[Senate Hearing 111-991]
[From the U.S. Government Publishing Office]




                                                        S. Hrg. 111-991
 
     SECURITY CLEARANCE REFORM: SETTING A COURSE FOR SUSTAINABILITY

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


                                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 ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                           NOVEMBER 16, 2010

                               __________

         Available via the World Wide Web: http://www.fdsys.gov





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

        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

               JOSEPH I. LIEBERMAN, Connecticut, Chairman
CARL LEVIN, Michigan                 SUSAN M. COLLINS, Maine
DANIEL K. AKAKA, Hawaii              TOM COBURN, Oklahoma
THOMAS R. CARPER, Delaware           SCOTT P. BROWN, Massachusetts
MARK L. PRYOR, Arkansas              JOHN McCAIN, Arizona
MARY L. LANDRIEU, Louisiana          GEORGE V. VOINOVICH, Ohio
CLAIRE McCASKILL, Missouri           JOHN ENSIGN, Nevada
JON TESTER, Montana                  LINDSEY GRAHAM, South Carolina
ROLAND W. BURRIS, Illinois
CHRISTOPHER A. COONS, Delaware

                  Michael L. Alexander, Staff Director
     Brandon L. Milhorn, Minority Staff Director and Chief Counsel
                  Trina Driessnack Tyrer, Chief Clerk
            Joyce Ward, Publications Clerk and GPO Detailee


  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
MARY L. LANDRIEU, Louisiana          SCOTT P. BROWN, Massachusetts
ROLAND W. BURRIS, Illinois           LINDSEY GRAHAM, South Carolina
CHRISTOPHER A. COONS, Delaware

                     Lisa M. Powell, Staff Director
                Evan W. Cash, Professional Staff Member
                 Dana Smullen, Minority Staff Director
                Kristy Brown, Professional Staff Member
                      Aaron H. Woolf, Chief Clerk


                            C O N T E N T S

                                 ------                                
Opening statement:
                                                                   Page
    Senator Voinovich............................................     1
    Senator Akaka................................................    10
    Senator Coons................................................    12

                               WITNESSES
                       Tuesday, November 16, 2010

Hon. Jeffrey D. Zients, Deputy Director for Management and Chief 
  Performance Officer, U.S. Office of Management and Budget......     3
Hon. James R. Clapper, Director of National Intelligence, Office 
  of the Director of National Intelligence.......................     5
Hon. John Berry, Director, U.S. Office of Personnel Management...     6
Hon. Elizabeth A. McGrath, Deputy Chief Management Officer, U.S. 
  Department of Defense..........................................     7
Brenda A. Farrell, Managing Director, Defense Capabilities and 
  Management, U.S. Government Accountability Office..............     9

                     Alphabetical List of Witnesses

Berry, Hon. John.:
    Testimony....................................................     6
    Prepared statement...........................................    39
Clapper, Hon. James R.:
    Testimony....................................................     5
    Prepared statement...........................................    34
Farrell, Brenda A.:
    Testimony....................................................     9
    Prepared statement...........................................    50
McGrath, Hon. Elizabeth A.:
    Testimony....................................................     7
    Prepared statement...........................................    44
Zients, Hon. Jeffrey D.:
    Testimony....................................................     3
    Prepared statement...........................................    27

                                APPENDIX

Questions and responses for the record:
    Mr. Zients...................................................    68
    Mr. Clapper..................................................    70
    Mr. Berry....................................................    73
    Ms. McGrath..................................................    78
    Ms. Farrell..................................................    79
Background.......................................................    82


     SECURITY CLEARANCE REFORM: SETTING A COURSE FOR SUSTAINABILITY

                              ----------                              


                       TUESDAY, NOVEMBER 16, 2010

                                 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 10:45 a.m., in 
room SD-342, Dirksen Senate Office Building, Hon. Daniel K. 
Akaka, Chairman of the Subcommittee, presiding.
    Present: Senators Akaka, Coons, and Voinovich.

             OPENING STATEMENT OF SENATOR VOINOVICH

    Senator Voinovich. [Presiding.] The hearing will come to 
order. I have been asked by Senator Akaka to get the hearing 
started today. We are very, very fortunate to have a very 
distinguished panel of witnesses to talk about a subject that I 
have been working on for a long period of time. And to begin 
with, I would like to say to all of you I really appreciate the 
work that you are doing and your cooperation and your 
receptivity to our request that you keep us informed on a 
pretty regular basis. And today what we are going to try to do 
is find out where we are.
    If you will all stand, as is the custom of our 
Subcommittee, I will ask you to be sworn. Do you swear the 
testimony that you are about to give before this Committee is 
the truth, the whole truth, and nothing but the truth?
    Mr. Zients. I do.
    Mr. Clapper. I do.
    Mr. Berry. I do.
    Ms. McGrath. I do.
    Ms. Farrell. I do.
    Senator Voinovich. I am grateful to Senator Akaka for 
calling this hearing. Yesterday we were in Akron, Ohio, on 
another subject dealing with human capital. And I am grateful 
that we continue the review of the Federal Government's efforts 
to reform the security clearance process. The Chairman and I 
worked a long time together on a bipartisan basis. I try to 
remind people that it looks like sometimes we are not 
functional or we are dysfunctional here, but there are some 
wonderful things that are happening in committees in the 
Senate, and Dan Akaka and I have been friends for a long time, 
and our agenda has been the same for about 10 years, which is 
awesome.
    My hope is that enough progress would have been made on 
this that you all could say that this is off the high-risk 
list. I told General Clapper that you are going to have it off 
for next year. I know you will. And I am going to come back 
when they have the news conference just to be in the room to 
hear it.
    We started these hearings back in 2005 to examine efforts 
in furtherance of the Intelligence Reform and Terrorism 
Prevention Act, the (IRTPA), as well as efforts to remove the 
Department of Defense (DOD) from the high-risk list. But soon 
thereafter, we recognized that the problem was not exclusive to 
the Defense Department but was instead a government-wide issue, 
and it must be addressed collaboratively, such as through the 
Joint Suitability and Security Reform Team.
    I would like to congratulate the team on the significant 
strides it has made in streamlining and improving the 
timeliness of the process. According to the data the Joint 
Reform Team provided to Senator Akaka and me earlier this 
month, in the fourth quarter of fiscal year 2010 Executive 
Branch agencies investigated and adjudicated 90 percent of all 
initial security clearances in an average of 53 days and 90 
percent of initial secret/confidential clearances in 45 days, 
thus exceeding the 60-day benchmark, with an impressive change 
from 2007, just 3 years ago, when it took the Department of 
Defense an average of 208 days to process secret clearance 
requests for contractors.
    While improvement in timeliness of the security process 
should be acknowledged, we must recognize that timeliness is 
just one aspect of the clearance, and the law necessitates a 
number of other actions, including uniform policies regarding 
the security clearance process, reciprocal recognition of 
security clearances among agencies, and an evaluation of the 
use of technology to expedite security clearance processes. I 
am particularly concerned about the lack of progress being made 
in reciprocity. I still consistently hear from individuals who 
have problems with one agency accepting another agency's 
clearance.
    Another issue that gives me some concern is the information 
technology, which is an update of existing technologies, 
despite the fact that these technologies are old and outdated 
as opposed to the fact that these technologies--purchasing new 
technologies would likely better sustain efficiency in the 
security clearance process. And, by the way, Mr. Berry, we got 
into that yesterday in terms of Social Security and the 
technology that you are using in terms of those judges.
    Furthermore, lack of timeliness in budget estimates for 
technology relating to clearance processes is also a concern 
for me. As the Government Accountability Office (GAO) has 
pointed out for several years now, quality, particularly 
completeness of investigative and adjudicative files, has been 
a problem. Fortunately, the team has recognized that more work 
regarding the security clearance process was needed. In 
December 2008, it issued a report identifying its seven-step 
approach for reform, including, but not limited to, validating 
the need for investigation requests, using automated records 
checks to better target investigations, allowing for electronic 
adjudication of less complex cases, and continuously re-
evaluating individuals who have been granted clearances.
    As requested, the team has provided monthly updates to us, 
as I mentioned, and I am also interested in learning about 
additional efforts that remain before the goal of security 
clearance can be achieved.
    I want to thank our witnesses for their participation. I am 
honored by your presence today. I do not think that everybody 
realizes that this is a top group of people here, and I am 
very, very grateful that you thought enough of what we are 
doing here to come over and spend some time with us. As we have 
the kind of protocol rule at 5 minutes; your testimony will be 
put in the record.
    I would like to start out with Mr. Zients. We will hear 
from you, and, again, thank you for being here.

