[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]


 
FREQUENT TRAVELER PROGRAMS: BALANCING SECURITY AND COMMERCE AT OUR LAND 
                                BORDERS 

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

                                HEARING

                               before the

     SUBCOMMITTEE ON BORDER, MARITIME, AND GLOBAL COUNTERTERRORISM

                                 of the

                     COMMITTEE ON HOMELAND SECURITY
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                             JULY 26, 2007

                               __________

                           Serial No. 110-63

                               __________

       Printed for the use of the Committee on Homeland Security
                                     
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                     COMMITTEE ON HOMELAND SECURITY

               BENNIE G. THOMPSON, Mississippi, Chairman

LORETTA SANCHEZ, California,         PETER T. KING, New York
EDWARD J. MARKEY, Massachusetts      LAMAR SMITH, Texas
NORMAN D. DICKS, Washington          CHRISTOPHER SHAYS, Connecticut
JANE HARMAN, California              MARK E. SOUDER, Indiana
PETER A. DeFAZIO, Oregon             TOM DAVIS, Virginia
NITA M. LOWEY, New York              DANIEL E. LUNGREN, California
ELEANOR HOLMES NORTON, District of   MIKE ROGERS, Alabama
Columbia                             BOBBY JINDAL, Louisiana
ZOE LOFGREN, California              DAVID G. REICHERT, Washington
SHEILA JACKSON-LEE, Texas            MICHAEL T. McCAUL, Texas
DONNA M. CHRISTENSEN, U.S. Virgin    CHARLES W. DENT, Pennsylvania
Islands                              GINNY BROWN-WAITE, Florida
BOB ETHERIDGE, North Carolina        MARSHA BLACKBURN, Tennessee
JAMES R. LANGEVIN, Rhode Island      GUS M. BILIRAKIS, Florida
HENRY CUELLAR, Texas                 DAVID DAVIS, Tennessee
CHRISTOPHER P. CARNEY, Pennsylvania
YVETTE D. CLARKE, New York
AL GREEN, Texas
ED PERLMUTTER, Colorado
VACANCY

       Jessica Herrera-Flanigan, Staff Director & General Counsel

                     Rosaline Cohen, Chief Counsel

                     Michael Twinchek, Chief Clerk

                Robert O'Connor, Minority Staff Director

                                 ______

     SUBCOMMITTEE ON BORDER, MARITIME, AND GLOBAL COUNTERTERRORISM

                LORETTA SANCHEZ, California, Chairwoman

JANE HARMAN, California              MARK E. SOUDER, Indiana
ZOE LOFGREN, California              BOBBY JINDAL, Louisiana
SHEILA JACKSON-LEE, Texas            DAVID G. REICHERT, Washington
JAMES R. LANGEVIN, Rhode Island      MICHAEL T. McCAUL, Texas
HENRY CUELLAR, Texas                 GUS M. BILIRAKIS, Florida
AL GREEN, Texas                      PETER T. KING, New York (Ex 
BENNIE G. THOMPSON, Mississippi (Ex  Officio)
Officio)

                         Alison Rosso, Director

                         Denise Krepp, Counsel

                       Carla Zamudio-Dolan, Clerk

        Mandy Bowers, Minority Senior Professional Staff Member

                                  (II)




















                            C O N T E N T S

                              ----------                              
                                                                   Page

                               STATEMENTS

The Honorable Loretta Sanchez, a Representative in Congress From 
  the State of California, and Chairwoman, Subcommittee on 
  Border, Maritime, and Global Counterterrorism..................     1
The Honorable Mark E. Souder, a Representative in Congress From 
  the State of Indiana, and Ranking Member, Subcommittee on 
  Border, Maritime, and Global Counterterrorism
  Oral Statement.................................................     2
  Prepared Statement.............................................     3
The Honorable Henry Cuellar, a Representative in Congress From 
  the State of Texas.............................................    15
The Honorable David G. Reichert, a Representative in Congress 
  From the State of Washington...................................    23

                               Witnesses
                                Panel I

Mr. Robert M. Jacksta, Executive Director, Traveler Security & 
  Facilitation, Office of Field Operations, U.S. Customs and 
  Border Protection:
  Oral Statement.................................................     4
  Prepared Statement.............................................     6

                                Panel II

Mr. Neal M. Belitsky, Executive Vice President & General Manager, 
  Detroit & Canada Tunnel Corporation:
  Oral Statement.................................................    31
  Prepared Statement.............................................    33
Ms. Maria Luisa O'Connell, President, Border Trade Alliance:
  Oral Statement.................................................    25
  Prepared Statement.............................................    27
Mr. Thomas Gann, Vice President, Public Policy, Digimare 
  Corporation:
  Oral Statement.................................................    38
  Prepared Statement.............................................    40

                               Appendixes

I. Prepared Statement:
  The Honorable Bennie G. Thompson, a Representative in Congress 
    from the State of Mississippi, and Chairman, Committee on 
    Homeland Security............................................    55
II. Questions and Responses
  Responses from Mr. Robert Jacksta..............................    57
  Responses from Ms. Maria Luisa O'Connell.......................    70


                     FREQUENT  TRAVELER  PROGRAMS:
                    BALANCING SECURITY AND COMMERCE
                          AT OUR LAND BORDERS

                              ----------                              


                        Thursday, July 26, 2007

             U.S. House of Representatives,
                    Committee on Homeland Security,
                          Subcommittee on Border, Maritime,
                               and Global Counterterrorism,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 2:08 p.m., in 
room 311, Cannon House Office Building, Hon. Loretta Sanchez 
[chairwoman of the subcommittee] presiding.
    Present: Representatives Sanchez, Cuellar, Souder, and 
Reichert.
    Ms. Sanchez. The subcommittee will come to order. And the 
subcommittee is meeting today to receive testimony on Frequent 
Traveler Programs: Balancing Security and Commerce at our Land 
Borders.
    Good afternoon. I want to thank all of our witnesses for 
being here today for the subcommittee hearing on Frequent 
Travel Programs: Balancing Security and Commerce at our Land 
Borders. We appreciate the witnesses' time and the insights 
that they are going to provide on this important topic.
    You know, I know that it takes time for witnesses to 
prepare to be before our committee, and specifically I 
understand that the Department of Homeland Security has 
requested that their witnesses be invited 2 weeks in advance. 
This committee has worked hard to conscientiously provide 2 
weeks' advance notice. And in that vein, I would hope that the 
Department would be more conscientious with complying with our 
requests that the witnesses' testimony be submitted 48 hours 
before this hearing. In this particular case we received it 
last night. And that makes it very difficult to prepare to be 
able to ask questions, probing questions, difficult questions, 
the type of questions we like to ask the witnesses. So I look 
forward to the Department's renewed commitment to comply with 
our 48-hour rule.
    Today's hearing is our subcommittee's eighth hearing 
specifically focused on border issues. And in the past we have 
reviewed many of the border security initiatives at Customs and 
Border Protection. Today we turn to the frequent traveler 
programs that impact both our Nation's security and the free 
flow of commerce.
    Customs and Border Protection currently operates three 
frequent travel border crossing programs: NEXUS, which is a 
binational program with Canada for people traveling between the 
U.S. and Canada via air, land, or private boat for business or 
pleasure; we have SENTRI, which is a unilateral initiative for 
pedestrians and noncommercial vehicle travelers crossing into 
the U.S. across the southwestern border; and FAST, a binational 
program with Canada for cargo shipments at specific locations 
on the northern border; and it is also accepted in conjunction 
with Mexico's Express program along the southern border. These 
programs are designed to allow preapproved, low-risk travelers 
or shipments to receive expedited processing at certain border 
crossings.
    And today I am interested in examining the security 
implications of these programs and the effect they have on 
commerce, particularly to our border regions. I would also like 
to gain a better understanding of how Customs and Border 
Protection administers these various programs, and to discuss 
whether it makes sense to keep these programs separate.
    In addition, the Western Hemisphere Travel Initiative is a 
huge initiative at our Nation's borders, with implications that 
will affect both security and commerce. So I would like to have 
a discussion about how these frequent traveler programs can 
integrate with the Western Hemisphere Travel Initiative to 
reduce the potential disruptions to people who are crossing our 
Nation's borders.
    I would like to thank my Ranking Member for his interest in 
these trusted traveler programs, and I look forward to working 
with him on these important issues. And I now recognize the 
gentleman from Indiana for his opening statement.
    Mr. Souder. Thank you, Madam Chair, and I appreciate it. 
And these hearings are steady and information-based, fact-
based, putting together a real serious study rather than just a 
lot of the rhetoric that we often hear. You, in, fact have 
taken the leadership here in this committee to make sure we 
have a solid foundational understanding.
    CBP processes an average of 1.2 million travelers at a port 
of entry every day. It is an amazing number. There is no doubt 
that determining who should and who should not enter is a 
significant challenge. In 2005, 84,000 individuals were 
apprehended at the border with either a false claim of 
citizenship or for using fraudulent documents.
    Mr. Jacksta has testified earlier this year that CBP 
intercepts over 200 fraudulent documents every day. I have been 
studying the border for over a decade, and believe this is just 
the tip of the problem. There are likely hundreds more that we 
never intercept.
    It is in this context I would like to examine the trusted 
traveler program today. I understand and support the 
facilitation aspects of these programs. However, my primary 
focus will be on what security measures are in place in these 
programs, as well as the border crossing card, which is also a 
trusted traveler program used by the Department of State, but 
used at the land borders.
    In fiscal year 2006, CBP seized 16,828 fraudulent border 
crossing cards. So far in 2007, CBP has received 12,905. Of all 
these seizures, 95 percent are cards that are used by 
imposters. The person holding the card is not the person it was 
issued to. We don't scan or read the vast majority of these 
cards, and the fraudulent use is likely significantly greater 
than these statistics represent. Under this program, millions 
of Mexican nationals are able to travel into the U.S. for up to 
30 days, and are supposed to remain within 25 miles of the 
border in New Mexico and Texas, and 75 miles in Arizona.
    In addition to the imposter issue, we have no idea how many 
of these cardholders stay within the parameters of the program. 
I look forward to hearing what CBP is doing to address this 
issue. Basically, very similar to visa overstays.
    On the second panel, I would like to welcome Thomas Gann 
from Digimarc, a secure document company, that will offer 
testimony on some of the best practices for protected 
documents, and how to use them in a secure border management 
program. Digimarc has extensive experience in developing secure 
driver's licenses. Given the debate on whether or not enhanced 
driver's licenses should be used as part of the Western 
Hemisphere Travel Initiative, I am especially interested in his 
testimony, and would like to express my appreciation for Tom's 
participation today. This is also very important for the 
Canadians, who are asking how to make their provincial licenses 
compliant and looking for guidance on this.
    I thank the Madam Chairlady, and I yield back the remainder 
of my time.
    [The Statement of Mr. Souder follows:]

   Prepared Opening Statement of the Honorable Mark Souder, Ranking 
 Member, Subcommittee on Border, Maritime, and Global Counterterrorism

    Thank you Madame Chair.
    CBP processes an average of 1.2 million travelers at a port of 
entry every day. It is an amazing number and there is no doubt that 
determining who should and should not enter is a significant challenge. 
In 2005, 84,000 individuals were apprehended at the border with either 
a false claim of citizenship or for using fraudulent documents. Mr. 
Jacksta testified last year that CBP intercepts over 200 fraudulent 
documents every day. I have been studying the border for over a decade 
and believe that this is just the tip of the problem and there are 
likely hundreds more that we never intercept.
    It is in this context that I'd like to examine the trusted traveler 
programs today. I understand and support the facilitation aspects of 
the programs. However, my primary focus will be on what security 
measures are in place in these programs, as well as the Border Crossing 
Card, which is also a trusted traveler program managed by the 
Department of State but used at the land borders.
    In fiscal year 2006, CBP seized 16,828 fraudulent border crossing 
cards. So far in 2007, CBP has seized 12,905. Of all of these seizures, 
95 percent are cards that are used by imposters--the person holding the 
card is not the person it was issued to. We don't scan or read the vast 
majority of these cards and the fraudulent use is likely significantly 
greater than these statistics represent.
    Under this program, millions of Mexican nationals are able to 
travel into the U.S. for up to 30 days and are supposed to remain 
within 25 miles of the border in New Mexico and Texas and 75 miles in 
Arizona. In addition to the imposter issue, we have no idea how many of 
these card holders stay within the parameters of the program. I look 
forward to hearing what CBP is doing to address this issue.
    On the second panel, I'd like to welcome Thomas Gann from Digimarc, 
a secure document company that will offer testimony on some of the best 
practices for protected documents and how to use them in a secure 
border management program. Digimarc has extensive experience in 
developing secure driver's licenses. Given the debate on whether or not 
enhanced driver's licenses should be used as part of the Western 
Hemisphere Travel Initiative, I am especially interested in his 
testimony and would like to express my appreciation for Tom's 
participation today.
    Thank you and I yield back the remainder of my time.

    Ms. Sanchez. I thank my Ranking Member.
    And I will remind the other members of the subcommittee--
since there are so many here--that under committee rules, 
opening statements may be submitted for the record.
    Thank you, Mr. Cuellar, for being with us today. I 
appreciate that. I think these topics are incredibly important. 
So we will have to do something about where all these members 
are.
    I welcome our first witness. Welcome Mr. Robert Jacksta, 
Executive Director for Traveler Security and Facilitation at 
Customs and Border Protection. And in that capacity, he is 
responsible for developing and implementing policies, programs, 
and initiatives to ensure border security, while facilitating 
low-risk travelers through the border at our land, sea, and 
airport ports of entry. Among those responsibilities are CBP's 
trusted traveler programs NEXUS, SENTRI, and FAST.
    And, without objection, we will submit your full statement 
to the record, and I will ask you to summarize that statement 
or tell us whatever you think we should know. Welcome. In 5 
minutes. Did I tell you that? In 5 minutes.

 STATEMENT OF ROBERT M. JACKSTA, EXECUTIVE DIRECTOR, TRAVELER 
  SECURITY AND FACILITATION, OFFICE OF FIELD OPERATIONS, U.S. 
                 CUSTOMS AND BORDER PROTECTION

    Mr. Jacksta. In 5 minutes, yes. You told me.
    Good afternoon, Chairwoman Sanchez, Ranking Member Souder, 
and distinguished members. I am pleased to be here today to 
outline the steps the Department of Homeland Security has taken 
to provide security and facilitate processing of travelers and 
cargo through our land ports of entry.
    I would like to begin also by apologizing for getting the 
written statement up here late. We have to take care of that. 
Specifically, what I would like to talk today about is the 
trusted traveler programs, and specifically how U.S. Customs 
and Border Protection is moving forward with the trusted 
traveler programs on the southern border, which we call SENTRI; 
on the northern border the NEXUS program; and then the Free and 
Secure Trade, FAST program, for commercial travelers on both 
the northern and southern border.
    CBP employs highly trained and professional personnel, 
resources, and law enforcement authorities to discharge our 
priority mission of preventing terrorist and terrorist weapons 
from entering the United States. This is an enormous challenge. 
We have over 7,000 miles of shared borders with Canada and 
Mexico. We have 327 official ports of entry. And each day CBP 
officers must inspect more than 1.1 million travelers and 
pedestrians. However, despite this challenging enforcement 
reality, CBP has made great strides toward securing our 
Nation's borders, while facilitating legitimate trade and 
travel.
    CBP's trusted traveler programs are a critical component of 
our late enforcement strategy, and help facilitate the crossing 
of low-risk travelers and commercial truck drivers at the land 
borders through exclusive dedicated lanes. Average inspection 
times at CBP's trusted travel lanes are reduced by up to 30 
seconds per traveler.
    To achieve low-risk status, program members, of which we 
currently have close to 340,000 members, must submit to 
intensive background checks against law enforcement and 
terrorist databases, personal interviews by our CBP officers, 
and collection of biometrics; and then they must provide proof 
of citizenship and other identity documentation. Applicants 
will not be granted trusted traveler privileges if they fail to 
satisfy the requirements as outlined above. Furthermore, 
members found in violation of these requirements are subject to 
revocation of their trusted traveler privileges. Travelers who 
have been denied entry to or removed from the program are still 
permitted to make entry into the United States. They simply are 
not allowed to use the dedicated trusted traveler lanes that we 
have in place.
    It should be noted that every traveler, whether in a 
trusted traveler program or not, is subject to full inspection 
upon entry to the United States. However, assigning low-risk 
status to trusted travelers enables CBP to better focus our 
time and resources to unknown and higher-risk travelers. In 
addition to being subject to both full and random inspections, 
CBP officers perform a complete database check of all trusted 
travelers every 24 hours and upon each trusted traveler's entry 
into the United States.
    Each of our trusted traveler programs were created prior to 
the creation of DHS. The SENTRI program was established in 
1995, the NEXUS program in 1999, and the FAST program in 2002. 
CBP has since centralized the biographic membership information 
for all of the trusted traveler programs. The centralized 
database SENTRI and NEXUS is known as the Global Enrollment 
System, GES. FAST drivers' information is in a separate 
centralized database; however, we have developed a plan to also 
merge it into our Global Enrollment System.
    The centralized database has allowed CBP to network the 
program locations into a single process. Accordingly, as of 
last year, members can now use their cards at any trusted 
traveler location enabling crossing. For instance, on the 
northern border, NEXUS members in Detroit can now use their 
card in Buffalo. And on the southwest border, SENTRI members in 
San Ysidro can now use their cards in Laredo.
    The Global Enrollment System has also allowed CBP to 
centralize the law enforcement vetting process in Vermont, 
creating a significantly more efficient and consistent vetting 
process.
    On November 1, 2006, an online application process for 
SENTRI applications became available, with online NEXUS 
applications becoming available in the next few weeks. With 
this online process, applicants may register and input their 
application electronically, and their information is sent 
correctly to CBP. Notification messages are returned 
electronically, and applicants can also check their status via 
their online application.
    CBP has also changed the renewal period for SENTRI from 2 
years to 5 years, thereby harmonizing the renewal period with 
the NEXUS and FAST programs. CBP has also instituted a review 
process to ensure we are maximizing the security and 
facilitation of the program. All of these efforts have helped 
secure the borders by providing better facilitation for low-
risk travelers, and increasing security where we need to 
interview individuals for a longer period of time.
    Regarding the protection of data and privacy of the 
travelers, CBP has strict penalties in place to make sure that 
any improper disclosure of information is taken seriously and 
action taken immediately. In addition, privacy impact 
assessments and system of record notices have been published.
    Madam Chairwoman, members of the subcommittee, I have 
outlined the trusted traveler program for our borders, and with 
your committee's support we will help DHS continue to protect 
Americans from terrorist threats while fulfilling our other 
important traditional missions.
    Thank you again for this opportunity to testify. I am ready 
to address any issues that you may have today.
    Ms. Sanchez. I thank the gentleman for his testimony.
    [The statement of Mr. Jacksta follows:]

