[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]



 
                 ELIMINATING WASTE, FRAUD, ABUSE, AND 

                   DUPLICATION IN THE DEPARTMENT OF 

                           HOMELAND SECURITY

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


                                HEARING

                               before the

                       SUBCOMMITTEE ON OVERSIGHT,

                     INVESTIGATIONS, AND MANAGEMENT

                                 of the

                     COMMITTEE ON HOMELAND SECURITY

                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION

                               __________

                             MARCH 8, 2012

                               __________

                           Serial No. 112-75

                               __________

       Printed for the use of the Committee on Homeland Security
                                     

[GRAPHIC] [TIFF OMITTED] CONGRESS.#13




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

                               __________



                  U.S. GOVERNMENT PRINTING OFFICE
76-602                    WASHINGTON : 2012
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing 
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC 
area (202) 512-1800 Fax: (202) 512-2104  Mail: Stop IDCC, Washington, DC 
20402-0001



                     COMMITTEE ON HOMELAND SECURITY

                   Peter T. King, New York, Chairman
Lamar Smith, Texas                   Bennie G. Thompson, Mississippi
Daniel E. Lungren, California        Loretta Sanchez, California
Mike Rogers, Alabama                 Sheila Jackson Lee, Texas
Michael T. McCaul, Texas             Henry Cuellar, Texas
Gus M. Bilirakis, Florida            Yvette D. Clarke, New York
Paul C. Broun, Georgia               Laura Richardson, California
Candice S. Miller, Michigan          Danny K. Davis, Illinois
Tim Walberg, Michigan                Brian Higgins, New York
Chip Cravaack, Minnesota             Cedric L. Richmond, Louisiana
Joe Walsh, Illinois                  Hansen Clarke, Michigan
Patrick Meehan, Pennsylvania         William R. Keating, Massachusetts
Ben Quayle, Arizona                  Kathleen C. Hochul, New York
Scott Rigell, Virginia               Janice Hahn, California
Billy Long, Missouri                 Vacancy
Jeff Duncan, South Carolina
Tom Marino, Pennsylvania
Blake Farenthold, Texas
Robert L. Turner, New York
            Michael J. Russell, Staff Director/Chief Counsel
               Kerry Ann Watkins, Senior Policy Director
                    Michael S. Twinchek, Chief Clerk
                I. Lanier Avant, Minority Staff Director
                                 ------                                

       SUBCOMMITTEE ON OVERSIGHT, INVESTIGATIONS, AND MANAGEMENT

                   Michael T. McCaul, Texas, Chairman
Gus M. Bilirakis, Florida            William R. Keating, Massachusetts
Billy Long, Missouri, Vice Chair     Yvette D. Clarke, New York
Jeff Duncan, South Carolina          Danny K. Davis, Illinois
Tom Marino, Pennsylvania             Bennie G. Thompson, Mississippi 
Peter T. King, New York (Ex              (Ex Officio)
    Officio)
                  Dr. R. Nick Palarino, Staff Director
                   Diana Bergwin, Subcommittee Clerk
              Tamla Scott, Minority Subcommittee Director


                            C O N T E N T S

                              ----------                              
                                                                   Page

                               Statements

The Honorable Michael T. McCaul, a Representative in Congress 
  From the State of Texas, and Chairman, Subcommittee on 
  Oversight, Investigations, and Management:
  Oral Statement.................................................     1
  Prepared Statement.............................................     3
The Honorable William R. Keating, a Representative in Congress 
  From the State of Massachusetts, and Ranking Member, 
  Subcommittee on Oversight, Investigations, and Management:
  Oral Statement.................................................     9
  Prepared Statement.............................................    10
The Honorable Bennie G. Thompson, a Representative in Congress 
  From the State of Mississippi, and Ranking Member, Committee on 
  Homeland Security:
  Prepared Statement.............................................    12