TESTIMONY OF THE HON. JEFFREY D. ZIENTS,\1\ DEPUTY DIRECTOR FOR 
    MANAGEMENT & CHIEF PERFORMANCE OFFICER, U.S. OFFICE OF 
                     MANAGEMENT AND BUDGET

    Mr. Zients. Thank you, Senator. It is my privilege to 
testify in my role as the Chairman of the Suitability and 
Security Clearance Performance Accountability Council (PAC)--
admittedly, a mouthful--otherwise known as the PAC. Before I 
start, I want to acknowledge my colleagues who are testifying 
with me today: General Clapper, John Berry, and Beth McGrath. 
We have a very strong partnership, and the initiative would not 
be where it is today without their leadership.
---------------------------------------------------------------------------
    \1\The prepared statement of Mr. Zients appears in the appendix on 
page 27.
---------------------------------------------------------------------------
    In keeping with our partnership, we divided up our time 
this morning, and I will probably run a little longer than the 
5 minutes, but we will make up time as my colleagues will do 
brief updates on their specific areas.
    Since we last appeared before you in September 2009, the 
administration has made critical advances in reforming the 
security clearance process. Today I look forward to sharing our 
accomplishments and discussing the steps necessary to sustain 
our progress moving forward.
    For many years, the backlog of security clearances caused 
tremendous problems and significant expense for the Federal 
Government. In 1994, a Joint Security Commission report noted 
that substantial delays in processing security clearances led 
to unnecessary costs and risks because workers were unable to 
perform their jobs while waiting for a clearance. In light of 
these results, in 2005, the GAO placed security clearances on 
its high-risk list.
    Today, however, much has changed. The Intelligence Reform 
and Terrorism Prevention Act, otherwise known as IRTPA, was 
signed into law in 2004, challenging the Federal Government to 
address longstanding problems that unnecessarily affected the 
timeliness and quality of security clearances. As a result of 
actions taken to meet the objectives of IRTPA, the average time 
for security clearance has decreased dramatically. IRTPA 
required that all agencies complete 90 percent of their 
security clearances in an average of 60 days. At the time that 
IRTPA was enacted, the government-wide average was 205 days. By 
December 2009--so about a year ago--90 percent of the 
government's clearances were completed within the IRTPA-
required time frame of 60 days. We have met the IRTPA target 
every quarter since. In fact, as you mentioned in your opening 
remarks, Senator, last quarter 90 percent of security clearance 
determinations were completed within 53 days, a 74-percent 
reduction from the 2004 level. Moreover, the backlog of 
investigations is gone.
    Now we must ensure that our progress is sustained in the 
future. The Strategic Framework document we submitted to this 
Committee in February established the path forward. Today I 
would like to emphasize our progress in the most critical areas 
within this larger strategic framework.
    First, we are aligning suitability and security policies 
and processes to limit redundancies in our investigations and 
adjudications. To achieve this, we are modifying the regulatory 
and investigative standards as well as the information 
collection forms that underlie our clearance operations. For 
example, in March, we published a revised Standard Form 86 that 
will capture the information necessary to enable more cost-
effective security investigations.
    Second, we are working to improve reciprocity through 
initiatives such as enhanced sharing of relevant investigatory 
data among Federal agencies and developing performance metrics 
for tracking reciprocity outcomes. Notably, Office of Personnel 
Management (OPM) and DOD data are now integrated through a 
single interface, allowing agencies to see the data that 
underlies existing security clearances when they are deciding 
whether to grant reciprocity.
    Third, we are improving clearance quality by increasing 
access to information and enhancing training. To ensure that 
our approach on quality is most effective, we are also 
measuring the results. In May 2010, in partnership with GAO, we 
reported to you a set of quality metrics, which we will 
continue to refine and deploy by early next year.
    Finally, we are using enhanced technology to improve 
timeliness and reduce the number of unnecessary questions or 
the possibility of receiving incomplete forms. We have made 
important advances in converting paper-based application 
processes to automated solutions such as Electronic 
Questionnaires for Investigations Processing (e-QIP). Notably, 
over 98 percent of clearance application submissions to OPM are 
now completed electronically.
    Although this reform process has achieved many successes, 
work still remains to be done. We are making progress in 
establishing a five-tier framework for investigations that will 
enable greater reciprocity of clearances among tiers of equal 
or lower work. We expect this new framework to be released 
early next calendar year. Next month, we plan to deploy the new 
Standard Form 86 in an electronic format. And, importantly, we 
will continue to develop and improve metrics to track 
reciprocity and quality.
    Throughout this process, three key principles drove our 
reform effort.
    First, IRTPA set clear, outcomes-based goals, and each 
month, the administration delivers to your Committee a report 
on our progress relative to these goals.
    Second, we hold the appropriate agency leadership 
accountable for results. Since I joined the administration, I 
have met regularly with my colleagues testifying here today as 
well as with their teams who drive the day-to-day effort. The 
administration has also used our High Priority Goal Initiative 
to hold officials at OPM and DOD responsible for their 
respective deliverables.
    And, third, the backbone of the reform effort has been 
effective partnership. The PAC has helped foster collaboration 
among various Federal stakeholders, and the Joint Reform Team 
has provided technical leadership, training, and monthly 
progress reports. The GAO has offered insightful and important 
counsel, and this Subcommittee has held us accountable to the 
goals set forth in IRTPA.
    In closing, we have made significant progress on improving 
the suitability and security clearance processes. In fact, I 
believe that this effort serves as a model for our broader 
government-wide reform initiatives. I would like to thank you, 
Senator Voinovich, for the extraordinary work that you have 
done on this issue and for your leadership throughout your 
Senate career. I think I speak for all of us in saying we will 
certainly miss you.
    I would also like to recognize the talented staff who have 
been instrumental in the security clearance reform effort, in 
particular my Vice-Chair, Beth McGrath, Kathy Dillaman from 
OPM, and John Fitzpatrick from the Office of the Director of 
National Intelligence (ODNI). With their hard work, as well as 
that of the agency leadership testifying with me today, and the 
continued support of this Subcommittee, I am confident that we 
will continue to improve the timeliness, reciprocity, and 
quality of clearance decisions.
    Once again, thank you for the opportunity, and I look 
forward to questions.
    Senator Voinovich. Thank you very much. I think you have 
really done a good job as Director of Management and Chief 
Performance Officer.
    Mr. Zients. Thank you.
    Senator Voinovich. We enjoyed working with you.
    Mr. Zients. Thank you.
    Senator Voinovich. Our next witness is General James 
Clapper, Director of the National Intelligence, Office of the 
Director of National Intelligence, and, General, we are glad 
that you are here today, and we appreciate the fact that you 
are continuing to serve your country.

TESTIMONY OF THE HON. JAMES R. CLAPPER,\1\ DIRECTOR OF NATIONAL 
 INTELLIGENCE, OFFICE OF THE DIRECTOR OF NATIONAL INTELLIGENCE