                Prepared Statement of Robert M. Jacksta

    Good morning, Chairwoman Sanchez, Ranking Member Souder, and 
distinguished Members of the Subcommittee. I am pleased to be here 
today to outline the steps that the Department of Homeland Security 
(DHS) has taken to provide secure and facilitated processing of 
travelers and cargo through our land ports of entry. Specifically, I 
would like to discuss how the ``trusted traveler'' programs operated by 
U.S. Customs and Border Protection (CBP)--including the Secure 
Electronic Network for Travelers Rapid Inspection (SENTRI), Free and 
Secure Trade (FAST), and NEXUS programs--provide for both increased 
security and facilitation at our land ports of entry.
    As America's frontline border agency, CBP employs highly trained 
and professional personnel, resources, and law enforcement authorities 
to discharge our priority mission of preventing terrorists and 
terrorist weapons from entering the United States. This is an enormous 
challenge. We have over 7,000 miles of shared borders with Canada and 
Mexico and 327 official ports of entry, and each day CBP officers must 
inspect more than 1.2 million passengers and pedestrians. Despite this 
challenging enforcement reality, CBP has made great strides toward 
securing America's borders while facilitating legitimate trade and 
travel and ensuring the vitality of our economy.
    With such a tremendous volume of passengers and pedestrians 
crossing our borders each day, seconds are of critical importance. An 
average processing time can take up to 30 seconds, which at first 
glance may seem insignificant. However, when you multiply that by many 
thousands, you are left with long delays at our ports of entry and 
reduced time for our officers to properly perform their duties. CBP's 
trusted traveler programs are a critical component of our layered 
enforcement strategy and help facilitate the crossing of low-risk 
travelers and commercial truck drivers at the land borders through 
exclusive, dedicated lanes. Average inspection times are reduced from 
up to 30 seconds to an average of six to eight seconds.
    To achieve low-risk status, program members--of which we currently 
have over 340,000--must submit to intensive background checks against 
law enforcement and terrorist databases, personal interviews, and the 
collection of biometrics, and they must provide proof of citizenship 
and other identity documentation. Applicants will not be granted 
trusted traveler privileges if they fail to satisfy the requirements as 
outlined above. Furthermore, members found in violation of these 
requirements are subject to revocation of their trusted traveler 
privileges. Travelers who have been denied entry to, or removed from, 
the program are still permitted to make entry into the United States; 
they are simply no longer able to use the dedicated trusted traveler 
lanes to do so.
    It should be noted that every traveler--whether in a trusted 
traveler program or not--is subject to full inspection upon entry to 
the United States; however, assigning low-risk status to trusted 
travelers enables CBP to better focus its time and resources on unknown 
and higher-risk travelers. In addition to being subject to both full 
and random inspections, CBP performs a complete database check every 24 
hours and upon each trusted traveler's entry into the U.S.
    An approved applicant is issued a Radio Frequency Identification 
(RFID)-enabled card and, in the SENTRI and FAST programs, an 
accompanying vehicle transponder, which CBP officers are able to read 
in a matter of seconds upon a traveler's arrival at a port of entry. To 
ensure the privacy and security of a member's data, all of the personal 
information is stored securely in IDENT, the Department's biometric 
database, which is managed by US-VISIT. No personal information is 
stored on the card, which instead contains only a file number that is 
transmitted via the RFID reader to CBP's secure database. This is the 
same technological approach that DHS and the Department of State have 
proposed as part of the recently published Notice of Proposed 
Rulemaking for the Western Hemisphere Travel Initiative (WHTI), and it 
will enable CBP to process legitimate travelers more quickly, while 
maintaining the necessary level of security. Furthermore, under WHTI, 
all three trusted traveler cards will be considered WHTI compliant and 
will be accepted from U.S. Citizens and Canadians as border crossing 
documents at all Ports of Entry.
    Enrollment into one of the programs is a two-step process. A 
written application is filled out and submitted to CBP for biographical 
background vetting. Database queries are performed against several law 
enforcement, intelligence, customs, immigration, and terrorist indices. 
If an applicant passes this stage of review, he or she is asked to 
schedule an in-person interview with a CBP officer at a local 
Enrollment Center. At the Enrollment Center the applicant will be 
fingerprinted, have his or her travel and identity documents verified, 
and be interviewed by a CBP officer to confirm his or her low-risk 
status. Enrollment Centers are located throughout the country at land 
border and air ports of entry and in some urban centers such as Seattle 
and Vancouver.
    Each of our trusted traveler programs was created prior to the 
creation of DHS--the SENTRI program in 1995, the NEXUS program in 1999, 
and the FAST program in 2002. The programs were created disparately, 
and since a traveler's information was maintained on the database at a 
specific port of entry, a traveler might be registered in Detroit, but 
could not use his or her privileges at another location. CBP has taken 
significant steps in the past years to harmonize all the trusted 
traveler programs.
    CBP has centralized the biographic membership information for the 
NEXUS and SENTRI programs into a centralized database known as the 
Global Enrollment System (GES). FAST driver information is in a 
separate centralized database; however, we are in the process of 
developing a plan to also merge it into GES. As of last year, members 
can use their cards nationwide within their respective trusted-traveler 
programs. For instance, on the Northern border, NEXUS members in 
Detroit can now use their cards in Buffalo, and on the Southwest 
border, SENTRI members in San Ysidro can now use their cards in Laredo. 
A centralized GES database has also allowed CBP to centralize the 
vetting process in Williston, Vermont, thereby creating a significantly 
more efficient and consistent vetting process.
    An on-line application for SENTRI applicants became available on 
November 1, 2006, and an online application for NEXUS applicants 
likewise became available in late summer 2007. With on-line processing, 
applicants may register and input their applications electronically, 
and their information is sent directly to the CBP Centralized Vetting 
Center in Vermont. Notification messages are returned electronically, 
and applicants can also check the status of their applications via 
their on-line account.
    The GES has also facilitated consolidating application data 
requirements across the programs, standardized the risk assessment 
processes for the programs, and offered better services to the public. 
CBP has also recently changed the renewal period for SENTRI from 2 
years to 5 years, thereby harmonizing the renewal period with the NEXUS 
and FAST programs.
    CBP has instituted a review process to ensure that we are 
maximizing the security and facilitation benefits of our trusted 
traveler programs. This process includes yearly site visits to 
designated program ports of entry and Enrollment Centers to review both 
the application processing and the inspection process. We have also 
developed program accountability measures under the CBP Securing 
America's Borders at Ports of Entry Initiative. These measures include: 
reduced processing times at NEXUS and SENTRI designated lanes, 
increased number of program participants, and increased compliance 
rates of program participants.
    All of these efforts--developing an online, paperless application 
process; centralizing membership information; consolidating application 
data requirements across the programs; and standardizing the risk 
assessment processes for the programs have resulted in enrollment and 
participation into our trusted traveler programs being more convenient 
and secure than ever.
    I would like to take this opportunity to address each of these 
programs in additional detail.

NEXUS
    NEXUS is a binational program with Canada, developed in 1999 under 
the Shared Border Accord, and is available for people traveling between 
the United States and Canada via land, air, or private boat. Although 
originally developed as separate programs, in December 2006, CBP and 
the Canada Border Services Agency (CBSA) commenced the process of 
merging the NEXUS Land, Air, and Marine into a single program, with one 
card, one application, and one vetting process. The integration was 
completed in January 2007. The application process usually takes 4--6 
weeks, and CBP closely monitors this process to maximize efficiency 
while ensuring that the necessary security protocols are in place.

ENROLLMENT, LOCATIONS, AND FEES
Members: approximately 133,000
Enrollment Fee: $50 U.S./$80 Canadian, split between U.S. and Canada
Enrollment Period: Five Years
 Current NEXUS Land Locations                Current NEXUS Enrollment
(11 locations; 15 lanes)                     CentersBlaine, WA (Pacific Highway) (1)            Blaine, WA
Blaine, WA (Peace Arch) (1)                 Champlain, NY
Blaine, WA (Point Roberts) (1)              Detroit, MI
Buffalo, NY (Peace Bridge) (2)              Fort Erie, Canada
Buffalo, NY, (Rainbow Bridge) (1)           Montreal, Canada
Buffalo, NY (Whirlpool Bridge) (2)          Ottawa, Canada
Champlain, NY (1)                           Port Huron, MI
Detroit, MI (Ambassador Bridge) (2)         Seattle, WA
Detroit, MI (Tunnel) (2)                    Toronto, Canada
Highgate Springs, VT (1)                    Vancouver, Canada (2)
Port Huron, MI (1)                          Warroad, MNPending NEXUS Enrollment Centers            Urban Enrollment Centers
(Available by August 2008)Alexandria Bay, NY                          Seattle, WA*
Calais, ME                                  Vancouver, Canada*
Houlton, ME                                 ............................
International Falls, MN                     *pilot sites
Pembina, ND                                 ............................
Sault Ste. Marie, MI                        ............................
Sweetgrass, MT                              ............................
SENTRI
    The Secure Electronic Network for Travelers Rapid Inspection: 
(SENTRI) program began in 1995 and is available for pedestrians and 
non-commercial vehicle travelers at select locations along the 
Southwest border (currently operational at the nine largest Southwest 
border crossings, with a total of 15 dedicated lanes). As with the 
NEXUS program, the application process usually takes 4--6 weeks, and 
CBP closely monitors this process to maximize efficiency while ensuring 
that the necessary security protocols are in place.

ENROLLMENT, LOCATIONS, AND FEES
Members: approximately 129,000
Enrollment Fee: $129 per person
Enrollment Period: Five Years
 Current SENTRI Locations                    Current SENTRI Enrollment
(9 Locations; 15 lanes)                      CentersBrownsville, TX (Veteran's Bridge) (1)      Brownsville, TX
Calexico, CA (1)                            Calexico, CA
El Paso, TX (Stanton Street) (3)            El Paso, TX
El Paso, TX (Ysleta) (2)                    Hidalgo, TX
Hidalgo, TX (1)                             Laredo, TX
Laredo, TX (Lincoln Juarez) (1)             Nogales, AZ
Nogales, AZ (Deconcini) (1)                 Otay Mesa, CA
Otay Mesa, CA (1)
San Ysidro, CA (4)........................
FAST
    The Free and Secure Trade (FAST) program began in 2002 and is a 
binational program for pre-approved, low-risk, commercial cargo 
shipments at designated locations on the Northern and Southern land 
borders. Trucks using FAST lanes are provided expedited processing of 
qualifying merchandise. To achieve this preferred status, members of 
FAST must also be a U.S. Customs-Trade Partnership Against Terrorism 
(C-TPAT) approved carrier, carry qualifying goods from a C-TPAT 
approved importer, and the driver must be in the possession of a valid 
FAST Commercial Driver Card.
    Along with CBP, the CBSA jointly administers FAST on the Northern 
border. CBSA and CBP perform individual background checks on FAST 
Commercial Driver applicants and conduct joint interviews at ten shared 
facilities. FAST enrollment is also offered at several Alaska ports 
upon request and via a portable Enrollment Center used for enrollment 
fairs. Both the U.S. and Canada must agree to admit a driver to 
Northern border FAST, since both countries have FAST dedicated lanes 
with similar benefits
    The Mexican government accepts U.S.-issued FAST cards in its 
counterpart program, ``Expres'', and supports FAST by monitoring and 
enforcing exclusive use of FAST dedicated lanes by qualifying shippers, 
but otherwise it does not participate in the program. FAST cards 
approved at either the Southern or Northern border are valid for entry 
into the U.S. At present, processing of FAST applications requires 
approximately 6 weeks.

ENROLLMENT, LOCATIONS, AND FEES: FAST
Members: approximately 87,000 drivers and over 1,600 commercial 
carriers
Enrollment Fee: $50 U.S. or $80 Canadian, fee split between U.S. and 
Canada
Enrollment Period: Five Years
 Current FAST Locations
(28 Locations)............................Northern Border                             Southwest Border
Alexandria Bay, New York                    Brownsville, Texas *
Blaine, Washington *                        Calexico, California *
Buffalo, New York                           Del Rio, Texas
Champlain, New York *                       Douglas, Arizona
Derby Line, Vermont                         Eagle Pass, Texas
Detroit, Michigan *                         El Paso, Texas *
Highgate Springs, Vermont                   Laredo, Texas *
Houlton, Maine                              Nogales, Arizona *
Massena, New York                           Otay Mesa, California *
Ogdensburg, New York                        Pharr, Texas *
Oroville, New York                          Rio Grande, Texas
Pembina, North Dakota                       San Luis, Arizona
Port Huron, Michigan *                      Santa Teresa, New Mexico *
Portal, North Dakota                        Tecate, California
Sault Ste. Marie, Michigan
Sweetgrass, Montana* Indicates dedicated FAST laneCurrent FAST Enrollment CentersNorthern Border                             Southwest Border
Blaine, WA                                  Brownsville, TX
Buffalo, NY                                 Calexico, CA
Champlain, NY                               El Paso, TX
Derby Line, VT                              Hidalgo, TX
Detroit, MI                                 Laredo, TX
Houlton, ME                                 Nogales, AZ
Pembina, ND                                 Otay Mesa, CA
Port Huron, MI
Portal, ND
Sweetgrass MT.............................
    Madame Chairwoman, Members of the Subcommittee, I have outlined an 
assortment of programs and initiatives today that, with your 
assistance, will help DHS continue to protect America from terrorist 
threats while fulfilling our other important traditional missions. But 
our work is not complete. With the continued support of the Congress, 
DHS will succeed in meeting the challenges posed by the ongoing 
terrorist threat and the need to facilitate ever-increasing numbers of 
legitimate shipments and travelers. Thank you again for this 
opportunity to testify. I will be happy to answer any questions you may 
have.

