent of the recent hires have advanced degrees and, of those with 
baccalaureate or advanced degrees, 25 percent possess critical skills 
in such areas as Islamic studies, international banking, analytical 
studies, or computer science.

                        SENIORS INVESTMENT FRAUD

    Question. Since 9/11, the FBI has focused on protecting our 
homeland and rightfully so. But the FBI also has other law enforcement 
priorities. Recently, I chaired an Aging Committee hearing that focused 
on the growing issue of securities fraud that seniors are facing. One 
of the messages from that hearing was that law enforcement must focus 
on both prosecuting fraud complaints and investigating potential scams 
before they ensnare seniors' life savings. I understand that the FBI 
has begun working on this, but can you tell us what additional 
resources you need to step up your efforts in this area?
    Answer. Securities fraud is a priority of the FBI's White Collar 
Crime Program. During fiscal year 2005, the FBI had more than 1,500 
pending securities fraud cases. These investigations resulted in 479 
indictments or informations, 479 convictions, over $4.9 billion in 
court-ordered restitution, and approximately $25 million in 
forfeitures. The FBI will work with DOJ and Congress to identify any 
additional resources needed to increase our securities fraud program as 
it relates to senior citizens.
                                 ______
                                 
            Questions Submitted by Senator Patrick J. Leahy

                              CHOICEPOINT

    Question. On April 3, 2006, the FBI announced that it was entering 
into a $12 million, 5-year licensing agreement with ChoicePoint to 
expand the use of software that helps the FBI analyze criminal 
organizations. During the Committee's April 5, 2006, hearing, you 
stated that the FBI did not consult with Congress before entering into 
this agreement.
    Given the well-publicized problems that ChoicePoint has had with 
maintaining data security, how can the Justice Department possibly 
justify entering into a multi-million dollar contract with ChoicePoint 
to handle sensitive investigative data about how criminal enterprises 
operate?
    Answer. The FBI awarded a 5-year, fixed-price contract to i2, Inc., 
a subsidiary of ChoicePoint, on 12/1/05. ChoicePoint issued a press 
release announcing this contract on 4/3/06, which created some 
confusion as to whether the contract was for ChoicePoint data services 
or for i2 analytical tools. In fact, this contract is solely for i2's 
software applications and analytical tools, and not for ChoicePoint 
data services. These i2 applications and tools include software 
licenses, software upgrades, technical support for the ``Analyst's 
Notebook'' (i2's primary product), a scaled-down version of i2's 
``Visual Notebook,'' and related tools. The ``Analyst's Notebook'' is a 
link-node analysis tool that has proven highly useful in 
counterintelligence, counterterrorism, and criminal investigations that 
involve large volumes of data.
    Like private investigators, paralegals, and others who subscribe to 
such services, the FBI continues to use commercial databases, such as 
ChoicePoint, that contain public-source information as well as 
proprietary information that is privately owned and commercially 
available at the owner's discretion. This information is available to 
the FBI from the same sources that provide it to the commercial 
databases. What these commercial databases offer their customers, 
including the FBI, by contract is a consolidation of this information 
so that, rather than going to multiple databases for this information, 
it can be obtained through one or two searches.
    The FBI contracts with commercial data providers, such as 
ChoicePoint, in order to access the information they maintain. We do 
not provide FBI information, including FBI investigative data, to these 
organizations, and neither they nor their other clients have any access 
to FBI information as a result of our contract or our access.
    Question. Given the well-publicized problems that ChoicePoint has 
had with maintaining data security, why did the FBI choose to not 
consult Congress before entering into this licensing agreement?
    Answer. As indicated in the response above, the recent contract did 
not concern ChoicePoint's data services, but was instead a contract for 
i2's software applications and analytical tools. Furthermore, the FBI's 
spending with regard to contracts with ChoicePoint and other data 
brokers has always been consistent with resources appropriated for such 
matters.
    Question. Did the FBI conduct a review of ChoicePoint's data 
security procedures and privacy policy before entering into this 
licensing agreement? If so, please describe that review process.
    Answer. Because the recent contract with i2, Inc., was for software 
applications and analytical tools, rather than for data services, it 
did not raise any concerns regarding data security procedures or 
privacy policy. These tools were evaluated as part of the FBI system's 
security certification and accreditation process, in accordance with 
FBI data security procedures and privacy policy.