    Mr. Clapper. Thank you very much, Senator Voinovich. I, 
too, am pleased to be here to highlight the progress we have 
made on security clearance reform. And as Jeff said, I am also 
very pleased to appear beside my principal partners of reform 
with whom I have bonded over the last couple years, and that is 
Jeff, John Berry, and Beth McGrath, as well as our GAO 
colleague, Brenda Farrell, to update you on the work we have 
done together to ensure that improvements to clearance 
timeliness, quality, and reciprocity are institutionalized and 
sustained.
---------------------------------------------------------------------------
    \1\The prepared statement of Mr. Clapper appears in the appendix on 
page 34.
---------------------------------------------------------------------------
    In both my former role as Under Secretary of Defense for 
Intelligence and now as Security Executive Agent as the 
Director of National Intelligence, I have pushed this effort 
and will continue to do so to transform the end-to-end security 
clearance process across the Federal Government. The 
intelligence community (IC) is a key player in this, and I 
assure you the IC as a whole continues to pay attention to this 
as a top priority.
    As Jeff mentioned, we are all pleased to note that our 
performance continues to meet the timelines set forth in the 
Intelligence Reform and Terrorism Prevention Act.
    As Security Executive Agent, I continue to support the 
Performance Accountability Council's emphasis on sustaining 
timeliness performance by hosting Executive Branch-wide reform 
briefings where we address agencies' performance and progress. 
Together with the Council, we will also continue to develop new 
and meaningful performance measures, including reciprocity, and 
also assess agencies' progress in adopting reform practices in 
the context of their own technology and process improvement 
goals.
    I would be remiss if I did not recognize the crucial role 
that GAO continues to play in keeping the heat on the Executive 
Branch for security clearance reform and also on areas they 
have identified where more work is required. Reform leaders 
have long focused on the goal of removing DOD from GAO's high-
risk list. In this regard, I also want to recognize the value 
of this Subcommittee's continued attention to this issue, and 
specifically you, Senator Voinovich, for your leadership. You 
leave a lasting legacy that will ensure a secure and capable 
Federal workforce for the future.
    So thanks very much for your efforts to ensure effective 
and efficient processes, and certainly when the time comes, we 
will stand ready to answer your questions. Thank you very much.
    Senator Voinovich. Thank you very much.
    Mr. Berry, Director of the U.S. Office of Personnel 
Management. John, I remember when we first met, and I thought 
you were an eager beaver, and you talked a good game, and I 
thought, if he can just do half as good as it looks like he 
wants to do. And you have done a very, very good job. I have 
dealt with your predecessors, and I am really pleased with what 
you are doing and your outreach to other agencies and working 
with them. It is extremely important. I do not think that this 
country realizes how important your operation is to human 
capital, and you have done a very good job, and I am grateful 
for your service.

 TESTIMONY OF THE HON. JOHN BERRY,\1\ DIRECTOR, U.S. OFFICE OF 
                      PERSONNEL MANAGEMENT

    Mr. Berry. Senator, right back at you. It has been an 
incredible honor to serve with you, sir, and I appreciate very 
much your allowing me the opportunity to hold this position, 
and having your support at the beginning meant a lot. You are 
one of those leaders who not only, on this issue, is concerned 
with the effectiveness and the efficiency of our government, 
but your appreciation for the men and women who serve our 
country, both in uniform and in the civilian service, day in 
and day out. And you are amongst a handful who really 
understands and appreciates the importance of their role and 
responsibility in our Republic. And you are going to be sorely 
missed. On behalf of everyone in the civil service, sir, thank 
you for your service to your Nation and for your emphasis on 
quality. It has been an honor, and the Nation has been 
fortunate for your service.
---------------------------------------------------------------------------
    \1\The prepared statement of Mr. Berry appears in the appendix on 
page 39.
---------------------------------------------------------------------------
    I am going to try to even be briefer than General Clapper, 
sir. I think what this comes down to is four keys. We, in our 
piece of this puzzle, have focused very diligently on 
timeliness, on quality and accuracy, and on cost, because at 
the end of the day we have to bill agencies, and we want to 
make sure that we are doing this in a responsible manner.
    But I think it is the fourth--and it has been alluded to by 
everybody at this table--that has really made the difference on 
this, and that is teamwork. None of us could have taken on this 
task by ourselves and succeeded. We only did it because all of 
the players at this table, and GAO included, really rolled up 
their sleeves, recognized the criticality of this issue, and I 
think are delivering solid progress for you and for the 
country. My promise to you while I remain in this post is that 
I will continue to maintain high attention and focus on this 
and will continue to be a productive member of the team. As 
General Clapper mentioned, we have actually all become, I 
think, good friends over this process as well, which also 
bespeaks the attention that has been focused.
    So with that, sir, I will yield back and look forward to 
discussing more in questions.
    Senator Voinovich. Thank you very much. Thank you for your 
kind words.
    Our next witness is the Hon. Elizabeth McGrath, Deputy 
Chief Management Officer of the U.S. Department of Defense. 
Beth, you have played a key leadership role in bringing folks 
together, and I am very much impressed with your work and your 
leadership. I think that, as I have looked over the last 12 
years and I have observed this, if you can get people to work 
together and develop good interpersonal relationships, it is 
amazing what you can get done. And I think that is what has 
happened here, and that is why I think you are doing as well as 
you are. And it takes somebody like you to understand that and 
keep the team together. Thank you.

  TESTIMONY OF THE HON. ELIZABETH A. MCGRATH,\1\ DEPUTY CHIEF 
         MANAGEMENT OFFICER, U.S. DEPARTMENT OF DEFENSE

    Ms. McGrath. Senator, thank you very much. As all of the 
witnesses have mentioned, the teamwork really has gelled over 
the last probably 3 years, so I think General Clapper and I 
have tenure in terms of the clearance reform effort. Certainly 
it would not compete with yours, sir, but it has been very much 
a team effort to enable the progress to have been made, and it 
is not just with--it also includes the Government 
Accountability Office (GAO).
---------------------------------------------------------------------------
    \1\The prepared statement of Ms. McGrath appears in the appendix on 
page 44.
---------------------------------------------------------------------------
    I, too, appreciate your continued oversight and interest 
and also the opportunity to testify today regarding DOD's 
continued commitment to and progress in reforming the personnel 
security clearance process.
    As the Deputy Chief Management Officer, I am the primary 
agent for improving cross-cutting management of the 
Department's business activities. Secretary Gates and Deputy 
Secretary Lynn have both clearly articulated the pressing need 
for departmental reforms that include: Modernization of our 
financial management strategy; a different, more streamlined 
approach to information technology acquisition; and a 
transformed hiring process to get the right talent on board in 
a timely manner.
    DOD's overarching management agenda is focused on creating 
an effective, agile, and innovative business environment that 
is fiscally responsible.
    The Department has invested a significant amount of 
attention and energy on the improvement of personnel security 
clearance processes, both within the Department and as part of 
the integrated Federal reform effort. As GAO placed the DOD's 
Security Clearance Program on its high-risk list in 2005 due to 
timeliness issues which included extensive backlogs and 
significant delays. Each year since then, the Department has 
taken proactive steps and made improvements. This includes 
direct leadership engagement, sufficient resources to resolve 
risk, a corrective action plan, the presence of a program to 
monitor and independently validate effectiveness and 
sustainability of corrective actions, and the ability to 
demonstrate the implementation of corrective measures. My 
written testimony highlights the activities we have undertaken 
to improve security clearance cycle times and institute 
proactive management and accountability, as well as describes 
the actions the Department has taken to address all of the 
GAO's high-risk list removal criteria.
    To specifically address the issue of timeliness of 
investigations, DOD partnered with its primary Investigative 
Service Provider, OPM, and together has made remarkable 
progress. In 2006, DOD military and civilian clearances 
averaged 155 days and industry clearances averaged 
approximately 196 days. As has been mentioned, the 2004 
Intelligence Reform and Terrorism Prevention Act required all 
agencies to complete 90 percent of their security clearances in 
an average of 60 days by December 2009. DOD has met that 
requirement and has continued to improve.
    This remarkable performance is attributable to several 
initiatives. The first came from OPM and its ability to 
significantly reduce the amount of time needed to conduct the 
investigation portion of the clearance process. OPM's proactive 
processing steps, coupled with DOD's improved clearance 
forecasting capability, enabled effective workload balancing 
for both investigations and adjudications.
    Next came DOD's transition away from hard-copy paper 
reports of investigation to electronic transmission and receipt 
of these documents, eliminating the need to deploy trucks to 
deliver the investigative packages. This process improvement 
alone is estimated to have eliminated up to 15 days of 
processing time for each clearance package.
    We have also made extensive progress in the quality of our 
clearances by focusing on improvements to our policies, use of 
information technology, and training for those involved in 
security clearance and adjudicative processes. In short, I 
believe the Department has taken all the necessary steps to 
warrant removal from the GAO high-risk list for personnel 
security clearances. Our demonstrated and sustained performance 
that exceeds the requirements set by both the IRTPA and the 
Performance Accountability Council is evidence of our ability 
to demonstrate the implementation of corrective measures. The 
decades-old backlog of investigations, which as recently as 
October 2006 stood at almost 100,000 cases, has been 
eliminated.
    I would like to thank Chairman Akaka but also and 
especially Senator Voinovich for your leadership and commitment 
and strong oversight of this issue. Your continued call for an 
efficient, effective Federal security clearance process has 
helped bring positive and lasting change to the way we do 
business at DOD. I wish you all the best as you prepared to 
leave the Senate.
    Thank you for the opportunity again, and I look forward to 
your questions.
    Senator Voinovich. Thank you. Senator Akaka.
    Senator Akaka. [Presiding.] Thank you.
    Now we will hear from Director Farrell.