    Ms. Sanchez. I will remind each of the members that he or 
she will have 5 minutes to question the witness, and I will 
begin the process.
    When I was reviewing your testimony, I noticed that for a 
U.S. citizen, the enrollment fee for the NEXUS program on the 
Canadian border is $50; but for SENTRI, which is used for 
frequent travel across the Mexican border, the enrollment fee 
is $129. Why is there a difference in the enrollment fee?
    Mr. Jacksta. OK. When we moved forward with the NEXUS 
program back in 1995, we took a look and did a cost analysis of 
the program, and we determined that $129 was the most 
appropriate fee for the travelers that were going to be using 
the program. This would allow us to get the proper equipment as 
well as to make sure that we would have additional personnel 
during the interview process.
    On the SENTRI side of the house, we have additional 
security checks put into place, where we actually require that 
the vehicle be checked by our CBP officers in addition to just 
the individual. So only specific vehicles are allowed to use 
the SENTRI lanes on the southern border.
    On the northern border, when we were taking a look at 
moving forward with the trusted traveler program there--it is a 
joint program with the Canadians--and working with the 
Canadians, the decision was made to have a program to sell to 
the individuals on the northern border. And to work together 
with the Canadians, the $50 fee would be the most appropriate 
fee for us to ensure that we would have enough people to enroll 
in the program and also to address some of our requirements to 
put the equipment out there, and resources.
    Ms. Sanchez. So are you saying that with the one at the 
northern border with Canada, you have U.S. citizens who use the 
program, and then you have Canadian citizens who use the same 
program; or you have U.S. citizens who live in Canada who use 
the program, and because you have both countries participating 
in that manner you have decided to keep the fee lower?
    Mr. Jacksta. Yes. It is a joint program with the Canadians, 
where the----
    Ms. Sanchez. Do their citizens use it or our citizens?
    Mr. Jacksta. It is a joint program with the Canadians, 
where both Canadian citizens and U.S. citizens, as well as----
    Ms. Sanchez. Use the same program.
    Mr. Jacksta. --and lawful permanent residents for both the 
United States and Canada can utilize the program.
    Ms. Sanchez. With our Mexican neighbor, it is only U.S. 
citizens who use the program.
    Mr. Jacksta. No. Mexican citizens can also enroll in the 
program. Mexican citizens and U.S. citizens and lawful 
permanent residents.
    Ms. Sanchez. But you don't consider it a joint program?
    Mr. Jacksta. It is not a joint program with the Mexicans. 
The Mexicans do not have a process in place where people who 
present SENTRI cards can go through specific lanes and receive 
trusted traveler privileges.
    Ms. Sanchez. To enter their country.
    Mr. Jacksta. To enter their country. On the northern border 
area, the Canadians, at the same time that a person is applying 
to the United States, they are also applying to the Canadians. 
The Canadians also do a vetting of the individuals through 
their law enforcement databases. They do an interview process. 
And they also work with us to issue the card to the individual. 
On the Mexican side, we currently do not have that process in 
place.
    Ms. Sanchez. OK. Well, I go to the Mexican border a lot, 
and usually when I go through California and I go through San 
Ysidro, Tecate, I am just swiped through. So when you say that 
the Mexicans don't really have a program, they don't really 
have a program, they just swipe you through most of the time. 
Once in a while they make you press the button and it turns up 
red and they take you to secondary. But most of the time you 
are just going through.
    So you are telling me it costs more for us to have our own 
program than it costs when the Canadians are actually doing 
something? I mean, I am trying to figure out why the cost 
differential.
    Mr. Jacksta. The cost differential is that for the southern 
border, because of a higher threat for illegal immigration, as 
well as for narcotics, we do a little bit more during the 
interview process. We also validate that the vehicle--the 
vehicle has to be enrolled in the program, while up on the 
northern border you do not. So our officers have to do a check 
of the vehicle, and as a result of those efforts, the daily 
costs are----
    Ms. Sanchez. Higher.
    Mr. Jacksta. --higher than the northern border.
    Ms. Sanchez. But you also said you do a more detailed 
interview for the person applying at the Mexican border.
    Mr. Jacksta. Well, we need to make sure that individuals 
that are coming across the border, that when they are 
requesting an application to participate in the program, that 
they have--there is clear indication that the individuals will 
be going back once they get these cards.
    Ms. Sanchez. But you don't do that for Canadians or for 
people who live in Canada?
    Mr. Jacksta. We do an interview check for the Canadians. It 
is not as----
    Ms. Sanchez. Why isn't it as thorough from Canada?
    Mr. Jacksta. Well, there is clearly a higher threat for us 
on the southern border than the northern border regarding 
illegal immigration and narcotics smuggling. And therefore, we 
want to make sure that individuals who are in the programs are 
fully vetted, and ensure that there is no threat that these 
individuals may use their vehicle in the future for narcotics 
smuggling or for possibly illegal immigration reasons. So when 
we enroll these people we want to make sure that anyone, 
whether it is a northern border or southern border, that they 
have the proper identification and their citizenship is 
identified. But on the southern border we do a little bit more 
of a check of the vehicle to ensure those types of issues are 
addressed regarding narcotics smuggling.
    Ms. Sanchez. We don't have----I mean I am just amazed that 
it is different, because I think we have just as much of a 
potential threat coming from Canada of terrorists or people who 
are smuggling drugs. And I think the more this committee works 
and the Department works on getting a handle on the southern 
border in particular, we are going to have more people coming 
in from Canada. I mean, the weakest link of the whole chain is 
where I as a terrorist would enter, or as a drug smuggler would 
enter.
    So, you know, maybe we have to on a staff-by-staff level 
review what is going on there. But it doesn't sound good to me 
to hear you do less of a review from people coming in from 
Canada than you do for people coming in from the southern 
border.
    Mr. Jacksta. I want to make sure that we understand that 
when we say less of a review, we do the same type of vetting 
through our law enforcement databases. That is why we have the 
Vermont vetting center. Every applicant, whether it is on the 
NEXUS border--on the northern border or on the southern border, 
we ensure they are fully vetted through our process. Each 
applicant we receive fingerprints for the southern border and 
the northern border, NEXUS and SENTRI. In addition to that, on 
the southern border we do do an inspection of the vehicle. And 
we ensure that the vehicle does not have any compartments or it 
could be utilized for smuggling goods across the United States
    Ms. Sanchez. But you feel comfortable in having to do more 
at the southern than having to do--what if we do a good job and 
start to really plug up the southern border? Are you going to 
do more on the northern border?
    Mr. Jacksta. Well, the vehicle is not currently inspected 
as part of the program.
    Ms. Sanchez. Why is that?
    Mr. Jacksta. Because of the southern border threat 
regarding narcotics smuggling.
    Ms. Sanchez. But there is narcotics smuggling coming in 
from Canada.
    Mr. Jacksta. Yes, there is.
    Ms. Sanchez. But it is not a threat?
    Mr. Jacksta. No, it is a threat. It is a higher threat on 
the southern border.
    Ms. Sanchez. It is a higher threat on the southern border. 
OK. I see that my time is up. I am going to go to my Ranking 
Member for 5 minutes. Mr. Souder.
    Mr. Souder. I have some other questions, and I don't want 
to prolong your agony too long on this question. But it jumped 
out at me, too, and I quite frankly don't know how I didn't 
understand, in all my visits, that it is almost 2-1/2 times as 
much cost. I know part of it is, quite frankly, President 
Calderon is trying to improve the vetting of the law 
enforcement officials on the Mexican side. But the IBETs and 
the RCMP and the provincial governments as a whole do more 
screening in the overall system. And that leads to slightly 
different risk assessments in law enforcement cooperation.
    But there are some questions I have with that. And that is 
that in the north border, under the scenario that you just 
said, to be blunt, it should be $129 at the Vancouver, 
Washington, crossing and $50 at the rest, because there is not 
a lower threat of narcotics coming across at British Columbia 
than there is on the south border in, say, certain parts of it.
    Now, there are parts of the south border that are a higher 
threat, but right now the BC bud that is pouring through and 
the meth stuff that is pouring through in Vancouver--and part 
of the question I would have, I don't really want to ask that 
question here, because I have some others, but one that I am 
going to be asking as a follow-up and want to talk to the 
Department about is at what point do you make adjustments. If 
the cost is related to risk, at what point do we start checking 
vehicles?
    And in fact I saw at the Ambassador Bridge, them nail two 
brand-new SUVs coming with compartments loaded on both sides. 
Two had just gotten through, and fortunately an alert CBP 
person said, I just saw a guy with the same kind of 
identification and vehicle go blowing through over here. Why 
don't we nab this one? And they found the compartments. And 
then another one is coming through, and they realized they 
missed two and got two. So it is a matter of degree here.
    And the Canadians are getting better at prescreening on 
their side, and their licenses are better prescreened, but 
there are--your figures from your Department are that the watch 
list catches are 3--to 400 percent higher on the north border. 
That is, quite frankly, because RCMP is doing a good job in 
helping us identify and work with that.
    But the fact is, the terrorism risk is higher right now at 
the north border, to some degree, at least based on what we are 
catching, and because of the huge Arab American and Arab 
Canadian communities within which to hide. And there aren't 
such communities in Mexico. So it is not clear on terrorism.
    On methamphetamines, Asian heroin, and BC bud, it is not 
clear. It is clear that the quantity of drugs coming through, 
both in the size and scale, which may be tunnels or trucks. A 
lot of what we are catching at the south border are individuals 
carrying small amounts with which to fund their illegal 
immigration. When you have a gap that big, you can already get 
a sense--I don't think there is an awareness politically. I 
have a slightly----
    Ms. Sanchez. Would the gentleman yield just for a second?
    Mr. Souder. Yeah.
    Ms. Sanchez. When you were talking about President Calderon 
trying to do right by his law enforcement there, I mean, what I 
got from Mr. Jacksta is that none of the money, actually the 
129, is actually for anything going on on the southern side. 
They are not in cooperation with us.
    Mr. Souder. No, but----
    Ms. Sanchez. Are you just saying that he has to use more 
men because the quality of checking on people is worse in 
Mexico?
    Mr. Souder. That along the border there have been several 
governors themselves have been brought down in drug rings. In 
Juarez you have----
    Ms. Sanchez. Right. No, I know that has been going on.
    Mr. Souder. --sheriffs getting killed. Well, it means that 
our background checks, we are not getting a double-check. That 
when somebody goes through a frequent traveler on the Canadian 
side, they are in effect being double-checked to get their 
license in Canada.
    Ms. Sanchez. I see what you are saying.
    Mr. Souder. And their RCMP is, on the whole, more 
aggressive in narcotics. But British Columbia is falling flat 
on its face. And the question is, do we adjust our policies 
when that happens?
    Mr. Jacksta. I want to make sure there is a clear 
understanding that individuals who enroll in this program go 
through the full vetting process, whether it is on the Mexican 
border or the southern border. They go through the vetting. We 
do a fingerprint check on them. Doesn't matter which program 
they are in. We do a background check and we do an interview 
process for every traveler, northern and southern. So when we 
make a decision they are going to be enrolled in the trusted 
traveler, there is a confidence level by the CBP officer who 
will make that final decision that the identification, 
documentation, and the citizenship of the person has been 
determined, and we are confident that it is truthful and that 
these are the individuals. That is where the programs are 
exactly the same.
    On the southern tier, there is one other requirement, and 
that is where we look for the vehicle, and only specific 
vehicles. If you are in a trusted traveler program, you can 
only use specific vehicles that have been identified and looked 
at by CBP officers to ensure that those vehicles are not 
utilized. We recognize that there is a clear threat no matter 
what border you are at, whether it is at the southern border or 
the northern border. We have random checks put into place. We 
have random checks not only on the vehicles, but we have random 
checks based upon the number of times you have come across.
    There is a number of compliance measurement programs to be 
put into place. So with those programs, we are making every 
attempt to make sure anyone who is crossing that border meets 
those requirements.
    Mr. Souder. But the problem you have here is you have a, 
bluntly put in political terms, hey, I am a north border 
person, I obviously have a lot going both directions, but you 
have a $79 difference. Yet in effect you are saying it is $50 
to check the person and 79 for the vehicle? Is that what you 
are saying?
    Ms. Sanchez. That is not what he said. He said you have a 
more thorough review, and you didn't say it was just the 
vehicle. Now you are saying the whole difference is based on 
the vehicle.
    Mr. Jacksta. The difference is that when the officer does 
the interview process, they question the individual to feel 
confident that the person is not a threat or concern and that 
their identity and citizenship has been identified. That is 
done at both locations. There is no difference between southern 
and northern border on that.
    Mr. Souder. That is not what you said earlier.
    Mr. Jacksta. If I said that, I apologize. I don't want to 
get into----
    Ms. Sanchez. We are just trying to get to the bottom of it. 
You may have said something you thought it sounded one way; 
just if we look back at the record, you will see that you said 
we do a more thorough check on the person applying in the 
south, and then we do a vehicle check.
    So our question is, is the difference due to the vehicle 
check?
    Mr. Jacksta. Yes.
    Ms. Sanchez. And why, as my Ranking Member said, aren't we 
doing vehicle checks in particular in areas where we know 
vehicles are being driven across with, you know, with marijuana 
or drugs? I mean we have plenty of----
    Mr. Jacksta. Seizures. The northern border seizure numbers 
have gone up over the last couple of years with Canadian bud, 
as well as other drugs, coming across. And it is a concern for 
us. I mean, I will tell you that your observation that maybe 
the vehicles should be looked at on the northern border is 
something that could be considered to be looked at. We would 
have to work with the Canadians on that to ensure through the 
process that that effort would be put into place. I will bring 
that back as an issue to follow up on.
    I also think that when we talk about the issue of fees, I 
think you should recognize that the $129 fee was initially 
established back in 1995 as part of the program when it moved 
forward. We are taking a look at all our user-fee requirements 
to try to bring them into consolidation. The discussion that we 
are having is that we should have one fee. We believe in that. 
We believe that it should be one fee. But you can understand 
some of the challenges of getting that moved forward to have 
one fee.
    Mr. Souder. It has to be one fee, or the difference be 
clear why there is a difference and be defended. Because 
politically, to have the poorer country pay a higher fee than 
the more affluent country is not going to be a politically 
defensible position.
    Ms. Sanchez. Go ahead.
    Mr. Souder. I have more questions if you want to go another 
round, or if Mr. Cuellar wants to.
    Ms. Sanchez. Mr. Cuellar, are you ready to ask your 
questions? Are you ready, or shall we continue over here?
    Mr. Cuellar. I certainly want to join you if you all want 
to just----
    Ms. Sanchez. Why don't you go ahead and ask some questions, 
and then we will come back to Mr. Souder here?
    Mr. Cuellar. I just want to follow up. I will just ask 
him--I will be happy to yield some of my time--I feel the same 
way as the Ranking Member and my Chairwoman feel.
    I just don't understand, and I heard your justification, 
but just being from the southern border, and if I would try to 
explain that to my constituents, my business people there, they 
wouldn't understand. They would say, what the heck is the 
difference between the northern and the southern port? Which 
you get a trustee card just like a passport. I mean, you get a 
passport; if you are going to go to Mexico, it is going to cost 
the same thing whether you are in the southern part or northern 
part of the United States. A passport is a passport.
    Here I think the NEXUS, the SENTRI, the FAST, those trustee 
cards should be the same; it doesn't really matter where. I 
can, and certainly I think we can all debate you, if you want 
to look at--you know, look at the 9/11 terrorists. They didn't 
come from the southern border. They came from the northern part 
of the border. I try to explain to my folks down there in 
Laredo when we passed this secure fence law, the southern 
border got a fence and the northern border got a study to see 
if they get a fence.
    And then we get the SENTRIs, and I didn't know about the 
prices until it was just mentioned. And it just doesn't make 
sense to us. As policymakers, it just doesn't make sense.
    And I just want to add my 2 cents' worth on this. And I 
agree with my Chairwoman and Ranking Member that I really think 
you all need to look at that. And I hope we do follow up on 
this.
    But let me just ask you one particular question. How many 
individuals are currently enrolled in the trustee travel 
programs that are used in the land ports, the NEXUS, the 
SENTRI, the FAST? And has there been a trend in the usage of 
those programs in the last couple years? I know some of them 
have been in existence a little bit longer.
    Mr. Jacksta. Just to give you some numbers, on the NEXUS 
program we have currently about 127,000 people enrolled. That 
is for the northern border. For the SENTRI program we have 
about 124,000 currently enrolled. And for the FAST program, 
which is the Free and Secure Trade program, which you can use 
that card on either the northern or southern border, we have 
approximately 90,000 drivers enrolled in that program. And with 
that, we are looking at expanding to additional locations for 
both the FAST program and the NEXUS program. The SENTRI program 
we just expanded to a number of new locations down in the 
Laredo district. We moved to Brownsville. We moved to Hidalgo. 
We also moved to Nogales within the last 12 to 14 months. So 
the program, we have new lanes there that allow traffic coming 
into the United States to----
    Mr. Cuellar. Has there been a trend on----
    Mr. Jacksta. There has basically been on the FAST cards, 
most of the truck drivers now have that card so it has been 
rather flat. For the SENTRI program, it has been increasing at 
a fairly level rate of about 2 or 3 percent. And for the NEXUS 
program, we have seen a jump. And one of the reasons why we 
think we will see a jump in both the NEXUS and the SENTRI 
program is that in the Notice of Proposed Rule that was issued 
about a month ago, it indicates that the Department will be 
accepting the NEXUS and SENTRI FAST cards as cards that can be 
compliant with the WHTI land requirements. So we expect to see 
growth in that area in the next couple months.
    Mr. Cuellar. What is your effort in trying to harmonize the 
application process for the trusted traveler applications?
    Mr. Jacksta. One of the important efforts is that we have 
currently in place the capabilities for people to apply for the 
SENTRI program through an Internet Web page, where they fill 
out the information. At that point the information comes in to 
CBP, we do the vetting. We hope to in the next couple of weeks 
have that same capability for the NEXUS program. So therefore, 
if you are a NEXUS or SENTRI you will be able to apply on line.
    And then the goal is for the FAST program to also be able 
to apply on line after the new year, calendar year, sometime in 
the January time frame. That would bring all the programs into 
one mechanism for people to apply for.
    Mr. Cuellar. OK. My last question before I pass this back 
to my Chairwoman, there has been some reports, some 
participants in the NEXUS, SENTRI and FAST lanes have 
complained at times about the wait timeS--and being from Laredo 
I am very concerned about the wait times--that sometimes in 
those lanes that are dedicated to those programs are equal or 
even exceed those of the regular lanes at our port of entries. 
Is there any truth to those reports?
    Mr. Jacksta. I can tell you that there shouldn't be.
    Mr. Cuellar. My question is shouldn't be----
    Mr. Jacksta. I don't have any--I have no evidence given to 
me that that is actually happening. What we expect is that if 
that is happening, then our managers have to manage the port of 
entry. I know that there are certain locations where we are 
able to add additional lanes or open additional lanes, like San 
Ysidro and a couple of other locations.
    There is the issue that one of the things that is extremely 
important for this program is that you have the capabilities 
for the roads that are bringing travelers from Mexico into the 
United States, to have the proper infrastructure in place so 
that individuals who are in the trusted programs can get into 
that lane immediately. There are certain locations that we are 
working on right now where that capability doesn't exist until 
they actually cross the bridge and go into the U.S. area. And 
then once they are in the U.S. area, then they should have a 
dedicated lane for the trusted traveler program. So that may be 
one of the issues with the wait.
    Mr. Cuellar. OK. Thank you. Thank you, Madam Chair.
    Ms. Sanchez. I thank the gentleman from Texas. And, Mr. 
Souder, if you would like to continue asking your questions?
    Mr. Souder. I had to first ask a couple of other questions. 
If you have a north border card, does it also work on the south 
border?
    Mr. Jacksta. At the present time it does not. We hope to 
have that once we have all our harmonization done. That should 
be happening sometime next year.
    Mr. Souder. If you have a US-VISIT card, is it going to 
work?
    Mr. Jacksta. I am sorry, sir, there is no US-VISIT card. 
The pass card? Is that the----
    Mr. Souder. What we are using at airports. Is that going to 
work at the land borders?
    Mr. Jacksta. There is the NEXUS program currently in place 
in Canada that is acceptable at the land border on the northern 
border and would be acceptable down the road when we bring both 
the northern and southern programs into place.
    But just to make sure we don't go confusion again, so we 
have the NEXUS program, which is up in Canada, our preclearance 
locations where we accept it. It is different from the 
registered traveler program that TSA runs. I don't want to 
confuse you.
    Mr. Souder. And I don't want to be confused. In fact, one 
of the things that would be nice--and I thought we were moving 
this direction--is that I don't like all the different 
initials, and that we are all doing different things and we are 
having to buy different equipment to do it, because at some 
point this is all going to need to be harmonized. That it is 
like if I want to go this direction, I have to have this card 
and pay this fee, and then this fee over here. And if I get on 
a cruise, I might have to have this.
    But we need to be moving towards a commonality, which is 
part of the goal of Real ID. Because we are going to need this 
internally on visa overstays, on people who may have gone out 
of their zones. And I think that one of the things here is not 
to too long perpetuate the differences between the north and 
south border systems, there needs to be a common operating 
system, if not the other.
    I mean to some degree, we have had this problem in defense. 
In fact, one man in my district became very wealthy and was 
bought out by General Dynamics because he got the linkage to 
make different systems talk to each other.
    There is only so long you can have Betamax and VHS. Most 
younger people don't even know what Betamax is. You have to 
have some kind of operating joint system if we are going to do 
this. And that should be a priority, I would assume.
    Mr. Jacksta. Yes, and it is a priority to get--the first 
step is to get the NEXUS and SENTRI program so that you can use 
them at either locations, northern and southern border. 
Remember that one of the challenges that we have to face is the 
issue of the vehicle, that if you are going to be using the 
NEXUS card you cannot use it on the southern border unless the 
vehicle has been checked. So that is something that we are 
working out on. You remember the issue of the car.
    Mr. Souder. Do you see yourself moving to a vehicle check 
on the north border?
    Mr. Jacksta. It has been discussed in the past. Will it be 
going forward or not? It is something that can be considered. 
Obviously, it is not going to be something that will not have 
some ramifications. It would have to be looked at.
    Mr. Souder. Right. There is a ramification in my district 
without enough capacity at Detroit in the making of a pickup. 
We have a hundred border crossings in the making of each pickup 
down in Indiana. So it has ramifications. But it also has 
ramifications not to have vehicle checks if there are not 
secure vehicles.
    Mr. Jacksta. But it should be noted, although it is as part 
of the registration program you have the vehicle check, we 
always have the authority, and we do check, as I mentioned, the 
random checks that go on on a regular basis for both the 
northern and southern border programs. You know, individuals 
are randomly selected who are enrolled in these programs and go 
through a full inspection to ensure that they haven't 
compromised the program.
    Mr. Souder. And you have a fingerprint check in this 
program?
    Mr. Jacksta. Both programs, that is correct.
    Mr. Souder. Do you know how many people you have caught 
abusing this program?
    Mr. Jacksta. We haven't caught anybody specifically that 
can be indicated that we have caught them terrorist-related. We 
have identified individuals that were possibly wants and 
warrants that we had to clean up when we received their 
application and they did their fingerprint check. We had to 
verify whether the wants and warrants were still valid.
    We have denied basically around 90 percent--I am sorry. We 
accept about 90 percent of the people on the northern border 
into the program that do apply. And on the southern border we 
accept about 82 percent of the people who apply.
    Mr. Souder. You haven't had any revocations?
    Mr. Jacksta. We have had revocations where individuals have 
been caught. Over the years we have identified close to 100 
individuals that we have stopped and discovered violations 
during their processing through one of the trusted traveler 
programs.
    Mr. Souder. I remember one hearing I did on the north 
border, the Canadians were more than willing to take a triple 
penalty for people who abused the system. Do we have enhanced 
penalties?
    Mr. Jacksta. We have the narcotic violations that are 
discovered. With the trusted traveler programs we go to the 
U.S. attorney's office and ask for prosecution, even though it 
may be a minor one. We advise people that if they are in the 
trusted traveler program, if there is a violation discovered 
they are going to be immediately revoked from the program. And 
if it is actually an illegal activity, we will go to the U.S. 
attorney's office.
    We also publicize, through press releases, all violations 
at our border where we discover a person who is a trusted 
traveler who has violated the program, to make sure that 
everyone understands that we will not tolerate any type of 
violation of the trust.
    Mr. Souder. And I don't want to get into the Detroit, 
Buffalo bridge-tunnel questions, but just know that that is a 
key part of making sure that this program can actually expand 
in what we do.
    Two other quick points. The Canadians would be quick to 
point out that nobody on 9/11 was proven to have come across in 
Canada. But that doesn't mean they didn't come from Canada. It 
means we didn't have a clue how people were getting in and out 
of our country. We don't know whether they came across from 
Canada and Mexico and through Florida and at our airports. The 
fact is that some of them were from Montreal at one point. So 
clearly, at some point they came in and out from Canada. The 
Canadians get very sensitive because there were false 
statements early on. But if one of them or two of them or a 
number of them had been at a mosque in Montreal, presumably 
they crossed the north border. But they could have crossed lots 
of other points, too. The United States didn't have any system.
    Also just for the record--and this is where we need an 
explanation--the $129 fee on the south border, it says $25 
application and $24 fingerprint. And you said fingerprints on 
both, and applications on both. So that is $49. And then it 
says 89 per person, or maximum of 160 for minor children. That 
doesn't say ``vehicle,'' but presumably vehicle may be part of 
that. So there clearly is some kind of a different charge, 
because this implies it is not even if they don't have a 
vehicle. If you were just to walk across----
    Mr. Jacksta. But the application process for the SENTRI 
program, when it was established through the regulations that 
you are reading right there, that outlines the fee. When the 
program was established, a vehicle check became part of that 
standard procedure and is part--is absorbed into the 
application process.
    Mr. Souder. And if you can tell us how much of that $80 is 
vehicle. That is really what the fundamental question is. 
Because the 24 and 25 would be the same on the north--a people 
fee and a fingerprint fee.
    Mr. Jacksta. And in all honesty, that is exactly why we are 
looking at the whole issue of the fees and exactly trying to 
bring them into one consistent, uniform fee across the board 
for all three programs. And so we have some consistency.
    That regulation goes back to 1995 under the legacy 
immigration authority. And you know, we are looking at that 
now.
    Mr. Souder. Thank you.
    Mr. Jacksta. Can I just--you mentioned an issue regarding 
people coming across the border. That is why the WHTI effort 
and the land program, the NPRM that is out there is extremely 
important. I have documentation in front of me. These are all 
documents, fraudulent documents that our officers have stopped. 
These are driver's licenses, this is a birth certificate, these 
are naturalization papers. And these are the kind of concerns 
that our officers see on a regular basis.
    And that is why we feel very strongly that WHTI is 
important for us, as well as how the trusted traveler programs 
fit into that capability for our officers to quickly determine 
whether a person is admissible or not.
    I haven't had the chance to tell you how the RFID works and 
how the trusted traveler programs bring that information right 
up to our officer at primary. So that when the person comes up 
to the lane the card is read through the RFID, the information 
is made available to our officers, and the officers can quickly 
determine whether the person is a concern or not and whether it 
is actually the person enrolled in the program. That is what 
the Global Enrollment System has done for us.
    Ms. Sanchez. Great. How long does it take to apply for 
SENTRI, from application to when you get the card?
    Mr. Jacksta. The application process currently is between 4 
to 6 weeks. We currently have a measurement in place that once 
the application is submitted to us, 2 weeks after that the 
application should have been completed through and gone through 
the full vetting process. At that point, the individuals are 
notified.
    In the SENTRI program they are notified electronically, 
because we have the electronic Web-based system in place. They 
get a message saying they can register for the program, the 
interview, and the fingerprint check. And they can pick a date 
and time. That capability will be in place for the northern 
border SENTRI program in the next couple of weeks. And so our 
goal is to try to make sure that we give the opportunity for 
individuals to get their card within 6 weeks of the initial 
application.
    Ms. Sanchez. And you do a fingerprint background check on 
the fingerprints?
    Mr. Jacksta. Yes.
    Ms. Sanchez. You do it; not the FBI?
    Mr. Jacksta. No, we transmit the fingerprint checks through 
IDENT IAPHIS to the FBI. They do the quick check on it and they 
send a message back to us.
    Ms. Sanchez. Because you know, we are having this problem 
with people who are trying to become citizens who have applied, 
and the big backlog is fingerprint checks by the FBI. In fact, 
once they are over 18 months old, they are null. And the next 
thing the applicant has to do is go and get another set of 
fingerprints for the FBI.
    So I am trying to understand, are they just doing a more 
thorough check on the other or--I mean why would it take only 4 
to 6 weeks for your process if you are doing a fingerprint 
check, that I would hope would be a good fingerprint check, 
versus it is taking--I think the backlog is 4 years or 
something if the FBI with respect to citizenship fingerprints. 
Do you have any idea about that?
    Mr. Jacksta. I do not want to speculate on exactly what 
they do with the immigration checks versus the trusted traveler 
programs checks. But I can tell you that when you apply and you 
get the interview, you will go down to a CBP office. And at 
that point we take the fingerprints, and normally within an 
hour or two we will get a response back. And we believe that it 
does a full check of the databases that we are concerned with. 
Both the IDENT and IAPHIS check.
    Ms. Sanchez. That sounds to me like they do a much faster 
check for someone we are going to let in the country versus 
somebody that is already in the country that is in the 
application process. It is an interesting concept. If I want to 
go into the program and I apply for it and I get denied, is 
there an appeals process for it? Let's say at SENTRI at the 
border.
    Mr. Jacksta. If you are denied--if your application is 
denied, we send a letter to the individual, advising them the 
reason for denial. They then at that point have the 
capabilities to contact a CBP office and determine why they 
were denied. In certain cases we are not able to tell the 
person exactly what the record says. For the most part, most 
people do know why they are denied.
    Ms. Sanchez. That wasn't the question I asked. Is there an 
appeals process?
    Mr. Jacksta. The appeal process is they can apply again. It 
is a zero-tolerance program, where if there are any type of 
previous violations the person is not admitted into the 
program.
    Ms. Sanchez. Previous violations. What does that fall 
under?
    Mr. Jacksta. Previous violations can go all the way from 
criminal activity, which means misdemeanors or felonies, or to 
previous violations of customs, immigration or agricultural 
laws. So if an individual had been stopped, say, 5 years ago 
for a narcotics violation, they would not be admitted into the 
trusted traveler program. If they were previously stopped for 
an agricultural or an immigration violation and the violation 
was a violation that was something that is still valid today, 
or was clearly a breaking of the rules or requirements of CBP, 
then the person would not be admitted into the program.
    Doesn't mean that they are not admitted into the United 
States. It means they are not admitted into the trusted 
traveler program.
    Ms. Sanchez. I understand that. I am asking if there is an 
appeals process. Because I recall reading an actual denial that 
said there is no appeals process directly in the letter.
    Mr. Jacksta. There is no written appeal process. The 
process is that you can----
    Ms. Sanchez. Does it say that in the letter? It doesn't. I 
am going to tell you, because I have a particular one I am 
thinking of. I have a brother who was denied. And he came to me 
with it. And he gave me the letter and he said, do something 
about this. Of course, I didn't. But I mean, it doesn't say it 
has an appeals process. In fact it says, sorry, you are out of 
luck.
    Mr. Jacksta. I can tell you that the letters that we are 
currently issuing--once again, this is an old program, don't 
know when exactly that that happened. We have been trying to 
bring it into a standard format for all three programs. The 
letter should say the reason why the person is denied and that 
they have the capabilities to contact a location close to their 
area to request further information regarding the incident and 
why the person was denied. That is in the current letters that 
are being issued by CBP.
    Ms. Sanchez. So have you had people appeal and get their 
card?
    Mr. Jacksta. Yes, we have had people that have requested an 
appeal to be resubmitted into the program or to receive a card. 
Some of them have been denied, and the denial stands because of 
the concern that we have. And there are other people, based on 
the fact, the information that they have provided us, that they 
have been accepted into the program.
    Ms. Sanchez. OK. That is good to know. I will tell my 
brother to reapply. I want to ask you about the FAST program, 
because the FAST program, it is my understanding that the 
participants in the FAST program for commercial cargo shipments 
must also be members of C-TPAT. Is that correct?
    Mr. Jacksta. That is correct.
    Ms. Sanchez. OK. So I have been following C-TPAT quite a 
bit. And I am concerned that the companies that are considered 
tier one members of C-TPAT--that is, they write their little 
thing about how great they are going to be, and then they turn 
it in and we certify that we received it, and therefore they 
become tier one members. But we actually don't validate it 
sometimes for years.
    So a tier one C-TPAT member who has been not validated, but 
allowed to participate in the FAST program before their 
security--are they allowed to participate before their security 
plans are validated on site?
    Mr. Jacksta. I believe that there are companies or were 
companies--I am not familiar with the program in the sense of 
knowing exactly the details today. I do know that there were 
people who were C-TPAT certified that had not had their 
security verifications taken place. I don't know whether that 
exists today. I don't know whether that has been completely----
    Ms. Sanchez. You are saying to me historically in this 
program FAST that if I have--if you would get a company who 
wants to FAST, and they are a C-TPAT--they would have to be, 
according to all participants in FAST program must be C-TPAT. 
Many of them had not been reviewed, not all of them are 
reviewed to this point, but they are using the FAST program.
    Mr. Jacksta. At one point they did. I believe that has been 
cleaned up. And I can get back to you with the actual protocol 
and numbers that are being verified.
    Ms. Sanchez. I would like see those numbers, because I am 
very, very concerned.
    Mr. Jacksta. Recognize that the C-TPAT program does require 
some certain things. First of all, the drivers have to be 
vetted and be members of the FAST program. The company has gone 
through an initial vetting process by CBP, not onsite 
verification, I will verify that, but they have gone through 
our enforcement data checks. There are certain requirements 
when they are bringing shipments in that the shipments have 
seals on them so that there is no compromising of the shipments 
between the time that they left the manufacturer to the time 
that they cross the border. And then we also have the same type 
of random checks and the same radiation portal monitors that 
they must go through, just like any other truck.
    So there are certain requirements. There is advanced 
information that we receive through the manifest process. So 
there are protocols and procedures in place for the FAST 
trucker to be able to bring goods across. And the FAST driver 
is a key part of that.
    Ms. Sanchez. Thank you. Mr. Cuellar, do you have any other 
questions?
    Mr. Cuellar. No, ma'am.
    Ms. Sanchez. Then we will go to Mr. Reichert for 5 minutes.
    Mr. Reichert. Thank you, Madam Chair. I have just one 
question. I represent the Northwest, just east of the Seattle 
city limits. So we are preparing for 2010 for the Olympics in 
Canada. We have a pilot program I am sure you are aware of. How 
is that pilot program progressing, and how are you preparing 
for the numbers of people who will fly to Seattle and drive to 
Canada or take the train?
    Mr. Jacksta. OK. Well, one of the requirements that we are 
looking at is the issue of enhanced driver's licenses, and 
making sure that we can use driver's license to be consistent 
with the WHTI requirements of being able to denote citizenship 
and to ensure the identity of the person.
    As you know, the Secretary signed an agreement with the 
Governor of Washington, and we are currently working through 
that process. I can tell you that a number of action items have 
already taken place where we are currently in the process of 
identifying with the State of Washington the individuals from 
the State who will do the actual review of the applications for 
these enhanced driver's licenses.
    We have worked, we are working with the State, and I think 
they were in town 2 weeks ago, where we actually started 
working on the technical capabilities for our system to 
communicate with their system so that we would have that 
information. And the latest, from what I understand, is that we 
are looking at sometime in January for that process to begin 
where the actual driver's licenses would be able. We believe 
that is an extremely important part of the WHTI effort.
    In addition to that, we have identified the director of 
field operations, Tom Hardy, who is up there in the Seattle 
area, as being--as one of the key members in the group that is 
taking a look at the Olympics and making sure that there are 
protocols in place for travelers going to Vancouver, and also 
travelers that are coming back from Vancouver, and making sure 
that we have the proper protocols in with the bus lines, the 
rail lines. Obviously, Amtrak is going to be used up there. As 
you know, there is a rail, regular rail service there.
    We are also looking at the whole issue of cruise lines and 
various use of the cruise lines. So we are actively involved 
with that. We recognize that it is getting close. And we want 
to make sure that we are fully participants with making sure 
the documentation that is utilized.
    Now, I will just tell you over the years we have had a 
number of Olympics where Customs and Border Protection, the 
legacy Customs and legacy Immigration had a very good working 
relationship with the various committees that are trying to put 
this together to ensure that we have personnel up there to 
assist with any type of increased traffic, as well as making 
sure that we work with the Olympic Committee to have 
documentation of various members that are involved with the 
Olympics, and have a prevetting process so that we can feel 
confident that they don't pose a risk.
    Mr. Reichert. Thank you very much.
    I yield.
    Ms. Sanchez. Thank you, Mr. Jacksta.
    As usual, you are a wealth of information, and we 
appreciate the information you have given us, and I know that 
you are going to get back to us in a fairly quick manner with 
the information we have asked. Again, thank you for coming 
before us. We appreciate it.
    We will take about a minute or two to get our second panel 
up there and get started on the testimony of the second panel.
    I welcome the second panel of witnesses. Our first witness 
will be Ms. Maria Luisa O'Connell, President of the Border 
Trade Alliance. Founded in 1986, the BTA is a grassroots, 
nonprofit organization that allows stakeholders to address key 
issues affecting trade and economic development in North 
America. Under Ms. O'Connell's leadership, the BTA has become a 
recognized authority on border trade issues and is a leading 
advocate for improving the quality of life among border 
communities.
    Welcome.
    Our second witness is Mr. Neal M. Belitsky, Executive Vice 
President and General Manager of the Detroit & Canada Tunnel 
Corporation. The corporation manages the Detroit-Windsor 
Tunnel, your favorite, Mr. Souder, which is one of the busiest 
crossings between the U.S. and Canada. Mr. Belitsky joined the 
corporation in 1998 and has a variety of responsibilities, 
including strategic planning, operations, security, 
maintenance, government, and customer relations.
    Welcome.
    Our final witness will be Mr. Thomas Gann, Vice President 
for Public Policy at Digimarc Corporation. It is a leading 
supplier of secure identity and media management solutions. The 
company provides products and services that enable the 
production of more than 60 million personal identification 
documents, including two-thirds of U.S. driver's licenses and 
IDs for more than 25 countries.
    Welcome.
    Without objection, we will put your full statements into 
the record, and I will now ask each witness to summarize his 
and her statements or tell us whatever it is that you think we 
need to know in 5 minutes.
    Ms. Sanchez. Ms. O'Connell, please.

