[Senate Hearing 110-636]
[From the U.S. Government Publishing Office]


                                                       S. Hrg. 110-636
 
               SECURITY CLEARANCE REFORM: THE WAY FORWARD 

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

                                HEARING

                               before the

                  OVERSIGHT OF GOVERNMENT MANAGEMENT,
                     THE FEDERAL WORKFORCE, AND THE
                   DISTRICT OF COLUMBIA SUBCOMMITTEE

                                 of the

                              COMMITTEE ON
                         HOMELAND SECURITY AND
                          GOVERNMENTAL AFFAIRS
                          UNITED STATES SENATE


                       ONE HUNDRED TENTH CONGRESS

                             SECOND SESSION

                               __________

                              MAY 22, 2008

                               __________

       Available via http://www.gpoaccess.gov/congress/index.html

       Printed for the use of the Committee on Homeland Security
                        and Governmental Affairs

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        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

               JOSEPH I. LIEBERMAN, Connecticut, Chairman
CARL LEVIN, Michigan                 SUSAN M. COLLINS, Maine
DANIEL K. AKAKA, Hawaii              TED STEVENS, Alaska
THOMAS R. CARPER, Delaware           GEORGE V. VOINOVICH, Ohio
MARK L. PRYOR, Arkansas              NORM COLEMAN, Minnesota
MARY L. LANDRIEU, Louisiana          TOM COBURN, Oklahoma
BARACK OBAMA, Illinois               PETE V. DOMENICI, New Mexico
CLAIRE McCASKILL, Missouri           JOHN WARNER, Virginia
JON TESTER, Montana                  JOHN E. SUNUNU, New Hampshire

                  Michael L. Alexander, Staff Director
     Brandon L. Milhorn, Minority Staff Director and Chief Counsel
                  Trina Driessnack Tyrer, Chief Clerk


  OVERSIGHT OF GOVERNMENT MANAGEMENT, THE FEDERAL WORKFORCE, AND THE 
                   DISTRICT OF COLUMBIA SUBCOMMITTEE

                   DANIEL K. AKAKA, Hawaii, Chairman
CARL LEVIN, Michigan                 GEORGE V. VOINOVICH, Ohio
THOMAS R. CARPER, Delaware           TED STEVENS, Alaska
MARK L. PRYOR, Arkansas              TOM COBURN, Oklahoma
MARY L. LANDRIEU, Louisiana          JOHN WARNER, Virginia

                   Richard J. Kessler, Staff Director
                Evan W. Cash, Professional Staff Member
             Jennifer A. Hemingway, Minority Staff Director
                     Tara L. Shaw, Minority Counsel
                     Jessica Nagasako, Chief Clerk














































                            C O N T E N T S

                                 ------                                
Opening statements:
                                                                   Page
    Senator Akaka................................................     1
    Senator Voinovich............................................     2

                               WITNESSES
                         Thursday, May 22, 2008

Brenda S. Farrell, Director, Defense Capabilities and Management, 
  U.S. Government Accountability Office..........................     6
Hon. Clay Johnson, III, Deputy Director for Management, U.S. 
  Office of Management and Budget................................     7
Elizabeth McGrath, Principal Deputy Under Secretary of Defense 
  for Business Transformation, U.S. Department of Defense........     9
John P. Fitzpatrick, Director, Special Security Center, Office of 
  the Director of National Intelligence..........................    10
Kathy L. Dillaman, Associate Director, Federal Investigative 
  Services Division, U.S. Office of Personnel Management.........    12

                     Alphabetical List of Witnesses

Dillaman, Kathy L.:
    Testimony....................................................    12
    Prepared statement...........................................    55
Farrell, Brenda S.:
    Testimony....................................................     6
    Prepared statement...........................................    33
Fitzpatrick, John P.:
    Testimony....................................................    10
    Joint prepared statement with Ms. McGrath....................    49
Johnson, Hon. Clay III:
    Testimony....................................................     7
    Prepared statement...........................................    48
McGrath, Elizabeth:
    Testimony....................................................     9
    Joint prepared statement with Mr. Fitzpatrick................    49

                                APPENDIX

Background.......................................................    59
Questions and Responses for the Record from:
    Ms. Farrell..................................................    64
    Mr. Johnson..................................................    67
    Ms. McGrath..................................................    73
    Mr. Fitzpatrick with an attachment...........................    78
    Ms. Dillaman.................................................    93


               SECURITY CLEARANCE REFORM: THE WAY FORWARD

                              ----------                              


                         THURSDAY, MAY 22, 2008

                                 U.S. Senate,      
              Subcommittee on Oversight of Government      
                     Management, the Federal Workforce,    
                            and the District of Columbia,  
                      of the Committee on Homeland Security
                                        and Governmental Affairs,  
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 2:37 p.m., in 
Room SD-342, Dirksen Senate Office Building, Hon. Daniel K. 
Akaka, Chairman of the Subcommittee, presiding.
    Present: Senators Akaka and Voinovich.

               OPENING STATEMENT OF SENATOR AKAKA

    Senator Akaka. Good afternoon, everyone. This hearing of 
the Subcommittee on Oversight of Government Management, the 
Federal Workforce, and the District of Columbia is called to 
order.
    This is our fifth hearing on security clearance reform and 
testifies to the difficulty of solving this important problem.
    Three years ago, Senator Voinovich and I began this series 
after the Department of Defense's personnel security clearance 
program was placed on the Government Accountability Office's 
high-risk list. Since that time, we have uncovered several 
systemic problems which demonstrate that the current security 
clearance process is outdated and needs fundamental reform.
    After last year's hearing, the Administration took steps to 
begin that reform. All of the Federal Government stakeholders 
in security clearances from the military, intelligence, and 
civilian communities came together, forming what we now know as 
the Joint Security and Suitability Reform Team, which is 
represented here today by many members of our panel. The team 
crafted a plan to finally bring the security clearance process 
into the 21st Century. I look forward to hearing more about 
this plan and how these reforms will move forward.
    I want to applaud the hard work that has been put in over 
the past year to reduce the clearance backlogs and speed up 
processing. The Office of Personnel Management, who is in 
charge of most investigations, has made a huge investment in 
manpower to attack the backlog. The backlog finally seems to be 
under control and waiting times have come down. However, I 
still think that the processes and technology now in use do not 
allow for very much more improvement.
    There is far too much manual activity going on in the 
clearance process today. Literally caves full of hundreds of 
thousands of file folders along with a dozen computer programs 
bolted together make up the backbone of the investigation 
process at OPM. Though some may consider this system the 
Cadillac of IT solutions, unfortunately, it is a 25-year-old 
model, probably suited for a car museum.
    More of the security clearance process should be automated 
and electronic. That data must then be portable so that it can 
be efficiently sent to agencies for adjudication. The current 
process of shipping or printing off investigation files to 
adjudicators rather than sending data to agencies is very 
burdensome. The information must also be easily accessible for 
reinvestigations and readjudications.
    Reforming clearances is a national security issue and 
increasingly a fiscal issue. Delays in the clearance process, 
especially for ``Top Secret'' clearances, cost taxpayers 
millions of dollars. Cleared individuals are in such high 
demand that they are paid inflated signing bonuses or given 
expensive cars just to work for a contracting firm hired to 
support Federal agencies. Those costs are eventually borne by 
the Federal Government in the form of more expensive contracts.
    More importantly, however, getting people cleared is 
essential for national security. Rightly or not, it is a fact 
that the government relies on contractors to support critical 
national security functions, from the tanker drivers in Iraq to 
the intelligence analysts here at home. Whether an individual 
works for the Federal Government or works as a contractor, it 
is essential that we can fill positions that support our 
national security.
    I have great hope that what has been outlined by the Joint 
Security and Suitability Reform Team are all steps in the right 
direction. Their recommendations go to what we have been 
pushing for over the course of these hearings. I will be 
interested in what GAO has to say about the report, as they are 
the ones that initially placed this issue on the high-risk 
list.
    However, I note that the report is still short on much 
detail. I will be asking for some of those details today, and 
as recommendations are implemented over time, I will continue 
to ask those questions.
    I am pleased that in looking at our panel, who will all 
play a role in implementing these reforms, that most are career 
civil servants who will still be here after January 20. I can 
assure you that this Subcommittee will still be here after 
January and that we will make sure that the progress made does 
not get lost in the shuffle of transitioning to a new 
Administration.
    I now call on Senator Voinovich. Thank you, Senator 
Voinovich. I appreciate your continued dedication to this issue 
and look forward to continuing to work with you on moving this 
along. Senator Voinovich.