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

    Ms. Farrell. Thank you, Mr. Chairman. It is good to see you 
again.
---------------------------------------------------------------------------
    \1\The prepared statement of Ms. Farrell appears in the appendix on 
page 50.
---------------------------------------------------------------------------
    Mr. Chairman, Senator Voinovich, and Members of the 
Subcommittee, thank you for the opportunity to be here today to 
discuss DOD's progress on addressing timeliness and quality 
with its personnel security clearance process. The recent 
unauthorized leak this past year of about 500,000 pages of 
classified documents posted to the Internet related to the 
ongoing wars in Afghanistan and Iraq is an example of the 
inherent risk involved when granting an individual a security 
clearance. We have testified on clearance-related issues in six 
prior hearings that this Subcommittee has had since January 
2005 when we first placed DOD's personnel security clearance 
program, which represents the vast majority of clearances 
adjudicated, on our list of high-risk government programs.
    Over the years, we have conducted a broad body of work on 
clearance issues that gives us a unique historical perspective. 
My remarks today draw on both our ongoing work and prior work 
on the personnel security clearance process. My main message 
today is that DOD has made significant and noteworthy progress 
to reduce delays in granting clearances and taken positive 
steps to integrate quality into its investigative and 
adjudicative processes.
    My written statement submitted for the record is divided 
into two parts. The first addresses DOD's progress in reducing 
delays in its clearance process. In 2007, we found that initial 
clearances for DOD industry personnel took almost a year to 
complete. When I testified before this Subcommittee last year, 
I noted that DOD had made significant improvements in reducing 
delays. However, despite these improvements, we continued to 
designate DOD's program as a high-risk area due to more 
stringent timeliness objectives that were to take effect later 
in the year. As of December 2009, by law the timeliness 
objective is for each Federal agency to process the fastest 90 
percent of initial clearances within an average of 60 days. I 
have good news to confirm. DOD met the 60-day objective for 
each of the first, second, and third quarters of fiscal year 
2010. GAO's ongoing work will continue to examine the 
timeliness for the last quarter.
    The second part of my statement addresses DOD's progress in 
building quality into the process used to investigate and 
adjudicate security clearances. We have stated many times that 
timeliness alone does not provide a complete picture of the 
clearance process. For example, in our prior work, we estimated 
that with respect to initial top secret clearances adjudicated 
in July 2008, documentation was incomplete for most OPM 
investigative reports that DOD adjudicators used to grant 
clearances. Today I am pleased to report that DOD has taken a 
number of positive steps to integrate quality into OPM's 
investigative process and its adjudicative process, including 
issuing guidance and developing tools to measure quality. For 
example, in March 2010, DOD issued guidance to clarify when 
adjudicators may use incomplete investigative reports as the 
basis for granting clearances.
    In addition, DOD created two electronic quality assessment 
tools to track the quality of investigative and adjudicative 
documentation. These tools are embedded in a DOD tracking 
system used by all non-intelligence DOD central adjudication 
facilities. However, these tools have not been fully 
implemented. GAO's ongoing work continues to examine the 
implementation of these tools.
    In conclusion, Mr. Chairman, we are strongly encouraged by 
the progress that GAO has made over the past few years. The 
progress that has been made with respect to the overall 
government-wide reform efforts would not be made possible 
without the committed and sustained leadership of Congress, in 
particular this Subcommittee, and by the senior leaders 
involved in the Performance Accountability Council. Their 
continued oversight and stewardship of the reform efforts is 
the cornerstone to sustaining momentum and making future 
progress.
    Mr. Chairman, this concludes my remarks. I will be happy to 
take questions when you are ready.

               OPENING STATEMENT OF SENATOR AKAKA

    Senator Akaka. Thank you very much, Director Farrell.
    I want to welcome this panel to the Subcommittee and also 
thank my brother and good friend, Senator Voinovich, for his 
leadership here, and we will begin here with my opening 
statement. I am also going to call on our newest Member to the 
Subcommittee, Senator Chris Coons, for any remarks that he 
would like to make after my statement. Then we will return to 
the questions.
    Just over 5 years ago, in 2005, this Subcommittee held its 
first hearing on the Department of Defense's personnel security 
clearance program after the Government Accountability Office 
designated the program as being at high risk for waste, fraud, 
abuse, or mismanagement. Today, we hold our seventh hearing on 
security clearance issues, and I am pleased to say that we have 
seen tremendous progress throughout the course of our oversight 
work.
    Delays in the clearance process began over 20 years ago. By 
the time this issue was added to the GAO high-risk list, DOD 
industry clearances took over 300 days on average to complete. 
Ongoing delays led to a backlog of hundreds of thousands of 
investigations and adjudications.
    Today, as we will hear from our panelists--and we have 
heard from our panelists--the backlogs are gone and timeliness 
is within the goals laid out in the 2004 Intelligence Reform 
and Terrorism Prevention Act: less than 60 days total for most 
investigations and adjudications.
    The other key aspect of the high-risk designation is 
investigation quality. Until recently, GAO noted that 
incomplete investigation files were routinely sent to 
adjudicators, who would either send them back to OPM or 
adjudicate them with incomplete information. Unfortunately, 
there was no way to monitor or measure investigation quality.
    I am pleased that earlier this year, in response to a 
letter from Senator Voinovich and me, GAO and the Executive 
Branch worked together to identify metrics that would be 
consistent with GAO's recommendations on quality.
    Overall, I have been pleased with the work of the 
Performance Accountability Council to address the high-risk 
designation and to modernize and streamline the security 
clearance process. We will continue to rely on its work to 
sustain the progress and momentum for reform in the future.
    Despite the progress, however, there are remaining issues 
and challenges that I believe are crucial to successfully 
reforming the clearance process. The information technology in 
place, especially at the Office of Personnel Management, must 
be modernized to support 21st Century capabilities--as is 
common across the private sector and other government agencies. 
I look forward to hearing more about this and OPM's enterprise 
architecture modernization project.
    Additionally, it seems reciprocity may be still an issue 
between certain agencies. The intent of several Executive 
Orders on this issue is clear: Agencies need to work together 
to accept clearances from other agencies. This will allow 
national security positions to be filled more quickly with 
right people in the right jobs. Reciprocity for employment 
suitability may need to be addressed as well.
    Senator Voinovich and I introduced legislation to 
institutionalize these reforms to the security clearance 
process. Our bill, the Security Clearance Modernization and 
Reporting Act calls for strategic planning, expanded timeliness 
reporting, and a more formal establishment of the PAC.
    I also look forward to GAO's next high-risk list update in 
the coming months to see where this issue stands. Regardless of 
whether it remains on the list, I think that we can all agree 
that there has been outstanding progress.
    The progress is in no small part a testament to strong 
congressional oversight, which is key to making the Federal 
Government more efficient, more effective, and more responsive. 
I have been proud to work with Senator Voinovich on these 
issues over the years, and I will continue our oversight 
efforts in the future.
    As evidenced by our distinguished panel here today, this 
particular issue has enjoyed high-level leadership attention, 
and I hope your work will serve as a model for addressing other 
high-risk areas and management challenges.
    We are very pleased to have the Acting Office of Management 
and Budget (OMB) Director, the Director of National 
Intelligence, and the OPM Director working so closely together 
with this Subcommittee.
    I am also honored to have my brother and good friend 
Senator Voinovich by my side as we hold this, one of our last 
hearings together. He has been a leader on this issue, as he 
has been on many other complicated management challenges our 
Nation faces. Again, I want to thank him for all of his work on 
these issues over the years, and I thank our entire panel for 
being here today.
    I would like to now call on newest Member, Senator Coons, 
for any remarks that he may have.

