[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]


 
                     UNITED STATES CITIZENSHIP AND 
                          IMMIGRATION SERVICES

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

                                HEARING

                               BEFORE THE

                      SUBCOMMITTEE ON IMMIGRATION,
                CITIZENSHIP, REFUGEES, BORDER SECURITY,
                         AND INTERNATIONAL LAW

                                 OF THE

                       COMMITTEE ON THE JUDICIARY
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                             MARCH 23, 2010

                               __________

                           Serial No. 111-104

                               __________

         Printed for the use of the Committee on the Judiciary


      Available via the World Wide Web: http://judiciary.house.gov






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                       COMMITTEE ON THE JUDICIARY

                 JOHN CONYERS, Jr., Michigan, Chairman
HOWARD L. BERMAN, California         LAMAR SMITH, Texas
RICK BOUCHER, Virginia               F. JAMES SENSENBRENNER, Jr., 
JERROLD NADLER, New York                 Wisconsin
ROBERT C. ``BOBBY'' SCOTT, Virginia  HOWARD COBLE, North Carolina
MELVIN L. WATT, North Carolina       ELTON GALLEGLY, California
ZOE LOFGREN, California              BOB GOODLATTE, Virginia
SHEILA JACKSON LEE, Texas            DANIEL E. LUNGREN, California
MAXINE WATERS, California            DARRELL E. ISSA, California
WILLIAM D. DELAHUNT, Massachusetts   J. RANDY FORBES, Virginia
STEVE COHEN, Tennessee               STEVE KING, Iowa
HENRY C. ``HANK'' JOHNSON, Jr.,      TRENT FRANKS, Arizona
  Georgia                            LOUIE GOHMERT, Texas
PEDRO PIERLUISI, Puerto Rico         JIM JORDAN, Ohio
MIKE QUIGLEY, Illinois               TED POE, Texas
JUDY CHU, California                 JASON CHAFFETZ, Utah
LUIS V. GUTIERREZ, Illinois          TOM ROONEY, Florida
TAMMY BALDWIN, Wisconsin             GREGG HARPER, Mississippi
CHARLES A. GONZALEZ, Texas
ANTHONY D. WEINER, New York
ADAM B. SCHIFF, California
LINDA T. SANCHEZ, California
DEBBIE WASSERMAN SCHULTZ, Florida
DANIEL MAFFEI, New York
[Vacant]

       Perry Apelbaum, Majority Staff Director and Chief Counsel
      Sean McLaughlin, Minority Chief of Staff and General Counsel
                                 ------                                

          Subcommittee on Immigration, Citizenship, Refugees, 
                 Border Security, and International Law

                  ZOE LOFGREN, California, Chairwoman

HOWARD L. BERMAN, California         STEVE KING, Iowa
SHEILA JACKSON LEE, Texas            GREGG HARPER, Mississippi
MAXINE WATERS, California            ELTON GALLEGLY, California
PEDRO PIERLUISI, Puerto Rico         DANIEL E. LUNGREN, California
LUIS V. GUTIERREZ, Illinois          TED POE, Texas
LINDA T. SANCHEZ, California         JASON CHAFFETZ, Utah
ANTHONY D. WEINER, New York
CHARLES A. GONZALEZ, Texas
JUDY CHU, California

                    Ur Mendoza Jaddou, Chief Counsel

                    George Fishman, Minority Counsel


                            C O N T E N T S

                              ----------                              

                             MARCH 23, 2010

                                                                   Page

                           OPENING STATEMENTS

The Honorable Zoe Lofgren, a Representative in Congress from the 
  State of California, and Chairwoman, Subcommittee on 
  Immigration, Citizenship, Refugees, Border Security, and 
  International Law..............................................     1
The Honorable Steve King, a Representative in Congress from the 
  State of Iowa, and Ranking Member, Subcommittee on Immigration, 
  Citizenship, Refugees, Border Security, and International Law..     3
The Honorable John Conyers, Jr., a Representative in Congress 
  from the State of Michigan, and Chairman, Committee on the 
  Judiciary......................................................     5

                               WITNESSES

Mr. Alejandro Mayorkas, Director, U.S. Citizenship and 
  Immigration Services, Washington, DC
  Oral Testimony.................................................     8
  Prepared Statement.............................................    10
Mr. Frank W. Deffer, Assistant Inspector General for IT Audits, 
  Office of the Inspector General, Department of Homeland 
  Security, Washington, DC
  Oral Testimony.................................................    19
  Prepared Statement.............................................    21
Ms. Susan J. Irving, Ph.D., Director, Federal Budget Analysis, 
  United States Government Accountability Office, Washington, DC
  Oral Testimony.................................................    33
  Prepared Statement.............................................    35


           UNITED STATES CITIZENSHIP AND IMMIGRATION SERVICES

                              ----------                              


                        TUESDAY, MARCH 23, 2010

              House of Representatives,    
      Subcommittee on Immigration, Citizenship,    
   Refugees, Border Security, and International Law
                                Committee on the Judiciary,
                                                    Washington, DC.