                               Witnesses

Hon. James S. Gilmore, III, Former Governor of Virginia, Former 
  Chairman, Congressional Advisory Panel to Assess Domestic 
  Response Capabilities For Terrorism Involving Weapons of Mass 
  Destruction:
  Oral Statement.................................................    13
  Prepared Statement.............................................    16
Ms. Cathleen A. Berrick, Managing Director, Homeland Security and 
  Justice Issues, Government Accountability Office:
  Oral Statement.................................................    20
  Prepared Statement.............................................    21
Mr. Charles K. Edwards, Acting Inspector General, Department of 
  Homeland Security:
  Oral Statement.................................................    33
  Prepared Statement.............................................    35
Mr. Scott Lilly, Senior Fellow, Center for American Progress:
  Oral Statement.................................................    40
  Prepared Statement.............................................    41


 ELIMINATING WASTE, FRAUD, ABUSE, AND DUPLICATION IN THE DEPARTMENT OF 

                           HOMELAND SECURITY

                              ----------                              


                        Thursday, March 8, 2012

             U.S. House of Representatives,
    Subcommittee on Oversight, Investigations, and 
                                        Management,
                            Committee on Homeland Security,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 9:09 a.m., in 
Room 311, Cannon House Office Building, Hon. Michael T. McCaul 
[Chairman of the subcommittee] presiding.
    Present: Representatives McCaul, Long, Duncan, and Keating.
    Mr. McCaul. The committee will come to order. I recognize 
myself for an opening statement.
    Today we continue our examination of the Department of 
Homeland Security's ability to adequately manage its own 
people, its resources, and billions of taxpayer dollars, and 
ultimately its ability to carry out its core mission of 
protecting the American people.
    Investigations recently completed by both the Government 
Accountability Office and the DHS inspector general call into 
question the Department's ability to operate effectively and 
without susceptibility to waste, fraud, and abuse of authority. 
For example, last year more than 150 Department of Homeland 
Security employees were arrested for offenses that hindered 
carrying out the Department's core mission to protect the 
homeland. There were thefts by airport screeners. You can see 
the slides. Between October 2009 and September 2010, at Newark 
Liberty Airport, TSA screeners stole as much as $30,000 from 
unsuspecting passengers who were trying to get through security 
to board their plane. In Orlando, passengers had laptop 
computers stolen from their luggage. There were immigration 
officers accepting bribes; even Customs and Border Protection 
officers conspiring with transnational drug traffickers. As a 
former Federal prosecutor in the Department of Justice Public 
Integrity Section, I find that to be extremely offensive.
    The DHS inspector general received in fiscal year 2011 
approximately 5,800 complaints against Customs and Border 
Patrol employees, and of these complaints, the IG converted 
approximately 730 of those complaints into active 
investigations. Presently the inspector general has 
approximately 1,200 CBP-related cases open for investigation.
    Then there is wasted taxpayer money. After squandering 
close to $1 billion on the failed SBInet, DHS is attempting yet 
another border security project. Once again, the lack of 
coordination, communication, and integration at the 
administrative level has produced similar results. The 
Department is unable to justify the rationale for specific 
technologies, how much is needed, or even where to put it along 
the Arizona border.
    Further findings expose duplicative functions within the 
Department that unnecessarily spend money and consume scarce 
resources.
    These findings call into question whether the Department of 
Homeland Security, given the challenges it faces from within, 
is capable of securing our borders, enforcing our immigration 
laws, and protecting the American people from terrorist 
attacks.
    Last month the Secretary of Homeland Security, Janet 
Napolitano, testified before our committee the administration's 
fiscal year 2013 budget reflects a commitment to protect the 
homeland and the American people through effective and 
efficient uses of resources. She said the Department of 
Homeland Security has implemented initiatives to cut costs, 
share resources across its agencies, and consolidate and 
streamline operations. This includes redirecting over $850 
million from administrative and mission support areas to front-
line priorities, as well as saving over $3 billion through 
various efforts since 2009, which has allowed DHS to redeploy 
funds to mission-critical initiatives.
    These are all positive initiatives, and I commend the 
Secretary, but the fact is the Government Accountability Office 
states the Department can do a better job saving taxpayer 
dollars by eliminating duplication and finding additional cost 
savings.
    For example, last week the GAO issued a key report related 
to duplication and cost-saving opportunities across the Federal 
Government. The report identified 16 homeland security areas 
where offices, programs, or initiatives have similar or 
overlapping objectives. The GAO report also identified 
inefficiencies within DHS that are causing other Federal 
agencies that contract with DHS to spend more money than 
necessary.
    Last year DHS collected about $230 million in fees from 
other agencies to pay for 2,500 facility risk assessments. 
However, DHS's Federal Protective Service completed only four 
of those assessments. The agencies that paid for the service 
got nothing in return for their risk assessments.
    In addition to GAO's work, the DHS inspector general found 
hundreds of millions of dollars in questionable costs in 2011. 
During the past year, the IG made recommendations to improve 
acquisition controls, to reduce duplication, develop more 
efficient fraud-prevention efforts for FEMA, strengthen 
information sharing between the Government and private industry 
on cyberthreats, and improve TSA's oversight of airport badging 
procedures, among other important findings.
    Just as American families have had to make difficult 
choices concerning their finances, so should the Department. 
DHS has a responsibility to not only protect and secure the 
homeland, but also ensure that it is a good steward of the 
taxpayer dollars.
    In February, our subcommittee began a series of hearings 
examining the challenges faced by DHS. These hearings seek to 
answer three basic questions: What challenges does DHS face? 
More bluntly, what is wrong with the Department? Why is it 
taking so long to become ``One DHS'', as Secretary Napolitano 