               OPENING STATEMENT OF SENATOR COONS

    Senator Coons. Thank you very much, Chairman Akaka, and my 
purpose today is to join you in this hearing, in part to 
continue the good work of Senator Kaufman of Delaware, in whose 
shoes I attempt to stand today. This is my first day on the job 
as a U.S. Senator. Thank you, Chairman Akaka, thank you, 
Senator Voinovich, for what from the testimony today has 
clearly been an effective and engaged job of oversight, and 
thank you to all the panel members today for demonstrating in 
response to both the identification of issues by the GAO and 
repeated and effective engagement by this group in a 
collaborative process that identified critical steps forward, 
set metrics, and then, in the course of several hearings and 
several years of difficult work, reduced what was a critical, 
longstanding backlog in a way that improved efficiency, reduced 
costs, and delivered an outcome that is important to the 
security of our Nation.
    I am glad to join you in today's hearing and look forward 
to working with you in what time I have left on this Committee. 
Thank you, Mr. Chairman.
    Senator Akaka. Well, thank you. You are certainly welcome, 
and I look forward to working with you.
    We will begin now with the questions. Ms. Farrell, last 
year, Senator Voinovich and I sent GAO and members of the PAC a 
letter asking GAO and the PAC to work together to address 
performance measures for quality of clearance investigations 
which have been suggested by GAO.
    My question to you is: Was GAO satisfied with the resulting 
response from the PAC regarding these measures?
    Ms. Farrell. Thank you, Mr. Chairman. Yes, GAO was 
satisfied with the result. There had been a great deal of 
collaboration that we witnessed among the players that you have 
already acknowledged here, and we have been pleased to see that 
collaboration continue even with the change in the 
administration almost 2 years ago.
    The metrics, the 15 metrics that resulted in the letter to 
you and Senator Voinovich, we have evaluated those against what 
we consider successful--indicators of successful performance 
measures. There are at least nine criteria that GAO has 
identified in prior work that we have used to measure 
performance measures against to see if they are showing 
success, and those consist of, for example, being quantifiable, 
having measurable goals, aligned with an agency's goals, 
reliable, independent, free from bias so that an independent 
party can make the same determination using those performance 
measures, as well as interim goals with measures to show 
progress as the transformation is playing out.
    We found that most of the performance measures had some of 
the criteria as well as baselines and goals for 2010 and 2011.
    The PAC, once it decided that quality was a high priority, 
moved very quickly, I think, to develop these and put a plan in 
place with some guidelines that can be used as measurement. So 
we are very pleased with what the result was, sir.
    Senator Akaka. Thank you for that response.
    General Clapper, I want to follow up with you regarding 
performance measures. Some elements in the Executive Branch, 
including the intelligence community, do their own 
investigations rather than using OPM.
    How will the quality measures apply to these elements? And 
does the PAC plan to standardize quality standards across all 
executive agencies?
    Mr. Clapper. Well, sir, it would be my view that whatever 
performance metrics we agree on for the community would apply 
across the board regardless of who does the investigation or 
how it is done. And I say this since I signed up to those 
standards in my last job, so it would be a little difficult for 
me to fall off that position, so absolutely.
    Senator Akaka. Thank you.
    Director Berry, DOD has initiated the Rapid Assessment of 
Incomplete Security Evaluations (RAISE), a tool to track and 
complete investigation files. This tool measures investigation 
completeness after OPM has delivered its investigation file.
    Does OPM have a system for ensuring the completeness of its 
own investigations? And how do you resolve investigations that 
customers identify as incomplete?
    Mr. Berry. Thank you, Senator. It is great to be here with 
you again today on this important issue.
    The answer is yes, absolutely, we have in place such a 
system. Kathy Dillaman, who is my Associate Director, who 
manages this project for us on a day-to-day basis, has put in 
place, consistent with the Department of Defense's systems and 
these measurements that we've worked out jointly with GAO, a 
couple of ways to sort of triple-check and have some backstops 
that we can know what we can rely upon.
    Most urgently, we put in place an immediate direct line 
ability for DOD to be in touch with sort of a fast call 
complaint issue so that Kathy can have at her--she knows 
exactly where shortfalls are happening, and so we can decide 
whether they are the result of factors that are beyond our 
control. For example we cannot resolve some cases if there is 
an ongoing criminal investigation or a court case. We know that 
is one--we are obviously not moving forward with that, but 
there are others that might be a trend indicator. And so one of 
the most important things we have is for Kathy to be able to 
carefully monitor through all of that feedback system so we can 
identify where there might be a weakness that we need to 
immediately address in our investigations.
    In addition, we are moving forward with upgrading our 
automated systems so that we can share information in an 
electronic format. And that is one we have made substantial 
progress to date on. We have a long way to go. We are 
probably--as I say, you have to balance costs to the customer 
to make sure that we can do this. We have eight components in 
our IT system, and all eight are being upgraded as we speak. 
And those will also greatly assist us in--as we pass this 
information back and forth, we are able to do that in a much 
quicker time frame, sir, so that we can get those complete 
cases, back and forth in such a way that the adjudication by 
the agency can be made off of a complete file.
    Senator Akaka. Thank you.
    I would like to follow up with a question to Director 
Zients on this, and I would like to hear from you as well. Do 
you believe tools should be developed at other agencies that do 
not have the same tools?
    Mr. Zients. Yes, although I am hesitant to say that they 
need to be developed, as we have developed good tools at DOD, 
at OPM, and what we should be doing is taking those tools and 
other best practices beyond technologies and transferring those 
to the smaller-volume agencies so that we can get the same 
efficiencies and quality gains that we have achieved at DOD.
    Senator Akaka. Thank you.
    Senator Voinovich, your questions.
    Senator Voinovich. Thank you, Senator Akaka. Again, thank 
you for holding this hearing. We have one more.
    When Senator Akaka and I met with the Joint Reform Team at 
GAO in the spring, I expressed concern about the lack of 
information regarding budget plans and funding needs for the 
reform effort. In the past, GAO has suggested that the Joint 
Reform Team provide Congress with ``long-term financing 
requirements for security clearance reform.'' With long-term 
funding requirements--and during last year's hearing, Senator 
Akaka and I specifically asked for such information and 
expected to see it in the Security and Suitability Reform 
Strategic Framework. However, the framework States, ``Resources 
from DOD and OPM are sufficient to enable implementation of the 
transformed process designed for the mainstream elements of the 
process.''
    Do you have the resources to continue to do the job that we 
have asked you to do? And, second, is this issue of continuing 
resolution and the omnibus bill or whatever we get, what impact 
is that having on your ability to do this work?
    So that is two questions. In your budgets currently do you 
have the money? In the budget that is proposed, is the money 
there for you to get the job done? And are you being thwarted 
right now in terms of some things you would like to do because 
of not being confident as to when this budget is going to be 
passed, appropriations are passed?
    Ms. McGrath. So I can----
    Mr. Zients. Please.
    Ms. McGrath. Our position on the funding has not changed 
from what we provided the Department--between the Department 
and the Office of Personnel Management, we believe we have 
sufficient resources to sustain.
    I will indicate that the information technology that the 
Department is developing, primarily the DISS, the DISS Program, 
the Defense Information Security System (DISS), does have a 
Program Objective Memo (POM)-12 request that will ensure that 
we have sufficient development dollars. It has not yet been 
locked, but I do believe that we will have that. It was 
previously not funded in 12.
    Having said that, we are not impacted by the continuing 
resolution. The work we have in the budget for 2010 and 2011 is 
continuing. It is not a new start; therefore, we are not 
impacted specifically by the CR.
    And then from the long term, we also have sustainment 
dollars that are in the budget to ensure that we can sustain 
the programs. And as Mr. Zients mentioned earlier, many of the 
information technologies that we are developing within the 
Department are portable, if you will, to other organizations. 
We are ensuring that we have the proper contracting language so 
that these can be utilized by other Federal agencies so we are 
not developing new systems, that we are leveraging existing 
technologies.
    Senator Voinovich. Mr. Berry.
    Mr. Berry. Senator, I would underscore what Beth is saying, 
especially from our information technology (IT) needs, which 
obviously the systems that we discussed we need to upgrade over 
the next period of time. We have been able to keep our rates--
which is obviously what we charge the agencies for the 
investigations. We have not exceeded the cost of inflation, so 
we have been able to sort of keep our customers happy but build 
into that approach sufficient resources necessary to upgrade 
the technology as we move along. And so, for example, right now 
almost 70 percent of our fingerprints are done electronically. 