    The Subcommittee met, pursuant to notice, at 2:06 p.m., in 
room 2141, Rayburn House Office Building, the Honorable Zoe 
Lofgren (Chairwoman of the Subcommittee) presiding.
    Present: Representatives Lofgren, Conyers, Jackson Lee, 
Gutierrez, Sanchez, Chu, King, Poe, and Chaffetz.
    Staff present: (Majority) Traci Hong, Counsel; Hunter 
Hammill, USCIS Detailee; Andres Jimenez, Staff Assistant; and 
(Minority) George Fishman, Counsel.
    Ms. Lofgren. The Immigration Subcommittee will come to 
order, and I will note that just as we sat down the House 
notified us that there are votes on the floor of the House. 
There are three votes and since Mr. King is on his way I 
thought we might do opening statements but that won't work.
    So I think what we will do is go over, we will do our 
votes. We will come back. That will take at least a half an 
hour so if people want to go get a cup of coffee, you don't 
have to sit here. We will reconvene no sooner than, I think, 
2:35, 2:40.
    If people want to go get a snack in the basement, you are 
free to do that and--hello, Steve. We are just--they just 
called for votes, so I think we will go vote and come back.
    With that we are recessed until after votes and thanks to 
our witnesses for your patience.
    [Recess.]
    Ms. Lofgren. So welcome. Thank you for waiting and this 
hearing of the Subcommittee on Immigration, Citizenship, 
Refugees, Border Security, and International Law is now 
reconvening. We would like to welcome everyone to the hearing.
    And before we begin, I would like to recognize that the 
U.S. Citizenship and Immigration Service has performed 
extraordinarily with just extra effort in responding to the 
tragedy in Haiti following the January 12th earthquake.
    Two-and-a-half months into the registration period, over 
30,000 TPS applications have been filed. In addition, a USCIS' 
creation of a humanitarian parole policy specifically to deal 
with Haitian orphans in the process of adoption by U.S. 
citizens has allowed for nearly 1,000 orphans to travel safely 
to the United States.
    The agency has also processed a multitude of other 
humanitarian parole requests including for Haitians in need of 
critical medical care and also allowing for escorts of U.S. 
citizen children from Haiti to family in the United States.
    And finally, I would like to specifically recognize the 
heroic efforts of USCIS Haitian Field Office Director Pius 
Bannis and Officer Marie Brierre, who worked around the clock 
for weeks following the earthquake to respond to the tragedy. 
Again, thank you for your efforts and for responding to the 
crisis in Haiti.
    In this hearing, however, we will examine the funding 
structure for USCIS and the impact that it has on immigration 
law and policy. We will also review the status of the agency's 
decade-long efforts to transform its business and technology 
processes.
    USCIS and formerly the INS have been primarily dependent on 
fees to fund its adjudication operations since 1989. Between 
then and now, INS and later USCIS have raised fees for 
immigration and citizenship applications and petitions at a 
rate far exceeding the rate of inflation. For example, the fee 
for citizenship applications has increased from $90 in 1991 to 
$675 in 2007, an increase of 750 percent.
    The last time that USCIS raised its fees in 2007, it did so 
by an average of 86 percent. But just 3 years later USCIS 
appears to be considering yet another increase in fees, and we 
hope to hear a little more about that.
    In 2007, this Subcommittee held two hearings on USCIS' most 
recent fee increase. At that time I expressed my concerns about 
the enormous size of the increase and the methodology by which 
USCIS calculated the increase.
    I was especially worried about the barriers that such large 
fees would erect against legal immigrants who are eligible to 
become U.S. citizens, but may be unable to do so due to the 
high cost involved.
    At the first hearing then USCIS Director Emilio Gonzalez 
testified that the agency's new fee rules were carefully 
devised ``to ensure USCIS recovers its full business costs.''
    At the second hearing then Deputy Director, Acting Director 
Jock Sharfen testified that the new fees were designed to bring 
about greater efficiency and, as he said, ``long term cost 
reductions.''
    And in the final fee rule, USCIS wrote that the new fee 
structure would enable USCIS to make improvements that may 
ultimately ``help avoid future increases and possibly reduce 
costs.''
    But 3 years later, I am concerned that USCIS is considering 
another fee increase instead of reaping the benefits and 
reducing costs and reducing fees. It already costs $2,700 for a 
family of four to apply for citizenship. Another increase will 
make it that much more difficult for persons of limited means 
to become U.S. citizens.
    I hope to have a frank discussion with the witnesses in 
today's hearing about the financial health of USCIS and how to 
achieve the right mixture of funding streams for the agency 
through fees and appropriations.
    On a related note, USCIS and the former INS have been 
trying to transform information and business processes for 
roughly a decade. And I know the new director is new on the 
job, but the agency still continues to use a filing system that 
is predominantly paper-based.
    And with approximately 55 million files spread out over 
numerous offices across the country, in this day and age it is 
hard to believe that any Federal agency dealing with millions 
of files has not yet developed a primarily digital filing 
system.
    In 2005 the DHS Office of Inspector General reported that 
despite repeated assessment and attempts to modernize, USCIS' 
processing of immigration benefits continues to be inefficient, 
hindering its ability to carry out its mission. Processes then 
remain primarily paper-based and duplicative, resulting in an 
ineffective use of human and financial resources. I.T. software 
and hardware systems were not well-configured to meet U.S. 
users' needs.
    In the follow-up report in 2006, the I.G. observed that 
because of repeated changes in focus and direction, USCIS has 
tended to duplicate previous modernization initiatives and has 
not demonstrated the ability to execute its planned strategies.
    Since 2007 the Immigration Subcommittee has actively worked 
with the department and outside experts to evaluate the 
agency's proposals for the transformation program. To date, 
however, the Subcommittee and outside observers have not found 
the transformation efforts to have been successful yet.
    We fear that they are some problems, perhaps, or at least 
questions about progress and the level of detail regarding 
actual transformation implementation. And so we hope to learn 
more today about that whole subject.
    I also want to mention that the Subcommittee's last hearing 
following the USCIS fee increase rule on September 20th, 2007 
we, again, raised significant concerns about the progress of 
the transformation efforts. And we had a follow-up report in 
July of last year from the I.G. that did find that the 
transformation efforts were ineffective and plagued with 
problems.
    Now, we need to examine what steps have been taken and can 
be taken to bring USCIS into the 21st century. The stakes are 
very high and the agency just cannot continue to be buried in a 
sea of paper if a digital solution is available.
    I know that the director is committed to modernization 
efforts. I know that he agrees with me that we can't just work 
faster, we have to work smarter to get this done. And so I look 
forward to his testimony on what we have done and what we need 
to do and how the Subcommittee can help the agency in that 
effort.
    I do know that you inherited something of a mess and we do 
hope that you are successful in cleaning the technology scene 
up. And with that, I will yield to the Ranking Member Steve 
King for his opening statement.
    Mr. King. Thank you, Madam Chair. The immigrants who will 
enjoy the priceless benefits of living and working in America 
should have to pay for the costs the U.S. government incurs on 
their behalf. The American taxpayers should not have to foot 
the bill for granting highly sought after immigration benefits.
    While I agree that our Nation has been much enriched by 
legal immigration, in fact, skimmed the cream of the crop off 
of every donor civilization to build a foundation for the 
American spirit with their vitality, but given the competing 
needs for new tax dollars and any tax dollars, it only makes 
sense that those who directly receive an individual immigration 
benefit should pay for it; fee-for-service, so to speak.
    The ability to become a naturalized citizen is the greatest 
benefit a country can bestow. Indeed, it is priceless. 
Therefore USCIS should structure its application processing 
fees to recover its full costs. The new fee schedule that USCIS 
instituted in 2007 was based on a comprehensive fee study 
conducted at the recommendation of the Government 
Accountability Office.
    Although the fee increases were substantial in some 
categories, that does not necessarily make them excessive. Full 
cost recovery includes more than the direct cost of providing 
services. It covers overhead and support costs such as the cost 
of personnel and their retirement benefits for the facilities 
and litigation.
    Most importantly, it includes the cost of background checks 
and fraud detection, both of which are critical to ensuring 
that immigration benefits are granted to those who deserve them 
and not to those who plan to do us harm.
    USCIS pledged that part of the new fees would go to pay for 
the enhanced security and integrity of the immigration system. 
They were to fund 170 additional fraud detection and national 
security agents to oversee fraud investigations and the 
processing of applications that have national security 
concerns.
    I hope to learn that these agents were in fact hired at 
this hearing today, that it is not unprecedented for criminals 
and terrorist to try to enter the U.S. through legal channels. 
Mahmud Abouhalima, a terrorist who blew up the World Trade 
Center in 1993, received amnesty through the 1986 immigration 
bill.
    Further, 9/11 hijackers came into the U.S. on student and 
visitor visas. As we have tragically learned through background 
checks, they are especially critical to immigrant processing.
    Immigration benefit fraud remains a critical issue. In 2006 
the GAO found that individuals who pose a threat to national 