  STATEMENT OF MARIA LUISA O'CONNELL, PRESIDENT, BORDER TRADE 
                            ALLIANCE

    Ms. O'Connell. Thank you, Madam Chairwoman Sanchez, Ranking 
Member Souder, and other distinguished members, Congressman 
Cuellar. It is an honor to be here, and thank you for inviting 
the Border Trade Alliance. I have my written comments.
    I do want to say, since you said to say whatever we want to 
say in terms of this area, we are living in challenging moments 
at the border, and it is challenging in terms of putting 
everything together. We have the expectations of Congress. We 
have the expectations of the administration, and we, the people 
who live at the border who have businesses, have to live with 
it. The administration will go. You probably will be on another 
subcommittee assignment later on, but we still have to live 
with whatever decisions are being made, and we cannot afford 
you to fail in your leadership, and we cannot afford the 
government to fail in the implementation of the programs, 
because it is our livelihood.
    So thank you for having this hearing, because all of the 
hearings have been lately about between the ports of entry, and 
there are a lot of things going on at the ports of entry, so we 
need that from you; we need that leadership. So thank you so 
much for taking the initiative. Now I am going to go back to 
the written remarks.
    For the past 21 years, the Border Trade Alliance has been 
involved with all aspects of trade, travel, security, and 
commerce in our border communities along the U.S.-Canada and 
the U.S.-Mexico borders. The BTA represents, through our 
members and sponsors, a network of 1.8 million public and 
private sector representatives. Currently, the BTA serves as a 
member of the Department of State and Homeland Security's 
Secure Borders Open Doors Advisory Committee. The BTA is also 
an active participant of the U.S. Customs and Border 
Protection's Trade Support Network.
    The policies and procedures designed to facilitate secure 
trade and travel at our borders have changed dramatically since 
September 11, 2001. The changes at our borders have not 
occurred without concerns about their impact on legitimate 
trade and commerce. Similarly, the incredible growth in trade 
at our borders has not been without its share of growing pains. 
The infrastructure at our border crossings, for the most part, 
has not kept up with the increased volume of trade and travel.
    So, to give you an example, a visual of it, if you go to 
the lanes--think of the Ambassador Bridge, and you are a FAST-
certified truck. It takes you 2 hours if you are FAST 
certified. If you are non-FAST certified, it takes 2 hours and 
5 minutes. So what is fast about FAST? What is the challenge is 
that the trucks still have to be in the lanes for 2 hours, and 
the time is counted as they get to the booth. So, from the 
booth on, it is faster because you are certified, and you have 
the information, but the challenge is the infrastructure, that 
we do not have enough infrastructure, and it is the growing 
pains of success, of trade and growth, that we are growing at a 
very fast pace. So perhaps the greatest challenge we are facing 
in working toward improved security while facilitating 
legitimate trade and travel is the management of the 
expectations of the various stakeholders involved.
    Madam Chairwoman, my testimony today will focus on three 
main areas related to current and proposed secure traveler 
programs. I will also share recommendations to help provide for 
the economic and physical security of our border communities 
and our Nation.
    Our first point is that the secure traveler programs are 
inextricably linked and have a direct impact on cross-border 
commerce, travel and security.
    The universe of Federal secure traveler programs, along 
with cargo security initiatives such as the C-TPAT program--
Customs-Trade Partnership Against Terrorism--are fundamentally 
linked in their impact on travel at our border crossings. Let 
me give you an example. Recently, at the Mariposa port of entry 
in Nogales we had an event. On February 14th of this year, 
errors with the newly initiated e-Manifest system, where 
truckers electronically file their cargos with CBP prior to 
crossing the border, along with frustrations with the 
overburdened infrastructure led, in part, to a spontaneous 
blockade of commercial traffic by truckers at the Mariposa port 
of entry. You have pictures in there, I think exhibits 1 and 2, 
to give you an actual idea. There were lines of trucks stopped 
for 8 hours at the port of entry. Though this event directly 
affected commercial traffic, it also impacted all other traffic 
at the port of entry, negating the advantages afforded 
travelers enrolled in programs such as SENTRI.
    So, because of the infrastructure, the trucks were FAST 
certified, C-TPAT certified. You have all of the programs--you 
have the SENTRI--but if there is a blockade, there is a 
blockade. The FAST trucks cannot go there to get out of the 5 
hours or the 8 hours and have a special lane to move on. So 
that is a challenge that we are facing.
    While the implementation of e-Manifest was not the sole 
reason for the trucker strike in Nogales, the lessons learned 
from this event can be applied at both borders and in all our 
present security programs. Effective and open communication 
between the traveling public and the Federal Government, fully 
tested, vetted, and integrated technology and event contingency 
planning are critical components for the success of any Federal 
security program or initiative. I am running out of time.
    The two other points are the facilitation of legitimate 
travel while targeting limited Federal resources toward 
greatest potential threats.
    This is something that we continue to urge from the 
policymakers. How can our various secure traveler programs and 
initiatives be reconciled to maximize increasingly scarce 
Federal resources while improving security and allowing for 
legitimate travel at our borders?
    Our border communities support diverse, international 
economies that are dependent upon cross-border trade and 
travel. A large percentage of traffic at our borders is 
repeated, daily crossers who account for a significant portion 
of the sales tax and commercial revenues generated. There needs 
to be more efficient management.
    When you have the Western Hemisphere Travel Initiative 
coming along, there is a new RFID for more money, but you 
already have spent millions of dollars, and there is no 
coordination, and so I know we are a rich Nation, but we have 
to be good stewards of our money, and that is one of the 
concerns that we have here. It is important to have special 
access lanes for low-risk travelers and to look at these 
programs, but we have to be effective managers of the process.
    The third part, the development of an ongoing assessment 
and improvement in the coordination of Federal security 
initiatives while considering their impact on security, travel 
and commerce--the Western Hemisphere Travel Initiative--will be 
the greatest impact program that we are going to have at the 
borders because this is not a voluntary program. This is 
mandatory for all U.S. citizens. So now we have to deal with--
it has to happen. Do we have the process? Do we have the 
infrastructure? I am going long over my time. I will try to 
summarize it.
    The biggest challenges are: You have the Department of 
Homeland Security and the Department of State that have to 
agree on how this program is going to be implemented. You have 
to have the process using the technology that is going to 
leverage what is existing technology, and we do not see that 
happening, and that is a huge concern, Madam Chairwoman, and we 
want you to take that leadership with respect to that area.
    The last point is the outreach. We have to be able to 
educate the public and have a clear message of what is going to 
happen. Is it going to be a PASS Card? Is it going to be a 
driver's license, and the pilot projects are going to be 
launched? Is a pilot project going to be launched with a 
driver's license? Are we coordinating the efforts?
    Those are things and questions that have not been answered 
yet.
    In my last 30 seconds, I do want to say that infrastructure 
is a huge challenge, and we have found a good partner in the 
GSA's current administrator in terms of helping us identify the 
needs for better infrastructure. That has not happened before. 
It is a huge concern, the infrastructure managing with the 
process. Then we have U.S. leaders asking for several programs 
and deadlines, et cetera. So we have to manage the expectations 
and see how we work this out.
    I went over my time, Madam Chairwoman, but those are my 
comments. Thank you--and if you have any questions.
    [The statement of Ms. O'Connell follows:]