often talks about? Do the DHS shortcomings hinder it from 
carrying out its core mission of securing the homeland?
    Today we continue that discussion. Stealing from airline 
passengers, conspiring with drug traffickers, blindly throwing 
resources onto the border, and unnecessarily duplicating 
efforts contributing to the waste, fraud, and abuse of 
authority that fleeces the American taxpayer and breaches their 
trust. We need to assess to what extent internal control 
weaknesses exist that, if corrected, could prevent incidences 
like these in the future.
    Given the fiscal challenges facing our Nation and the 
possibility for continued waste within DHS, it is important to 
assess how Congress could help make DHS a stronger 
organization. So I look forward to hearing more about these 
cost-saving areas from the GAO and DHS inspector general and 
the witnesses here.
    We are honored to have Governor Gilmore here as well. I 
appreciate you being here, Governor.
    With that I recognize the Ranking Member.
    [The statement of Mr. McCaul follows:]
                Statement of Chairman Michael T. McCaul
                             March 8, 2012
    Today we continue our examination of the Department of Homeland 
Security's ability to adequately manage its people, its resources, 
billions of taxpayer dollars and, ultimately, its ability to carry out 
its core mission of protecting the American people.
    Investigations recently completed by both the Government 
Accountability Office and the DHS Inspector General call into question 
the Department's ability to operate effectively, and without 
susceptibility to waste, fraud, and abuse of authority.
    For example, last year more than 150 Department of Homeland 
Security employees were arrested for offenses that hindered carrying 
out the Department's core mission to protect the homeland.
    There were thefts by airport screeners. Between October 2009 and 
September 2010 at Newark Liberty Airport, TSA screeners stole as much 
as $30,000 from unsuspecting passengers who were trying to get through 
security to board their plane. In Orlando, passengers had laptop 
computers stolen from their luggage.
    There were Immigration officers accepting bribes. Even Customs and 
Border Protection officers conspiring with transnational drug 
traffickers. The DHS Inspector General received in fiscal year 2011 
approximately 5,800 complaints against Customs and Border Protection 
employees. Of these complaints, the Inspector General converted 
approximately 730 into investigations. Presently, the Inspector General 
has approximately 1,200 CBP-related cases open for investigation.
    Then there's wasted taxpayer money. After squandering close to $1 
billion on the failed SBINet, DHS is attempting yet another border 
security project. Once again, the lack of coordination, communication, 
and integration at the administrative level has produced similar 
results. The Department is unable to justify the rationale for specific 
technologies, how much is needed, or even where to put it along the 
Arizona border.
    Further findings expose duplication of functions within the 
Department that unnecessarily spend money and consume scarce resources.
    These findings call into question whether the Department of 
Homeland Security, given the challenges it faces from within, is 
capable of securing our borders, enforcing our immigration laws and 
protecting the American people from terrorist attacks.
    Last month, the Secretary of Homeland Security, Janet Napolitano, 
testified before our committee the administration's fiscal year 2013 
budget reflects a commitment to protect the homeland and American 
people through effective and efficient use of resources.
    She said the Department of Homeland Security has implemented 
initiatives to cut costs, share resources across its agencies, and 
consolidate and streamline operations. This includes redirecting over 
$850 million from administrative and mission support areas to front-
line priorities, as well as saving over $3 billion through various 
efforts since 2009, which has allowed DHS to redeploy funds to mission-
critical initiatives.
    These are all positive initiatives. But the Government 
Accountability Office states the Department can do an even better job 
of saving taxpayer dollars by eliminating duplication and finding 
additional cost savings.
    For example, last week the GAO issued a key report related to 
duplication and cost savings opportunities, across the Federal 
Government. The report identified 16 homeland security areas where 
offices, programs, or initiatives have similar or overlapping 
objectives.
    The GAO report also identifies inefficiencies within DHS that are 
causing other Federal agencies that contract with DHS to spend more 
money than necessary.
    Last year, DHS collected about $230 million in fees from other 
agencies to pay for 2,500 facility risk assessments. However, DHS's 
Federal Protective Service completed only four of those assessments. 
The agencies that paid for the service but got nothing in return ended 
up conducting their own risk assessments.
    In addition to GAO's work, the DHS Inspector General found hundreds 
of millions of dollars in questionable costs in 2011. During the past 
year, the Inspector General made recommendations to improve acquisition 
controls to reduce duplication, develop more efficient fraud prevention 
efforts for the Federal Emergency Management Agency, strengthen 
information sharing between the Government and private industry on 
cyber threats, and improve TSA's oversight of airport badging 
procedures, among other important findings.
    Just as American families have to make difficult choices concerning 
their finances, so should the Department. DHS has a responsibility to 
not only protect and secure the homeland but also ensure that it is a 
good steward of taxpayer dollars.
    In February, our subcommittee began a series of hearings examining 
the challenges faced by DHS. These hearings seek to answer three basic 
questions:
   What challenges does DHS face and put bluntly, what is wrong 
        with DHS?
   Why is it taking so long to become ``One DHS''? as Secretary 
        Napolitano so often mentions, and
   Do DHS shortcomings hinder it from carrying out its core 
        mission of securing the homeland?
    Today, we continue that discussion. Stealing from airline 
passengers, conspiring with drug traffickers, blindly throwing 
resources onto the border and unnecessarily duplicating efforts 
contribute to the waste, fraud, and abuse of authority that fleeces the 
American taxpayer and breaches their trust. We need to assess to what 
extent internal control weaknesses exist that, if corrected, could 
prevent incidents like these in the future.
    Given the fiscal challenges facing our Nation and the possibility 
for continued waste within DHS, it is important to assess how Congress 
can help make DHS a stronger organization. We look forward to hearing 
more about these cost savings areas from GAO and the DHS Inspector 
General. 

