security and public safety may seek to enter the United States 
by fraudulently obtaining immigration benefits. It determined 
that although the full extent of benefit fraud is not known, 
available evidence suggests that it is an ongoing and serious 
problem.
    USCIS' Office of Fraud Detection and National Security 
found that an astounding 33 percent of religious worker visa 
applications were fraudulent. And for some denominations a 
majority of the applications were fraudulent, and by 
recollection, it seems to me that all of the applications from 
an individual country were fraudulent.
    Yet GAO found that immigration adjudicators it had 
interviewed, reported that ``communication from management did 
not clearly communicate to them the importance of fraud 
control. Rather it emphasized meeting production goals designed 
to reduce the backlog of applications, almost exclusively.''
    GAO concluded that ``the lack of a clear strategy for how 
and when to punish fraud perpetrators limits DHS' ability to 
project a convincing message that those who commit fraud face a 
credible threat of punishment.''
    Last year, GAO reported that fraud detection and prevention 
accounted for only 4\1/4\ percent of USCIS' annual expenditures 
for application processing. And just last October, DHS' Office 
of the Inspector General found that the Office of Fraud 
Detection and National Security ``has had little measureable 
effect on benefit fraud.''
    The inspector general cited a lack of incentives such as in 
employee evaluations for USCIS personnel to combat fraud, as 
opposed to simply rubberstamping applications to improve 
productivity.
    Director Mayorkas, while these findings are disturbing, I 
am heartened that you have elevated the fraud detection to a 
newly established fraud detection and national security 
directorate that will report directly to you, demonstrating in 
your words, and I will quote them, ``Our continued commitment 
to eliminating fraud, identifying national security threats and 
sharing information with our law enforcement and intelligence 
partners.''
    Your continued commitment is indeed crucial, and I 
appreciate that commitment that you have demonstrated. The 
balance of the increased fee revenue was promised to go to 
modernizing the technology and business structure of USCIS and 
improving the delivery of services. We will find out today how 
well this transformation has gone.
    I think we do understand the importance of the 
investigative component, especially of USCIS, and I believe 
that we had set the foundation for fee-for-service and that was 
a consensus this Congress had voted for.
    And I am hopeful that whatever we do with the fee structure 
in the future it is based on fee-for-services and not taxing 
American taxpayers who are overtaxed, overstressed, 
overburdened and over indebted, especially with the 
acceleration of the government spending that we have had.
    They simply cannot fund out of the taxpayer dollars 
applications that are fee-for-service for a service that 
benefits individuals that can, in spite of the cost, need to 
find a way to use their own revenue.
    So I look forward to your testimony. and I appreciate this 
hearing, Madam Chair, and I yield back the balance of my time.
    Ms. Lofgren. We are pleased to have the Chairman of the 
Judiciary Committee with us this afternoon. Mr. Conyers, it is 
an honor to have you here. And I would welcome your opening 
statement should you wish to give one.
    Mr. Conyers. Thank you, Chairwoman, and to my good friend, 
Steve King and the Members of the Committee. I haven't been to 
this kind of a hearing before. And I wanted to begin as we 
examine the United States Citizenship and Immigration Services, 
USCIS, by commending Director Mayorkas about the diligent way 
that they have acted in terms of the Haiti earthquake.
    I have done a lot of work with that country and its people, 
and you moved in right away on the issue of granting temporary 
protective status. And you have done some Haitian adoptions 
through humanitarian parole, and it is just impressive. And I 
think you are living up to your informal record on the Hill as 
a pretty effective administrator, and I commend you for it.
    Now, the fee increases and the paperwork burdens are two 
other challenges that you are faced with. Now, occasionally 
Steve King and I disagree and this is one of those instances 
because I don't want these costs to be continually heaped on 
the applicant.
    Maybe I will find out here at this hearing, and it may give 
Steve and I an opportunity to work on this issue together, but 
there are applicants otherwise qualified to apply for 
citizenship that don't have the money. They can't afford it. 
Some of them are not working at too good of jobs to begin with.
    So I just want to try to get a picture of this. Fee 
increases should be absorbed by the appropriations process. 
Good night, when you have got a trillion-dollar budget and we 
are talking about charging each person, what is it, $500, 
$625----
    Ms. Lofgren. $675.
    Mr. Conyers [continuing]. $675 each? A family of four--do 
you know how many people apply for citizenship and never can 
follow through because they can't afford it? They are otherwise 
qualified. And so I am for putting these fees into the 
appropriations process.
    But I don't even want a fee increase. Floating this rumor 
about a tiny increase doesn't work--look, as Zoe Lofgren said, 
the increases have been astronomic already. So we don't need 
that. We don't need it as far as I am concerned.
    Now the paperwork problem, here we are. We have been 
getting computers and we are going to digitize all the 
paperwork, which can only occasionally get lost, but one of 
your predecessors, Eduardo Aguirre worked on this. Emilio 
Gonzalez then came along and he gave it his best shot. Jock 
Sharfen did the job, and now here you are.
    And what I think a number of us on the Committee are 
concerned with is what is the problem? What makes it so 
difficult to realize that without computerizing this 
information, papers have to be sent back and forth from one 
office to the other. They are frequently lost.
    Besides your sympathy, I want you to present a plan or 
construct one that will really take care of the technology 
transformation that all of your predecessors have tried and 
quite frankly not been that successful.
    So let us see where we go today and I look forward, Madam 
Chair, to the hearings.
    Ms. Lofgren. Thank you, Mr. Conyers. And I am sure if Mr. 
Smith arrived we will be pleased to accept a statement at that 
time. But in the interest in proceeding to our witnesses I 
would ask other Members to submit their statements for the 
record within 5 legislative days. And without objection all 
opening statements will be placed in the record. And without 
objection, the Chair is authorized to declare a recess of the 
hearing at any time.
    I would like to introduce the witnesses. First, it is my 
pleasure to introduce Alejandro Mayorkas. Mayorkas was 
nominated to be the Director of U.S. Citizenship and 
Immigration Services by President Obama on April 24, 2009, less 
than 1 year ago.
    He was unanimously confirmed by the United States Senate on 
August 7th, 2009. Director Mayorkas has served as the United 
States attorney for the Central District of California and 
previously was a partner in the law firm of O'Melveny and 
Myers. Last year he was named one of the 50 most influential 
minority lawyers in America by the ``National Law Journal.''
    Director Mayorkas previously served as an assistant U.S. 
attorney for the Central District of California from 1989 to 
1998. He holds a Juris Doctorate degree from Loyola Law School 
and a Bachelor's degree from the University of California at 
Berkeley.
    Next I would like to introduce Frank Deffer. Mr. Deffer 
joined the Office of the Inspector General for the Department 
of Homeland Security in March of 2003. He previously served as 
Director, Information Management Division and the Office of 
Audits at the Department of State and at the Office of 
Inspector General for the Broadcast Board of Governors.
    Before joining the State Department, from 1984 through 
1998, he served in a number of positions at the U.S. General 
Accounting Office. And while at the GAO he directed audits of 
defense and government-wide technology acquisition programs as 
an assistant director in the accounting and information 
management division and produced dozens of reports for 
Congress.
    He is a graduate of Pennsylvania State University where he 
earned both his Bachelor's of Arts and Master's of Arts degree 
in political science. Mr. Deffer is also retired from the U.S. 
Army Reserve, where he last served as a major in the Medical 
Service Corps.
    Finally, I would like to introduce Susan Irving. Ms. Irving 
is a director for the Federal budget analysis within strategic 
issues at the GAO. She oversees work on Federal budget 
structure, the congressional budget process, user fees, U.S. 
fiscal position, long term fiscal outlook and debt and debt 
management.
    Prior to joining the GAO in 1989, Ms. Irving held a number 
of positions in and out of government largely concerned with 
economic and budget policy. She served as a legislative 
assistant and legislative director to Members of the Senate 
Finance Committee and as staff director to the President's 
Council of Economic Advisers in the Executive Offices of the 
President and as Vice President of the Committee for a 
Responsible Federal Budget.
    Ms. Irving has also been a fellow at the Institute of 
Politics at Harvard and has taught public management at the 
John F. Kennedy School of Government at Harvard University. She 
holds a B.A. in United States studies from Wellesley College 
and an MPP and Ph.D. in public policy from Harvard University. 
She is a native of Washington, D.C. where she resides with her 
husband and son.
    Now, your written statements will be made part of the 
record in their entirety. We ask that you summarize your 
written statement in about 5 minutes. We have a system of 
lights here. That little machine on the desk will be green 
until 4 minutes have gone by, and then it will turn yellow.
    And when it turns red it means you have actually spoken for 
5 minutes. It always comes as a shock. We won't cut you off 
mid-sentence, but would ask that you try and summarize at the 
point so that Members will have an opportunity to ask 
questions.
    And so now we will proceed with the testimony and we will 
begin with you, Director Mayorkas. Please begin.