              Prepared Statement of Maria Luisa O'Connell

    Good afternoon Madam Chairwoman Sanchez, Ranking Member Souder and 
other distinguished Members of the Subcommittee. Thank you for inviting 
the Border Trade Alliance (BTA) to participate in this important 
hearing focused on balancing security and travel at our land ports of 
entry. My name is Maria Luisa O'Connell and I serve as the President of 
the Border Trade Alliance.
    For the past 21 years, the BTA has been involved with all aspects 
of trade, travel, security and commerce in our border communities along 
the U.S.--Canada and U.S.--Mexico borders. Currently the BTA serves as 
a member of the Departments of State (DOS) and Homeland Security's 
(DHS) Secure Borders Open Doors Advisory Committee. The BTA is also an 
active participant of the U.S. Customs and Border Protection's (CBP) 
Trade Support Network.
    About Us
    Founded in 1986, the BTA is a tri-national, grassroots, non-profit 
organization that serves as a forum for participants to address key 
issues affecting trade and economic development in North America.
    Who We Are
    The BTA represents, through our members and sponsors, a network of 
1.8 million public and private sector representatives, including: 
business leaders, area chambers of commerce and industry, academic 
institutions, economic development corporations, industrial parks, 
transport companies, custom brokers, manufacturers, and federal, state, 
and local government officials and agencies.
    Our Vision
    The BTA's vision is to be the recognized leader in authority for 
the facilitation of international trade and commerce in the Americas.
    Our Mission
    Our core values include a commitment to improving the quality of 
life in border communities through the development of trade and 
commerce, and a commitment to work as a community-based grassroots 
organization.
    The U.S., with the inception of the North America Free Trade 
Agreement (NAFTA), has seen tremendous growth in economic activity 
along its borders with Canada and Mexico. As cross-border trade and 
travel have increased so have the demands upon the federal agents and 
employees tasked with regulating commerce and enforcing security.
    Without these dedicated individuals secure trade and travel would 
not be achievable. The Border Trade Alliance would like to extend our 
gratitude and appreciation toward these men and women for their devoted 
service to protecting our nation. We must support our security 
personnel and provide them with adequate funding and resources so that 
they may perform their difficult duties.
    The policies and procedures designed to facilitate secure trade and 
travel at our borders have changed dramatically since September 11, 
2001. The changes at our borders have not occurred without concerns 
about their impact on legitimate trade and commerce. Similarly, the 
incredible growth in trade at our borders has not been without its 
share of growing pains. The infrastructure at our border crossings, for 
the most part, has not kept up with the increased volume of trade and 
travel.
    Perhaps the greatest challenge we face in working toward improved 
security, while facilitating legitimate trade and travel, is the 
management of the expectations of the various stakeholders involved. 
The BTA is proud to serve as the forum where policymakers, border 
communities, the traveling public and the trade industry can meet to 
discuss these expectations and work toward the common goal of 
protecting our physical and economic security as a nation.
    Madam Chairwoman, my testimony today will focus on three main areas 
related to current and proposed secure traveler programs. I will also 
share our recommendations to help provide for the economic and physical 
security of our border communities and our nation.

    1. Secure traveler programs are inextricably linked and have a 
direct impact on cross-border commerce, travel and security.
    The universe of federal secure traveler programs, along with cargo 
security initiatives such as the Customs Trade Partnership Against 
Terrorism (C-TPAT) program, are fundamentally linked in their impact on 
travel at our border crossings.
    A recent event at the Mariposa port of entry in Nogales, Arizona 
illustrates this point. On February 14th of this year aggravations 
concerning errors with the newly initiated e-Manifest system, where 
truckers electronically file their cargos with Customs and Border 
Protection (CBP) prior to crossing the border, along with frustrations 
with the over-burdened infrastructure led in part to a spontaneous 
blockade of commercial traffic by truckers at the Mariposa port of 
entry (Exhibits 1 and 2).
    Though this event directly affected commercial traffic it also 
impacted all other traffic at the port of entry, negating the 
advantages afforded travelers enrolled in programs such as SENTRI. In 
addition to the economic loss associated with delayed commercial cargo, 
the trucker blockade impacted local traffic within the city of Nogales 
resulting in lost commerce at the local level.
    While the implementation of e-Manifest was not the sole reason for 
the trucker strike in Nogales, the lessons learned from this event can 
be applied at both borders and in all our present security programs. 
Effective and open communication between the traveling public and the 
federal government, fully tested, vetted and integrated technology, and 
event contingency planning are critical components for the success of 
any federal security program or initiative.
    The BTA extends its thanks and appreciation to CBP, especially 
Director Louis Samenfink, for their strong efforts to resolve the 
situation in Nogales and work to prevent any similar situations in the 
future as ACE e-Manifest becomes mandatory at all our land ports of 
entry.

    2. Facilitation of legitimate travel while targeting limited 
federal resources toward greatest potential threats.
    The BTA has been integrally involved in all of the various secure 
traveler programs put forth by Congress and implemented by the federal 
government. The BTA supports efforts to increase security for 
legitimate trade and travel at both our international borders. Secure 
travel, a primary focus of the BTA's upcoming International Conference 
in Austin, Texas on September 24-25, 2007, is among the highest 
priorities for securing our homeland.
    The largest security efforts, in terms of dollars and resources 
dedicated, during the past half-decade have been focused on 
verification of traveler identities and their status in entering and 
exiting the United States. Programs and requirements, including US-
VISIT, FAST, SENTRI, WHTI and Real ID, have been developed or are in 
development to improve the ability of the federal government to monitor 
visitors who cross our borders legally. The complex web of secure 
traveler programs and initiatives has resulted in confusion and 
uncertainty among both the traveling public and federal agents.
    The BTA is urging policy-makers, such as the distinguished Members 
of this committee, to consider:
         How can our various secure traveler programs and 
        initiatives be reconciled to maximize increasingly scarce 
        federal resources while improving security and allowing for 
        legitimate travel at our borders?
    Our border communities, north and south, support diverse 
international economies that are dependent upon cross-border trade and 
travel. A large percentage of traffic at our borders is repeated, daily 
crossers who account for a significant portion of the sales tax and 
commercial revenues generated in our border communities (Exhibit 3). 
There needs to be a more efficient and coordinated approach to 
facilitate legitimate daily travel and commerce while focusing 
increasingly scarce federal resources on travelers and cargo presenting 
the greatest potential risk.

    The BTA finds that:
         Special access lanes for low risk travelers continue 
        to be good investments that must maintain benefits.
         Facilities are strained or past capacity and adding 
        new technology must be thoughtfully planned and scheduled to 
        minimize disruption and maximize investment.

    3. Need for development of an on-going assessment and improvement 
in the coordination of federal security initiatives while considering 
their impact on security, travel and commerce.
    The pending implementation of the Western Hemisphere Travel 
Initiative (WHTI) is likely to have the largest impact on the land 
border crossing experience of any of the secure traveler programs to 
date. While SENTRI, NEXUS, FAST and other programs are voluntary in 
nature, WHTI will become a mandatory requirement for all U.S. citizens 
traveling within North America and the Caribbean.
    The recent experience for U.S. citizens traveling by air to Canada, 
the Caribbean and Mexico is alarming in that the large backlog of 
passport applications was not anticipated by the U.S. Department of 
State.
    Further, the Departments of State and Homeland Security have not 
issued further plans for the development of the alternative passport 
document or PASS Card. The BTA continues to urge DHS and DOS to provide 
flexibility in development of the PASS Card to accommodate spontaneous 
travelers from the U.S. who take advantage of our border communities 
close proximity to the border to visit Canada and Mexico. Without this 
flexibility, the local economies of our border communities will be 
negatively impacted by WHTI.
    100 percent verification of travelers at land ports of entry using 
federal identification (passports) is a new responsibility for CBP. CBP 
must be given the adequate resources to be able to staff the new 
workload created by WHTI.
    The BTA has continued to request that DHS and DOS increase their 
outreach and educational efforts to the traveling public in advance of 
WHTI's implementation for land and sea to alleviate current confusion 
of the new travel requirement.
    The BTA strongly recommends that the technology utilized as part of 
WHTI must be seamlessly integrated with the current technological 
infrastructure at our ports of entry or if new infrastructure is 
required, it must be installed and fully operational prior to the 
implementation of the passport requirement under the Western Hemisphere 
Travel Initiative.
    DHS and DOS must also ensure that they provide adequate staffing 
and training to enable proper implementation of the PASS Card as part 
of the larger effort to implement the requirements of the WHTI.
    The BTA continues to insist that identification generated by other 
federal secure traveler programs, such as NEXUS cards, SENTRI cards, 
Border Crossing Cards and FAST driver identification cards be deemed 
acceptable alternatives to a passport for hemispheric travel.
    The BTA, considering the present implementation of WHTI for air 
travel and the pending passport requirement of WHTI for land and sea 
crossings, sees a need to evaluate whether this specific secure 
traveler program will provide a sufficient improvement to security to 
justify its large cost in both terms of taxpayer dollars to support it 
and its economic impact on cross-border commerce. Further, we believe 
that we should attempt to evaluate WHTI in contrast to other secure 
traveler programs, in particular against US-VISIT, which is focused on 
foreign travelers, and the REAL ID program that is directed at U.S. 
citizens who may or may not travel abroad.
    The BTA also believes that there is a strong need to better 
leverage existing federal security programs rather than pursuing the 
strategy of creating new programs that aim to accomplish many of the 
same objectives as the current secure traveler programs.
    An example of the aforementioned is all the work and effort that 
the US-VISIT team, currently led by Robert Mocny at DHS, has performed 
to assess the technological options and review the processes in 
screening foreign travelers. Despite all this groundwork, it is not 
apparent to us that the best practices and technological solutions 
identified as part of the US-VISIT team's efforts have been shared 
across programs and within agencies at DHS.
    The BTA has partnered with several research universities, including 
Texas A&M's Center for North American Studies and New Mexico State 
University, to establish the capability to perform objective, 
quantitative analysis of the impact of federal policy on the economies 
of our border regions. Through this partnership we aim to achieve a 
better understanding of federal policy decisions on trade, travel and 
security at our borders prior to the implementation of new programs and 
initiatives, as well as to assess the impact of current programs and 
policies.
    In conclusion, I would like to thank the Chair and Ranking Member 
along with the full committee for its focus on the need to achieve a 
balance between security and facilitation of legitimate travel at our 
borders. The BTA can assist in identifying solutions and participating 
in discussions with local communities on these issues that must be 
jointly addressed by federal, state and local officials.
    The Border Trade Alliance is honored to participate in this hearing 
and it will be my pleasure to address any questions you may have.
    Thank you.
    
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    Ms. Sanchez. Thank you, Ms. O'Connell.
    Let me just tell you that, in Mr. Cuellar, you have a very 
big proponent of land ports. He has been asking for many 
hearings and questions not just about between the land ports 
but the actual land ports. So we do have someone on the 
committee who hammers that idea home every day.
    Thank you for your testimony.
    Now I will recognize Mr. Belitsky and ask him to summarize 
his statement for 5 minutes.

  STATEMENT OF NEAL M. BELITSKY, EXECUTIVE VICE PRESIDENT AND 
      GENERAL MANAGER, DETROIT & CANADA TUNNEL CORPORATION

    Mr. Belitsky. Good afternoon and thank you.
    Last year, over 6 million vehicles used the Detroit-Windsor 
Tunnel, representing approximately 12.5 million travelers. Our 
traffic is down significantly since 2001 and is typical of 
passenger traffic across the entire U.S.-Canadian border. 
Michigan and New York are unique as both States have border 
crossings to and from Canada. The tunnel remains the world's 
only international--subaqueous international--vehicular 
crossing. My written testimony provides information on border 
traffic compiled by the Bridge and Tunnel Operators 
Association.
    Just to follow up to the comment made earlier, operators do 
support harmony between these programs, be it FAST, be it 
SENTRI, be it NEXUS. Two of the reasons often given by 
travelers are the inaccurate perception of the border and 
confusion on documentation. This view was reinforced last week 
in an article in the Detroit News by Andy Henion. Though one 
cannot discuss trusted or frequent traveler programs without 
discussing the Western Hemisphere Travel Initiative, I am going 
to limit my remarks to NEXUS.
    The chairwoman provided an accurate description of the 
NEXUS program. NEXUS works. We see this every day. As a rule, 
the average time in a NEXUS primary lane is about 10 seconds, 
compared to an average of 40 seconds in a traditional lane. The 
inspector, before the NEXUS cardholder reaches the booth, has a 
photo and pertinent information, increasing both officer 
security and national security. The program is risk management 
in action, allowing CBP to balance trade and traffic 
facilitation with border securities. Yes, there are times when 
it does take longer to get through a NEXUS lane, and that is an 
issue that individual port operators work with CBP on.
    The program within its existing limits has been successful. 
The majority of our commuter traffic, approximately 2,500 
vehicles into the U.S. per day, is enrolled in NEXUS and our 
companion program NEXPRESS. NEXPRESS was created as a value-
added incentive to entice travelers to enroll in NEXUS. Value-
added components are being used at various crossings for both 
NEXUS and FAST. We started with one U.S. lane in 2003, worked 
with CBP to add a second commuter rush lane in 2004 and are 
awaiting a response from CBP regarding the addition of a third 
commuter rush lane before this year is out.
    The crossing operators and, more recently, local business 
communities have filled a void in promoting and in marketing 
the program. Examples include CrossingMadeEasy in the Windsor-
Detroit region, GoBorder in Port Huron-Sarnia, converting one 
of the bridges over the Niagara River to a NEXUS-only bridge, 
and the NEXPRESS program at the Detroit-Windsor Tunnel.
    Opportunities abound to expand the success of the program 
and make NEXUS an integral part of WHTI implementation. Our 
recommendations for NEXUS are as follows:
    Though the application is available online, the process 
remains a paper and pen exercise. The option for online 
processing is a must. Accelerating the application process as 
part of the global, online system is critical. We were glad to 
hear that that is due within the next couple of weeks.
    Expanding the days and hours that NEXUS lanes are open is 
important. Commuters working off hours, along with 
discretionary travelers, do not have the option for the program 
as the lanes are limited on weekends, closed on U.S. holidays 
and are unavailable after 8:00 p.m. We recommend expanding 
NEXUS' functionality to all land border primary inspection 
lanes to provide CBP additional tools to manage the border and 
to provide an alternative to passports as an acceptable entry 
document. NEXUS-only express lanes can be open based on demand 
and will speed the inspection process for the entire crossing.
    Integrating, advertising and marketing are critical in both 
the land and the sea programs, and this is a joint 
responsibility, we believe, between the operators and CBP.
    Many of the NEXUS enrollment centers are not conveniently 
located in all communities, many with limited hours. We provide 
an international-intercity transit system where the bus riders 
have to get off every day and go through inspection. As SENTRI 
is available on the southern border to pedestrians, we are 
suggesting that NEXUS be available to those using other means 
besides passenger cars to get across.
    There are indirect benefits to increasing NEXUS 
participation--the reduction in fuel consumption and the 
reduction in air pollution. Cars idle while sitting in line for 
the booths.
    A NEXUS appeals process does need to be provided for those 
who are denied an application as well as those who lose the 
privilege post enrollment.
    The land border remains fragile in light of threats of 
terrorism, WHTI, US-VISIT, and ACE implementation. NEXUS serves 
as an opportunity, a platform, if you will, for secure and 
efficient entry into the United States.
    We invite members of the committee to Detroit to see the 
land border and NEXUS in action. The Detroit-Windsor Tunnel and 
the bridge combined have the highest volume of passenger 
crossing on the northern border. Thank you.
    [The statement of Mr. Belitsky follows:]