    Mr. Keating. Thank you, Mr. Chairman. Thank you for having 
this hearing, which I think is a timely examination of the ways 
to ensure that our scarce Homeland Security funds are being 
utilized properly.
    I do agree with you in terms of the Arizona border 
surveillance technology plan. I agree with you, as a former 
district attorney myself, there is no place for criminal acts, 
you know, with the people that are there to protect us in the 
law enforcement field in our country. But I do think it is 
important to note as well that DHS itself has been vigilant in 
rooting out this kind of behavior, and they are to be commended 
in that respect.
    The current economic climate does have all people 
tightening their belts across the country. The same is true for 
our Federal Government. Congress has the responsibility of 
safeguarding taxpayer funds by eliminating instances of 
duplication and wasteful spending. Yet streamlining operations 
can at times be distinguished from reducing the resources of 
Federal employees so drastically that they can't perform their 
jobs effectively and provide needed Government services.
    I mentioned at our last hearing both the necessity of 
looking at these issues from a broader perspective; that 
shortsighted plans that eliminate job-creating programs and 
compromise our safety for the sake of short-term savings are 
not always the answer. For this reason, I am pleased to see the 
GAO has taken a bird's-eye view of Federal Government programs 
and provided with us a roadmap for actual savings prospects. 
The report identifies 51 areas that require greater efforts at 
efficiency, as well as suggestions for providing more effective 
Government services. It also identifies Government duplication, 
overlap, fragmentation to help Congress discover more cost 
savings and revenue-enhancement opportunities.
    Although the report contains a Government-wide assessment, 
it highlights several broad areas where duplication, overlap, 
and fragmentation exist within DHS. Accordingly, this 
subcommittee received testimony from DHS Under Secretary Rafael 
Borras last week on efforts the Department is making to 
integrate its management system.
    Pursuant to his testimony, the Department is making 
positive strides in this regard and is having clear plans in 
place to reduce duplicated efforts in the management area. In 
fact, the Department's Efficiency Review Initiative, which was 
highlighted by Vice President Biden as a model for all Federal 
agencies, has resulted in more than $1 billion in DHS cost 
avoidances, including $180 million saved by consolidating 
duplicative software-licensing agreements.
    Moreover, the Department serves as one of the leading 
Federal agencies in the administration's Shared First 
Initiative, which requires Federal agencies to eliminate 
duplicative IT systems. Due to this program, there aren't any 
duplicative IT efforts at DHS, even in the face of at least 
$1.2 billion in duplicative IT investments at the Departments 
of Energy and Defense. So according to the GAO head, 
Comptroller Gene Dodaro, again, DHS is to be commended for 
moving in this direction.
    These are the good stories. I am pleased to see that 
Secretary Napolitano has advanced internal measures aimed at 
eliminating waste, fraud, and duplication. Unfortunately, this 
does not change the fact that DHS is still made up of 22 legacy 
agencies, and a number of its activities are still shared by 
other Federal agencies. It is within these instances where GAO 
identifies numerous instances of undefined roles, 
responsibilities, and duplicative efforts that ultimately 
result in spending taxpayer money that could have been better 
utilized.
    For example, when it comes to personnel background 
investigations, cybersecurity training, and the identification 
of fraudulent travel documents, the lines between multiple 
agencies are blurred. Furthermore, despite its management 
strides, the Department has yet to fully address efficiencies 
in component operations that result in wasted funds.
    The Department's Federal Protective Service has received 
over $230 million from Federal agencies for risk assessment and 
security services, yet these agencies have not found the FPS's 
services adequate or satisfactory, so they perform their own 
assessments as well.
    Mr. Chairman, I think that a much more sound strategy to 
eliminate and streamline bureaucratic programs that haven't 
been working for years over preventing new programs and 