TESTIMONY OF ALEJANDRO MAYORKAS, DIRECTOR, U.S. CITIZENSHIP AND 
              IMMIGRATION SERVICES, WASHINGTON, DC

    Mr. Mayorkas. Thank you very much Chairwoman Lofgren, 
Ranking Member King and Members of the Subcommittee. It is a 
privilege for me to appear before you today. On behalf of our 
entire agency thank you for your continued strong support of 
the U.S. Citizenship and Immigration Services and its programs.
    I look forward to testifying today about the state of the 
USCIS and providing you an overview of our key initiatives and 
accomplishments, including our current financial condition and 
progress of the agency's transformation program.
    Each of the actions we are undertaking serves our agency's 
guiding principles of integrity, efficiency, consistency and 
transparency. Our agency faces several operational and 
management challenges.
    The inherent challenges in our immigration system have led 
us to improve operational transparency, begin initiatives to 
create consistency and predictability in agency actions, 
strengthen community outreach and improve customer service 
functions.
    To enhance our national security and the integrity of our 
immigration system, we have established a new directorate 
devoted exclusively to fraud detection and national security, 
and developed improved safeguards and security measures in our 
operations.
    The consistent decline in our revenue underscores the 
importance of developing new and greater efficiencies. This is 
acutely significant for us as an agency funded primarily by 
applicants' and petitioners' fees. We have a tremendous 
responsibility to be careful stewards of the funds we receive.
    In recognition of the difficulties of our financial 
situation, upon my arrival I immediately called for an 
exhaustive and vigorous review of the agency's annual operating 
plan. The review remains under way and already we have 
identified cuts exceeding $160 million.
    Our USCIS budget request for fiscal year 2011 reflects both 
cost and fee financing adjustments in response to the current 
economic climate and the corresponding projected decrease in 
fee revenue. By the end of this fiscal year, we will be 
publishing the results of our Fee Study required by the Chief 
Financial Officer's Act which will indicate any projected 
changes to the amounts we charge for our services.
    We understand that the communities we serve include 
individuals without significant financial means. We are making 
every effort to honor this concern amidst our difficult 
financial circumstances.
    Our outdated information technology infrastructure has led 
us to reassess how we operate so that we can move more quickly 
from a paper-based workplace to one that is account centric and 
more reliant on electronic information.
    Challenges indeed present opportunities. These 
opportunities in the hands of the men and women of U.S. 
Citizenship and Immigration Services will mean a stronger and 
brighter future for our agency and for the public we serve.
    There can be no stronger recent example of this than the 
dedication and skill our personnel exhibited in the tragic wake 
of the January 12th earthquake in Haiti. Thank you very much, 
Madam Chairwoman, for recognizing our work in this regard.
    Working tirelessly and selflessly day and night, our 
workforce work brought hundreds of Haitian orphans to safety 
and humanitarian relief to thousands of Haitian nationals in 
our country who could not return safely to their homeland.
    What we have done since January 12th and what we continue 
to do are shining examples of our abilities and our potential. 
While USCIS has made vast improvements in both customer service 
and reduced processing times, USCIS also faces significant 
challenges that we are working to overcome.
    I look forward to working with you on these and other 
matters critical to the transparency, integrity, consistency 
and efficiency of our work at USCIS, and of the immigration 
system we help administer.
    Your demands and expectations help further define our goals 
and our aspirations. I am privileged to be before you today. I 
look forward to working with you and to answering your 
questions as best I can. Thank you.
    [The prepared statement of Mr. Mayorkas follows:]

         Prepared Statement of the Honorable Alejandro Mayorkas



















                               __________

    Ms. Lofgren. Thank you very much.
    Mr. Deffer?

 TESTIMONY OF FRANK W. DEFFER, ASSISTANT INSPECTOR GENERAL FOR 
   IT AUDITS, OFFICE OF THE INSPECTOR GENERAL, DEPARTMENT OF 
               HOMELAND SECURITY, WASHINGTON, DC

    Mr. Deffer. Madam Chairwoman and Members of the 
Subcommittee, thank you for the opportunity to discuss the 
United States Citizenship and Immigration Services' efforts to 
transform its business and modernize the information technology 
used to support that business. With immigration reform now back 
on the legislative agenda, this is an important issue to 
address.
    My testimony today will address the need for USCIS 
transformation and I.T. modernization, progress made thus far 
and will identify critical challenges to successful 
transformation and I.T. modernization.
    USCIS has recognized that its paper-based processes hinder 
its ability to verify the identity of applicants, efficiently 
process immigration benefits and provide other agencies with 
relevant information on possible criminals and terrorists.
    In 2005, USCIS embarked on an enterprise-wide 
transformation program to transition its fragmented paper-based 
operational environment to a centralized and consolidated 
operational environment using electronic adjudication.
    Since then it has made progress in a number of areas. 
Specifically, USCIS has established the Transformation Program 
Office to oversee all transformation initiative within USCIS. 
Also, it has developed an acquisition strategy to provide a 
roadmap for the agency to acquire the resources such as program 
support and I.T. services necessary to implement the 
transformation.
    USCIS awarded a contract for a transformation I.T. service 
provider referred to as a solutions architect in November 2008. 
Further, USCIS has made progress in strengthening I.T. 
management to support the agency's mission and its 
transformation efforts.
    Specifically, USCIS developed a new organizational 
structure to facilitate I.T. services, and it has realigned 
field I.T. staff under the CIO. Still, USCIS faces a number of 
critical challenges as it moves forward with transformation and 
I.T. modernization.
    First and foremost, it is critical that transformation and 
I.T. modernization receive the full support of USCIS executive 
leadership starting with the director. As the champion for 
transformation, the director and his leadership team can ensure 
that the program has sufficient resources while at the same 
time providing strong oversight to keep the program on track.
    Business process reengineering is also key to the success 
of transformation. Without effective business process 
reengineering, USCIS risks developing new I.T. systems that 
support ineffective and outdated processes.
    Also critical to the success of transformation will be a 
strong partnership between TPO and the CIO. USCIS business 
units and I.T. stakeholders need to be closely aligned in 
setting the direction and managing the transformation effort.
    A strong partnership between TPO and the CIO can help 
ensure that new I.T. systems are developed in accordance with 
lifecycle development standards, are tested fully and meet I.T. 
security standards.
    In conclusion, over the past 5 years USCIS has elevated the 
transformation program to an agency-wide priority to more 
efficiently and effectively meet its mission of administering 
the Nation's immigration laws.
    Moving forward, in addition to addressing current 
operational needs, USCIS must also prepare for potential 
increases in benefits, processes and workloads that could 
result from proposed immigration reform legislation. 
Consequently, transformation will be critical to support the 
agency's current workload and prepare for potential future 
increases in immigration benefits processing.
    Madam Chairman, this concludes my prepared statement. I 
appreciate your time and attention and welcome any questions 
from you or Members of the Subcommittee.
    [The prepared statement of Mr. Deffer follows:]

                 Prepared Statement of Frank W. Deffer


























                               __________
    Ms. Lofgren. Thank you very much.
    And finally we will turn to Dr. Irving for her testimony.

 TESTIMONY OF SUSAN J. IRVING, Ph.D., DIRECTOR, FEDERAL BUDGET 
   ANALYSIS, UNITED STATES GOVERNMENT ACCOUNTABILITY OFFICE, 
                         WASHINGTON, DC

    Ms. Irving. Madam Chair, Mr. Chaffetz, Ms. Chu, thank you 
for inviting me today to stand back a little bit from the 
operations of the specific agency to talk about user fees and 
the funding structure as it applies to USCIS.
    The decision to fund an agency either partially or fully 
through fees is fundamentally a policy decision. But we in GAO 
developed the user fee design guide to help identify the 
issues, the questions and tradeoffs that must be confronted in 
creating a workable and effective fee structure.
    We talk about several stages in the fee process: the 
setting of the fee, collecting it, how the agency may use the 
fee and the reviewing of the fee, which strikes me as being 
very important to you.
    The criteria against which you bump up a fee: equity, 
efficiency, revenue adequacy and administrative burden, I would 
like to focus today on setting of the fee. It is among the most 
challenging because you have to both determine the costs and 
determine who shall pay them.
    It highlights one of the more complicated issues in the 
criteria--that of equity. At one level we all think equity is 
quite easy. We should all pay our ``fair share.'' We think of 
that in many areas of American law. But, what is the fair 
share? This graphic is just an illustrative picture of the 
question of the beneficiary should pay.
    [The information referred to follows:]

    
    