             OPENING STATEMENT OF SENATOR VOINOVICH

    Senator Voinovich. Thank you, Senator Akaka. I first of all 
want to say that one of the joys of being on this Subcommittee 
with you is that the two of us have shared the same agenda for 
a long period of time. There were some who were concerned that 
perhaps after the leadership change and I became Ranking and 
you became Chairman that some of the things that we worked on 
might disappear, but the fact of the matter is that you have 
stayed on top of them and have been very aggressive and 
hopefully the hard work that we do will bear some fruition.
    While I commend the Joint Security and Suitability Reform 
Team for producing its April 30 reform document, I do have a 
hard time understanding why it took the Federal Government 4 
years to get to this point, a 10-page outline on how to 
transform our current process, and I am hopeful that this 
effort will find result and sustained reform.
    Since 2004, we have been attempting to bring a performance-
based approach to how government manages access to sensitive 
national security information. In June 2005, following our 
first hearing on this matter after the Department of Defense 
security clearance process was added to the GAO's 2005 High-
Risk List, I believed significant progress could be made in the 
short-term and this management challenge would be removed from 
GAO's 2007 High-Risk List. At the rate we are going, I am 
afraid the process will remain on the list in 2009.
    Thus far, the most meaningful reform effort appears to be 
the hiring of additional investigative staff by OPM to support 
a cumbersome process reliant on antiquated computer systems. 
More investigative staff has helped. For our first hearing on 
this matter in June 2005, GAO estimated a backlog of about 
270,000 clearance investigations for DOD alone. In February 
2008, OPM has reduced that number to about 42,000 pending 
investigations over 180 days old for all agencies it conducts 
investigations for.
    However, additional reforms are needed, including the use 
of 21st Century technology, as Senator Akaka made reference to. 
OPM highlights its success in transferring virtual files among 
agencies, but those files are printed prior to adjudication. 
The automated system, which is essentially a computerized fax 
machine that does not allow for online manipulation of case 
files, isn't really the type of system I envisioned when 
Senator Akaka and I began working on this management challenge.
     Senator Akaka and I held hearings earlier this month to 
examine the Federal Government's outdated hiring process. At 
that hearing, witnesses tried to tout the ability of 
individuals to apply for Federal jobs using an online process, 
but many of those individuals, after wading through the Federal 
Government's hiring process and receiving a job offer, are 
being told that they have to apply on paper for a security 
clearance and that process could take months.
    As Senator Akaka and I discussed at that hearing, 
Generation X and Y job seekers get frustrated with the lack of 
response from our agencies when applying for jobs. Imagine 
their level of frustration when they are told that clearances 
for such jobs could take months, reinforcing their impression 
of an inflexible bureaucracy. The delay in clearing individuals 
simply adds to the overall hiring delay and gives the wrong 
impression of those seeking to work for the Federal Government.
    We need to create a seamless hiring and clearing process. 
Until we do, our human capital crisis will be exacerbated. The 
Federal Government is trying to find the best and brightest 
people in an increasingly competitive era when we are losing 
high-skilled potential employees to a private sector that 
offers higher salaries and better benefits. This is a national 
problem. The government is competing now with the rest of the 
world and in this country with the private sector big time 
because of the baby boomer retirement.
    We need to move expeditiously to hire individuals with the 
skill sets we need, but even when we find qualified individuals 
who are willing to be public servants, we subject them to a 
cumbersome hiring process and outdated security clearance 
system. It is no wonder that we lose qualified potential 
employees.
    The February 2008 report by OMB and the Security Clearance 
Oversight Group identified several obstacles which impede the 
current security process. First, agencies had an April 2006 
deadline to transmit all their security clearance applications 
to OPM electronically. After failing to meet the deadline, the 
2007 Security Clearance Oversight Group Report indicated that 
all agencies had plans in place to transmit 100 percent of 
their applications electronically in fiscal year 2007. However, 
the 2008 report shows we failed to meet this goal, meeting 83 
percent compliance government-wide.
    The Department of Defense bears most of the burden for this 
failure. For the first quarter of fiscal year 2008, it 
submitted only 77 percent of its applications electronically to 
OPM. Electronic transmission of applications can cut weeks out 
of the investigation process and agencies need to fully utilize 
this tool.
    I was also disheartened to see that the issue of security 
clearance reciprocity seems to be getting less and less 
attention, when we are going into a new Administration. I 
expect some of the people that work for this Administration may 
work for the other Administration and take on some new security 
responsibilities, but reciprocity was not listed as a priority 
challenge in the February 2008 report. The word ``reciprocity'' 
appears only five times in that April 30 reform outline, and 
that outline makes no real recommendations on how we are going 
to achieve reciprocity. Gordon England has a great story about 
how often he had to get security clearances as he moved from 
one agency to another agency. Reciprocity is still a problem. 
It is a problem, and I think that we need to address that.
    The other thing that the February 2008 report highlighted 
is a new shortcoming in our current piecemeal approach to 
security clearance reform. Completing investigations in a more 
timely manner has simply shifted the security backlog from the 
investigation to the adjudication phase. At the time of that 
report, DOD had more than 76,000 adjudications that were over 
45 days old. I am anxious to hear how our witnesses intend to 
deal with that problem.
    And last, the Security Clearance Oversight Group's February 
2008 report shows that our clearance system is not utilizing 
readily available technology. As important as technological 
growth has been in the last century, it is likely to be even 
more important in the coming years. However, making full use of 
new capabilities will only be possible in a system that values 
the need for investment in new technology over adding band-aids 
to antiquated systems, such as PIPS. Technology provides us the 
opportunity to expedite the security clearance process while 
minimizing time, cost, and effort.
    Automation, as described in some of the testimony today, 
does not mean the ability to e-mail a PDF file. It means using 
a paperless system at each step to process and allow for 
continuous reinvestigation based on risk. I think we have to 
address all of these issues and find a way to achieve 
meaningful and lasting reform of the current security clearance 
process. I think failure to do so is going to cost us in many 
ways.
    Senator Akaka, I think you know that it costs the taxpayers 
$684 per day in lost salary and benefits because of the delays 
on these cases. Over 208 days' failure to complete a ``secret'' 
clearance for one person costs more than $140,000, almost three 
times the 2006 median U.S. household income of $48,200.
    I have a lot more here and I am taking the witnesses' time, 
so I am just going to wrap it up and say I had really hoped 
that this would be off the high-risk list and it is not. It is 
very frustrating that after all this time and all this effort 
that we still have major problems issuing timely security 
clearance. I am glad to know that so many of you are going to 
be around, and as Senator Akaka has indicated, we are going to 
continue to monitor this process so that we can have a big 
celebration when this goes off the high-risk list. Thank you.
    Senator Akaka. Thank you very much, Senator Voinovich. You 
have been a great champion in human capital and we will 
continue to pursue this.
    It is my pleasure now to welcome our witnesses here today: 
Brenda Farrell, Director of Defense Capabilities and Management 
for the Government Accountability Office; welcome back to the 
Hon. Clay Johnson, Deputy Director for Management for the 
Office of Management and Budget; Elizabeth McGrath, Principal 
Deputy Under Secretary for Business Transformation at the 
Department of Defense; John Fitzpatrick, Director of the 
Special Security Center for the Office of the Director of 
National Intelligence; and welcoming back Kathy Dillaman, 
Associate Director of Investigations for the Office of 
Personnel Management, Federal Investigative Services Division.
    It is the custom of this Subcommittee to swear in our 
witnesses. Will you please stand and raise your right hand.
    Do you swear that the testimony you are about to give to 
this Subcommittee is the truth, the whole truth, and nothing 
but the truth, so help you, God?
    Ms. Farrell. I do.
    Mr. Johnson. I do.
    Ms. McGrath. I do.
    Mr. Fitzpatrick. I do.
    Ms. Dillaman. I do.
    Senator Akaka. Thank you. Let the record show that the 
witnesses answered in the affirmative.
    Although statements are limited to 5 minutes, I want all of 
our witnesses to know that their entire statement will be 
included in the record.
    Ms. Farrell, will you please proceed with your statement.

     TESTIMONY OF BRENDA S. FARRELL,\1\ DIRECTOR, DEFENSE 
  CAPABILITIES AND MANAGEMENT, U.S. GOVERNMENT ACCOUNTABILITY 
                             OFFICE

    Ms. Farrell. Thank you, Mr. Chairman. Mr. Chairman, Senator 
Voinovich, thank you for the opportunity to be here today to 
discuss reforming the Federal Government's personnel security 
clearance process. My remarks today are based on GAO's numerous 
reports that give us a historical view of key factors that 
should be considered in clearance reform. Our reviews have 
identified delays and other impediments in DOD's program, which 
represents 80 percent of the Federal Government's clearances. 
These longstanding delays resulted in our adding DOD's 
clearance program to our high-risk list in January 2005, as you 
noted.
---------------------------------------------------------------------------
    \1\ The prepared statement of Ms. Farrell appears in the Appendix 
on page 33.
---------------------------------------------------------------------------
    In the past few years, several positive changes have been 
made to the security clearance process because of increased 
Congressional oversight, such as a number of clearance-related 
hearings that this Subcommittee has held, recommendations from 
our body of work, and new legislative and executive 
requirements, most notable the passage of the Intelligence 
Reform and Terrorism Prevention Act of 2004.
    One important change is the formation of the Interagency 
Team, of which members of that team are present on the panel 
today. This team was established to develop a reform clearance 
process that would be applicable not only to DOD, but across 
the Federal Government, including the intelligence community. 
As directed by the President, the Joint Reform Team submitted 
its proposed design for the reform effort on April 30, 2008.
    As the Joint Team moves forward, we encourage them to 
consider the four factors highlighted in my statement today. 
Two of the four key factors in my written statement essential 
to the Joint Reform Team achieving positive outcomes, such as 
greater security clearance reciprocity, involve, one, 
incorporating quality control steps, and two, establishing 
metrics for assessing all aspects of the process.
    First, government agencies have paid little attention to 
quality, despite GAO's repeated suggestions to place more 
emphasis on it. For example, the government has documented 
quality with a single metric on only one of the six phases of 
the clearance process by using the percentage of investigative 
reports returned for insufficiency during the adjudicative 
phase. Further, GAO has identified this metric as being 
inadequate by itself.
    Prior GAO work examined a different aspect of quality, the 
completeness of the documentation in investigative and 
adjudicative reports. We found that OPM provided incomplete 
investigative reports to DOD adjudicators, which the 
adjudicators then used to determine top secret eligibility. 
Almost all, 47 of 50, of the sampled investigative reports we 
reviewed were incomplete based on requirements in the Federal 
investigative standards. In addition, DOD adjudicators granted 
clearance eligibility without requesting additional information 
for any of the incomplete investigative reports and did not 
document that they considered some adjudicative guidelines when 
adverse information was present in some reports.
    Further, our October 2007 report documented the reluctance 
of some agencies, particularly DHS and FBI, to accept 
clearances used by other agencies. To achieve greater 
reciprocity, clearance-granting agencies need to have 
confidence in the quality of the clearance process.
    The second key factor I wish to discuss is establishing 
metrics for assessing all aspects of the clearance process. 
Many efforts to monitor the clearance process emphasize 
measuring timeliness, but additional metrics could provide a 
fuller picture of the process. GAO reports, as well as 
Inspector General reports, have highlighted a variety of 
metrics that have been used to examine clearance programs, such 
as completeness of investigative and adjudicative reports, 
investigators' training, staff and customers' perceptions, and 
the adequacy of internal controls. Including these and other 
types of metrics could add value in monitoring clearance 
processes and provide better information to allow greater 
Congressional oversight.
    In summary, the current Joint Reform Team to develop a new 
government-wide security clearance process represents a 
positive step to address past impediments and manage security 
reform efforts. However, past experience has shown that 
Congress has every reason to remain vigilant. Much remains to 
be done and GAO stands ready to assist the Congress.
    Mr. Chairman, this concludes my opening statement. I will 
be happy to take questions when the members are ready.
    Senator Akaka. Thank you very much, Ms. Farrell. Now we 
will hear from Director Johnson.