                  Prepared Statement of Neal Belitsky

    My name is Neal Belitsky, the General Manager for the Detroit 
Windsor Tunnel, one of the busiest passenger crossings between the 
United States and Canada. Thank you for this opportunity.
    Last year over 6 million vehicles used our facility representing 
approximately 12.5 million travelers. Our traffic is down significantly 
since 2001 and is typical of passenger traffic across the entire US/
Canadian border. Michigan and New York are unique as both states have 
water crossings to and from Canada. The tunnel remains the world's only 
international sub aqueous international vehicular tunnel.
    My written testimony provides information on border traffic 
compiled by the Bridge and Tunnel Operator's Association (BTOA). [See 
Figure 1.]
    Two of the reasons often given by travelers are the inaccurate 
perception of the border and confusion on documentation. Though one 
cannot discuss trusted or frequent traveler programs without discussing 
the Western Hemisphere Travel Initiative (WHTI), I am going to limit my 
remarks to NEXUS.
    According to US Customs & Border Protection (CBP), ``the NEXUS 
alternative inspection program has been completely harmonized and 
integrated into a single program. NEXUS members now have crossing 
privileges at any air, land, and marine ports of entry. In addition, 
NEXUS is being expanded to seven airports in Canada with Toronto in 
early 2007.
    The NEXUS program allows pre-screened, low risk travelers to be 
processed with little or no delay by United States and Canadian 
officials at designated highway lanes at high volume border crossing 
locations, at a NEXUS kiosk at the Vancouver International Airport, and 
at certain marine reporting locations in the Great Lakes and Seattle, 
Washington regions. Approved applicants are issued a photo-
identification/proximity card. Participants use the three modes of 
passage where they will present their NEXUS card and make a 
declaration. They are then released, unless chosen for a selective or 
random secondary referral.''
    The NEXUS program works, we see it every day. The average time at a 
NEXUS primary inspection lane (PIL) is 10 seconds, compared to an 
average of 40 seconds in a traditional lane. The inspector, before a 
NEXUS cardholder reaches the booth, has photo and other pertinent 
information increasing both officer safety and national security. The 
program is risk management in action, allowing CBP to balance trade and 
traffic facilitation with border security.
    The program, within its existing limits, has been successful. The 
majority of our commuter traffic, approximately 2500 vehicles into the 
US per day, is enrolled in NEXUS and our companion program NEXPRESS. 
NEXPRESS was created as a value-added incentive to entice travelers to 
enroll in NEXUS. Value added components are being used at various 
crossings for both NEXUS and FAST. We started with one US lane in 2003, 
worked with CBP to add a second commuter rush lane in 2004 and are 
awaiting response from CBP regarding the addition of a third commuter 
rush lane before the year is out.
    The crossing operators and more recently the local business 
communities have filled a void in promoting and marketing the program.
    Examples include: CrossingMadeEasy.com in the Windsor-Detroit 
region, GoBorder.com in Port Huron-Sarnia, converting one of the 
bridges over the Niagara River to a NEXUS only bridge and the NEXPRESS 
program at the Detroit Windsor Tunnel.
    Opportunities abound to expand the success of the program and make 
NEXUS an integral part of WHTI implementation. These are my 
recommendations:
         Though the application is available on-line, the 
        process remains a paper and pen exercise. The option for on-
        line processing is a must, i.e. Accelerating the application 
        process as part of the Global Online Enrollment System (GOES).
         Expand the days and hours that the NEXUS lanes are 
        open. Commuters working off hours along with discretionary 
        travelers don't have the option for the program as the lanes 
        are limited on weekends, closed on holidays and are unavailable 
        after 8:00 PM.
         Expand NEXUS functionality to all land border primary 
        inspection lanes to provide CBP additional tools to manage the 
        border and to provide an alternative to passports as an 
        acceptable entry document. NEXUS- only express lanes can be 
        opened based on demand and will speed inspection at all lanes.
         Integrate, advertise and market the advantages of the 
        NEXUS land, sea and air programs.
         NEXUS enrollment centers are not conveniently located 
        in all communities, many with limited hours. Enrollment and 
        activation are important, CBP must become more consumer 
        oriented.
         The Tunnel provides an international-intercity transit 
        route. This requires riders to get off the bus when entering 
        the country and go through inspection. Expanding the program to 
        transit would speed the process and enhance security.
         There is an indirect benefit to increasing NEXUS 
        participation- reduction in fuel consumption and air pollution. 
        Cars idle while in line for the booth.
         We understand from senior officials at CBP that the 
        NEXUS program is under resourced, staff and funds. This needs 
        to be addressed if any real progress is to be made in expanding 
        the program.
         A NEXUS appeals process needs to be provided for those 
        that are denied at application as well as those that loose the 
        privilege post enrollment.
         As the federal government continues to be faced with 
        challenges in issuing and renewing passports, the initial wave 
        of NEXUS applicants are due for renewal starting later this 
        year. The renewal process needs to be clear and efficient. The 
        challenge may not only be expanding the program but retaining 
        the existing base.
    The land border remains fragile in light of threats of terrorism, 
WHTI, US VISIT and ACE implementation. NEXUS serves as an opportunity, 
a platform if you will for secure and efficient entry into the United 
States.
    We invite members of the Committee to Detroit to see the land 
border and NEXUS in action. The Detroit Windsor Tunnel and the bridge 
combined have the highest volume of passenger crossing on the northern 
border.
    Thank you.

                                Fiure 1

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    See http://www.sarnialambtonchamber.com/main/ns/65/doc/452/lang/EN/
session/

    Ms. Sanchez. Thank you.
    Next, I recognize Mr. Gann to summarize his statement for 5 
minutes.

   STATEMENT OF THOMAS GANN, VICE PRESIDENT, PUBLIC POLICY, 
                      DIGIMARC CORPORATION

    Mr. Gann. Chairwoman Sanchez, Ranking Member Souder and the 
rest of the committee, thank you for giving me the opportunity 
to testify on behalf of Digimarc Corporation today.
    The focus of my discussion really will be on a series of 
technology innovations that, in large part, are being rolled 
out in the States, which we believe can be leveraged to enhance 
border security. At the same time, we think these innovations 
and processes can also increase the degree of travel ease that 
goes on.
    Digimarc Corporation is the leading supplier of IDs in the 
United States. We do many programs around the world. Of 
particular note for this hearing, we have done a lot of 
innovative work on a technology called ``digital 
watermarking.'' Digital watermarking is a secure technology 
that embeds imperceptible data to the actual body of the ID 
card, which makes it very hard to counterfeit. Today, some 20 
States in the Union use this technology to make their IDs more 
secure.
    Now, one of the big challenges, of course, is that our 
border has been very porous and has been viewed as very 
insecure. To address that, our country has put in place a 
number of programs such as the WHTI PASS program. This program, 
however, has been rather controversial with many 
businesspeople, particularly those along the northern border. 
We think that much could be done to leverage the investment 
that States are already making to improve their ID programs. In 
particular, many more investments will be made as a result of 
the REAL ID program. The States have estimated that billions of 
dollars will be spent to improve these credentials and, indeed, 
we expect these credentials to get a lot better. They will get 
better in the area of enrollment. They will get better in the 
area of card security. They will get better in every aspect.
    We think, therefore, that it makes sense to create better 
connective tissue between WHTI and these driver's license 
programs. A very good example of this is the Department of 
Homeland Security has announced a recent pilot program with the 
State of Washington, whereby they will put in place a very 
advanced driver's license program. It will have an RFID chip in 
it. It will have a range of additional overt and covert 
security features. It will also have digital watermarking in 
it, and this pilot will enable citizens to cross the border in 
a very secure way.
    The other thing that is important about this pilot--and we 
are the vendor that is delivering the technology for 
Washington--is that the entire program can be run for $40. 
Indeed, a basic driver's license in Washington today costs $25. 
The added capacity to cross the border in a secure fashion will 
only cost an extra $15. So we think this pilot is a very good 
example of what could be done in the future. We, therefore, 
recommend the idea of additional pilots, possibly one in 
Michigan or in other States that may express an interest, and 
over time, we would like to see high security driver's licenses 
leveraging the investments of REAL ID to be used on a border 
crossing basis. The good news about these pilots is that they 
are run on a voluntary program. Individual citizens opt into 
the program.
    In terms of our public policy recommendations, we urge that 
the government implement technologies today that can be used on 
the border while, at the same time, making sure that those 
investments can be upgraded as new innovations come on line. 
Likewise, we think all border crossing cards should have three 
machine-readable capabilities. This machine-readable capability 
is important because it takes the guesswork out of who is 
coming across the border. So often, these verifications are 
done on a visual basis. So these technologies include a chip, 
an MRZ, and we think the digital watermark has worked very 
well. By the way, other companies beyond Digimarc have digital 
watermarking capabilities.
    As I have said before, we like the idea of implementing 
additional pilots. One day, we would like to see driver's 
licenses with true PASS capabilities working along the northern 
and southern borders.
    Finally, we think it makes sense for Congress to help fund 
the REAL ID law. This is going to be one of the largest 
investments in improving credentials in the country. The States 
and most of the States that we work with are actually quite 
eager to implement it, but budgets are tight, and they would 
like at a minimum to have the Federal Government pay the 
initial start-up costs of the REAL ID law, and with that type 
of investment and a partnership with the States, we think the 
program can be successful.
    I think I have reached my 5-minute timeline. Though, in 
question and answer, I will be more than happy to address any 
and all issues. We are very excited about this pilot. We have 
been excited to work with the Department of Homeland Security 
and also with our customer, Washington, and we think it is our 
obligation to make sure that we help bring on to line 
technologies that can make a real difference in securing our 
country and, at the same time, making sure that cross-border 
travel happens effectively.
    Thank you.
    [The statement of Mr. Gann follows:]

                   Prepared Statement of Thomas Gann

    Chairwoman Sanchez and Ranking Member Souder, I would like to thank 
you both, and your colleagues on the Subcommittee, for giving me an 
opportunity to present Digimarc Corporation's views on improving border 
security while also promoting legitimate cross border travel and 
commerce. As the leading supplier of government-issued citizen identity 
documents in North America, Digimarc is pleased to be of service to the 
Subcommittee.
    Customs and border protection and law enforcement officers face 
extraordinary challenges as they try to authenticate the more than 200 
forms of valid driver licenses circulating in the U.S. today through 
unaided visual inspection. My testimony discusses technological 
innovations that are available now and in use by several state 
governments and commercial entities to augment visual inspection of 
driver licenses. Such technologies, like digital watermarking, are 
already in broad distribution and can be used to machine authenticate 
U.S. driver licenses, travel documents and other modern identification 
documents in the immediate future. These technologies should be 
integrated into a flexible platform that can accommodate new innovative 
technologies that are developed in the future.

Digimarc and the Importance of Digital Watermarking
    Digimarc (www.digimarc.com), based in Beaverton, Oregon, has 
supplied issuance systems for driver licenses and other government-
issued credentials for nearly 50 years and is the leading supplier of 
government-issued IDs in North America. We produce more than two-thirds 
of all driver licenses issued in the U.S. and offer products and 
services in more than 25 other countries. Additionally, we are a 
trusted supplier of a global system used by an international consortium 
of central banks to deter digital counterfeiting of currency.
    Digimarc supports U.S. states with solutions covering all aspects 
of ID issuance: applicant identity verification and enrollment; over-
the-counter and centralized secure card production systems; design and 
manufacturing of the cards using advanced technologies and multiple 
security features; and inspection to authenticate the ID after 
issuance.
    Additionally Digimarc pioneered a signal processing technology 
innovation known as ``digital watermarking,'' which allows 
imperceptible digital information to be embedded in all forms of media 
content, including personal identification documents, financial 
instruments, photographs, movies, music and product packages. In 
identity documents digital watermarking is used to embed digital data 
imperceptible to the human eye within the structure of the document. 
Using commercially available devices such as scanners, PDAs with built-
in cameras and other digital technology, it's possible to authenticate 
IDs and readily identify counterfeit and fraudulent documents. We 
believe that digital watermarking, to be discussed further later, is an 
important component of securing the nation's borders.
    U.S. states began incorporating digital watermarking into their 
driver licenses in 2002 using a Digimarc product known as Digimarc 
IDMarcT1TM, and to date 20 states have adopted this security 
capability in their driver licenses. The list includes Iowa, Wyoming, 
Nebraska, New Jersey, Kansas and Massachusetts as well as key border 
States such as Washington, Michigan, Minnesota, Florida, Texas, Vermont 
and others that keep their use of the technology confidential for 
security reasons. By the end of the year, one out of every two driver 
licenses being issued will include digital watermarks, and this number 
is growing rapidly.

Our Insecure Borders:
    Since Sept. 11, 2001, the United States Government Accountability 
Office (GAO) has published a number of studies that have demonstrated 
how insecure our borders really are. In 2003, and also as described in 
today's testimony, GAO officials partnered with agents of the Office of 
Special Investigations to develop counterfeit documents used by special 
agents to enter the United States from various ports of entry from the 
Western Hemisphere. In GAO's most recent series of tests, 17 of 19 
counterfeit driver licenses successfully presented to cross into the 
United States were produced by using off-the-shelf, commercially 
available graphics software, a computer, a scanner and a printer, and 
were. Our hard-working border officials were unable to detect these 
fakes because they do not have all the tools they need to properly 
verify the authenticity of these types of documents.
    Visual inspection of travel documents--the key method our 
inspectors have today--is inadequate for a number of reasons, including 
the fact that there are more than 200 valid U.S. driver license 
formats. Only specialists, with years of training, have the skill sets 
needed to conduct reasonable visual inspections, and even then, visual 
inspection alone is not adequate to catch digital counterfeits. Our 
border agents do not have the necessary training or tools to inspect 
these documents on a day-to-day basis at ports of entry. This is made 
more difficult by the demands that arise from timely processing of 
thousands of individuals every day. Machine-authentication of the 
digital watermark present in many of these documents, however, would 
take the guess work out of determining which documents are valid and 
which are not.

The WHTI Initiative and the Economic Challenges of the PASS Card:
    To improve the security of our borders, the Western Hemisphere 
Travel Initiative (WHTI), under the Department of Homeland Security 
(DHS), mandates that upon seeking entrance to the United States across 
a land border port of entry, all travelers, including U.S. citizens, 
present a passport, other verifiable and secure document, or 
combination of documents that can ensure a person's identity and 
citizenship. This initiative has already begun to change travel for 
U.S. citizens traveling between the U.S. and both Canada and Mexico.
    More than 29 million people move across the U.S. / Canadian border 
to engage in trade and tourism each year, supporting more than $1.2 
billion of daily trade between the countries. In 2004, Canadians spent 
$10.3 billion in the U.S., nearly $8 billion of which was spent on 
travel and tourism.
    As only 25% of U.S. Citizens hold passports, the initial 
implication of WHTI was that each citizen traveling home from Canada or 
Mexico had to obtain a valid passport at the cost of nearly $100. To 
ease the financial burden, and to partly address the concerns of the 
business community, DHS has proposed a driver-license-like ``passport 
lite'' document called the PASS Card.
    While the PASS card is a sensible approach to giving citizens an 
alternative to buying a passport for purposes of travel in the Western 
Hemisphere, a coalition of U.S. and Canadian businesses, called 
Business for Economic Security, Trade & Tourism (BESTT) comprised of 
over 60 associations and companies, believes that the PASS proposal, as 
currently written, will significantly reduce commerce between the US 
and Canada. Indeed, BESTT has cited one estimate saying the new 
identification requirements could cost the U.S. economy $785 million a 
year and the Canadian economy $1.7 billion in lost revenue due to a 
decline in tourism.
    The coalition ``opposes requiring passports for Americans and 
Canadians entering the U.S., and instead, urges the U.S. and Canadian 
government to develop another approach that would do a better job of 
balancing commercial and homeland security interests.'' BESTT has also 
urged both the U.S. and Canadian government to consider allowing REAL 
ID compliant drivers licenses to be used as border crossing cards--a 
concept that has real merit.

Leveraging State Investments in ID Security to Secure our Borders:
    Many states have established security processes that complement and 
extend many of the processes employed in the current U.S. passport, or 
the expected PASS card. The states have made and are making major 
investments in their driver licenses and issuance systems to promote 
transportation safety, protect their citizens from identity theft and 
fraud, and enhance their personal security and the security of the 
nation--particularly since September 11. As we know, the perpetrators 
in the Sept. 11 terrorist attacks obtained valid driver licenses under 
false identities. In any security system, criminals tend to look for 
weak points to exploit. In these cases, the documents were genuine 
driver licenses obtained fraudulently. States and their suppliers are 
upgrading not only the documents but also the enrollment process and 
inspection processes to address all known weaknesses that could be 
exploited by criminals.
    According to the National Conference of State Legislatures, the 
states are expecting to invest billions of dollars as they continue to 
enhance the security of their driver licenses in compliance with the 
REAL ID Act, which sets federal security standards for state-issued 
driver licenses and IDs. These efforts will result in a high level of 
security in the enrollment, issuance and inspection processes of our 
current driver licenses. These same processes and technologies being 
deployed by the states could also be used to strengthen the enrollment 
processes for Federal employee credentials and citizen credentials such 
as passports, and can be used in conjunction with gaining citizenship 
certification from the Department of State for State-issued REAL ID-
compliant driver licenses.

These improved enrollment processes include:
         Secure in-person photo capture to protect against 
        fraudulent photo submittal and enable downstream biometric 
        facial recognition
         Electronic scanning and archiving of documents 
        enabling efficient enrollment, subsequent forensic 
        investigation of documents, and electronic transmittal as part 
        of adjudication process
         Electronic document authentication at point of 
        enrollment using a variety of machine readable features 
        including digital watermarking
         Electronic applicant verification against federal and 
        third party databases such as Social Security
         Electronic verification of applicant data against 
        State DMV and vital record databases
         Facial and/or fingerprint recognition, both 1-to-1 and 
        1-to-many, to verify identity against existing biometric 
        records
         Use of trained driver license agency personnel who are 
        experienced in fraudulent document recognition, work with 
        enrollment processes on an ongoing basis, and have successfully 
        passed thorough background checks

Leveraging Existing Technologies to Secure our Borders:
    As described above, proven, cost-effective technologies are 
commercially available today that can enable border officials to 
machine authenticate U.S. driver licenses and other border crossing 
credentials. These documents contain numerous security features such as 
digital watermarks, holograms, and special inks. There are software and 
hardware solutions available that can automatically inspect such 
security features and facilitate background checks via third party data 
bases. Digital watermarks are key in that they provide the only means 
of trusted authentication of a driver license in use today, and they 
can be read using commercially available scanners with special 
software.
    Digital watermark-based document authentication solutions are 
compatible with other travel document reading efforts including the 
ePassport efforts. This capacity to work with an ever-evolving set of 
security features is essential because it ensures that government can 
stay ahead of terrorists and criminals who seek to use loopholes in our 
security systems to gain access to the U.S. Additionally, these 
technologies can be quickly deployed, within six to 12 months, and are 
efficient for the inspector to use so that citizens are not 
inconvenienced with long lines. And essential to success, digital 
watermarks do not compromise citizen privacy.