That has been a significant time saver for us, and we look 
forward--we are not going to be happy until that number 
continues to increase, but it is great and a great example of 
how we have been able to bring the technology forward.
    Right now, 98 percent of all the submissions are done 
electronically, so a lot of the speed which you have seen in 
these has been in the IT solutions that we have been able to 
bring online over time with this. And because we have been able 
to build a budget that provides for the upgrade of each of 
these eight components of that IT system, we believe we have 
the resources both now and in the future to stay on track with 
the objectives that we all share.
    Senator Voinovich. I think one of the really important 
things about this endeavor is that--General Clapper, you 
understand how important it is, and I think I would be 
interested--and you do not have to do it today, but I would 
really be interested in--you are making this effort, and I 
would like your--we are spending more money, but the issue is 
we are becoming a lot more efficient. And the impact that it is 
going to have, security clearance and having this move the way 
it is supposed to in terms of the warfighter and other people 
that--security and how important it is that we get this system 
to where it should be. And I think you are going to have to do 
a lot more of that because of the tight financial situation 
that you have. And I think that--I know you are all busy, but 
as much as you can do that and share that with Congress, I 
think the better off all of us are going to be.
    Now, Ms. Farrell, I congratulate you. You are working with 
the team. Obviously, you have a good interpersonal type of 
operation here. And I want it off the list. Do you think it is 
possible that--I think you put out your high-risk list in, 
what, February of next year?
    Ms. Farrell. Maybe January.
    Senator Voinovich. There is a possibility that it could be? 
Could you list maybe the one or two things--let us say two 
things that you think really need to be addressed if that were 
to occur?
    Ms. Farrell. Yes, sir. The Acting Comptroller General, 
soon-to-be Comptroller General, will make that announcement in 
January of next year, hopefully, and I believe the written 
statement does reflect a lot of the significant and noteworthy 
progress that DOD has made toward actually implementing actions 
that we are evaluating to make that high-risk determination. 
Sometimes we will take a program off of the high-risk list and 
we will keep monitoring it always, but sometimes we have to 
reapply that designation. Hopefully, it will not happen in this 
case if personnel security clearances are removed. But it has 
happened. The decennial census is an example of one that has 
been on and off, on and off.
    DOD has been very responsive, again, to our 
recommendations, and it is not just our recommendations that we 
look at. It is other solutions that they are putting in place 
regarding timeliness and quality.
    We have seen great progress with the timeliness and the use 
of IT that you have already discussed, and I think the main 
message today is the progress being made to develop metrics 
which can be used to measure the documentation.
    Senator Voinovich. And you all agree on the metrics?
    Ms. Farrell. Yes, we do. We saw those before they were 
submitted to you, and we have--at that time we had not done a 
complete evaluation against our criteria, but we had a number 
of conversations to help facilitate the development of those 
metrics.
    We are looking--and I am not in a position to say it is 
coming off or staying on, but obviously there is progress, as 
you have noted. Whether it stays on or off, I do not think--we 
should not forget how much progress and how far DOD and the 
other agencies have come over the last 5 years. It is truly 
noteworthy.
    We will continue to monitor the implementation of the tools 
that I mentioned in my opening, the tools that are going to be 
used or are being used for investigations and adjudications. 
Those tools are not fully implemented. There is some more 
information that we want to work with DOD and OPM regarding 
those tools' deployment as well as what is the process in place 
for continuous evaluation for the results of those tools.
    Senator Voinovich. Do you think they have the budget to get 
the job done? They both said that they thought they did, but 
how do you feel about that?
    Ms. Farrell. DOD does have a large budget. I think one of 
our concerns has been that as we are moving into more and more 
tightening of dollars, what is going to happen to that large 
budget, not only at DOD but at the implementation of some of 
these IT projects at the smaller agencies? We have heard 
concerns from agencies outside of DOD about how they will be 
able to keep pace with the technology and be responsive.
    We still believe that identifying long-term funding for all 
of the reform efforts would help, especially as the money 
becomes tighter and congressional decisionmakers such as 
yourself have to prioritize.
    Senator Voinovich. Thank you.
    Senator Akaka. Thank you very much, Senator Voinovich.
    Senator Coons, do you have any questions?
    Senator Coons. Thank you, Chairman Akaka.
    If I might, Ms. McGrath, you had spoken previously that the 
Department of Defense was working to achieve some cost savings 
through the streamlining of its processes. Have you, in fact, 
achieved some cost savings? I understand the necessary pressure 
for increased appropriations in order to implement some of 
these reform moves. But have you been able to realize cost 
savings in the adjudication process for security clearances?
    Ms. McGrath. Senator, thank you for the question. All 
along, this reform effort has taken an approach of one that 
puts policy, process, and information technology in the same 
conversation in addition to cost savings, performance 
management, and leadership engagement. And so all of those 
attributes must be present, I believe, in order to have an 
effective outcome. And I think what you have heard today is 
exactly that, and specific to the cost savings question, if you 
do not put the policy, process, and information technology as 
part of the answer, then I think you are falling short of the 
overall outcome.
    And so from specifically the electronic adjudications that 
the Department has implemented for clean secret cases, where 
you have a very clean case, it is coded that way, and the need 
for a human adjudicator to take a look at a very simple case 
was not necessary based upon business rules and data standards. 
We have taken that step using again, policy, process, and 
information technology. We processed last year over 73,000 
cases utilizing this e-adjudication capability. And, again, 
before we launched on the information technology, we ensured we 
had the appropriate standards and business rules, and we also 
did a 100-percent audit for 6 months to ensure that we had the 
process right. And so with that, we certainly have saved 
dollars but, more importantly, increased productivity in the 
use of our professional adjudicators, put their time and 
attention on those cases that needed it more than those.
    Mr. Zients. Might I chime in on cost? I think Beth is 
exactly right. We are getting better and better, both in terms 
of cost and quality. But I think if you really want to think 
about the cost here, it goes beyond the process to eliminating 
the backlog and going from 200 days down to 60 days, which 
allows us to get thousands, tens of thousands, hundreds of 
thousands of people more productive in protecting our national 
security interests.
    So I think we need to be cognizant of the cost, and we 
should be using information technology to drive costs down of 
the process and to improve the quality at the same time, which 
I think can be done. I think they are correlated. At the same 
time--and we at OMB will be very careful on this front--we do 
not want to be penny-wise and pound-foolish because the main 
productivity gain here and national security gain is by 
ensuring we never have a backlog again and by ensuring that we 
get it done within the 60 days.
    Senator Coons. That is right. Thank you for that point. So, 
in other words, if you are saying a look at total cost is not 
just a per transaction cost, but the total benefit to the 
public, to the national security----
    Mr. Zients. And I think the latter is much more weighted.
    Senator Coons. In many ways. What are some of the reasons--
--
    Mr. Clapper. Senator--oh, excuse me. I was going to, if I 
might just add to that.
    Senator Coons. Certainly.
    Mr. Clapper. One of the underlying features of the whole 
security clearance reform process is actually to reduce the 
need for investigations as a standard uniform requirement and 
do it on a selective, focused basis. So that in itself, I 
think, will over time--as we implement that feature will accrue 
great savings.
    At the same time, we are all concerned about forthcoming 
budget pressures, and I think it is clear, at least as far as 
the intelligence community is concerned, that we are going to 
become smaller and we are going to have a lot less reliance on 
contractors. So the demand here, even though we are going to 
have less funding, so the demand for investigations and 
clearances is also going to go down proportionally.
    I can attest, having spent some time in industry for about 
6 years in one of my sojourns back out of the government, to 
the huge impact this has on industry in the amount of lost 
time, which for a company is money, in waiting for clearances. 
So in a sense, there are opportunity costs there that I think 
are huge by virtue of implementing, fully implementing this 
process.
    Senator Coons. Having had that experience previously in 
private industry, I agree with you.
    What are some of the reasons that even today there might 
still be a lack of documentation about adjudication in these 
cases, Ms. McGrath?
    Ms. McGrath. Although it seems as if an adjudication should 
be an adjudication, it is not. And every adjudicative decision, 
what we talk about, we tend to commingle a hiring adjudicative 
decision and also then a clearance adjudicative decision, and 
then the different levels of adjudications that take place. So 
what decisions are you making? What information do you need? 