  TESTIMONY OF HON. CLAY JOHNSON III,\1\ DEPUTY DIRECTOR FOR 
        MANAGEMENT, U.S. OFFICE OF MANAGEMENT AND BUDGET

    Mr. Johnson. Mr. Chairman, Senator Voinovich, thank you 
very much for having me. A couple of comments.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Johnson appears in the Appendix 
on page 48.
---------------------------------------------------------------------------
    One, the intelligence bill in December 2004 called for 
security clearance reform and the issue to be addressed in this 
reform was timeliness, and that has been our focus of this 
reform effort, was to improve timeliness. In 2005, it took 
approximately 162 days to make a security clearance 
determination for all clearances, the fastest 80 percent of all 
clearances. Today, it takes 112 days. Our most recent time, it 
takes 112 days.
    The goal as defined by the intelligence bill was 60 days, 
so the intelligence bill called for us to go from 160 to 60 
days. We are 50 days toward that 100 days. We are halfway there 
on timeliness. I am personally very proud of the work that the 
reform effort has done, has accomplished, and what we have 
accomplished to reduce timeliness by almost 2 months in 2006-
2007, 2\1/2\ years that we have been working on this.
    The reason there is not more, a new-fangled 21st Century 
technology reform in place is because of a decision that I made 
with the consent of the reform group, which was to initially 
focus almost exclusively on the lack of capacity and the lack 
of accountability in the process. We would not have achieved 
the 50-day improvement in the process that has been achieved to 
date if we had focused on developing an altogether new system, 
if we had not focused before that on expanding investigative 
and adjudicative capacity and adding accountability across the 
government for conducting these clearances in a timely fashion.
    So we have, as all have said, there is much to be 
accomplished still, but I am very proud, and when I leave here, 
I am going to be extremely proud for the accomplishments that 
have been realized and the increases in timeliness with 
continued emphasis on quality in the 3-plus years that we will 
have been working on this.
    A couple of additional comments. You talk about reciprocity 
and Gordon England's concern, and Mike McConnell has a similar 
story, and I have a similar story, and so forth. That is a very 
different process. That is the White House clearance process 
for Senate-confirmed positions. That is more broken than the 
system that we are trying to reform, but we are working with 
the White House Counsel and the investigative units that they 
use to fix that system, as well. But that is a totally 
different process than the security clearance suitability 
determination process that we are trying to reform.
    On terms of reciprocity, our belief is that there is not a 
security clearance reciprocity problem. We have checks and 
balances on whether reciprocity is granted or not. What does 
not exist is suitability determination reciprocity, and that is 
one of the reasons why we have decided and have pointed out in 
this April 30 report that we can't reform clearance 
determinations and not reform suitability determinations. Those 
have to be thought of as similar systems with similar levels of 
accountability and that we don't collect a piece of information 
to make a suitability determination and then collect the same 
piece of information according to a different schedule to make 
a security clearance determination. We need to collect data one 
time and use it for both, and then we need to have a high level 
of capacity and a high level of accountability for both of 
those, which is why we proposed the governance structure that 
we proposed in the April 30 report.
    One final comment. The reason that there is not more 
specifics in the April 30 report about specifically what change 
in the process we are going to implement by what specific date 
and what impact it is going to have on the timeliness is the 
President's charge to us was you come tell me what you know, 
what you can validate, what you can support by April 30, and 
then when you know more, you can come and tell me as soon as 
you know it. So this April 30 is what we know by that date, 
which is here is the process design, here is the kinds of 
concepts we want to develop that will be our guiding feature, 
the guiding light for all future specific developments, but our 
challenge is and what we will deliver is by the end of this 
year, there will be the detail that you look for in terms of 
the specific implementations that are to be made and by when 
according to this process design, who is accountable, and there 
will be a governance structure in place to ensure that it 
happens as promised.
    So I know both of you have talked about, are we going to 
have to start all over when the new Administration comes, and 
the answer is no. There will be a clear path forward. There 
will be a governance structure to make sure that we proceed 
down that path with dates and implementation schedules and so 
forth.
    And so we don't know all those details by April 30. That is 
why it is not included in the report. But we will know all of 
that and we will divulge all of that in a series of reports 
between now and the end of the year. We will have all of that 
by the end of the year.
    Thank you very much.
    Senator Akaka. Thank you very much, Director Johnson.
    Now I will call on Ms. McGrath. I understand that you and 
Mr. Fitzpatrick are giving a joint statement, but Ms. McGrath, 
you may begin.

   TESTIMONY OF ELIZABETH McGRATH,\1\ PRINCIPAL DEPUTY UNDER 
    SECRETARY OF DEFENSE FOR BUSINESS TRANSFORMATION, U.S. 
                     DEPARTMENT OF DEFENSE

    Ms. McGrath. Yes, sir. Thank you and good afternoon, Mr. 
Chairman and Senator Voinovich. I appreciate the opportunity to 
discuss security clearance reform and in particular the initial 
report that we provided from the Joint Team.
---------------------------------------------------------------------------
    \1\ The joint prepared statement of Ms. McGrath and Mr. Fitzpatrick 
appears in the Appendix on page 49.
---------------------------------------------------------------------------
    As the largest industrial organization in the world, the 
size, complexity, and mission of the Department of Defense 
presents unique challenges not faced by other entities 
undergoing transformational change. As in other parts of its 
operations, this contributes to the challenges and 
opportunities presented to DOD in clearance reform. For the 
past few years, the Department has built a strong foundation of 
agile business practices and management that supports the 
warfighter and provides accountability to the taxpayer.
    Deputy Secretary of Defense, Gordon England, has devoted 
extensive time and energy to this effort and the senior 
leadership of the Department has been engaged and accountable 
for the performance of its business operations. Under Secretary 
England's leadership, we successfully established the Business 
Transformation Agency (BTA) in 2005 as the accountable entity 
for DOD-wide business and system improvement efforts. The BTA 
has brought the best and brightest career civil servants 
together with highly qualified experts hired from private 
industry to apply best practices to the business of government 
which we have applied to this reform effort.
    As part of the larger business transformation efforts, the 
Deputy Secretary identified clearance reform as one of the 
Department's top 25 transformation priorities. Championed by 
the Under Secretary of Defense for Intelligence, the Office of 
Business Transformation, my office, which also oversees the 
implementation, enterprise implementation of continuous process 
improvement and Lean Six Sigma was asked to apply this 
methodology to the clearance reform challenge.
    While recent progress has been made in reducing the 
security clearance backlog, it is clear that larger reforms 
remain necessary, leveraging modern methods and tools which are 
standards based and data driven. For example, the Defense 
Industrial Security Clearance Office is now meeting the 
adjudication timelines established by the Intelligence Reform 
and Terrorism Prevention Act. Adjudications of those clearances 
are now down to 17 days. They have also achieved a 20 percent 
overall reduction in adjudication timelines for the first 6 
months of this fiscal year. This improvement was achieved, 
however, through increased capacity, accountability, and local 
process improvements, not the broader transformation effort 
that we are discussing in our report.
    Opportunities exist for further improvements across the 
defense enterprise through the implementation of standard 
processes and information technology. The Department is taking 
a holistic view of its operations to include processes and the 
co-location of the 10 adjudicative facilities at Fort Meade as 
part of their Base Realignment and Closure Commission. This 
effort is also being led through the Office of Business 
Transformation in concert with the joint reform efforts also 
applying the Lean Six Sigma methodologies. The goal of our 
collective effort is to eliminate arcane and arbitrary 
processes and procedures that hinder progress.
    Mr. Chairman, thank you for the opportunity to appear 
before you today. That concludes my statement.
    Senator Akaka. Thank you very much, Ms. McGrath. Mr. 
Fitzpatrick.

TESTIMONY OF JOHN P. FITZPATRICK,\1\ DIRECTOR, SPECIAL SECURITY 
    CENTER, OFFICE OF THE DIRECTOR OF NATIONAL INTELLIGENCE

    Mr. Fitzpatrick. Good afternoon, Chairman Akaka, Senator 
Voinovich. Thank you for this opportunity. I am pleased to 
offer additional information to this Subcommittee regarding 
ongoing efforts to meet the goal of making hiring and clearing 
decisions more quickly, effectively, and efficiently.
---------------------------------------------------------------------------
    \1\ The joint prepared statement of Mr. Fitzpatrick and Ms. McGrath 
appears in the Appendix on page 49.
---------------------------------------------------------------------------
    As you are aware, the Joint Security and Suitability Reform 
Team is composed of representatives of the Office of the 
Director of National Intelligence (ODNI), the Department of 
Defense (DOD), the Office of Management and Budget (OMB), and 
the Office of Personnel Management, all represented before you 
today. I make particular note of the defense and intelligence 
partnership in this enterprise. Our leaders and organizations 
greatly desire the outcome of a reformed process, putting 
people to work in support of our missions. Our commitment is 
reflected in the joint manner in which we pursue reform, as 
well as in our presentation of a joint statement for the record 
today.
    As this Subcommittee is well aware, the Intelligence Reform 
and Terrorism Prevention Act (IRTPA) of 2004 established the 
first-ever legislated measures of success with regard to the 
timeliness of security clearance processing, with goals for 
2006 and more ambitious goals for 2009. While progress has been 
made across the Executive Branch, and we note the intelligence 
community (IC) agencies that conduct their own investigations 
and adjudications are compliant with the current IRTPA goals, 
the existing process is not in our estimation likely to allow 
the U.S. Government to achieve the additional efficiencies 
needed to meet the 2009 objectives. Further, improvements in 
terms of timeliness, consistency, and quality require adoption 
of a standard process across government using end-to-end 
automation and modern technologies.
    The Director of National Intelligence (DNI) recognized the 
need for transformational change to meet such future needs and 
identified security clearance reform as a top priority in his 
100- and 500-day plans. To that end, the DNI along with the 
Under Secretary of Defense, Intelligence, and the Deputy 
Director for Management at OMB commissioned a Joint Security 
Clearance Process Reform Team to systematically examine and 
improve the way we process and manage security clearances as an 
enterprise. Recognizing the need to align suitability and 
security clearance processes where appropriate, this effort 
combined forces with the Office of Personnel Management to form 
the Joint Security and Suitability Reform Team, thereafter 
accelerating and expanding efforts to develop transformed, 
modernized, fair, and reciprocal security clearance and 
suitability processes applicable across the Executive Branch.
    On April 30, 2008, the Joint Team submitted its initial 
plan to the President, announcing its intent to adopt and 
pursue implementation of a transformed process that manages the 
hiring and clearing process from an enterprise end-to-end 
perspective. This plan proposes a governance structure to drive 
implementation and near-term actions to develop and put into 
use modern investigative tools, end-to-end information 
technology, a risk management philosophy, and efficient, 
standardized business practices.
    Also of note, modifications to intelligence community 
policies are being made to allow for the clearing of more 
first- and second-generation American candidates. This effort 
includes careful consideration of ways to balance risk while 
increasing opportunity for such citizens to be considered by 
the clearance process. We have studied existing programs within 
the intelligence community that may offer a model for other IC 
agencies to build upon. We fully expect the near-term outcome 
of this DNI-level policy change to result in more applications 
from first- and second-generation Americans and ultimately a 
more robust mission capability within the IC.
    While we do not underestimate the challenge that a reform 
effort of this magnitude represents, we are resolute in our 
determination and dedication to achieve the change necessary to 
ensure effectively and timely hiring and clearing decisions. 
With the continued interest and commitment from the President, 
the Congress, and senior executive leadership, we are confident 
that this effort will ultimately succeed.
    Mr. Chairman, thank you for the opportunity. This concludes 
my remarks.
    Senator Akaka. Thank you very much, Mr. Fitzpatrick.
    And now we will hear from Ms. Dillaman.