Summary of Nebraska ID Authentication Pilot Results:
    The state of Nebraska provides a particularly poignant example of 
raising the ID security bar by deploying innovative security solutions 
and processes. In 2003, Nebraska was one of the first States in the 
country to incorporate the digital watermarking feature into its 
licenses.
    In 2005, the Nebraska Department of Motor Vehicles conducted a 
pilot under a grant from the U.S. Department of Transportation to 
demonstrate authentication of digitally watermarked driver licenses as 
a means to fight ID counterfeiting, reduce the purchase of age-
restricted products, such as alcohol, and enhance traffic safety. 
Digital watermark scanners were installed in a total of 18 point-of-
sale sites, 30 office sites, and 35 law enforcement sites, and were 
used in ``real time'' for an average of 30 days. Retailers, law 
enforcement and DMV operators were equipped with reader devices that 
allowed them to verify the information printed on a driver license--
even an unfamiliar out-of-state driver license--against the information 
contained in the digital watermark. By doing so, they were able to 
determine if a driver license was valid or not and, in the retail 
situations, which, if any, age-controlled products the DL holder was 
old enough to purchase. The scanner/reader devices proved invaluable in 
instantly determining whether or not the license presented was 
authentic, as well as validating the age of the DL holder.
    At the conclusion of the pilot, Digimarc staff interviewed the 
users regarding their experience with and response to the digital 
watermarking technology. The technology was extremely well received:
         100% of retail participants said that a valid read 
        from the watermark gave them confidence that the DL was 
        authentic.
         100% of law enforcement participants using a PDA 
        reading device had confidence that a valid read from the 
        watermark meant the DL was authentic.
         100% of office staff surveyed reported that they 
        believed the device was beneficial, that it gave them 
        confidence that the scanned ID was authentic, and that they 
        would use it in the future.
    The deployed readers continue to be used by the state, and in fact, 
this summer, Nebraska plans to put new Document Inspector units into 
production at DMVs across the State. This will arm front-office 
operators with the tools to inspect and positively authenticate the 
millions of U.S. driver licenses secured with digital watermarking 
(Digimarc's ID Marc). When Nebraska and other state driver licenses are 
presented as proof of identity to obtain a new or renewal driver 
license, machine authentication will be able to validate the ID or 
detect fraud. The system will be effective with licenses from 
neighboring states such as Colorado, Iowa, Kansas and Wyoming - 
effectively removing the guesswork that can come with visually 
inspecting an out-of-state ID.
    Today, more than 60% of valid driver licenses in Nebraska are 
secured with digital watermarking, and it is anticipated that within 
two years all valid Nebraska licenses in circulation will be protected 
by digital watermarking. Nebraska's experience--as well as that of 
other states such as Iowa--can serve as a model for the federal 
government to help make our nation's borders more secure in a timely 
and cost effective way. Iowa, for instance, has deployed secure card 
materials, digital watermarking, and many other cutting edge solutions. 
The state employs full time investigators to attack license and 
identity fraud, and has deployed advanced readers to help officials 
detect counterfeits.

Digimarc Document Inspector Scenario
    Authenticating documents like driver licenses and IDs can be done 
quickly and simply with a single device that scans both sides of the 
document simultaneously--a device such as the Digimarc Document 
Inspector software that checks the validity of common ID security 
features, including the digital watermark. To determine if a license is 
genuine, an inspector would start inspecting the document by inserting 
it into the scanner. The software is very easy to use--the operator 
just hits the spacebar to initiate the scanning process. In just a few 
seconds, the device scans both sides of the document and the software 
processes the information, determining if the document is authentic for 
that document type and jurisdiction. The software contains a regularly-
updated document information library that is used for this automated 
validation process.
    The software reads the individual's demographic data from the 
document and displays the key data and associated analyses to the 
operator, which assists validation of the document and card holder. 
This entire process produces a valid rating in seconds, displaying 
``green'' clearly on the screen if the license is valid and red if it 
is suspect. With such a process, operators can easily see if the 
document passed inspection--enabling them to focus on the individual, 
rather than the document. In a typical border crossing scenario, if a 
red indicator appears, the card holder would be sent to secondary 
inspection where an investigator could use the digital watermark and 
other features or databases to pursue the fraud.
    Digital watermarks can also be read and authenticated on travel 
document scanners, like the kind used to read passports. Software such 
as Digimarc's software is able to draw on the pattern matching library 
of such a scanner and its multi-spectral light inspection authenticate 
the watermark and check additional security features visible only when 
illuminated in UV or IR light. This is a more expensive solution, but 
one that can validate not just driver licenses and IDs, but travel 
documents like passports and foreign ID cards.
    The Document Inspector closes the loop on the secure ID lifecycle 
by providing an easy, reliable way to instantly authenticate IDs after 
issuance. Border inspectors can immediately validate the document using 
the digital watermark and other data and features present on the 
license. Visible features, like 2D barcodes and others, can be altered, 
but when linked to a second feature that is imperceptible to the human 
eye, counterfeiting becomes extremely difficult, if not impossible. 
After scanning, Document Inspector provides a quick pass/fail reading 
and keeps lines moving.
    Document Inspector is fast and easy-to-use. An operator can 
authenticate a document with confidence in just a few seconds. The 
software is hardware independent, working seamlessly with a variety of 
best-of-breed hardware and software components, and provides a simple 
user interface to eliminate the guess work associated with visual 
inspection.
    Table 1 summarizes the Document Inspector features and benefits.

        Table 1 Digimarc Document Inspector Features and Benefits
------------------------------------------------------------------------
                 Features                             Benefits
------------------------------------------------------------------------
Extensive document database that is          Standardizes
updated regularly                            authentication practices
                                             Gives agents more
                                             confidence
                                             Keeps the knowledge
                                             base up to date without the
                                             need for additional
                                             training
------------------------------------------------------------------------
Fast, easy authentication results            A clear red/green
                                             indicator of authentication
                                             evaluation
                                             Multiple visual
                                             cues to the result
                                             Ability to see the
                                             details if further
                                             investigation is necessary
------------------------------------------------------------------------
Standards-based technology                   Allows for
                                             integration with external
                                             systems
                                             Keeps deployment/
                                             investment costs low
                                             Provides clear
                                             technology path
------------------------------------------------------------------------

    In summary Digimarc Document Inspector is a document authentication 
solution that features:
         A system that offers fast document authentication to 
        ensure citizens are not inconvenienced or slowed down by the 
        process.
         Authentication of the most comprehensive set of 
        security features used in driver licenses

Cost Estimates of Deploying Readily Available Technologies:
    We don't have access to all of the government information, 
including technology integration, human resource, and third-party 
database expenses, to offer a precise estimate of what it would cost 
the federal government to deploy these readily available technologies 
to help secure our borders. However, we respectfully suggest that the 
Committee request that the Congressional Budget Office or the Office of 
Management and Budget conduct such a study.
    It is our understanding that the number of Northern and Southern 
land border points of entry are:
----------------------------------------------------------------------------------------------------------------
                                  Inbound  Passenger    Inbound  Cargo
                                         Lanes               Lanes         Pedestrian  Lanes     Total  Lanes
----------------------------------------------------------------------------------------------------------------
Northern Land                                   278                 121                  24                 423
 Border POEs
----------------------------------------------------------------------------------------------------------------
Southern Land                                   224                  72                  86                 382
 Border POEs
----------------------------------------------------------------------------------------------------------------
    Total                                       502                 193                 110                 805
----------------------------------------------------------------------------------------------------------------

    Our own rough estimate of the cost--based on our experience and 
market research studies--of deploying the necessary software and 
hardware in an estimated 805 lanes to cover all immigration land border 
lanes, including cargo and shoulder lanes is under $50 million. This 
would equip each lane to machine validate driver licenses and other 
common travel documents. Covering the Northern border lanes, assuming 
423, the cost is approximately $26 million. If we wanted to add any 
type of remote database interface to this system such as cross 
referencing watch list databases or consolidating the number of 
transactions etc., we would add an additional $10 million to our 
baseline cost estimates.
    These cost estimates do not include the cost to the States of 
deploying machine-readable security features, nor do they capture the 
expense to the States of improving a large number of their security 
programs such as their enrollment processes. But these requirements 
have already been mandated by the REAL ID Act and the States are 
already working out how to pay for compliance with this Act. In any 
case, if our cost estimates are roughly in the ball park, this would be 
a small price to pay to quickly improve the security of our borders.

    New Technologies: A Smart Card Capability to Enhance the Security 
of Travel Documents:
    Some months ago, DHS signed a Memorandum of Understanding with the 
state of Washington to authorize a pilot of a drivers license that 
would be enable to be used as a PASS card. The department has also made 
it known that it welcomes similar proposals from other states as a 
thoughtful approach to augmenting the current PASS program. We believe 
the Department is on the right track by giving states and their 
citizens another way to comply with the requirements of the PASS card.
    One key component of the PASS plan is to include a micro-chip in 
the card to enable it to either run on the same technology 
infrastructure of the new passport that is being rolled out, or to 
introduce a remote reading capability--the ability to determine a few 
minutes before citizens actually cross the border whether their 
credentials are valid. This capability, the government believes, will 
help ensure that citizens can move quickly across the border while 
ensuring that high level of security is maintained.
    Recently, Washington DOL and DHS have agreed to run an initiative 
that allows the Enhanced Driver License (EDL) to be used as an 
alternative travel document to re-enter the United States through sea 
and land border crossings. Digimarc will supply Washington DOL with 
applicant enrollment and screening solutions as well as production of 
the RFID-enabled EDL. Recent state legislation authorizes the use of 
enhanced driver licenses, issued on proof of citizenship, identity and 
residency, as a WHTI alternative document to a passport for re-entry 
into the United States. The new Washington licenses will cost $40.
    Washington's enhanced driver license system will employ Digimarc 
applicant screening solutions to verify an applicant's identity 
documents, data such as name and address, and facial biometrics to 
ensure that only one license is issued to one legitimate card holder.
    Digimarc launched its chip-enabled driver license solution last 
year in anticipation of States' needs for new applications of the 
driver license. The Digimarc enhanced driver license for Washington 
will include RFID technology that is compatible with the DHS Western 
Hemisphere Travel Initiative program. This will offer a convenient and 
cost-effective option for citizens to carry a single credential that 
meets their driving, identity, and land and sea border crossing needs.
    The Enhanced Driver License itself will carry traditional security 
features found on the current Washington driver license, including 
digital watermarking, as well as new features including an RFID chip 
and a ``Machine Readable Zone'' (MRZ) that is compatible with travel 
document readers.
    The Washington initiative will leverage a number of market leading 
Digimarc driver license products and services to provide a high level 
of security throughout the process, including:
         Document authentication of ``foundation documents'' 
        used to obtain an enhanced driver license;
         Applicant data verification that will be used by 
        interviewers to confirm the data presented by applicants, 
        including name, address or date of birth;
         1:many facial recognition-based biometrics to screen 
        out duplicate ID fraud, which is part of the gated issuance 
        process to coordinate the back-end screening process and 
        release the enhanced driver licenses to production; and
         Production of the enhanced driver license at a secure, 
        centralized facility.

Public Policy Recommendations
    We recommend that as the Federal government rolls out its next 
procurement to enhance border security, it purchase technologies that 
are both forward and backward compatible. The Federal government should 
deploy capabilities to machine verify the authenticity of U.S. driver 
licenses at the border, including reading and authenticating the 
digital watermark. Over time, these readers could be upgraded to 
accommodate enhancements being made to driver licenses and other 
identity documents from both the U.S. and Canada, and also other from 
other Western Hemisphere countries as deemed appropriate by the 
Department of Homeland Security and the Department of State. These 
technology solutions are scalable, having the capacity to integrate new 
technologies that will be developed in the future to ensure that 
criminals and terrorists are always challenged to defeat ever higher 
levels of security.
    Every border crossing official must be able to do machine-readable 
verification of driver licenses, processing the covert machine readable 
features in documents that are presented at the border. In addition to 
putting stationary readers at all border crossing stations, mobile 
readers should also be deployed to ensure that agents can do rapid and 
secure screening of driver licenses and/or travel documents. This will 
help ensure that transit times are not unduly affected. All of these 
technologies exist today and are proven and could be readily deployed 
if the funds were available.
    The REAL ID law requires the States to add a machine-readable 
feature to their driver licenses. Given that digital watermarking has 
become a de facto standard for driver license authentication, we 
recommend that the federal government require or encourage all States 
to adopt digital watermarking technology in addition to other 
appropriate machine-readable security features to comply with the 
requirements of this law so that national standard authentication will 
be realized. We also urge that digital watermarking be added as an 
additional security feature to all border crossing credentials.
    The REAL ID law will help States meet the security challenges of 
the 21st century by ensuring that they deploy best-of-breed, end-to-end 
security systems. However, the states have estimated that the cost of 
implementing the Real ID Law will be $13 Billion. The states have also 
asked the federal government to fund the $1 Billion in start up costs 
that the states have identified. We urge Congress help the states pay 
for these start up investments in hardware, software and card 
materials.
    Finally, we applaud the Administration for approving the Washington 
state pilot and urge that additional pilots be approved. These pilots 
can test the viability of leveraging state issued drivers' licenses to 
promote secure and efficient cross border travel. We believe that these 
pilots, as they prove successful, can form the basis for a program that 
will allow as many states as possible to issue dual use driver's 
licenses. This approach would leverage the significant investments in 
ID security that the States have already--and will continue to make, in 
the coming years. Such a policy will also leverage the existing ID 
systems that the Canadian Provinces have already deployed. The 
opportunity for both the United States and Canada to develop a 
collaborative approach should not be missed.

Conclusion
    In conclusion, I would like to thank Chairwoman Sanchez and ranking 
Member Souder for giving me the opportunity to appear before your 
Subcommittee on behalf of Digimarc Corporation. The States have been 
pressing forward with important security upgrades within the limits of 
their budgets and mandates. More will need to be done as States drive 
to comply with the REAL ID law. It makes sense, therefore, for the 
federal government to leverage these significant investments to help 
secure our borders, and at the same time, save taxpayers money and time 
in obtaining identification credentials. Digimarc Corporation, along 
with other suppliers and the many of the issuers that we serve stand 
ready to do all we can to support the government's objective of 
enhancing the security of our homeland.

*Additional information on digital watermarking
    Digital watermarking complements other authentication techniques 
such as the pattern matching and multi-spectral analyses found in 
passport and travel document scanners. Digital watermarking technology 
is compatible with and can enhance the security of passports, 
smartcards and other travel documents such as the proposed PASS Card. 
Digimarc broadly licenses digital watermarking technologies to many 
other vendors for supply of digital watermarking enhanced solutions for 
a variety of security purposes.
    Deployment of digital watermark reading is aligned with the 
published security strategies of the Department of Homeland Security 
and the Department of State, and is a recommended feature of the 
Document Security Alliance and an approved optional feature of the 
HSPD-12 PIV-2 standard, which calls for enhancing the identification 
and authentication of federal employees and contractors. Digital 
watermarks provide positive document authentication, age verification, 
cross-jurisdictional authentication, and forensic capabilities.