                               __________

    Ms. Irving. Again, stepping back from one critical--the 
issue of just USCIS, for many of the fee-funded operations in 
this country there is not an identity between user and 
beneficiary. I am going to give you a boringly simple 
illustration on this, one I used before the Transportation--one 
of the Transportation Committees when we were talking about 
next generation air traffic. I suggested that if I never get on 
an airplane I benefit if they don't fall out of the sky, which 
means that it is a more complicated issue for all of you which 
is how much of NGAT should be funded by user fees paid by 
current fliers.
    Sometimes this is the issue of the circle, who is the 
identified beneficiary or user versus other beneficiaries, is a 
policy call that is on a continuum. We range from things like 
you--with immigration to food inspection, air traffic, parks, 
even the funding of our roads.
    On the other side, once we have identified the identified 
beneficiaries, the question becomes how do we allocate the cost 
to them? Let me point out to you that the existence of 
exemptions and waivers makes this more complicated.
    If you have a fully fee-funded operation and through policy 
grounds and a directive from the Congress, there are people who 
are exempted from paying that fee but who still receive the 
service, you have to find some way to cover their costs.
    Again, outside just the USCIS example, if I fly into this 
country from Paris, I pay--that $17.50 you see at the end of 
your ticket covers the inspection for agriculture, for customs 
and for immigration.
    If I fly in from the Olympics in Vancouver I do not pay the 
customs portion of that fee. But those of you who have been in 
from Canada know you are inspected. That means some other user 
must cover the cost of that inspection.
    Assigning costs, therefore, brings into play both cost 
analysis and equity. At one level I would like to say the three 
bucket approach USCIS used in its last fee review is not 
unreasonable: first reform specific costs that can be 
attributed to specific applications.
    Second is overhead, or what I might call the cost of having 
the agency there to exist, that is the pencils, the papers, the 
office heat, all of that. There are a number of ways to do that 
consistent with accounting standards. In our review we raised 
some concerns about their documentation and level of detail. 
But allocating that across other payers is not an unreasonable 
approach.
    Finally, as you all know, there is a surcharge imposed for 
the cost of exemptions and waivers. What appeals to me as an 
analyst about isolating and identifying the surcharge is it 
provides to the policymaker--the Congress of the United 
States--the cost of their decision to exempt something.
    Once there is an exemption, as I said, you have only two 
choices. Other fee payers can carry that cost or there can be a 
decision made to provide general revenue for that. You cannot 
prevent cross-subsidization unless you either provide general 
revenues or you provide that people who are exempt from paying 
are also exempt from the service, which generally we don't want 
to do.
    Finally, I want to say something about revenue adequacy. 
This is especially important for fee-funded agencies. They need 
a carryover balance. You need something and to get to the right 
carryover balance, the agency needs to conduct an analysis 
about what makes this fee revenue fluctuate, so down and that. 
And we dinged them a little bit on that.
    Frankly, I want to just mention that infrequent reviews are 
likely to lead to larger fee increases. We all noticed how big 
the increase was in 2007, but we don't notice that there were 
no increases between the last review and that.
    I am sorry to have been the one witness who hit the red 
light, Madam Chair.
    [The prepared statement of Ms. Irving follows:]