TESTIMONY OF KATHY L. DILLAMAN,\1\ ASSOCIATE DIRECTOR, FEDERAL 
   INVESTIGATIVE SERVICES DIVISION, U.S. OFFICE OF PERSONNEL 
                           MANAGEMENT

    Ms. Dillaman. Chairman Akaka, Senator Voinovich, thank you 
for inviting me back to talk to you about our progress in 
improving the timeliness of security clearance process and 
OPM's support of continuing reform efforts.
---------------------------------------------------------------------------
    \1\ The prepared statement of Ms. Dillaman in the Appendix on page 
55.
---------------------------------------------------------------------------
    As you know and as you said, OPM conducts over 90 percent 
of the background investigations required by agencies to 
support their security clearance and suitability decisions for 
civilian, military, and contractor personnel. The extent of the 
investigations conducted is based on the subject's level of 
clearance or access and the type of work or position they are 
assigned. Investigations are completed for over 100 Federal 
agencies and their security offices across the country and 
around the world.
    With a vast network of field investigators and our current 
automated processing system, we have sufficient capacity to 
handle the government's high-volume demand for background 
investigations. Last fiscal year, we conducted over two million 
investigations of varying types, including 850,000 for national 
security positions.
    Since May 17, 2007, when I last spoke before your 
Subcommittee, we have continued to improve the overall 
timeliness for the security clearances process. We are not only 
meeting the initial goals for 2006, outlined in the 
Intelligence Reform Act, we also are exceeding these goals for 
investigations and have substantially reduced our pending 
inventory.
    In November 2005, the Performance Improvement Plan that was 
provided to Congress identified critical areas that had to be 
addressed. First, agency workload projections had to be 
reasonably accurate to ensure that there were sufficient 
resources available to meet the investigation and adjudication 
staffing needs. We are noting improved accuracy in agencies' 
projections, which has helped to ensure that enough resources 
are in place to get the job done.
    Next, we focused on the timeliness and quality of agencies' 
requests for investigations. The increased use of OPM's 
electronic questionnaires for investigations processing (e-
QIP), which is a web-based system that allows applicants to 
submit their background information electronically, has reduced 
handling and transmission time, while improving the quality of 
subject-provided information. In the second quarter of Fiscal 
Year 2008, 86 percent of all submissions for security clearance 
investigations were made online.
    The Intelligence Reform Act established a specific goal 
that 80 percent of the background investigations for initial 
security clearances be completed within an average of 90 days 
or less by the end of 2006. We have exceeded that goal. There 
is a chart in my written testimony that reports the processing 
time for all initial clearance investigations and further 
breaks that data down by the level of clearance. As you will 
note, we are currently completing 80 percent in an average of 
60 days, 84 days at the top secret level, which are much more 
extensive, and 56 days at the secret-confidential level.
    With a current staff of over 9,300 Federal and contractor 
employees, there is no longer a backlog of initial clearance 
investigations due to insufficient resources and we have seen a 
substantial decrease in the time it takes to complete all types 
of background investigations.
    In addition to maintaining an adequate staff level, we are 
working closely with Federal, State, and local record agencies 
so that their records required as part of the investigations 
are provided to OPM more rapidly. We also are working with the 
State Department and the international community to improve the 
process of obtaining required international coverage. In 2007, 
we had 360 agents who were stationed abroad complete more than 
24,000 international leads.
    While improving the timeliness of investigations, we have 
worked equally hard to retain the quality of these 
investigations. The quality control processes we have in place 
ensure that the investigations we conduct meet the national 
standards and the needs of the adjudicating communities. I 
should note that many of the metrics that Ms. Farrell described 
we are now incorporating into our quality measurement process.
    Once the investigation is completed, we also are tracking 
the time agencies take to adjudicate and record their 
adjudication actions in our record system. To speed up and 
streamline that process, we developed the capacity to transmit 
completed investigations to adjudication facilities 
electronically rather than hard copy through the mail, and this 
does allow for adjudication online, on-screen.
    In October 2007, we piloted this capability with the 
Department of Army. To date, over 190,000 investigations have 
been sent electronically to Army for adjudication, making the 
process between OPM and Army virtually paperless. Based on the 
success of this pilot, the Department of Transportation and the 
Federal Aviation Administration have converted to receiving 
completed investigations online and we are in the final stages 
of implementation with the Department of Energy and Department 
of Commerce. This capability will be made available to all 
agencies this fiscal year.
    The initiatives I have outlined have substantially improved 
the timeliness of the clearance process. However, we have taken 
it just about as far as we can take it. In order to achieve the 
aggressive goals outlined in the Intelligence Reform Act for 
2009, additional reform is necessary. As a partner with OMB, 
the Office of the Director of National Intelligence, and the 
Department of Defense, we are optimistic that the additional 
reform opportunities that have been identified for the overall 
security clearance process will allow us to meet these goals.
    This concludes my remarks and I would be happy to answer 
any questions you have.
    Senator Akaka. Thank you very much, Ms. Dillaman.
    Ms. Farrell, this Subcommittee took on the security 
clearance issue in large part because of faults found with it 
by GAO. You and your predecessors have testified about ongoing 
problems with the process and outcomes since 2005. Could you 
tell me what milestones generally would need to be met in order 
for GAO to move the security clearance process off the high-
risk list?
    Ms. Farrell. We would like to see that happen. There are a 
number of criteria that we use to determine whether or not we 
move a program off of the high-risk list. One is we look at 
leadership. Often these issues need sustained top management 
attention and we have seen that leadership since 2005 from OMB 
and OPM in focusing top-level attention on this very important 
issue.
    Other criteria that we look at include an action plan that 
is results oriented, that clearly identifies the roots of the 
problem, what the goals are in order to correct it, and how you 
are going to get there, in other words, a road map of how to 
fix the problem.
    Another criteria we look for is resources in terms of often 
additional resources. It may be people. Ms. Dillaman talked 
about the advances that have been made at OPM in terms of 
building up the human capacity to handle the backlog. We look 
for not only the human resources, but funding that may be 
necessary, such as in the case of using the advanced 
technology, what is it going to cost, visibility and 
transparency over that, as well.
    We currently have work underway--it has been underway for 
about 6 weeks or so--looking at timeliness and quality and what 
progress has been made in these areas. We will be positioned 
later this year to make a determination whether or not the 
Personnel Security Clearance Program remains on our January 
2009 High-Risk List.
    Senator Akaka. Yes. Do you think that if the Joint Team's 
recommendations move forward that you may be able to get the 
issue off the high-risk list in the near future?
    Ms. Farrell. We look forward to looking at the plan and the 
accompanying documents that Mr. Johnson mentioned in order to 
make that determination. Again, we are pleased with the 
leadership that has been shown and focused on this area and we 
are pleased to see the concept paper that came out in April. 
But we are in the process of looking at this paper and seeing 
what are the details behind it to actually make these actions 
happen, to show that there really is clear progress being made.
    Senator Akaka. Thank you, Ms. Farrell.
    Director Johnson, one of the cornerpieces of the new reform 
proposal, and you have told us the forthcoming Executive Order, 
will be the creation of the Performance Accountability Council. 
Can you tell me more about its make-up, such as who will be on 
it, who will oversee the security side, and what, if any, input 
there will be from non-government stakeholders?
    Mr. Johnson. You have asked several questions. One, as you 
know, there are two so-called Executive Agents designated, a 
Suitability Executive Agent and a Security Executive Agent. OPM 
now is the suitability entity and so OPM will remain the keeper 
of all things related to suitability. The term ``Executive 
Agent'' is a new term, but their responsibilities remain 
largely the same in terms of the keeper of the policy and being 
one who is officially responsible for suitability performance.
    There is no Security Executive Agent today. The National 
Security Council, if there is one, is the closest to being 
that. There are some policy clearance processes with the 
National Security Council. Some recommendations have been made 
about who that Security Executive Agent should be. That 
decision will be included in the Executive Order that will be 
produced by the end of June and it would be premature to talk 
about what has been recommended and what is under discussion, 
but that will be finalized by the time that Executive Order 
comes out by the end of June.
    The industry is one of our most important customers on this 
process because it costs them money, which means it costs us 
money, and they are generally--when security clearances are 
involved, they are working on really important things for our 
national security, homeland security, and nobody benefits from 
them taking a long time to get their people on the job. And so 
we have mechanisms in place to stay in touch with them, to 
compare what they perceive the situation to be to what the 
reality is, and they perceive the situation to be not what our 
numbers indicate, which means that there is a gap between what 
they perceive to be the timeliness and what our numbers suggest 
the timeliness.
    But we reach out to them a lot, particularly DOD, because 
that is where the industry people are. There are meetings with 
all their associations. I met with a group of industry folks 
the first week in May after the April 30 report came out. We 
are constantly getting information from them, looking for ways 
to even better communicate what the average timeliness is and 
the range of timeliness is to get the clearances for the people 
that they are trying to put on jobs that we are hiring them to 
do.
    In terms of who else is on the council, that hasn't been 
determined yet. Right now, I suspect it will be very similar 
to--from the security clearance standpoint, to the people that 
are on our oversight group right now, which is the large 
customers, DOD, Commerce, State, Transportation, Energy, 
Department of Homeland Security. It will be the primary people 
that are involved in the process, OPM, FBI. There will also 
have to be the large suitability customers, so-called. They are 
people that make a lot of hiring decisions that don't have much 
need for a security clearance determination, but now that 
suitability is being folded into this overall process, we have 
to look at the suitability process just like we are looking at 
the clearance process.
    But all that determination will be made in the latter part 
of June and the early part of July and our first meeting is 
already scheduled. Our first meeting, I think, is July 22, 
which would be the first meeting of this Performance 
Accountability Council. And the name is important because it is 
defining what the performance level should be and then holding 
everybody accountable for doing it, being develop and implement 
the new processes, new ways of making these determinations, but 
then also using those processes to perform as they are designed 
to be adhered to.
    Senator Akaka. The Joint Team's report also says that the 
new Security Executive Agent created in that council will 
consolidate clearance responsibilities that are now spread out 
among the members of the security community. Can you elaborate 
on exactly what responsibilities you hope will be consolidated 
and from who?