technologies with potential for taking effective due cost 
concerns in place is a sound strategy. I look forward to 
receiving testimony from our witnesses on these and other 
issues in the relevance of today's hearing. With that, I yield 
back my time.
    [The statement of Mr. Keating follows:]
             Statement of Ranking Member William R. Keating
    Thank you, Chairman McCaul for holding this important hearing, 
which is a timely examination of ways to ensure that scarce homeland 
security funds are being utilized properly.
    The current economic climate has people all across America 
tightening their belts and cutting back on spending.
    The same is true of our Federal Government.
    Congress has the responsibility of safeguarding taxpayer funds by 
eliminating instances of duplication and wasteful spending.
    Yet, streamlining operations is not one and the same with reducing 
the resources of Federal employees so drastically that they cannot 
perform their jobs effectively and provide needed Government services.
    I have said this time and again, both on and off the committee, 
shortsighted plans that eliminate job-creating programs and compromise 
our safety for the sake of immediate savings are not always the answer.
    For this reason, I am pleased to see that the Government 
Accountability Office (GAO) has taken a bird's-eye view of Federal 
Government programs and provided with us a road map for actual savings 
prospects.
    The report identifies 51 areas that require greater efforts at 
efficiency as well as suggestions for providing more effective 
Government services.
    It also identifies Government duplication, overlap, fragmentation 
to help Congress discover more cost savings and revenue-enhancement 
opportunities.
    Although the report contains a Government-wide assessment, it 
highlights several broad areas where duplication, overlap, or 
fragmentation exist within the Department of Homeland Security.
    Accordingly, this subcommittee received testimony from DHS Under 
Secretary of Management Rafael Borras last week on the efforts the 
Department is making to integrate its management system.
    Pursuant to his testimony, the Department is making very positive 
strides in regard to having clear plans in place to reduce duplicative 
efforts in the management arena.
    In fact, the Department's Efficiency Review Initiative, which was 
highlighted by Vice President Biden as a model for all Federal 
agencies, has resulted in more than $1 billion in DHS cost avoidances, 
including $180 million saved by consolidating duplicative software-
licensing agreements.
    Moreover, the Department serves as one of the leading Federal 
agencies in the administration's Shared First Initiative, which 
requires Federal agencies to eliminate duplicative IT systems.
    Due to this program, there aren't any duplicative IT efforts at 
DHS, even in the face of at least $1.2 billion in duplicative IT 
investments at the Departments of Energy and Defense, according to GAO 
head, Comptroller General Gene Dodaro.
    These are the good stories. And I am pleased to see that Secretary 
Napolitano has advanced internal measures aimed at eliminating waste, 
fraud, and duplication.
    Unfortunately, this does not change the fact that DHS is still made 
up of 22 legacy agencies and a number of its activities are still 
shared by other Federal agencies.
    It is within these instances where GAO identifies numerous 
instances of undefined roles and responsibilities and duplicative 
efforts that ultimately result in spending taxpayer money that could 
have been better utilized.
    For example, when it comes to personnel background investigations, 
cybersecurity trainings, and the identification of fraudulent travel 
documents, the lines between multiple agencies are blurred.
    Furthermore, despite its management strides, the Department has yet 
to fully address deficiencies in component operations that result in 
wasted funds.
    The Department's Federal Protective Service (FPS) has received over 
$230 million from Federal agencies for risk assessments and security 
services.
    Yet, these agencies have not found the FPS's services adequate or 
satisfactory, so they perform their own assessments, as well.
    Mr. Chairman, I think that it is much more sound strategy to 
eliminate or streamline bureaucratic programs that haven't been working 
for years over preventing new programs and technologies with potential 
from taking effect due to cost concerns.