                 Prepared Statement of Susan J. Irving























































                               __________

    Ms. Lofgren. That was very interesting. Thank you all for 
your testimony, and now we will begin our questions, and 
depending on what is going on, on the floor, maybe we will have 
a chance to do two rounds.
    I would like to begin and start with you, Mr. Director, 
about the fee issue and really the issues that Dr. Irving has 
mentioned. The USCIS has requested and received appropriations 
for certain other enforcement type activities, for example, E-
Verify and SAVE.
    And I am thinking about the fraud detection and national 
security directive. I gather, and I don't disagree that your 
creation and elevation of this function is an important one. We 
have to have, you know, integrity. You listed that first among 
the agency values.
    But it seems to me that that might be a good candidate for 
an appropriation because, just as with other law enforcement 
activities, you don't necessarily, you know, charge that 
against a refugee admission or an adoption. Do you have a 
comment on that or are you allowed to comment on that?
    Mr. Mayorkas. Madam Chairwoman, those are two different 
questions you have asked me now.
    Ms. Lofgren. They are. Maybe I should ask the first one 
first.
    Mr. Mayorkas. I am going to answer the first one about the 
issue of whether the fraud detection and national security 
responsibility that our agency has is one that should be 
executed with an appropriation rather than the fee-for-services 
model which is, I think, a policy worthy of discussion.
    We have indeed sought in the fiscal year 2011 budget an 
appropriation for our E-Verify program and for the SAVE 
program, both of which are integrity tools, if you will. And so 
I understand the Chairwoman's question with respect to fraud 
detection and national security.
    Ms. Lofgren. Thank you, I think that is a fair response and 
one that really probably the Subcommittee needs to discuss or 
perhaps even the full Committee.
    I would like to get into the question of the transformation 
and the details. Five minutes is not enough to talk about the 
details, I realize that, but the OIG report highlighted that 
the transformation efforts to date have focused primarily on 
high level business processes and various alternatives to 
implement transformation.
    We spent a fair amount of money, most of it spent before 
you were on the job I might add, $117 million spent since 2005. 
But it is not clear what benchmarks we are meeting. What 
technology is actually being deployed? What business 
engineering processes have been changed to make it work?
    Is it possible for you to give us some expectation of when 
and how we might expect that detail from your department? Not 
necessarily in a hearing but in a report of a briefing. Are 
there benchmarks that can be provided and that we could look 
to, to hold the agency accountable for?
    Mr. Mayorkas. Most certainly, Madam Chairwoman. We will 
provide this Committee with a report that identifies the 
benchmarks we currently have in place for the immediate future 
and for the longer term future of the transformation effort. 
And we do believe in such an undertaking of considerable 
breadth that benchmarks are pivotal to the program's success.
    And one thing I would like to comment about, if I may, 
Madam Chairwoman, is that I think the request for this hearing 
served a tremendous purpose for me personally, as the director 
of the agency, in establishing a very important and, hopefully, 
what will be a regular line of communication with the Office of 
the Inspector General.
    Given the breadth and depth of that office's knowledge of 
our transformation effort, its knowledge of the problems that 
we have encountered in the past, and hopefully, the path we are 
paving to success. And so I think that is a wonderful byproduct 
of the request for this hearing. We will provide to this 
Committee a schedule that we intend to honor.
    Ms. Lofgren. I would just like to say, Director Mayorkas, 
that is the first time in my entire service in Congress that a 
member of the Administration has thanked the Committee for 
holding a hearing and said it was useful. So that is a thrill 
to me, and I appreciate it very much and I am, well, I am just 
glad to hear that.
    I want to ask about something I think I know the answer to, 
but I want to explore it further. We had a huge backlog when 
you were confirmed on I-130 Petitions. I think, you know, I 
don't really know, but millions. I think it is down to round 
600,000 or 700,000, not that that isn't a substantial amount.
    You have plans to reduce that backlog. I would like to 
know, what are they? When do we think those backlogs will be 
done? And, further, as we look at how we could reform our 
immigration laws, how could we make them work better?
    Having details, actually a snapshot really would help 
inform us to make decisions, in terms of age of beneficiaries 
and relationships and the like. Will we be able to get a yield 
on that kind of information, as you work through this backlog?
    Mr. Mayorkas. Thank you, Madam Chairwoman. We have 
distributed the I-130 caseload throughout our offices across 
the country, in light of the significance of that caseload. We 
anticipate that the majority of the caseload will be worked 
through by the end of fiscal year 2010, this year.
    We intend to complete the processing of all the I-130's 
currently pending by the first quarter of fiscal year 2011, as 
that caseload has already been distributed throughout the field 
office across the country for adjudication.
    With respect to our ability to slice and dice, if you will, 
the data that are so important to our agency and to this 
Committee, we can do that now manually. One of the benefits we 
will receive from the transformation program is indeed the 
ability to assess that data and to collect it and to analyze it 
in real time by virtue of the electronic environment.
    Ms. Lofgren. I appreciate that so much and my light, red 
light is on so I will turn now to the Ranking Member for his 5 
minutes of questions.
    Mr. King. Thank you, Madam Chair, and I thank you for this 
hearing and for the witnesses and especially for the gratitude 
of the witnesses for having a hearing.
    I would direct first to Director Mayorkas, you know, you 
made a comment. It is in your written testimony at least, that 
your customers that you serve are those who file immigration 
and naturalization applications.
    And I would just ask you if you could reflect upon that. 
The applicants as your customers as opposed to the American 
public, and we are hearing discussing whether it is their fees, 
the applicants' fees that will be picking up the slack, so to 
speak, or whether it will be the American taxpayer. So would 
you care to clarify that?
    Mr. Mayorkas. Thank you very much, Congressman. Customer is 
a particular term that I am not fond of. It speaks of a barter 
relationship and the work of our agency is more fundamental 
than that. And so we are indeed looking for a different term.
    I view the term ``customer,'' for the time being, as 
pertaining to the individual who in fact is seeking a benefit 
from our agency, very different from the term that I use that 
is more encompassing, which is a ``stakeholder.'' The term 
``stakeholder'' includes the customer, includes the general 
public, includes the law enforcement community and it is a more 
encompassing term.
    Mr. King. Well, thanks for that clarification and I do 
agree with that, as it goes across the spectrum and focusing on 
the interests of the United States of America. And I made a 
point in my opening statement about 170 fraud detection and 
national security agents. How are you doing on that?
    Mr. Mayorkas. Congressman, since that statement, we have, 
indeed, I believe we have hired more than 200 individuals who 
are devoted to the fraud detection and national security 
effort.
    Mr. King. That is good news. Thank you, Director. And then 
I want to say it was stated that the GAO found that USCIS 
immigration adjudicators had interviewed and then I would pick 
up--this is a quote from the GAO report ``reported that 
communication from management did not clearly communicate to 
them the importance of fraud control. Rather it emphasized 
meeting production goals designed to reduce the backlog of 
applications almost exclusively.''
    Would you care to speak to that statement out of the GAO 
report as to how you would react to that and how you would like 
to characterize it?
    Mr. Mayorkas. Congressman, I can only speak of my efforts 
and the ethics that characterize our agency today. And I can 
say that the importance of our fraud detection and national 
security work is well understood by everyone throughout our 
agency. I have underscored it as well.
    Focus on production goals not only has a potential expense 
upon our fraud detection and national security work, but it 
also has a potential expense upon the rights of the customers 
who come before us.
    Mr. King. Thank you, Director, and I hear that focus back 
on the security as opposed to the just simply processing the 
numbers through and scoring according to the number of 
applications processed.
    And then I would just direct, also, your attention to the 
I.G.'s report that makes a recommendation that there be more 
site visits to the religious workers site, site visits to 
verify. I know that that was an initiative that was picked up 
when we discovered the fraud in the religious workers' visas 
component of this, and the recommendation of the I.G. that that 
be accelerated. I don't have the exactly quotes in front of me 
here, but to add site visits.
    Have you taken steps on that or do you have comments about 
the inspector general's recommendation?
    Mr. Mayorkas. Congressman, the administrative site visit 
verification program is under way and we have plans to continue 
it in fiscal year 2010.
    Mr. King. And has it been increased at the recommendation 
of I.G.?
    Mr. Mayorkas. I would have to get back to you with respect 
to its scope, Congressman. I would like to, if I may, just 
share with you a thought that is not born of my experience as 
the Director of U.S. Citizenship and Immigration Services, 
because I am only 7 months into my tenure there.
    If I may draw upon my 12 years of experience as a Federal 
prosecutor--9 years as an Assistant U.S. attorney, almost 3 as 
a United States attorney--I think ``more or bigger'' is not 
necessarily ``better.'' I think the key to a verification visit 
and verification program, its effectiveness, is ensuring that 
it is well-targeted--that it is strategic in nature.
    It is not necessarily to say that it should not grow, but 
we want to make sure we have the proper foundation, the proper 
strategic framework in place and then build from there.
    Mr. King. Thank you, Director. And watching this clock, I 