    Mr. Johnson. No, I can't, and I don't know the answer to 
that question. I don't know what is disseminated throughout the 
community. So Mr. Fitzpatrick.
    Senator Akaka. Mr. Fitzpatrick.
    Mr. Fitzpatrick. Yes. Thank you, Mr. Chairman. If you will 
note in the report in the area where it describes the functions 
of the council, there are policy, process, information 
technology, and training considerations that apply to these 
processes. In the realm of the current national security 
clearance policy development and oversight process, that 
happens in different communities and it is rolled up to some 
extent with the Security Clearance Oversight Group and the 
performance measures that are in that report but are not to 
date driven to operational impact in the areas of training and 
technology and touching the process as it is executed in the 
agencies. So I expect that in the area of the Security 
Executive Agent, the council will look to that entity for 
input, performance measures, an organizational approach to 
achieving the training needs of that process, the information 
technology needs, to ensure that they are driving towards 
implementation.
    In the present day, policy development happens in a series 
of disconnected working groups that eventually drive a single 
recommendation up to the Policy Coordinating Committee. That 
could be better leveraged in the Executive Branch and singly 
coordinated with the Suitability Executive Agent. One of the 
keys here is to identify a single point of contact for the 
security side so that when things need to be brought into 
alignment with suitability operational needs, that there is a 
person accountable for leading that charge.
    Senator Akaka. Senator Voinovich.
    Senator Voinovich. Thank you. I, first of all, want to 
thank all of you for the good work that you have done. I know 
we are up here complaining about the fact that things aren't 
exactly the way we would like them to be, but I know all of you 
have conscientiously undertaken the responsibilities that you 
have had and I want you to know that I appreciate it.
    Mr. Johnson, I want to say to you, thank you very much for 
all of your hard work staying on top of this. I don't know 
whether you are going to stick around until the end--I hope you 
do--and I know that between now and then you are going to put 
the frosting on as much of the cake as you can so you can look 
back and say, we got something done. So thank you very much.
    I need some clarification here, and that is this. I think 
we hired somebody from the CIA about 3 years ago after we had 
the gigantic foul-up over money. We ran out of money and we had 
to find the money to do the adjudication or whatever it was. I 
was kind of optimistic about it, that we were going to really 
take off with that hire. I am not sure whether that person was 
looking at the big picture or if she was just looking at the 
DNI aspect of security clearance reform, but it is my 
understanding that McConnell had said that in his first 100 
days and his first 500 days that modernizing the security 
clearance process was a core initiative and that DNI had come 
in, they looked at it and said, you know what, this system that 
we have is from the dark ages and we have to get together and 
change the system, and that system is different than the system 
that we are talking about here where the investigations go to 
OPM and then you send it back for adjudication.
    Is that all--Mr. Fitzpatrick, why don't you share that with 
me.
    Mr. Fitzpatrick. Thank you, sir. You could see me getting 
ready to speak. I think it is important to note that Mr. 
McConnell, along with Mr. Johnson, the Under Secretary of 
Defense for Intelligence, Jim Clapper, and the Director of OPM, 
Linda Springer, are the four champions of this effort that is 
represented by the April 30 report, and so while your 
description of Mr. McConnell's initiative in his first 100 days 
is entirely accurate, that interest and initiative to do 
something about the security clearance process led him about 1 
year ago into Mr. Johnson's office with General Clapper and 
launched the security clearance reform effort that I made 
reference to in my statement that quickly then joined up with 
suitability and said, if we are going to tackle this, we are 
going to tackle it at the Federal enterprise level and with 
security and suitability together. So what you may have 
discussed with Mr. McConnell in the past is this self-same 
effort to affect the Federal enterprise process.
    It is also important to know from the intelligence 
community perspective that the standards that drive 
investigations and secret and top secret clearances in all of 
the Federal space are the same standards used in the 
intelligence community for secret and top secret clearances----
    Senator Voinovich. OK, but do they do the investigations 
for everybody, including the DNI?
    Mr. Fitzpatrick. Within the intelligence community, there 
are six agencies that handle their own investigations and 
adjudications. Statistically, it is about 5 percent of the 
total that Ms. Dillaman discussed in her workload, and so some 
portion of the intelligence community is serviced by the OPM 
model, a good portion, and the Department of Defense being the 
largest customer in both the Federal stake and in the 
intelligence community.
    Senator Voinovich. But the part of it, that 5 percent or 
whatever, that is the thing that they were going to try and--it 
looks like they are trying to put a new personnel system into 
DNI. In fact, one of my former staffers, Andy Rickardson, is 
over there working on that. But that is internal within the 
intelligence community. They have their own investigation and 
own adjudication procedure.
    Mr. Fitzpatrick. They operate their own, but to the same 
Federal standards that we are affecting by this reform.
    Senator Voinovich. OK. So the point is they are doing it on 
their own, but you are trying to assimilate the standards that 
they have set within this big picture that came out in this 
report, is that right?
    Mr. Fitzpatrick. Yes.
    Senator Voinovich. OK. And----
    Mr. Johnson. Senator, can I take a shot at this?
    Senator Voinovich. Sure. Go ahead.
    Mr. Johnson. The intelligence agencies not part of DOD do 
their own investigations and adjudications and they do it 
within the standards that were called for--timeliness standards 
that were called for by the intelligence reform bill. The 
intelligence agencies that are part of DOD, their 
investigations are done by OPM and then they do their own 
adjudications.
    When General McConnell came in, it was a very rare 
opportunity because the head of the DNI and the Under Secretary 
for Security and Intelligence at DOD, Jim Clapper, and the 
Secretary of Defense all grew up together in this in the 
government and they all shared a huge dissatisfaction with the 
security clearance process.
    Senator Voinovich. Now you are getting at it.
    Mr. Johnson. OK. There was this coming together, a 
crescendo----
    Senator Voinovich. Yes.
    Mr. Johnson. So they came together and they said, we need 
to fix this system. Tell us what you are already working on. 
And so we gathered and we say, here is the concept. Here is the 
process. And they said, well, when are you going to have this 
done and that done and they said, July, and they said that is 
not fast enough. It needs to be April. And then what are you 
thinking about this and doing--well, that is not--so what they 
have done is taken on the concept.
    It is not what they have aspired to do and put in their top 
five goals or 10 goals or whatever it is. It is not a different 
process than the one that was laid out in concept in the April 
30 report. They have come in and, because of their influence, 
caused us to emphasize this, speed this up, do this faster, do 
this coincident with this, and so forth, and they have helped 
us bring government-wide attention to this, particularly within 
DOD, which is 80 percent of overall.
    So that short-term, for instance, one of the big problems 
we laid out and challenges for this year was that industry 
adjudications be conducted as quickly as employee 
adjudications. It was taking 20 or 25 days longer because there 
were a lot of extra steps or they had to go over here or 
something and nobody could figure out why. Well, I think it is 
true that as of April, the industry adjudications are being 
performed as quickly as employee adjudications. That would 
never have happened if the priority hadn't been placed on it by 
the Secretary and the Under Secretary.
    So what they have done is add impetus to it. They were the 
one that argued strongly for let us get the President to 
endorse this formally with his letter of February 5. So there 
was a lot of attention being paid, but when the President 
issues a letter and those three people say it is going to be 
done, mountains start moving. And so they have been 
tremendously helpful to us to provide even a greater force and 
speed and timeliness, attention to this, which gives us even 
greater assurance that when I am talking about where we will be 
at the end of this year, in fact, we will be there.
    You asked what the CIA--I think that was DOD. I think they 
were talking about when they--there were adjudications--DOD a 
couple of years ago stopped accepting applications for security 
clearances from industry because they ran out of money. It was 
like in June, I think. Nobody could understand why and there 
was a hearing and it was not their most comfortable----
    Senator Voinovich. So they got somebody over there to go 
over and----
    Mr. Johnson. So then they went and got the money and they 
got it started again and then they got smarter about what they 
needed to budget and so forth.
    Senator Voinovich. The fact of the matter is that the 
statistics are that right now, in terms of the adjudication, 
they are still kind of--there is a logjam there.
    Mr. Johnson. Well, as you talked about earlier, a lot of 
the jam that was in the investigative world, they got through 
that. It moved through there. So it is working its way through 
the snake. There are--you said seventy-some-odd-thousand, 
whatever the backlog was, their goal is to get it down to--and 
then we talk about it in the February report what their goal 
is, and they are on track to achieve that. But for a good bit 
of this fiscal year, they were going to be working down that 
backlog. And then we will be, starting in fiscal year 2009, we 
anticipate virtually no backlogs anywhere in this process.
    Senator Voinovich. OK. I just want to stay with this. They 
came together and said the system has to be changed. My 
assumption is that within the intelligence agencies that do 
their own investigations and adjudications, there was some 
frustration about the way that the system worked and the 
process of doing their work within that framework. That whole 
business, I would suspect, is in better shape because it is a 
smaller number of people than the overall problem that you are 
talking about here today.
    Mr. Johnson. I will make a general comment, and then Ms. 
McGrath and Mr. Fitzpatrick--who work firsthand with that--but 
there were not timeliness problems with the intelligence 
community the way we looked at it. What we were trying to 
address was the other 95 percent of the system, because the 
feeling, the feedback that was coming from the data we were 
getting from the intelligence community was, by and large, the 
timeliness of those clearance determinations was satisfactory.
    Mr. Fitzpatrick. That is also entirely true, and the IRTPA 
laid out the need to measure performance. The intelligence 
community did not measure its performance before the rest of 
government did and joined right along with Mr. Johnson's 
oversight group when we did, and we discovered at that time 
what we thought to be true, which seems like the intelligence 
community agencies get this done faster, turned out to be 
measurably true, in part because they own both the 
investigative and adjudicative stages and are able to integrate 
those better, and that is----
    Senator Voinovich. Right, and the point is that in terms of 
industrial people that need clearance within that, probably 
there aren't that many of those people who are going to work 
for the Department of Defense or do a special contract or 
whatever it is. There probably aren't that many private sector 
people that you are going to have to clear to do stuff within 
the DNI and all the agencies.
    Mr. Fitzpatrick. I am not sure what your perception of not 
that many is, because it includes the National Security Agency, 
the National Reconnaissance Officers, and the CIA, there are 
significant industry partnerships there----
    Senator Voinovich. OK, but those people that they are 
hiring are not in the system you are talking about here. Those 
are within the internal system of those other agencies.
    Mr. Fitzpatrick. But they get cleared to the same 
investigative standard and adjudicative standard as----
    Senator Voinovich. Does Ms. Dillman do the work on the 
investigation?