And how trained are you and how much risk does a particular 
case have with it based upon the clearance level that you are 
granting? A secret case would have less risk than a top secret 
case, or a moderate-risk public trust position certainly is a 
lesser risk than a high-risk public trust position.
    So I go through that level of detail to make my point that 
adjudication is not exactly the same as you go through. 
Therefore, we rely on many things to ensure that the right 
adjudicative decision is made. At the end of the day, that is 
what we are looking for. We want appropriately trained 
adjudicators having the right information to make the right 
decision. And so depending on the case, that information may or 
may not be slightly different. If the national standards 
indicate that you must look at all, prior history of 10 
employment organizations and you get 9 of 10, technically that 
might be an incomplete investigative package. But if it is 9 of 
10 and you have a seasoned investigator, you can make that 
decision.
    So the risk really is, I am going to say, somewhat on a 
case-by-case basis, recognizing that we want to drive standards 
as much as we possibly can, ensure that the different types of 
investigations or clearances, be it on the hiring side or the 
clearance side, build upon each other so that the adjudicator 
has all the information he or she needs to make the appropriate 
adjudicative decision.
    Senator Coons. Thank you for your responses.
    Senator Akaka. Thank you very much for your questions, 
Senator Coons.
    Director Berry, I understand that OPM has been working on 
transforming its investigation IT systems known as EPIC. The E-
Gov Office has ranked this investment as a 4 out of 10, 
indicating poor performance related to cost and schedule. Your 
Chief Information Officer (CIO) describes the project as in a 
``mixed life cycle.''
    Would you please update us on the status of EPIC, the 
anticipated costs, and when could we expect to see a new IT 
infrastructure?
    Mr. Berry. Yes, Senator, if it is OK, we will get you the 
specifics on the costs for the record. What we have, sir, is a 
system that is not sort of one monolith. It is a system that 
has eight components to it, and we are working on all eight in 
terms of upgrading them.
    Right now, we have a game plan that will provide for the 
updating of them within our cost structure to the agencies, 
staying within budget, over the next 3 years. And so we feel we 
are on schedule for that, and we are doing--we are happy with 
where we are at the time, recognizing we need to continue on 
with this and will not be happy until all of them are where we 
need them to be.
    But just to give you an example, sir, of one of the most 
important components--and I think it is one of the ones that 
also goes to the efficiency Senator Coons was discussing. We 
have a central verification system that allows us to automate 
the file, essentially the investigative history, so the 
adjudicator can see exactly where we are and what pieces may be 
missing.
    Right now, there are over 258,000 active cases on this 
system that is linked in what has been, I think, a major step 
forward with DOD's Joint Personnel Adjudication System. And so 
there are potentially over 3,500 people around the world who 
are adjudicating these issues and need to call up a case to see 
and, make sure they can make an appropriate judgment. And right 
now, because we have been able to integrate those systems, they 
can now do that, and that has been one of the leaders in terms 
of increasing our time and accuracy.
    We continue to move forward on all of these. Each of these 
components--for example, one of the systems we talked about is 
electronic fingerprints. That is one of the eight sub-units, if 
you will, getting that data. Getting background checks from 
State and local law enforcement agencies has been one that has 
been a major step forward. That used to take weeks. It is now 
done in 3 to 4 days. And it is because we have been able to 
upgrade that system and integrate it with 50 different State 
systems across the country.
    So you can see, as each one of these components of those 
eight components--and we for the record can break down each of 
the eight for you. But I feel we are making good progress. It 
is bearing fruit. The fruit is being borne in the numbers that 
we are reaching. And we can do this within the budget that we 
discussed, that you mentioned, Senator Voinovich. And anytime 
that we have a savings, the savings is folded into the 
technology. And then our customer, DOD, obviously the largest, 
has agreed with us on that, put that money into those IT 
systems so that we can continue the forward progress. And so I 
think we are on the right track, Mr. Chairman.
    Senator Akaka. Thank you so much for that response.
    Ms. McGrath, DOD also has been in the process of replacing 
its current clearance IT system known as Joint Personnel 
Adjudication System (JPAS) with a new system knows as the 
Defense Information System for Security.
    What is the status of this system, its funding, and what 
capabilities will DOD have after it is implemented?
    Ms. McGrath. JPAS is currently scheduled for sunset or 
retirement in mid-2013. That includes a 6-month parallel 
processing if we need it. So our plan is to deploy the Defense 
Information System for Security in total by the end of 2012, 
and we will run JPAS in parallel for 6 months. So we will cut 
over essentially at the end of 2012. It, too, is a family of 
systems. I do not think it has quite eight parts to it, but it 
has the access to the information, documentation of 
adjudicative decisions that have been made. We are including 
the Case Adjudication Tracking System (CATS), in the family of 
systems so that you have somewhat of an end-to-end process 
within the DISS program. We are leveraging the information 
technology, deploying it across the Department, so from a low 
side, an unclassified perspective, we have singled in on a 
single solution for all of our central adjudication facilities, 
both in IT and then the policy and process, so that it acts as 
if it is a single unit.
    Senator Akaka. Thank you.
    Director Zients, all of OMB's reform team partners--Office 
of the Director of National Intelligence (ODNI), OPM, and DOD--
are updating various components of their respective clearance 
IT systems. The 2004 Intelligence Reform Act called for a 
single clearance verification database which, as I understand 
it, has not been fully implemented. I would like to hear from 
you, as head of the PAC and the Director for Management at OMB, 
what is being done to ensure that IT investments are 
coordinated across the clearance community and that systems 
work together.
    Mr. Zients. On the actual clearinghouse, or having one 
database, I think we have effectively integrated, as Beth and 
John talked about, their major databases, and that coupled with 
scattered castles is the IC community, the intelligence 
community, has accomplished the same goal or outcome that we 
were looking for in IRTPA.
    So I think as to a single clearinghouse, while we have not 
merged all the databases by putting in front-end search 
capabilities, we have achieved in a very cost-effective way 
while protecting national security interests the same outcome 
that we were looking for.
    Overall, I think that IT here in the security clearance 
process, as is true across government, offers the promise to 
increase efficiency, timeliness in this case, and quality all 
at once if indeed we manage these projects well. So it is a 
major push at OMB working with the E-Gov Office and our Federal 
CIO, Vivek Kundra, to make sure that projects are appropriately 
scoped, that we are using developed software and avoiding 
proprietary development where appropriate, and holding these 
projects to clear milestones and deliverables along the way. 
Too often these projects historically have had years before any 
deliverable was planned or executed upon. We are bringing all 
that forward. That basic philosophy we are applying, as you 
heard in Beth's and John's statements, to the IT work that we 
are doing for security clearance, which I think is going well, 
holds a lot of promise for further efficiencies and quality 
improvements. And as I stated earlier, we are going to take 
what is working at the major agencies and transfer that across 
government.
    Ms. McGrath. Sir, if I might add, through the oversight of 
the Performance Accountability Council, we have asked each of 
the Federal agencies, in addition to the ones that are here, to 
bring forward their implementation plans for clearance reform 
and to identify budgets that are required for implementation, 
information technology, and to make available, as I previously 
mentioned, pre-existing or existing information technology like 
we are deploying at the Department.
    The Department of Energy has taken us up on that offer to 
date, and there are others that are interested, so that we are 
not creating duplicative information technology capability 
across the Federal space; rather, we are leveraging existing 
capability. And it is through the oversight of the PAC that we 
are achieving that.
    Senator Akaka. Mr. Berry.
    Mr. Berry. Mr. Chairman, I would just add that I think what 
was also an item of foresight of the Committee when you created 
this program was conferring on us the revolving fund authority 
that allows us to essentially operate very much like a business 
where we charge the customer for the product and have to meet 
schedules, meet budgets, etc. And that revolving fund authority 
is why, Senator, I think, when we answer your question of do we 
have the resources necessary to do the IT upgrade, at least 
from our component, our piece of this, we do because----
    Senator Voinovich. You charge them.
    Mr. Berry. You have given us the ability to recoup that. 
But as I say, we have never exceeded the cost of inflation. So 
we are trying to be careful with that authority that you allow 
us working with our customer.
    Senator Akaka. Director Berry, as the SF-86 form used for 
applying for a clearance was recently updated. Director Zients 
said in his statement that the electronic form of the new SF-86 
will be released soon.
    What new capabilities will this new electronic form have 