really had one more subject I would like to get to, if the 
Chair would indulge me?
    Ms. Lofgren. Yes, please extend additional minutes to the 
gentleman.
    Mr. King. Thank you, Madam Chair. I was anxious to get down 
to the E-Verify component of this, and I am curious as to what 
you might like to tell this panel. I am seeing progress in E-
Verify. I am seeing that the accuracy of it goes up, if I 
remember from your written testimony, 96 percent accuracy or 
90.
    What I am interested is if there is an effort to work in 
cooperation with the Social Security Administration and 
identify the duplicate or the multiple use of Social Security 
numbers. And if you could tell us also, in the same response 
from a time perspective, what you are able to do with digital 
photographs attached to the E-Verify records to provide a 
visual biometric, just to give us a sense of what is going on 
there with E-Verify.
    Mr. Mayorkas. Thank you very much, Congressman. You 
correctly cite to my written testimony with respect to the 
improved accuracy rate of the E-Verify program, a critical tool 
in ensuring the lawfulness of the workplace.
    We have worked with not only the Social Security 
Administration but other departments within the Administration 
to increase use of biometric information to further improve the 
accuracy of the E-Verify program.
    We use photographs from the Department of Homeland Security 
database, US-Visit and we will soon be utilizing passport 
photographs from the Department of State by way of example.
    Mr. King. Driver's licenses?
    Mr. Mayorkas. We do not yet have that full functionality 
across the country. We hope to achieve that over time.
    Mr. King. Thank you, Madam Chair, thank you, Director. I 
yield the witness.
    Ms. Lofgren. The gentleman's time has expired.
    I turn now to the gentleman from Illinois, Mr. Gutierrez.
    Mr. Gutierrez. Thank you, Madam Chairwoman, pleasure to 
have you all here before us. Just following up on the gentleman 
from Iowa's question, if 100 people showed up and underwent E-
Verify and they were all undocumented, that is to say they were 
unqualified to work, they weren't authorized to work, how many 
of them would ultimately be verified and given a clearance to 
continue working?
    Mr. Mayorkas. Congressman, the Westat study that has 
received----
    Mr. Gutierrez. The Westat study that you paid to have done?
    Mr. Mayorkas. Correct.
    Mr. Gutierrez. Okay.
    Mr. Mayorkas. The Westat study that has been discussed at 
considerable amount in recent days reported--putting aside, if 
I may, the statistical standard deviation for error rate in its 
methodology--indicated that the E-Verify program would 
accurately capture the unauthorized workers that perpetrated, 
that are sought to perpetrate identity fraud 46 percent of the 
time.
    Mr. Gutierrez. Okay. So 54 percent of the time it doesn't 
do it. So 54 out of every 100 people--so if I were to go to----
    Mr. Mayorkas. I am sorry, I reversed it. I think it is 54 
percent of the time.
    Mr. Gutierrez. Great. You know, let us not split hairs 
here. One hundred people, all of them undocumented, decide I am 
fearless, E-Verify is here to rein me in. I am going to go 
through the process if E-Verify. The fact is half of them, if 
they do it on Friday show up to work on Monday, all good, ready 
to go like nothing happened. That is how great the E-Verify 
system is.
    Let me just go on to other questions. Have you encountered 
Muslim Islamic buildup that would threaten this country within 
the religious visa program?
    Mr. Mayorkas. Within the religious worker program?
    Mr. Gutierrez. Yes, religious worker with your visa 
program.
    Mr. Mayorkas. Congressman, that is a question to which I do 
not have the answer today.
    Mr. Gutierrez. Well, you should look into it because there 
have been allegations made before this Committee in the past 
about just such a situation which, of course, we can't turn a 
blind eye to. We should look into those allegations, and if 
they are false we should certainly state that they are false.
    Let me ask, everyone has to pay for the citizenship 
processing fee and the fee must include all of the salaries and 
all of the expenses of your agency. Those fees must cover all 
of that, is that correct?
    Mr. Mayorkas. For those who are required to pay a fee, the 
cost does include agency overhead.
    Mr. Gutierrez. Okay. So they pay for it. There is no 
government assistance here or government, well, funded process 
here, right?
    Mr. Mayorkas. There are certain groups of people that as a 
matter of policy Congress has determined would not have to pay.
    Mr. Gutierrez. And who are they?
    Mr. Mayorkas. For example, to a limited extent, refugees 
and asylees. For the fiscal year 2011 budget we have sought a 
greater appropriation to further relieve that disadvantaged 
group from paying a fee that they can ill afford.
    We also have a fee waiver program that does assess the 
inability to pay, and it does seek to extend a benefit to an 
individual that might not otherwise be able to afford it.
    Mr. Gutierrez. Let me--but in that sense, you are a fee-
driven agency.
    Mr. Mayorkas. We are.
    Mr. Gutierrez. Thank you. I should have just asked the 
question that way. But there are people that don't pay. So the 
people that do pay subsidize the ones that don't, right?
    Mr. Mayorkas. Yes.
    Mr. Gutierrez. Like if you are a soldier----
    Mr. Mayorkas. Yes.
    Mr. Gutierrez. Right. If you are a soldier, you don't have 
to pay----
    Mr. Mayorkas. Unless there is an appropriate----
    Mr. Gutierrez [continuing]. Right? You are an asylee you 
don't have to pay. But the other ones have to pay because when 
that soldier gets processed, the American taxpayer doesn't help 
defray the cost of his citizenship application. The other 
people that participate in your citizenship program defray the 
costs and subsidize the costs, is that accurate?
    Mr. Mayorkas. Yes.
    Mr. Gutierrez. Good. You see because I would be happy to 
help defray the cost of that soldier.
    May I ask for an additional minute?
    Ms. Lofgren. Without objection, the gentleman is authorized 
for an additional minute.
    Mr. Gutierrez. Yes. Again, I would be happy to pay. I am 
sure they are, too. But as the fees continue to mount and to 
mount and to mount I think we have a responsibility to those 
soldiers. We have a responsibility to those asylees. And I 
would just like to state a quote and see if you agree with this 
quote.
    ``I have always pledged to be your partner as we work to 
fix our immigration system and that is a commitment that I 
reaffirm today. Nobody knows the cost of inaction better than 
you. You see it in the families that are torn apart and the 
small business owners who tried to do the right thing, while 
others gamed the system. You see it in the workers who deserve 
the protection of our laws and the officers who struggle to 
keep our communities safe while earning the trust of those that 
serve.''
    That was your boss, President Barack Obama. Your boss also 
said when he was a U.S. Senator and introduced legislation 
jointly with this Member--I got to stay in the House. I didn't 
get the promotion.
    But before he went on to the White House, and you should 
seriously look at it, not having everybody defray the costs of 
others, and making sure that we are all there. So I hope you 
take a look at that legislation.
    Mr. Mayorkas. Thank you very much, Congressman.
    Mr. Gutierrez. Thank you, sir.
    Ms. Lofgren. The gentleman's time has expired.
    The gentlelady from California, Ms. Sanchez is now 
recognized.
    Ms. Sanchez. Thank you, Madam Chair. I appreciate that 
USCIS has looked for cost cutting measures and is implementing 
them before raising fees again or requesting additional 
appropriations. And you mentioned in your testimony that USCIS 
has identified cuts to the tune of about $170 million. Is that 
correct?
    Mr. Mayorkas. That is the approximate amount under way.
    Ms. Sanchez. Okay. Can you give me an overview of what 
those budget cuts would consist of?
    Mr. Mayorkas. If I can, Madam Congresswoman, give you some 
examples. We have reduced our allocated workforce by over 300 
people. We have reduced overtime by approximately 90 percent. 
We have cut travel costs. We have centralized our training 
programs. Those would be just a few examples that come 
immediately to mind.
    Ms. Sanchez. Okay. So with respect to the staffing issues, 
if I am hearing you correctly that there are some staff that, 
what, are going to be let go or their hours cut or--clearly the 
overtime is cut----
    Mr. Mayorkas. I am sorry. We have reduced the contractor's 
staff by, I believe, approximately 200 spots or perhaps more.
    Ms. Sanchez. Have I----
    Mr. Mayorkas. We have not filled----
    Ms. Sanchez [continuing]. I am sorry to interrupt you but 
the contractor spots are those being filled by in-house hires 
or they are just being eliminated?
    Mr. Mayorkas. They are being eliminated. We are not filling 
certain Federal vacancies.
    Ms. Sanchez. My concern is that it is admirable that you 
are trying to cut costs before you raise fees because we 
certainly don't want to see people priced out of the American 
dream. But on the other hand when you are cutting positions and 
a lot of the casework that we see in my district office 
suggests that the backlogs that currently exist are lengthy, 
and in fact in some cases, kind of ridiculous.
    My fear is that now you want to cut costs but then services 
will also be cut and the wait times may become even longer. 
Have you considered that fully?
    Mr. Mayorkas. We most certainly have, and I appreciate the 
question and I appreciate the concern. It is our intention, and 
I should be held accountable to this, that the cuts that we 
have made will not impose upon the quality of the service. We 
hope to and are focused upon achieving greater efficiencies to 
ensure that our level of service remains high and hopefully, in 
fact, improves despite the economic challenges we face.
    To not make the reductions in force, to not undertake the 
cost saving measures that we have, would perhaps lead to an 
even more difficult conversation with those who are very 
concerned about the accessibility of immigration benefits to 
those who seek them and who are financially challenged.
    Ms. Sanchez. Okay. Do you still expect completion of non-
immigrant services under the transformation model by October of 
2012? Or is that----
    Mr. Mayorkas. Yes. Yes, we do. And we actually anticipate 
in fiscal year 2011 the first stage of making certain non-
immigrant visas available in the transformed environment. In 
2012 we anticipate launching all capabilities of non-immigrant 
benefit types.
    Ms. Sanchez. Okay. And you expect that that will happen. I 
am interested in knowing since the system is fee-based, the 