    Mr. Fitzpatrick. For some.
    Senator Voinovich. Yes.
    Mr. Fitzpatrick. For some agencies. The CIA, for example, 
handles its workload entirely. NSA, a portion of the NSA 
industrial program goes to OPM. The priority cases, they keep 
at home. So it is a little different. These are small in scale. 
We sometimes refer to them as boutique operations----
    Senator Voinovich. I am going to finish, Senator Akaka, 
because I have taken too much time already, but the complaints 
that I continue to get from the industry people are not people 
that are within the DNI group. They are working for the 
Department of Defense or somebody else and say, we got the 
contract and we can't get the clearance. We are going to put 
them on the payroll and they can't do intelligence work. If we 
don't do that, they are going to do something else. They are 
still not happy with the process because I continue to get 
complaints about it. But they are the ones that are involved in 
this big system that we are talking about right now.
    Mr. Johnson. Yes.
    Senator Voinovich. Senator Akaka.
    Senator Akaka. Thank you. Ms. Dillaman.
    Ms. Dillaman. Yes, sir.
    Senator Akaka. As you know, following our hearing last 
year, and from what I said here this afternoon, I believe that 
the systems in use by OPM are outdated and antiquated. I do not 
think that many outside experts believe that OPM is truly 
leveraging more modern systems. What is OPM doing to modernize 
or replace or improve its aging systems?
    Ms. Dillaman. Up until the point where we joined with this 
reform effort, there certainly were plans and continue to be 
plans to keep our systems up to date and viable. Now partnering 
with this reform effort, of course, we are going to keep any 
modernization consistent with the National Enterprise Plan for 
an end-to-end system.
    The core system that you described as an antique Cadillac, 
and I am thrilled that you at least described it as a Cadillac 
and not a Pinto, but that system alone is an in-house internal 
management system that much more modern systems are, in fact, 
bolted to. Our electronic questionnaire is a relatively newer 
system designed by industry. Our fingerprint transmission 
system is actually quite a state-of-the-art system designed by 
industry to support automated fingerprint processing. Our 
current imaging system, which allows for transmission of data 
and images and conversion of paper that we are forced to 
receive from information suppliers, is a brand new system 
deployed last year.
    We are in various stages of antique to modern 
configuration. But from this point forward, all investments--
and there are planned investments--will be made in conjunction 
with where the national reform effort is taking us all.
    Senator Akaka. Let me ask Ms. McGrath and Mr. Fitzpatrick, 
has DOD or DNI commented or consulted with OPM on any of these 
proposed improvements? Ms. McGrath.
    Ms. McGrath. Every week, Office of Personnel Management 
(OPM) is part of the overall joint reform effort and we meet on 
a weekly basis and have detailed project plans where we go over 
every, if you will, step of the end-to-end process, information 
technology being one of them. If you will note in the report, 
we are proposing in the near term--as a near-term opportunity 
some of the next-generation application capability in addition 
to automated records checks capability. Some of that technology 
currently exists within the Office of Personnel Management and 
we are looking to leverage those systems, if you will, and the 
platforms that are currently in use to see if they can be 
adopted to fit into the overall strategy. We still are not--we 
have not finalized the IT strategy. We will not be in position 
to do that until definitely the end of the fiscal year, but it 
might be closer to the fall.
    Senator Akaka. Mr. Fitzpatrick.
    Mr. Fitzpatrick. I would only add that that is a very 
complete answer.
    Senator Akaka. Ms. Dillaman.
    Ms. Dillaman. And if I may, sir, not only have I been 
involved personally with the reform effort with Mr. Johnson and 
the team from the very beginning, I have assigned a career 
senior executive to work with the reform team virtually full 
time on this effort. So, OPM has a very dedicated staff that 
has been partnered with this from the beginning.
    Senator Akaka. Ms. Dillaman, to follow up on an IT-related 
issue, I wanted to mention an article that was in this 
morning's Washington Post about the Investigative Services 
Division.
    Ms. Dillaman. Yes, sir.
    Senator Akaka. The article focused on a billing error----
    Ms. Dillaman. Yes, sir.
    Senator Akaka [continuing]. Attributed to your case 
processing and your billing systems. What role did your 
investigation processing system, PIPS, play in this error, and 
are we likely to see such problems with these linked-together 
systems in the future?
    Ms. Dillaman. I believe any automated system is capable of 
having logic errors in programs that are isolated and hard to 
detect. The billing error in question--the automated processing 
system, PIPS, tracked it accurately. What failed to happen was 
an electronic signaling. It was an odd error because it 
affected certain adjustments. There were no errors in case 
billing. All cases were billed accurately. But there were 
adjustments that had to be made and they were not predictable 
adjustments. They were ad hoc-type adjustments that an 
automated signal did not relay properly into OPM's billing 
system. Because it was infrequent and it happened sporadically, 
it was not detected quickly. It was a manual audit that 
identified it.
    Can it ever happen in an automated program? Of course, it 
can. The resolution of it is to have good, solid auditing 
programs to identify it and fix it quickly.
    Senator Akaka. Ms. McGrath, last week, the Army announced 
that they would pilot a more automated investigation system 
using elements found in the Joint Team's recommendations, such 
as automated records check. The system is known as the 
Automated Continuing Evaluation System (ACES). If the pilot is 
successful, would this mean that a significant part of OPM's 
investigation work could be bypassed by using this system?
    Ms. McGrath. The Army pilot is actually being driven by the 
Joint Team effort, so we are using the Army's case management 
system, which is called Central Adjudication Tracking System 
(CATS)--don't ask me for all of the DOD acronyms. But in 
addition to the Army case management system, because they can 
receive files electronically from OPM today, we use their 
receipt of electronic files from OPM into their adjudication 
system tied to the ACES capability, which I referred to as the 
automated records checks. ACES is the capability that DOD has 
today in a very--we use it in a very limited capacity, much 
more for research than full-blown implementation. We are trying 
to demonstrate what we would have from an end-to-end 
perspective because there is no end-to-end solution that exists 
today.
    So we expect to obtain--the Joint Team expects to obtain--
to identify performance gaps, capability gaps, so that at the 
end of the calendar year we would be able to put together a 
comprehensive IT strategy that would be applicable broader than 
the Department of the Army. As you well know, they have most of 
the casework within the Department of Defense, but it is not 
tied to the elimination of the investigative piece. It is the 
automated receipt of the investigative material to then much 
more quickly screen and make adjudicative decisions.
    Senator Akaka. Thank you. Let me ask Ms. Dillaman for any 
comment on this question.
    Ms. Dillaman. I think the implementation of electronic 
searches in any capacity certainly could have the benefit of 
reducing the amount of labor necessary to apply to background 
investigations. We have seen this for the past couple of years 
as we have converted other types of record checks from a labor-
intensive, feet on the street, sending an agent, knocking on a 
door to get a record, to an electronic records system. We have 
converted over one million law checks annually from agents 
going and visiting police departments to having individuals who 
have online keyboard access to State records systems and saving 
a tremendous amount of investigative resources.
    The types of searches envisioned in ACES or in the 
automated record check system means that we will have more 
electronic information available early in the process. It is 
possible that some of the investigations may be able to be 
cleared with electronic information up front rather than having 
labor-intensive field work associated with it. But it also is 
entirely possible that we will identify issues in these 
electronic checks that will require an agent to go out and do 
further probing and resolution.
    The impact has yet to be determined. At the end of the day, 
we do end up, though, with a better investigation and much 
earlier in the process a clear identification of whether or not 
the individual will be a risk or not.
    Senator Akaka. Thank you very much. Senator Voinovich.
    Senator Voinovich. To get back to just the process, I am 
the Defense Department. I decide that this individual that I 
have hired and qualified for the job has to get a security 
clearance. I suspect the Defense Department may have that 
application up on a computer screen. When they make the request 
to you, do they do it by computer or do they fax something to 
you and then you get the piece of paper and you start to 
investigate it?
    Ms. Dillaman. No. It comes to us electronically, sir, 
today.
    Senator Voinovich. OK. You get it electronically.
    Ms. Dillaman. Yes.
    Senator Voinovich. OK. Now you do the research 
investigation.
    Ms. Dillaman. Yes.
    Senator Voinovich. Is the information that you do on the 
investigation inputted on that screen?
    Ms. Dillaman. Yes.
    Senator Voinovich. OK. And then you have done your job and 
then electronically you get the information back to the 
Department of Defense, is that right?
    Ms. Dillaman. Yes, sir.
    Senator Voinovich. OK. At that stage of the game, they have 
all this information in front of them, and one of the things 
that Ms. Farrell said was that in many of those cases, the 
information is not complete and rather than go back to you to 
get the information, they just go ahead and take what they have 
got and make a decision and adjudicate it based on that. Ms. 
Farrell, maybe you could comment on that at this stage of the 
game.
    OPM is talking about some new things that you are doing 
electronically, but if it was all electronic, it seems to me 
that if there is something wrong with it, all you have got to 
do is look at the form and say, you know what? I don't have 
this information, so I will send it back to OPM, saying ``this 
is not complete. Give us more information so I can do a better 
job of adjudicating.'' It is all seamless, all up there.
    Ms. Dillaman. If I could first address this, sir, I think 
the quality of the investigation is absolutely of primary 
concern to everyone. No sense doing it fast if you are not 
doing it right. Ms. Farrell's study citing the investigations 
they looked at were from the process during the heart of the 
transition when merging DSS and OPM. When we had recognized 
that there were serious problems in how OPM versus the 
Department of Defense had interpreted the investigative 
standards, reporting style, etc., we were quite anxious for GAO 
to come in and take another look.
    I think there also is a dissatisfaction in some areas of 
the community. Not with the quality of the investigation, but 
the investigative standards themselves. There are different 
levels of investigations for different positions. Certainly 
what you do at the secret level does not come anywhere near 
close to what you do at the top secret level, nor should it, 
because the impact is not the same.
    And so, measuring the quality of the investigations, 
agencies do have an option to reject an investigation that they 
receive that they believe is deficient. That is, in fact, one 
measure of the quality of our work. We go out annually and ask 
for quality feedback from all the major clearance-granting 
agencies, suitability and security. Last year, we surveyed 622 
offices. Those were agency offices that had submitted at least, 
I believe, 200 or 500 investigations for the year. We had about 
a 50 percent response rate on the survey with a 91 percent 
satisfaction rate in quality and content of the investigation.
    And so I do not believe that the quality of the 
investigations compared to the standards that they are 
conducted is a problem today. Can we have an agent fail to do 
what he or she should? Yes, we can. But I believe we have built 
a very strong structure with tiered review systems and allowed 
agencies immediate feedback opportunities to correct any 
deficiencies that are found.
    Senator Voinovich. Ms. Farrell, you have had a chance to 
sit here and listen to all this. Would you share with us what 