over the current e-QIP system? And why is the new electronic 
form only now being deployed?
    Mr. Berry. Sir, we have had the form. It has been deployed. 
What we are doing is updating it with the changes that we have 
made to the form that the team has worked out. And we are on 
schedule to have those changes online by the end of the year, 
in December. And so we are on schedule and on budget with that 
update.
    So it is really a refresher, sir, of an electronic form, 
but we have made changes to it regarding--through the team 
here.
    Ms. McGrath. If I could add, the most significant 
enhancement--there are two--to the Standard Form 86, the form 
itself was approved back in the March time frame, and the 
deployment that Director Berry is mentioning is the deployment 
of that form through the e-QIP solution, which is on schedule 
for implementation in December of this year.
    The two main attributes of this particular form are the 
branching questions. If you will recall, back in the 2007 time 
frame when we looked at the end-to-end process, part of what 
would make the process better than what we do today is 
collecting more information earlier in the process. And the 
applicant is the most productive source of information, so 
asking those questions as part of the application process was 
felt by everybody that was the best way to initially achieve 
the collection of that information. So we revised the form to 
include branching questions, much like Quicken does, if you are 
familiar with that software tool. If you answer one way for 
something, it takes you down a series of questions, and that is 
what the electronic form would do.
    The other piece is we revised the consent piece. If you 
will also recall, part of the reform process looks and asks for 
at the end of the process more of a continuous evaluation to 
manage the cleared population. In order to do that, we had to 
change the consent form, the existing consent form on the SF-
86.
    So those are the two main changes that are being made, and, 
again, the information technology, the e-QIP upgrade is on 
schedule for deployment in December.
    Mr. Berry. And, Mr. Chairman, as you can imagine, what Beth 
just described takes a lot of programming, and there are over 
100--there are hundreds of screens through this branching that 
have to be developed and programmed to implement, which is why 
it has taken from March until the end of this year to get this 
done. And we have to test it, obviously, to make sure it works 
and is rigorous. But right now I am told we are on schedule 
with it, and it is looking good.
    Senator Akaka. Thank you very much. Senator Voinovich.
    Senator Voinovich. Thank you, Mr. Chairman.
    I was just thinking about all of this information that you 
are able to get today, and for a long time, the Department of 
Homeland Security (DHS) has been trying to get like four areas 
of information. We were trying to get the States to have better 
driver's licenses to get information, and one of the reasons 
why we have not been able to really crack down on them is 
because the information that they need is not available to 
them. And I was just thinking, through what you are all doing 
here, its applicability to perhaps dealing with their problem 
so that we can do a better job on the State level in terms of 
these licenses that are being granted to individuals. That is 
the big-picture stuff for your shop.
    The other thing is there is reciprocity. It is still a 
problem. Ms. Farrell, do you think we are making--what is the 
stumbling block there? Because I still get complaints from 
folks about the reciprocity, and that is a big deal because 
that--if somebody moves from one agency to another agency and 
they just sit there and cannot do things until they--even in my 
own office, people have come to work for me; they have 
clearances, and they have to go through the whole thing all 
over again in order to come into a meeting with me.
    Ms. Farrell. Senator, I believe everyone has a story, as 
you are conveying, about a neighbor or a friend or a family 
member that has had a security clearance but for some reason it 
does not transfer when they go to another agency. We have noted 
that perhaps the quality of the investigations or adjudications 
could be an underlying cause for reciprocity when it not 
working the way the law intended.
    We do have work ongoing that is looking at reciprocity. 
That work should be completed by the end of this year. Prior to 
that work, there had not been a GAO study or another study that 
we are familiar with that actually gave data on is reciprocity 
a problem or not. What is the extent to which it is a problem?
    Senator Voinovich. The thing is that part of the problem 
that we have had is that some agencies just refuse to do it. In 
other words, they say, ``Your background stuff is not good 
enough for us.'' And I think, General Clapper, or somebody 
needs to just say to them, ``Look, we have decided that if they 
have this kind of clearance, it ought to be acceptable in your 
shop.''
    Ms. Farrell. True, and I think my colleagues will elaborate 
that sometimes agencies are confusing what is needed for 
suitability clearance with the personnel security clearance, 
and that raises another set of issues. But still, whether we 
are talking about suitability or clearances, the granting of a 
clearance to an individual we do not really know at this time 
the extent to which reciprocity is an issue or if the agencies 
are actually refusing. We have work that is ongoing, and we 
have had conversations with agencies outside of DOD about their 
views, and I will say that their intent is to honor the 
reciprocity.
    Mr. Clapper. Senator, as a security executive agent, I can 
say that we have issued reciprocity rules, and, of course, the 
reporting we get back from security managers is that they 
support and follow them. And, of course, this is an area that 
we will always need to pursue improvements to. And as you have 
heard and you have experienced yourself, reciprocity is 
something that lends itself to anecdotes. And so one of the 
things we want to try to do here is to quantify some of these 
anecdotes, and one of the things we are thinking about doing is 
establishing a 1-800 line sort of thing so if people have 
reciprocity complaints, we will have a way to gather some 
actual empirical data on this and just see what the extent of 
the problem is.
    I would also point out that within the intelligence 
community oftentimes there are degrees of access, so for 
special access programs, if someone's initial background 
investigation is, say, 4 years old and under the current system 
it is every 5, a Special Emphasis Program (SEP) program manager 
is authorized--and this pertains both in DOD and the rest of 
the IC--to do an additional check, to do a quick bring-up on 
that initial investigation. Now, hopefully, when we get into 
the continuous evaluation program, some of that will be 
attenuated. But this, again, I would say is a case where it is 
an area that lends itself to anecdotes, and we want to try to 
quantify those anecdotes to see what the actual extent of the 
problem is.
    Senator Voinovich. I would like to say, again, thank you 
very, very much for the good work that you have done. It has 
been an inspiration to me to see the progress that you have 
made and, again, the teamwork that is obvious here at the 
table. I would also like the people that are sitting behind you 
to--I want to let you know how much I appreciate the work that 
you all do. At this stage in my life, I am looking around 
about, how do you get where you are and what can you 
accomplish. And I have found that all I am is a reflection of 
some wonderful people around me that have made a difference for 
me. And so I want to say I know they are sitting there at the 
table, but I know darn well that what they have been able to do 
would not have been able to happen without the great teamwork 
that you have and the support that all of you give them. And I 
just want you to know how grateful I am to you for what you are 
doing
    Senator Akaka, again, thank you for this hearing, and, Ms. 
Farrell, I hope I am back next year. I will even come back from 
Florida, where I expect to be. [Laughter.]
    Senator Voinovich. Thank you.
    Senator Akaka. Thank you very much, Senator Voinovich.
    I want to thank all of our witnesses for appearing today. 
As we have heard and as we have seen, great, great progress has 
been made on this issue, and I want to thank the panelists 
here. You have certainly been great leaders in this. Statistics 
tell us that tremendous progress has been made already through 
your efforts, and I really want to thank you for doing that. 
And this Subcommittee will continue its strong oversight in the 
coming Congress.
    Again, I want to thank my very good brother and friend 
Senator Voinovich for his attention and leadership on this 
issue. In 2005, he chaired the first in this series of 
hearings. As you can see, this continued when I became 
Chairman, and we have worked so well together in a bipartisan 
manner, and I would say accomplished so much doing it, and have 
enjoyed it as well. And I look upon him as a champion in human 
capital, and this will, of course, be part of the legacy of his 
life. And I hope your successor will bring the same dedication 
and energy to all of the high-risk areas and improving 
government management.
    Senator Voinovich. He would be a good one, if we can 
convince him. He was Director of the Office of Budget and 
Management, so he has a pretty good idea of how the system 
works.
    Senator Akaka. Yes. Well, this has been a great experience 
for me and for all of us and for the U.S. Senate as well. And I 
again want to say thank you to the Committee Members, this 
Subcommittee, and I want to say thanks to our staff. Our staff 
has done a tremendous job here on either side of the aisle, and 
I want to say thank you so much. We have made great progress as 
a Subcommittee.
    The record of the hearing will be open for 2 weeks for 
additional statements or questions other Members may have 
pertaining to the hearing.
    This hearing is adjourned.
    [Whereupon, at 12:11 p.m., the Subcommittee was adjourned.]


                            A P P E N D I X

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