    Ms. Sanchez. Thank you, Mr. Gann.
    I will now recognize the gentleman from Indiana, Mr. 
Souder, for 5 minutes.
    Mr. Souder. Thank you.
    I have questions for everybody, but I want to focus on Mr. 
Gann.
    First, let me disclose that they have a facility in my 
hometown that makes the licenses--even though you are based in 
Beaverton, Oregon--and it varies, but between 37 and 42 States 
have the licenses made by his company, the driver's licenses, 
and two other little competitors have developed off of this in 
Fort Wayne. I think 48 of the 50 States' driver's licenses are 
made in Fort Wayne as well as in Singapore. So, when you go 
through their facility, you can see the whole range of what 
different States mandate. It is the same basic card, but 
Singapore uses an eye scan. Some States have different 
standards. Some have watermarks. Some have other things. It is 
not a technology challenge. To some degree, it is political 
will, and I want to pursue that a little bit because, when I 
was chairman over in Government Reform of another subcommittee 
that had oversight of all justice and drugs and all of that, we 
did several hearings in North Carolina that were trying to 
address their State driver's licenses. I just met with the 
Indiana head of the Bureau of Motor Vehicles, and they were 
going, ``Hey, what are you going to do? Are you actually going 
to mandate us to do this on these licenses, and is that going 
to be the end?''
    Recently, we had the Miami Airport people in here, and I 
was down in that region and had stopped at the airport, and 
they are doing all of these new things and putting in all of 
these machines. Then the US-VISIT says, ``Oh, no. We want to do 
it this way.'' Then they start to do all of that, and then they 
want to do it this way. We heard that on the border, too.
    What I was really intrigued by in your testimony--and I 
would really like to work with the chairman of the subcommittee 
to see what we can do--is how to anticipate--because we know we 
are going to make changes.
    How can we build into the identification, you said, a chip, 
an MRZ and a digital----
    Mr. Gann. Watermark.
    Mr. Souder. --watermark?
    Then, whether it is NEXUS or SENTRI or US-VISIT or a State 
driver's license, if we have certain things built in a card, 
whether it would be a State-licensed card or even a passport, 
you are saying that we could upgrade that to potentially 
include fingerprints and to potentially include what?
    Mr. Gann. Right. Well, it is certainly a very good 
question. One of the great challenges in big technology 
implementations, whether in the public sector or even in the 
private sector, is putting in place an architecture that is 
scalable. To do that, I think it takes having some very good 
CIO's architect program that is scalable over a 5--, 10--, 15-
year program, but that is not enough.
    The other thing that is very important, I think, is to use 
as often as possible commercial off-the-shelf technologies that 
have already been proven and then integrate them. Most of these 
technologies, whether they are different software components or 
hardware components, generally speaking, are quite compatible 
with other technologies just because they need to be. That 
contrasts favorably with what I would describe as ``custom-
build solutions,'' and oftentimes in the public sector, you see 
more custom work where an agency decides they are unique and 
they need to build everything up from scratch. You know, the 
FBI case management system is a great example of that where you 
had huge cost overruns and where, unfortunately, the program, 
you know, did not do as well as it could have.
    So my two points would be to have a good architecture, have 
good CIOs implemented and, when possible, use as much 
commercial grade technology as you can because the R&D has 
already been invested in by companies for that.
    Mr. Souder. We make things in my district. We either grow 
them or make them because tourism is not our number one thing. 
That was sarcastic, by the way. One of the things that I see 
is--like we have a little company in the innovation center that 
is working with DHS to develop their IDs for things like the 
defense intelligence--DIA--facilities, CIA facilities. It is 
not like we do not have cards where you can only go in one part 
of the building but you cannot go in this part of the building 
and that these cards do not have readers. One of the things we 
were talking about earlier is that, as some States have moved 
to advanced information on the card, they cannot afford the 
reader for that. Could you take this into the commercial 
application, and where we are headed with this?
    For example, in North Carolina, they have more information 
on their card now than any policeman could possibly read in his 
car. He would have to go to downtown Charlotte to be able to 
read it. Eventually, at some point here, if we are going to 
have work permits in the United States and deal with overstays, 
you are going to have to have the ability to read the card. To 
do that, it is going to have to be an affordable reader, not 
only for what is going to be on the card and for the card's 
being secure, but there has to be a way to read the card in an 
affordable way much like the RFID things. Being able to read 
the RFID is one of the bigger challenges rather than just 
giving the thing on the item.
    Could you talk about how you interact with those types of 
companies?
    Mr. Gann. Right. Well, I think any good card program is 
going to be based on the integration of technologies from a 
number of companies and software capabilities from a number of 
companies to produce the whole, which is hopefully very 
successful.
    The good news is, over the last 5--10 years, a lot of 
innovation has occurred in the ID business. You have seen 
digital watermarking and chips and a lot of innovation in the 
area of readers. Optical readers today can be gotten quite 
inexpensively for $25. We can do a digital watermark demo that 
ascertains whether a card is, indeed, a good card or not with a 
reader that costs about $25, and so the innovation continues. 
Those readers are more expensive in a hardened situation, say, 
at the border where you need extra redundancy. The last point I 
would make is many readers today can also be implemented via 
cell phones via the cameras that can read security features.
    So I think the key is continued focus in the area of IDs, 
and things like the REAL ID law will create additional 
incentives for the private sector to invest so they can 
innovate.
    Ms. O'Connell. I know you are focusing on the technology 
part, but let me tell you, from the grassroots perspective, 
what you are saying is it is a huge challenge. We have all of 
the letters of the alphabet in programs that you can imagine 
are coming along for the border, and there is no coordination. 
So, when the gentleman was talking about having one 
infrastructure and architecture that can be expanded, that is 
something that we see that is lacking from the leadership 
within the Department of Homeland Security in terms of we need 
more coordination. You have created a border coordination 
office to look at all of this, but you have the Western 
Hemisphere Travel Initiative that is going to be millions of 
dollars, and they are working with US-VISIT that has already 
invested millions of dollars and that have used the same 
technology and architecture. Just when you were talking about 
RFIDs, you were down to the discussion of what type of RFID. I 
mean we can go vicinity, proximity, et cetera.
    There is a lot of discussion, but I think, from your 
perspective of the committee, the challenge is to request that 
coordination, and we need to leverage funds. I know I said it 
earlier that we are a rich Nation, but there are limited funds 
that we have. We have to be able to leverage the technology, 
and it is not recreating the wheel. It is already there as Mr. 
Gann said. So I wanted to----
    Mr. Souder. Thank you.
    I want to reinforce that point because one of the most 
baffling things is that the number one cause of drug deaths in 
the United States is from prescription drug overdoses. 
Interesting, Wal-Mart was RFID-ing their prescription drugs 
because of employee theft and different things that have been 
stolen, so they know more about any bottle of aspirin that 
moves through the Wal-Mart system than we know about illegals, 
terrorists or drug dealers in the United States because they 
are following each little, tiny bottle of aspirin.
    The question is in trying to use systems and coordination 
that are, quote, ``off the market'' or that are being done in 
the private sector, and we are sitting here, trying to invent 
things, and because of real world pressures in the private 
sector, they are already moving in this direction on security 
as to what parts of their building are going to be secure, 
whether their products are secure.
    How can we get some of this architecture together and 
coordinate it? It is like talk to each other. We have got our 
appropriations process. I mean it is one of our huge problems 
in Homeland Security. We have our corporations process, our 
committee oversight process, the different agencies, hearings 
that you all come to. It is just very frustrating because one 
of the key things here is having some basic coordination 
because we are going to keep changing. Congress can only plan 
for 2 years if there is not a fundamental flexibility in 
architecture built in. The private sector is going to have to 
adjust with every new Congress. If we have a terrorist 
accident, whatever that is, we are going to panic and do 
incredible things in that area, and it is going to require a 
flexible architecture as well.
    Thank you.
    Ms. Sanchez. Thank you.
    Ms. O'Connell, being a Californian and having parents whose 
hometowns are Douglas and Nogales, I have a lot of knowledge 
with respect to what is going on at the border and in border 
communities and the problems that we see, in particular, with 
respect to doing commerce across that arbitrary line there.
    Are your members confused by all of the initiatives we keep 
coming out with, I mean, just to be able to drive--C-TPAT, e-
Manifest, FAST, and God knows what other stuff--and just to be 
able to get their shipments from one country to another? There 
are NAFTA requirements, WHTI.
    Are they going crazy over there?
    Ms. O'Connell. Yes. The answer is that we are very 
confused. It is confusing and it is a challenge.
    Ms. Sanchez. How has the Department of Homeland Security or 
the State Department or the Commerce Department helped or 
reached out or gotten information out to your membership--to 
people, small businesses, medium-sized businesses--trying to 
commerce across?
    Ms. O'Connell. Our organization, for example, partners very 
much with the Department of Homeland Security and Commerce, et 
cetera, on helping to do outreach.
    The challenge has been that so many programs are coming out 
without a clear understanding of how they are going to be 
implemented. So, for example, you talk about the Western 
Hemisphere Travel Initiative. At some point, there was talk 
about the PASS Card, and it was going to be that you would need 
a passport or a DHS-recognized ID Then the PASS Card was 
announced, but we have not seen any details of what the PASS 
Card entails. Then we also talked about maybe using a pilot 
program to use a driver's license, but there is a lot of 
questions on how is that going to be paid. So, yes, there is 
confusion.
    The Department is doing outreach. I think there needs to be 
more outreach, but to be fair, Madam Chairwoman, also we need 
you, Congress, to be realistic on the expectations, too, and I 
mean it with all due respect. I mean you can have different--
regardless of RFIDs or whatever, you need to give the resources 
for them to do the outreach, too. That is something that I 
think is missing, Madam Chairwoman.
    Ms. Sanchez. Ms. O'Connell, in the notice for proposed 
rulemaking for WHTI, the Department of Homeland Security states 
that, in all case studies but one, four gone border crossings 
attributable to WHTI will have less than a 1-percent impact on 
the regional economy both in terms of output and employment. 
What do you say to that?
    Ms. O'Connell. I am not familiar with how they got that 
number. I think----
    Ms. Sanchez. Is it going to have an impact on your 
community?
    Ms. O'Connell. Definitely.
    Ms. Sanchez. I mean that is one of the first things you 
said to me.
    Ms. O'Connell. Yes, it is going to have a huge impact on 
the economy. I do not recall that figure from DHS, but it is 
going to have a huge impact, as I mentioned, because it is not 
a voluntary program. The challenge is going to be how does it 
get implemented. What is the process?
    Ms. Sanchez. What do you want us to do? You said we need to 
be up here. We are supposed to be giving some oversight to this 
department and some of my colleagues to other departments. What 
do you want us to do to make that go smoothly for your 
community?
    Ms. O'Connell. I would recommend that the committee request 
specific benchmarks on how this program is going to be 
implemented, that there is a leverage of the existing 
technology and that the outreach is mandatory to all the people 
to have a clear message out. Request DHS and DOS to have a 
clear message out on how the program is going to be 
implemented. If I can choose three, those are it, Madam 
Chairwoman.
    Ms. Sanchez. OK. I have a question for you, Mr. Belitsky.
    In your testimony, you said that expanding the frequent 
travel program to transit-like buses would enhance security and 
make the process more efficient.
    Can you explain how you think a transit frequent travel 
program would work while also ensuring that none of the 
passengers are security risks? Would all of the passengers who 
would get on one of these buses have to already have been 
cleared with frequent travel programs? How do you envision it?
    Mr. Belitsky. The way the border works is, if the person in 
front of you takes less time to get through, then you take less 
time to get through. So, if you look at the folks in our 
community who use the bus, it is virtually the same people 
every day. So, if these folks all were enrolled in a program 
like NEXUS, they would get through quicker. It would speed up 
the whole process.
    One of the things we have done--and this gets back to----
    Ms. Sanchez. So does that mean you would require that 
everybody who got on that bus would have to have the NEXUS 
card?
    Mr. Belitsky. No. It is optional, but if there are 40 
people on a bus, that bus does not leave until everybody is 
inspected. If there are 20 people on there who get through 
quicker, the whole time for that bus trip will be cut 
significantly.
    One of the programs we have worked on with CBP is in the 
greater Detroit area. One of their claims to fame has been 
international, world-class events--the Super Bowl, the All Star 
Game--and so we have actually worked on what we call 
``manifesting buses'' where there is a busload in Canada, and 
folks get on, and they agree to submit a variety of 
information. We send that electronically before the bus gets to 
the border, and it is there, and so that bus is able to clear 
the border in less than 5 minutes where typically that bus may 
take 25 minutes to a half hour.
    Ms. Sanchez. Do you have the same problem that Ms. 
O'Connell sees at her border, that it does not matter which 
lane you are in--the NEXUS lane or the FAST lane or the regular 
lane--because basically it is all backed up, and so the speed 
actually only occurs in the check-through process?
    Mr. Belitsky. That is a real issue. You have to remember 
that the vast majority of land border ports to the United 
States were all built before 2001. So, in virtually every case 
you are trying to stick a square peg in a round hole.
    One of the things that we did is, because we have such a 
large commuter base, we partnered with the City of Detroit, and 
we partnered with the City of Windsor where we actually close a 
street, and so, for the morning commute, if a commuter gets the 
NEXUS card, we give them free enrollment in our NEXPRESS 
program. They are the only ones allowed to use that street. 
They have their own lanes on the plaza. They have their own 
toll booths. They go through the tunnel uninterrupted, and they 
have their own lanes on the inspection plaza because that was a 
significant issue.
    So we have looked at the whole process, which is one of the 
things that we are suggesting to CBP. Don't look at what 
happens at the border right at that booth. You need to look at 
the entire process if you want to keep the program secure and 
if you want to keep the border moving.
    Ms. Sanchez. Mr. Souder.
    Mr. Souder. Can I clarify this and see if I am incorrect?
    In Sault Ste. Marie, one of the problems is that a truck is 
a truck and a car is a car, and it is a two-lane bridge, so it 
does not matter whether you are precleared or not precleared, 
because you are stuck on the bridge, and the only thing that 
matters is time, time when you are in the last three or four 
and when you split, and that is a little bit of a problem in 
Detroit. So, when you have a bridge or a traffic congestion 
problem, you have a different time/wait challenge than most of 
our land border crossings where, in fact, there are differences 
unless you are in a congested area as you are approaching.
    Mr. Belitsky. You are right. Unless you look at creative 
solutions to use the infrastructure better, you are going to 
have these problems, and so part of it--and Sault Ste. Marie is 
sort of isolated, but if you look at Detroit where you really 
have two crossings, if you look at the Niagara River where you 
have the three at Niagara, plus the Peace Bridge, if you look 
at a regional solution, you have the ability to move trucks 
more efficiently. You have the ability to move cars more 
efficiently. Again, the Whirlpool Bridge that is exclusively a 
NEXUS crossing is a good example of that.
    Ms. O'Connell. May I, Congressman?
    For example, in El Paso, the private sector partner built 
their own dedicated first FAST lane and their own dedicated 
SENTRI lane, but the private sector paid for it, and so, 
therefore, they can use it. The usage has gone down a little 
bit because the percentage of checking the trucks was higher in 
the FAST lane than in the regular lanes, so the trucks were 
saying, ``Why are we wasting our time here?'' So I think before 
that that was one of the questions.
    In some other areas, for example, in Nogales and in 
Mariposa, we raised money to build an extra FAST lane, but on 
the Mexican side, there are still only two lanes. So, even 
though there is not a bridge in that situation, in Texas, where 
you have bridges, they have the same challenge. So the 
infrastructure is a huge problem, and that does not help the 
program. That does not mean that the program is not useful, as 
Neal says it is. You can get creative and work together to find 
a solution.
    Ms. Sanchez. Ms. O'Connell, what city do you live in?
    Ms. O'Connell. I live in Phoenix, although 70 percent of 
the time I am at the border. So, yes, I spend time at the 
border. Yes.
    Mr. Souder. Just for the record, Mr. Belitsky, I heard that 
right after 9/11, on the next day when the traffic stopped from 
Windsor--and I cannot remember what the number was, and I do 
not know whether you know it off the top of your head, whether 
it was 2,000 or 4,000--nurses got, in effect, stopped at the 
border, and that would be some of the potentially bus traffic 
and some of that type of thing. People do not often realize the 
interrelationships. We have big cities on each side.
    Mr. Belitsky. Yes. Detroit is significantly dependent on 
nurses crossing the border. You always have to look for a 
silver lining. One of the silver linings out of 9/11 was it got 
organizations that typically worked in parallel to work 
together, and so the nurses were a really good example. We got 
together with the health care agencies in Detroit, the transit 
systems on both sides, the police departments, CBSA--which is 
Canadian customs--CBP, and we actually have processes in place 
if there were another event where it went up to a level red 
where the border crosses where we can get specific groups 
across the border. So these are not only paper and pencil 
exercises; these are ones where we have actually had Table 
Tops, and these are ones where we have actually tested the 
border to make sure these processes work.
    Another example is what I mentioned, manifesting the 
busses. We knew we had to make the Super Bowl successful, and 
so CBP went out of their way and developed this program that we 
use for special events.
    So there are examples where folks do get creative to keep 
traffic moving, and the side benefit of that or the main 
benefit of that is really that you have a more secure border as 
well as one that is freer flowing.
    Mr. Souder. If the White Sox don't get you, it may be a 
World Series again.
    Mr. Belitsky. We are hoping. We are hoping.
    Ms. Sanchez. Yeah. Right. It is like saying the Cubs will 
win. No.
    I thank the witnesses. I think that is it.
    Are those all of the questions you have? OK. Yes.
    I thank the witnesses for their valuable testimony and the 
members for their questions, and the members of the 
subcommittee may have additional questions for the witnesses, 
and we will put them in writing to you. Get back the answers as 
quickly as possible, if you will.
    Hearing no further business, the subcommittee stands 
adjourned. Thank you again for testifying.
    [Whereupon, at 3:50 p.m., the subcommittee was adjourned.]


                     Appendix I: Prepared Statement

                              ----------                              


   Prepared Statement of the Honorable Bennie G. Thompson, Chairman, 
                     Committee on Homeland Security

    Trusted traveler programs like NEXUS, SENTRI, and FAST offer 
expedited processing for frequent travelers willing to go undergo the 
required pre-screening process. Expediting low-risk individuals through 
our ports of entry facilitates legitimate cross-border trade and 
travel, which is the lifeblood of border communities and vital to our 
nation's economy. By identifying low-risk travelers, trusted traveler 
programs also allow Customs and Border Protection personnel to give 
greater scrutiny to the general population of travelers at our borders. 
NEXUS, SENTRI, and FAST are an excellent example of how the Department 
of Homeland Security and the public can work in partnership for their 
mutual benefit.
    These programs are not without potential concerns, however. Due to 
increased enrollment, there are often more trusted traveler program 
participants than Customs and Border Protection officers are able to 
process in an expedited way. At peak crossing times, dedicated commuter 
lanes may be just as long as regular lanes, which serves as a 
disincentive for people to apply for these programs. In some cases, 
backups are due to a lack of space or physical infrastructure necessary 
to add additional trusted traveler lanes to ports of entry.
    In other instances, there is a shortage of personnel required to 
open or expand the operating hours of existing lanes. With the 
Department of Homeland Security's recent announcement that trusted 
traveler program cards will be accepted for purposes of the Western 
Hemisphere Travel Initiative, we can expect that enrollment in NEXUS, 
SENTRI, and FAST will only increase. The Department needs to be 
prepared for a possible surge in applications, and take appropriate 
measures to alleviate congestion in lanes dedicated to trusted traveler 
programs.
    In addition to capacity issues, ensuring the security of these 
programs is an ongoing concern. Trusted traveler programs offer an 
attractive option for bad actors to use ports of entry as a means of 
smuggling illegal aliens, drugs, or dangerous materials into the 
country, due to the reduced scrutiny participants received.
    As we improve border security between the ports of entry by hiring 
more Border Patrol agents and constructing additional border security 
infrastructure, the incentive to use ports of entry for smuggling will 
only increase. It is imperative that the Department do everything 
possible to address these security concerns, while still ensuring that 
the programs function as intended.


                  Appendix II: Questions and Responses

                              ----------                              


Questions from the Honorable Loretta Sanchez, Chairwoman, Subcommittee 
            on Border, Maritime, and Global Counterterrorism

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

Questions from the Honorable Loretta Sanchez, Chairwoman, Subcommittee 
            on Border, Maritime, and Global Counterterrorism

                             QFR Responses

                                For the

     Subcommittee on Border, Maritime and Global Counterterrorism's

                               Hearing on

  ``Frequent Traveler Programs: Balancing Security and Commerce at our

                             Land Borders''

                                  Held

                         Thursday, July 26,2007

                                  From

                         Maria Luisa O'Connell

                               President

                       The Border Trade Alliance

    Question 1. In your prepared testimony, you describe WHTI as likely 
to have the largest impact on the land border crossing experience of 
any of the secure traveler programs. Yet, in the Notice for Proposed 
Rulemaking (NPRM) for WHTI, DHS states that that in all their case 
studies but for one, forgone border crossings attributable to WHTI have 
a less-than-1-percent impact on the regional economy both in terms of 
output and employment.
         Do you agree with the Department's economic assessment 
        for WHTI on border communities?
    Response: DHS's Draft Programmatic Environmental Assessment 
provides a section on border socioeconomics, but the section neglects 
to address potential impacts to regional economies from any of the 
three "actionf1 alternatives. The BTA sees this as a serious omission. 
The U.S. Federal Reserve-Dallas reports that U.S. border communities 
derive considerable economic benefit from cross-border trade and 
commerce. In some smaller communities, a majority of the economy may be 
based on the movement of goods and people between two neighboring 
nations. Implementation of WHTI has the potential to generate 
significant economic impacts within border communities.

    Question 2.: DHS recently announced in its NPRM for WHTI, that it 
would accept alternative travel documents at ports of entry, including 
NEXUS, SENTRI, and FAST cards. As we all witnessed this summer, the 
requirements of WHTI sent scores of people to the passport office, even 
if they did not have immediate travel plans.
        Can our ports of entry support the possible increase in trusted 
        travelers that may result from this proposed change?
        Does CBP have enough enrollment centers to meet the possible 
        increase in demand?
        How will the acceptance of these alternative cards facilitate 
        commerce at our ports of entry?
    Response: The BTA insists that alternative travel documents, NEXUS, 
SENTRI, and FAST cards, be acceptable documents under the requirements 
of WHTI. The BTA notes that the background checks conducted as part of 
the application process for NEXUS, SENTRI, and FAST are more intensive 
than those conducted as part of the passport application. If the 
benefits of these various secure traveler programs are truly to be 
realized by their participants, CBP should focus more resources on 
travelers presenting a higher security risk rather than on known 
travelers who participate in secure traveler programs.

    Question 3.: The NPRM for WHTI states that border crossings have 
mostly decreased at both the northern and southern borders since 
1999and that WHTI may discourage many travelers from crossing the 
border, which could cost millions of dollars to border communities.
         What type of effects do you anticipate WHTI having on 
        border communities and how can programs like NEXUS, SENTRI, and 
        FAST help alleviate any potential concerns?
         Do you believe the Department should be investing in 
        new travel cards and technology--State's Passport Card and REAL 
        ID Driver's Licenses--that accomplish many of the same 
        objectives as current frequent traveler programs?
    The Border Trade Alliance supports the efficient use of resources 
and proven technologies to expedite secure trade and travel along our 
nation's borders. The implementation of new procedures and technology 
must improve the efficiency of trade and travel at our borders. Adverse 
economic impacts as the result of delays at our international border 
crossings must be prevented at all costs in order for individuals and 
industry to support the federal government's efforts. The BTA strongly 
encourages DHS to leverage existing programs and technology to ensure a 
successful implementation of secure-traveler programs such as WHTI.

                                 
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