is going on in your head in terms of some of the things that 
have been said here today?
    Ms. Farrell. I am pleased to hear Ms. Dillaman acknowledge 
that there are plans to build in quality metrics other than the 
single metric that has been referred to in the past, which we 
have said that is inadequate. Regarding the number of 
investigative reports that are returned by the adjudicators, as 
a metric, one reason why we have said it is inadequate is 
because the adjudicators have told us they are reluctant to 
return those reports because that will just add to the time. 
Thus, in some cases, they will go ahead and determine the 
eligibility without it.
    We believe that not only do they need to establish metrics 
for that phase of the investigation, which Ms. Dillaman 
oversees, but also for the other phases. There are six phases, 
as I said, from the requirement-setting phase to the 
application-submitting phase to the investigation to the 
adjudication to the appeals and then the renewal of the 
clearances. There is very little attention that has been 
focused on any of these phases. Just one phase, again, had one 
metric that we had some indication of what was going on.
    What you were referring to about the adjudicators, with the 
timeliness issue, we are looking at this right now as we are 
with the quality, and as I said, we are pleased to hear that 
there are quality metrics being considered and we are going to 
be looking at those very carefully to see what they are, and if 
they do give a fuller picture of the timeliness, as well. In 
the past, we have had concerns about how the data is presented 
in terms of the timeliness. It may look like the numbers are 
going in the right direction, but perhaps they aren't.
    We have had concerns in the past, for example, regarding 
the time that is spent sending back a report to the 
investigators being counted against the adjudicators instead of 
the investigators. Another concern is the time that is needed 
to do additional investigative work when it is sent back by the 
adjudicators, it often takes less time to redo the 
investigation to satisfy the requirement, but that second time 
around with the investigation is what is counted instead of the 
first time. Maybe these issues have been resolved, hopefully 
so, but we are going to be looking very carefully at the 
timeliness to see what is behind those numbers.
    Senator Voinovich. Let us go to reciprocity. And one thing 
I want to make sure I clear up for the record, Mr. Johnson, you 
indicated that your metric was timeliness and I don't want 
anyone to think that you aren't interested in quality, too. I 
think that----
    Mr. Johnson. Yes.
    Senator Voinovich [continuing]. Timeliness plus you want to 
make sure it is done right. Why haven't we made the progress in 
terms of reciprocity that we all would like to have? What is 
holding it up? Why aren't we doing more there?
    Mr. Johnson. Again, our belief is that we do not have a 
security clearance reciprocity problem and that problems that 
did exist have been largely eliminated. Why do we know that? 
Why do we think that? If somebody requests an investigation for 
a security clearance in the 90 percent done by OPM, if they 
already have a clearance at that level, she doesn't initiate an 
investigation. So----
    Senator Voinovich. OK. What you are saying is that the 
system that was in place where you had to get another 
investigation, or the system that was in place where Mr. 
England had one clearance and then he was told, we are moving 
you from here to there and----
    Mr. Johnson. That is the White House. That is a another 
whole world.
    Senator Voinovich. OK. So the point is that it would seem 
to me that within that framework, are the folks at DNI 
interested in having that----
    Mr. Johnson. For PAS-es? For Senate-confirmed people?
    Senator Voinovich. Yes.
    Mr. Johnson. We are separately from this reform effort, 
separately, I am working with Ms. Dillman and working with 
Presidential personnel presently and with Fred Fielding to fix 
that process. But that is separate from this effort and that--
--
    Senator Voinovich. OK. So that is the White House process--
--
    Mr. Johnson. That is the White House.
    Senator Voinovich. I am worried about the fact that we are 
going to have a new Administration----
    Mr. Johnson. Right. Oh, yes.
    Senator Voinovich [continuing]. And I suspect there are 
some really good people out there that may not be of the same 
party, but they are qualified people. You want to bring them on 
board and you want to get them through, get them approved, but 
you have to get a security clearance on them, and you are 
saying that you think that----
    Mr. Johnson. That process needs to be fixed, and there are 
a number of things we are looking at and if we want to change 
that process, we have to do that with the Senate because they 
give their consent and they review people, their backgrounds, 
prior to a confirmation hearing and they are used to getting 
certain kinds of information at certain parts of the process. 
And if we want to make that process faster and maybe give them 
this information instead of that information, we have to do 
that with the Senate.
    Senator Voinovich. The Senate is not--the law doesn't 
require the White House to come up with a separate 
investigation on somebody. You look at the thing and they have 
had a security clearance and--are you telling me that we are 
the ones responsible----
    Mr. Johnson. No, never. I would not suggest that, sir.
    Senator Voinovich. Well, sometimes we are. [Laughter.]
    Mr. Johnson. Well, I have heard rumors, but I personally 
haven't experienced that, sir. We have to both agree, the White 
House and the Senate have to agree on what constitutes a 
background check for a PAS. So if any changes are going to be 
made, we are going to do it with each other, not to each other, 
and I am confident that nobody likes that process, either. It 
takes too long to get a new team on the field, and so there 
will be a lot of interest, I would suspect, in the Senate.
    Senator Voinovich. Is there any work being done on it right 
now?
    Mr. Johnson. Not in the Senate. What we want to do is we 
want to get what we think is a smart way forward and then sit 
down with Senate leadership, and I would hope that you and 
Senator Akaka would help us bring attention to that and get the 
right people to sit down and look at this.
    Senator Voinovich. Well, the sooner you get it to us, I 
will get a hold of Senator McConnell and talk to Majority 
Leader Reid and----
    Mr. Johnson. Right.
    Senator Voinovich [continuing]. See if we can facilitate 
that.
    Mr. Johnson. Great.
    Mr. Fitzpatrick. Senator.
    Senator Voinovich. Yes?
    Mr. Fitzpatrick. Could I add on the topic of reciprocity, 
you made reference earlier to perhaps it is a scarce mention in 
the report and I wanted to highlight a couple of aspects of the 
transformed process that will serve reciprocity. Mr. Johnson is 
right in that the security clearance reciprocity issue has been 
addressed by standards and policy issued out of OMB subsequent 
to the IRTPA. It is, however, a key component of the automation 
proposed in this report that will serve the information needed 
to enable reciprocal decisions. Often, agencies don't have the 
ability to reach to where the answer is to see that an 
individual is already cleared and so they revert to their local 
habits and put someone into the process.
    Senator Voinovich. In other words, if it is automated, you 
get the full picture of the individual. They can look at it, 
see what kind of clearance they have, and say, ah, that is 
fine. But if you don't have that, then they might say, gee, we 
better have him checked out or her checked out.
    Mr. Fitzpatrick. Yes. The transparency of that data, the 
accessibility of that data. Also, the alignment of security and 
suitability in this vision are critical, because sometimes an 
individual is first investigated for one of those purposes and 
later put into process for the other. Mobility across 
government, you can go from contractor to government or back 
and forth, and our goal is to allow the investigative package, 
if you will, that was used in one decision to serve the other 
one to reduce or eliminate the need to do re-work, and that, I 
think, would also fit into the goal of reciprocity.
    Senator Voinovich. Senator, when we were talking about the 
REAL ID Act recently when we had the hearings on that, one of 
the things that we were concerned about is the quality of the 
databases. And the better they are and the more confidence you 
have in them, it seems to me that, if you just accessed those 
databases, that should give you a pretty good idea. In fact, I 
think Admiral McConnell talked about that, that a lot of this 
could be done that way. That is the way a lot of businesses 
look at clearances. How is that coming along?
    Mr. Johnson. Let me make a comment on that. Admiral 
McConnell talks about Wall Street firms, in particular, it 
takes 5 days, and it takes us multiples of 5 days to get this 
done. If you lay out what Wall Street looks at versus what the 
Federal Government looks at, it is multiple times longer and 
there are things we would all agree are important for us to 
look at for suitability determinations and security clearances 
that are not concerns of Wall Street.
    What Wall Street does, they conduct something that is 
probably not even equivalent to a secret clearance here. They 
do it very quickly and relatively automated plus--are there lie 
detectors? Anyway, but it is all automated, but it is not the 
same thing. It is not the same information.
    But it does point out very clearly what we have all talked 
about here is a lot of very relevant data can be gathered 
electronically. We are doing a good bit of that now. We can do 
a good bit more of that and save manpower and so forth, and 
check that data and review it and adjudicate it and make some 
assessment of it electronically, and we do some of that now. We 
can do a lot more of it going forward.
    Senator Voinovich. Thank you.
    Senator Akaka. Thank you, Senator Voinovich.
    Senator Voinovich raised a concern that I have, as well. 
Mr. Fitzpatrick, as you know, some of the computer systems that 
the intelligence community uses to track investigations and 
store clearance information makes our oversight more difficult 
due to the classified information scattered throughout the 
process. I think this is a concern.
    One concern I have is that any combining of intelligence 
systems with Defense and civilian systems could make it harder 
for us to conduct oversight of the process. Do you believe that 
it will be necessary to keep the intelligence IT system 
separate from the rest of the systems in order for this 
Subcommittee and GAO to continue their oversight?
    Mr. Fitzpatrick. Very familiar with the concerns regarding 
the--what is known as the Scattered Castles database. That is 
the intelligence community repository for clearance and 
eligibility decisions, which exists on a classified network. We 
have an initiative underway now--let me back up and say there 
are three primary such repositories that are relevant to the 
security clearance reform effort. They are the CVS database 
operated by OPM, a Joint Personnel Adjudication System (JPAS) 
database that is operated by the Department of Defense, and 
Scattered Castles.
    OPM and DOD's databases are available at an unclassified 
level. The intelligence community's Scattered Castles database 
is on a secure network. There are several--this impairs access 
to the information and impairs reciprocity that we just 
discussed, so there are several initiatives underway to improve 
the accessibility of this data.
    Today, JPAS data is combined in Scattered Castles so that 
users of Scattered Castles have access to a wider amount of 
data to make the reciprocal decisions. So that puts more 
information where the classified users can get to it, but it 
does not address the opposite issue.
    So what initiative we have ongoing now in the Special 
Security Center where I am the Director is an effort to 
identify the unclassified records in the intelligence 
community's database for secure transmission down to the 
unclassified level, to make them more broadly available to 
where the greater number of users are searching for them and 
can leverage them.
    That raises some concerns in the intelligence community. 
Aggregating data, even though it is unclassified, can lead to 
conclusions that we don't want to put out there. But the intent 
is to study and overcome those problems. There are technologies 
that can permit databases to exchange information in more 
secure ways, even at the unclassified level, and we are 
pursuing those.
    So I share your concern with that, but I hope to assure you 
that there is attention on that and that this reform effort 
lays out a standard that the intelligence community is intended 
to meet to the best of its ability while still protecting those 
sources and methods.
    Senator Akaka. Mr. Fitzpatrick, just to follow up on that, 