number of people in the system or utilizing the system and the 
fees that they pay sort of affect the services that everybody 
receives. Is that not correct to some degree?
    Mr. Mayorkas. The fees that people--yes. Yes.
    Ms. Sanchez. Okay. So if, for example, there is a dramatic 
decline in the number of people who apply that would affect 
your bottom line and your ability to service the people that 
are currently in the pipeline. Is that not correct?
    Mr. Mayorkas. It is precisely what we have endured in 2009 
and are enduring now, which is a decline in the number of 
applications and therefore corresponding revenue.
    Ms. Sanchez. I mean, is there any modeling that you do or 
any way that you can predict what the number of applicants will 
be for any given year or are you just sort of subject to the 
whims of those who apply or don't apply? And I would ask 
unanimous consent for an additional minute?
    Ms. Lofgren. Could you take 30 seconds because we have two 
more----
    Ms. Sanchez. Thirty seconds.
    Ms. Lofgren [continuing]. More Members before----
    Ms. Sanchez. Certainly. Certainly.
    Mr. Mayorkas. We worked very hard to forecast anticipated 
workloads in the agency realignment that we performed. But 
several months ago one of the things that we did was create an 
Office of Performance and Quality.
    One of the functions of that office is indeed to engage 
with our Chief Financial Officer and other personnel 
projections of anticipated workload. So we do not leave it to 
whim. We do the best we can.
    Ms. Sanchez. Okay. I realize you have a daunting task, but 
again, I am going to make the plea that raising those fees 
really does price people out of the system and at the same time 
there is a huge concern with--I know you want to cut costs.
    But cutting service and potentially causing those that are 
waiting in line patiently and have been even further delays is 
a tremendous concern because Members of Congress deal with that 
on the case work end. And with that I will thank the Chairwoman 
and yield back.
    Ms. Lofgren. Gentlelady's time has expired.
    Ms. Chu has been here from the beginning of the hearing and 
is now recognized for 5 minutes.
    Ms. Chu. Thank you, Madam Chair. I have great concerns 
about this increase in the fee, and I saw that there has been 
an increase that is far above the cost of living and inflation, 
from $90 in 1991 to $675 in 2007. And now you are proposing to 
increase the fees even more.
    To me it amounts to a poll tax because here we are 
encouraging people to participate in the American system as 
fully as possible in the, you know, in the days when we were 
encouraging people to vote the poll tax became an impediment. 
And here having this high fee for the citizenship application 
is even more of an impediment for them to become a citizen.
    So let me ask this. I know that we have the relief of the 
fee for military members and asylees and refugees and that in 
fact it has been determined that there is a $72 surcharge to 
recover the costs associated with asylum and refugee services. 
In reality, you are putting the burden on all the applicants to 
pay for that surcharge, correct?
    Mr. Mayorkas. Yes, but that would be absent the 
appropriation that we obtained in fiscal year 2010 and what we 
are seeking in additional appropriated funds in fiscal year 
2011 to relieve other fee-paying customers of the surcharge so 
that we can afford to service the refugee and asylee community.
    Ms. Chu. Well, actually I have a question about that 
because last year the President requested $206 million to fund 
this processing but Congress only appropriated $55 million. So 
it didn't cover the cost of it.
    Mr. Mayorkas. And we have requested a greater appropriation 
for fiscal year 2011 to indeed cover that gap.
    Ms. Chu. What was the actual cost in 2009?
    Mr. Mayorkas. I am sorry?
    Ms. Chu. What was the actual cost in 2009 for that 
processing?
    Mr. Mayorkas. Congresswoman, I would have to get back to 
you on the precise cost.
    Ms. Chu. And what is it that you are requesting for 2011?
    Mr. Mayorkas. I believe it is just over $200 million.
    Ms. Chu. And would that cover that cost 100 percent?
    Mr. Mayorkas. I believe it would.
    Ms. Chu. I certainly would encourage us to fund that and 
not put that burden on the rest of the persons who are trying 
become U.S. citizens. The other issue I have that I hear from 
advocacy organizations is that in past the fee review process 
has been a closed process with little transparency.
    And it has been a mystery to many who could foresee some 
things. For instance, who could foresee that there would be a 
surge of applications before the last fee increase? And yet, it 
seems like there was little readiness to deal with it at the 
time.
    So what could be done this time to make the process more 
transparent and to make sure that there is more community and 
congressional input with regard to the fee increase this time?
    Mr. Mayorkas. I appreciate that question a great deal, 
Congresswoman, and if I may speak to an example of what already 
has been done. When I arrived at the agency and first learned 
that there was even a prospect of a fee increase, ever mindful 
of what the communities endured with the 2007 fee increase, I 
traveled around the country and met with community groups and 
community stakeholders to inform them of the potential.
    I wanted to inform them of the issues that our agency was 
confronting with respect to its financial challenges and the 
different possibilities that were before us in terms of 
addressing those financial challenges. And so I met with the 
communities in Chicago, in Los Angeles, in New York, in Texas 
and elsewhere.
    And so one thing that we have most certainly achieved in 
terms of the four pillars of which I spoke at the outset, was 
greater transparency. I believe we have made tremendous strides 
with respect to all four pillars.
    One that is, I think, receiving tremendous public accolades 
is, in fact, our increased transparency. We stood up in 
September of 2009, but 1 month after I first arrived, an Office 
of Public Engagement that is dedicated to engaging with our 
stakeholders in the most encompassing sense to inform them of 
the challenges that we have and to capture the issues and 
concerns that they have with respect to our performance, our 
past performance and our future.
    Ms. Lofgren. Gentlelady's time has expired. We have 5 
minutes left on the clock. Mr. King has indicated he has gone 
to vote, which is reasonable.
    I would now recognize our colleague, Ms. Jackson Lee for up 
to 5 minutes, but we don't want to miss this vote. So----
    Ms. Jackson Lee. Let me thank the witnesses and pointedly 
will focus my questions and points on two areas. This past 
weekend we witnessed an amazing exhibition of, I think, 
hundreds of thousands--it was represented to be a hundred 
thousand plus, who came to ask the question about comprehensive 
immigration reform?
    The Federal Government will be a key player in the work of 
this Congress and so my question is to the Director Mayorkas 
about the preparedness of your agency for the possible passage 
of comprehensive immigration reform?
    And then to Frank Deffer on this question of the 
transforming the system to electronic. I cannot imagine if we 
pass comprehensive immigration reform what a paper system will 
do, so preparedness and this whole idea of a pilot. I think we 
will pilot ourselves into the 22nd century and when are we 
going to find the wherewithal to do electronic records, to the 
director and then to Mr. Deffer?
    Mr. Mayorkas. Madam Congresswoman, many of the efficiencies 
that we have engineered and implemented in our agency will 
serve us well in terms of our preparedness should comprehensive 
immigration reform pass and should the reform that passes 
include a path to legalization for the approximately 11 million 
undocumented individuals in this country.
    Interestingly, the challenges that confronted us in the 
context of the tragic January 12th earthquake in Haiti 
presented a dry run, if you will, as to how we respond to a 
previously unforeseen volume of work on an emergency basis. And 
I think it is a testament to the engineered and implemented 
efficiencies that we had put in place that we were so ably and, 
frankly, nobly to address that challenge.
    We as an agency will be able to implement comprehensive 
immigration reform.
    Ms. Jackson Lee. Mr. Deffer?
    Mr. Deffer. Congresswoman, thank you for that question. It 
is actually one of the reasons we started looking at USCIS 5 
years ago is we were concerned that immigration reform would in 
effect place 12 million more people into the system. And it was 
clear to us in 2005 that the systems and the processes could 
not handle. It would be overwhelmed.
    And in fact, since then USCIS constantly has been serving 
this cycle of we have a backlog. Let us get money and get rid 
of the backlog. And so in effect adding 12 million more people 
to the system would be the, you know, the mother of all 
backlogs.
    And clearly to us the systems could not handle it now. It 
is the reason transformation has to address those processes, 
the underlying inefficient processes and get systems in place 
that can get rid of the paper. But it is going to take a few 
years.
    So it is something for Congress to consider that when they 
implement this they don't have a date that is too soon because 
it is going to take a while to get these systems that are 
properly tested and they meet requirement and they do the job 
in place. Thank you.
    Ms. Jackson Lee. Madam Chair, let me thank you very much. 
Obviously follow-up questions are warranted.
    Ms. Lofgren. That is absolutely right.
    Ms. Jackson Lee. But I will engage with both of you to 
really probe and I hope that--well, let me just do this. Let me 
ask a question on the record. If you could provide this 
Committee with a detailed analysis of the question, meaning 
here is what we have done in terms of the preparation for the 
12 million, I would appreciate a response in writing. Thank 
you. I yield.
    [The information referred to follows:]

    
    
                               __________

    Ms. Lofgren. An excellent question and I would--the 
gentlelady yields back. I would like to thank all the Members 
and the witnesses, each of you. It has been very helpful. 
Without objection Members will have 5 legislative days to 
submit any additional written questions to you which we will 
forward and ask that you answer as promptly as you can so that 
they can be made part of the record.
    Without objection the record will remain open for 5 
legislative days for the submission of any other material. And 
we thank you again, and the hearing is adjourned.
    Mr. Mayorkas. Thank you very much.
    [Whereupon, at 4:13 p.m., the Subcommittee was adjourned.]

                                 
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