                       VIRTUAL CASE FILE/SENTINEL

    Question. Director Mueller, you are well aware of my ongoing 
interest in getting a fully functional case management system into the 
hands of agents. Last year, after consultants pronounced it obsolete 
and riddled with problems, the FBI scrapped its $170 million Virtual 
Case File component of the Trilogy program, which was supposed to 
create an instantaneous and paperless way for FBI agents and analysts 
to manage all types of investigations.
    We recently learned that the FBI estimates that Trilogy's 
successor, Sentinel, will cost the American taxpayers $425 million to 
complete. Additionally, Sentinel will not be fully deployed until 2009. 
The FBI has already set aside $97 million for Sentinel this year and 
you are asking for an additional $100 million for this project for 
fiscal year 2007.
    How confident are you about the final cost estimate for the 
Sentinel program?
    Answer. The FBI is confident that the approved contract will meet 
the requirements specified in the statement of work at the contracted 
price. Should modifications be required, we will make the proper 
notifications within the FBI and to the Department of Justice (DOJ), 
OMB, and Congress. The total value of the contract with Lockheed Martin 
is $305 million over 6 years, including both development and Operations 
and Maintenance (O&M). The FBI estimates that the total cost for the 
Sentinel program, including program management, systems development, 
O&M, and independent validation and verification (IV&V), will be $425 
million over 6 years.
    Question. Based on this cost estimate, how much additional funding 
or reprogrammed funds will the FBI require to complete this program? If 
reprogramming is required, what programs do you anticipate will lose 
funds?
    Answer. The funding requested in the President's fiscal year 2007 
budget will fund O&M for Phase 1 and a portion or all of the system 
development, training, and program management costs for Phase 2. Final 
funding requirements for Phase 2 are dependent on the completed 
contract negotiations and other factors. Funding for Phases 3 and 4 and 
for the remainder of O&M for all Phases will be requested in future 
year budget submissions. If additional Phase 2 costs are identified in 
fiscal year 2007 beyond the $100 million in the President's budget, the 
FBI will work with DOJ, OMB, and Congress to redirect existing funds 
where available or request additional funding as needed.
    Question. I am trouble[d] by reports that two of the companies that 
are part of the Sentinel contract team--Computer Sciences Corp. and 
CACI International Inc.--also played roles in the earlier failed 
Trilogy effort. How do you justify entrusting these companies with 
taxpayer funds again?
    Answer. Although it is true that two of the 11 companies partnering 
with Lockheed Martin are common to both Trilogy and Sentinel (Computer 
Science Corporation (CSC) and CACI), these companies were associated 
with the Transportation Network and Information Presentation components 
of the Trilogy contract rather than with the Virtual Case File portion, 
which was led by SAIC.
    The FBI believes both CSC and CACI will make significant 
contributions toward Sentinel's success. CSC will provide subject-
matter expertise regarding legacy systems, system design, commercial 
off-the-shelf software selection, and O&M support. CSC will also 
provide information technology security services, a business line in 
which they have excelled while working with the FBI's information 
assurance program during the past three years. CACI will provide 
subject-matter expertise in support of case management, records 
management, development and testing, and implementation and 
integration.
    The FBI has strengthened its internal controls to avoid a 
repetition of prior problems. For example, we have improved our 
contract oversight in four significant ways. First, this contract has 
clear reporting requirements and clear, defined deliverables at each 
contract phase (each of the four phases delivers capability to the end-
user), and the contract can be terminated at any point should these 
results be unsatisfactory. Second, those responsible for contract 
management have clearly defined roles and responsibilities, and the 
management function is structured so as to ensure that accountable 
personnel review all documentation and expenses. This contract 
management function will be supplemented by internal financial 
management audits. Third, an IV&V specialist who reports directly to 
the Chief Information Officer will independently assess the efficiency 
and progress of the Program Management Office (PMO) and the work of the 
Sentinel contractors. Fourth, to eliminate the likelihood of ``scope 
creep,'' any significant requirements changes must first be approved by 
the Executive Steering Council chaired by the FBI's Deputy Director.
    The FBI has implemented measures to verify the FBI's receipt of the 
contract's deliverables and to validate their costs when invoiced. 
Unlike Trilogy, these measures include the creation of a PMO that 
includes personnel with the expertise to ensure proper contract 
administration. The Sentinel PMO includes a contracting officer and a 
dedicated unit that is specifically assigned to track, monitor, and 
control all program and development costs. This dedicated unit, which 
includes a business manager, budget analyst, Earned Value Metrics 
analyst, cost estimator, and full-time contracting officer's technical 
representative, will used detailed invoicing procedures developed by 
the PMO to validate all internal and external costs. As recognized in 
the recent GAO and IG reports, the FBI has conveyed to Lockheed Martin 
the importance of detailed cost tracking and adherence to established 
policies and protocols. Lockheed Martin has assured the FBI that they 
understand and concur in our requirements and will implement 
appropriate policies and processes to ensure compliance.
    Generally a government entity has no direct relationship with 
subcontractors, who instead work for prime contractor, submitting 
invoices to the prime contractor for approval and payment. While this 
is true of the FBI's relationship with subcontractors in this case, as 
well, the FBI has requested greater transparency of subcontractor 
activities and charges with respect to the Sentinel contract, and 
Lockheed Martin's monthly reports will be required to include 
subcontractor costs in the same manner as their own costs.

                          SUBCOMMITTEE RECESS

    Senator Shelby. We will review the 2007 budget request for 
the National Aeronautics and Space Administration on Wednesday, 
April 26 in this room, and at that time, the NASA 
Administrator, Dr. Michael Griffin, will be here to discuss the 
budget for the programs under his jurisdiction. Until then, the 
subcommittee stands in recess.
    [Whereupon, at 4:38 p.m., Wednesday, April 5, the 
subcommittee was recessed to reconvene at 2 p.m., Wednesday, 
April 26.]
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