how could you open up more of the intelligence community 
clearance process for additional oversight through changes in 
your IT system?
    Mr. Fitzpatrick. To ensure that I understand the question, 
the emphasis is on access to the classified systems as a means 
of oversight?
    Senator Akaka. Yes.
    Mr. Johnson. Senator, can I make a comment, I think in 
answer to that question?
    Senator Akaka. Yes.
    Mr. Johnson. The whole security clearance community needs 
to be held accountable, and for performance and quality. We, 
being the community, which means Congress, can get the 
information it needs from the intelligence community to track 
timeliness, quality. We don't have that now to the GAO's 
satisfaction or to your satisfaction. But when we want 
timeliness information from the intelligence community, we get 
it.
    What we can't get, and I don't think should get, is what is 
the status about a specific individual who is working on 
something that nobody knows about or--I think we would all 
agree, we don't want access to that information. That is why 
getting into that database should be highly restricted. But 
performance and quality information can be pulled from that 
system and pulled from the managers of that system to provide 
you and the community and the Executive Branch the information 
it needs to hold the intelligence community accountable for how 
it is granting these clearances, making these determinations, 
just like it can be with DOD, the Interior, and Agriculture.
    Senator Akaka. Ms. Farrell, would you make any comment on 
that question?
    Ms. Farrell. We are going to find out what our access is to 
the intelligence community's security clearance program. We 
have two requests that have been accepted from the House 
Permanent Committee on Intelligence, one is to look at the 
timeliness and quality of the security clearance process within 
the Intelligence Committee. That is those 16 agencies. That 
work parallels what we have already begun looking at timeliness 
and quality with DOD.
    The second request is to look at the joint reform efforts. 
As you know, it is more than just a plan. There have been a 
series of task force and other efforts underway for some time, 
and our focus will be again looking at what is going on in the 
intelligence community as well as with DOD.
    Our people have clearances. There should not be any access 
problem. We will test that. How reciprocal is it? But we will 
be getting that work underway shortly and then we will see what 
our access issues are, if any.
    Mr. Johnson. The difference between what I just said and 
what she said about GAO is I assume that if the intelligence 
community tells me this is their timeliness and their quality 
and their whatever, I don't believe I have to collect the data 
myself to verify that it is true and GAO, I think, feels 
differently. They have to go in and collect the data themselves 
as opposed to receive summaries from the intelligence 
community, so that is the difference.
    Senator Akaka. Director Johnson, two of the major aspects 
of the Joint Team's reform proposal is the use of more 
automated record checks from commercial sources and continuous 
checking of records to replace periodic investigations. Are 
there any privacy concerns or safeguards envisioned to protect 
the privacy of individuals that are checked against these 
commercial sources?
    Mr. Johnson. One of the things, and it has been a big 
priority of the reform team that is officed where Mr. 
Fitzpatrick is officed is to look at privacy issues, legal 
issues. When someone signs an application, do they know that 
they--an SF-86--do we have authorization to do periodic or 
continuous reinvestigations? Do we have the authorization to go 
look at these databases? And if we don't, what do we do to get 
that authorization and so forth? So it is a big question for us 
and we make sure that we aren't going to do anything that we 
don't have the authority to do and we won't do anything where 
we put the person's privacy rights at risk. It is a very 
important part of this process. It is a very relevant question.
    Senator Akaka. Yes. Well, in a sense, the REAL ID problem 
is one of these, and that is being careful about privacy.
    Mr. Johnson. Yes. There are some changes that do need to be 
made in the consent form the person signs and we are in the 
process of making those changes.
    Senator Akaka. Senator Voinovich.
    Senator Voinovich. No. I have done my thing.
    Senator Akaka. Well, I thank Senator Voinovich for his 
abiding faith in what we are doing. We are all trying to work 
together to take care of these problems.
    I want to thank our witnesses today. I have other questions 
that I will submit for the record. Thank you. This is a 
critically important issue, without question, and it has been 
now taking years for us to try to set up a system that really 
cuts the time of the process. Getting the clearance processes 
working is vital to our national security and we must continue 
to work to get it off of GAO's high-risk list. We have heard 
very valuable testimony today from all of you and I think that 
this will be useful as we go forward.
    The hearing record will be open for 2 weeks for additional 
statements or questions from other Members, and we again thank 
you very much----
    Senator Voinovich. Senator Akaka, can I make just one final 
point?
    Senator Akaka. Senator Voinovich.
    Senator Voinovich. I am really anxious to get this off the 
high-risk list.
    Senator Akaka. So it is unanimous.
    Senator Voinovich. Ms. Farrell, does everybody at this 
table know what it is going to take to get it off the list?
    Ms. Farrell. We have had conversations with OMB and OPM 
since 2005 regarding their strategy to work toward that end, 
and we have continued to have discussions and we are available 
at any time for those discussions. There is a lot going on with 
these reform efforts and we will have to--it is one of those 
issues that you are going to have to stay tuned to see what 
happens.
    Senator Voinovich. Well, from my perspective, if I were in 
their shoes, I would like to know what it is going to take to 
get it off the list, and from my perspective in the oversight 
capacity, I would like to know from you what you think--at 
least I would like to know what your standards are, your 
metrics, to judge whether they have done their job or not.
    Ms. Farrell. Well, first, there are several criteria that I 
mentioned, but the No. 1 that I think you are going to be 
interested in is the work that we have ongoing looking at the 
timeliness. There has been much discussion about the 
improvements in the numbers. We will be going back and looking 
at timeliness to see if those issues that were there in 2006, 
about how those numbers were derived, are still there or if 
there actually has been progress in the time it takes for the 
investigation or the adjudication phase for the top secret, the 
secret, and that is a key thing, real progress. That is one 
thing we will be looking for in terms of those numbers.
    Another one that we will be looking for that we have not 
seen are the resources that it is going to take to implement 
these IT plans that we have been discussing to some extent 
today. We believe, if you are going to use technology, what is 
it going to take in terms of resources so that you can make 
decisions that are transparent and trade-offs, if necessary, 
with competing demands. That is another example of what we will 
be looking for.
    Senator Akaka. Before I call on Director Johnson, may I 
tell the rest of the panel that I am going to ask you to make 
any final comments on what has happened today. Director 
Johnson.
    Mr. Johnson. Just one comment about resources. We were, in 
fact, talking about this Tuesday, I think it was. There are two 
primary resources that we have access to. One, the Defense 
Department has budgeted in this year and next money to reform 
their database, JPAS, and because that is 80 percent of all the 
system, that money can--in effect, if you reform JPAS or 
replace JPAS, you in effect have a system that is used by the 
entire community. So that is one major source of resources.
    Another source of financial resources is the revolving 
funds--is that what it is called?--a part of the fees that they 
charge at OPM for their investigative work that is set up to 
make refinements and reforms to their system. So those are the 
two primary sources before we get into the need for additional 
resources.
    Now, again, we have not spec-ed out if it is going to cost 
this much or that much. We haven't done that but plan to do 
that by the end of the year. But right now, our belief is that 
those two primary sources of financial support will be 
sufficient to do it. But I can't document that. But there are 
sufficient sources available to us today.
    Senator Akaka. Ms. McGrath.
    Ms. McGrath. Yes, sir. Thank you. I would like to thank you 
for the opportunity to address the Subcommittee today and I 
want to ensure, although we have had a lot of discussion around 
the information technology piece, if we don't get the process 
and the policies right, it won't matter what we build, which is 
why we have focused the last almost year that we have been on 
this joint reform effort on those things. So process first, 
policy, and then information technology informed by those, and 
that is where we are right now in the reform effort. We did, I 
will say, issue a strategic pause within the Department on 
ongoing modernization efforts to ensure alignment with the 
overall strategy and the vision to at least get a handle on 
most of the transactions. So thank you again for the 
opportunity.
    Senator Akaka. Thank you. Mr. Fitzpatrick.
    Mr. Fitzpatrick. Just briefly, a chance to express 
gratitude for the opportunity to come here and also for your 
leadership and attention to this problem. It is holding us 
accountable that will get this done. It is the goal of the 
Performance Accountability Council and the governance structure 
to do that, I will say amongst ourselves, but it also is in 
response to your own attention to this as well as the champions 
of this reform. Thank you.
    Senator Akaka. Thank you. Ms. Dillaman.
    Ms. Dillaman. I think I told you previously that I have 
spent 32 years as a civil servant, all of it devoted to the 
background investigations program, and in those 32 years, I 
have never seen the government come together and be more 
focused and more dedicated to resolving issues than they are 
today. When I say I am optimistic, that is putting it lightly. 
I think that we have swallowed the frog. The worst of it is 
behind us now and everything we see from this point forward is 
going to be great improvement.
    Senator Akaka. Well, I thank you very much. You have the 
last word on the record.
    Senator Voinovich. I don't want to have the last word, 
but----
    Senator Akaka. Senator Voinovich.
    Senator Voinovich [continuing]. One thing that bugs me 
about this place, big time, is the issue of continuing 
resolutions and omnibus appropriation bills. Mr. Johnson, it is 
your last year. Each of you can give stories, I am sure, about 
what has occurred because we don't pass our budgets on time, or 
our appropriations on time. It looks like this time around, 
from everything I can ascertain, that we may not do the 
appropriations until after the next President is elected and 
until that next President is sworn in, which means it could be 
February before we finish our appropriations.
    I just think that, Mr. Johnson, it would be wonderful if as 
a gift to the country this Administration would talk about how 
difficult it is to manage a situation where you really don't 
know what your budget is for 5 months of the fiscal year, 
because I don't believe we can continue to do this. And from 
our oversight position, if you have this kind of budgeting 
going on, or procedure, it makes it really--it gives an excuse 
to some people to say, ``We can't perform. We didn't know 
really what the numbers were for 5 months. We have got plans. 
We think money is appropriated, we can go forward with it, but 
it hasn't been authorized yet, or appropriated yet.''
    I know I have been doing some work on it and it is a 
nightmare. It is a nightmare for the Federal Government. It is 
a nightmare for State Government. It is a nightmare for county 
government. It is a nightmare as a mayor because of the Federal 
budget and the impact that it has.
    I just would really like, Mr. Johnson, to talk to you maybe 
about that, because I think you could do this country a great 
favor if you pointed out to the American people that this 
system that we have been following really doesn't lend itself 
to good management and delivering the services that the public 
and the citizens deserve.
    Mr. Johnson. I understand.
    Senator Akaka. Again, thank you very much. This hearing is 
adjourned.
    [Whereupon, at 4:28 p.m., the Subcommittee was adjourned.]


























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