    Mr. McCaul. I thank the Ranking Member and his 
bipartisanship. Other Members are reminded that they may submit 
statements for the record.
    [The statement of Ranking Member Thompson follows:]
        Prepared Statement of Ranking Member Bennie G. Thompson
                             March 8, 2012
    Thank you, Chairman McCaul for holding this hearing.
    These are very difficult financial times and every aspect of the 
Government--Federal, State, and local--must do its part to eliminate 
wasteful spending, weed out unnecessary duplication, and cut costs 
where possible.
    Reducing Government spending by eliminating overlapping and 
duplicative programs is a common-sense approach to saving scarce 
Federal funds and enhancing revenue.
    This approach, however, should be achieved with a careful 
examination of what works, what does not work, what should be 
consolidated, and what should be left alone.
    For example, it has been proposed that the Department of Homeland 
Security reduce 16 individually-authorized preparedness grant programs 
into a single pool of money.
    This proposal causes me grave concern.
    Although I recognize it is prudent to re-evaluate and streamline 
programs to promote efficiency and reduce costs in the wake of the 
current fiscal climate, I am concerned that the end result will be 
hamstrung first responders facing unprecedented natural disasters.
    As required by law, the Government Accountability Office (GAO) has 
conducted an examination of duplication, overlap, and fragmentation 
across Federal Government programs and has recommended actions for 
improvement.
    The result of this examination is a 426-page report, the size of 
which, is an indication that extensive work is required.
    In the report, GAO identifies 51 areas where programs may be able 
to achieve greater efficiencies or become more effective in providing 
Government services and 32 areas with evidence of duplication, overlap, 
or fragmentation.
    Due to its size, mission, and inherent overlapping authority, the 
Department of Homeland Security is named in more areas of overlap than 
any other agency.
    The report also contained 176 actions that either the Executive 
Branch or Congress should take to improve this country's fiscal 
outlook.
    While it is convenient for my colleagues to point the finger at the 
Executive Branch, in this instance, the numbers indicate that the 
Executive Branch is ahead of the game while Congress, with a Republican 
controlled House, lags behind.
    In fact, in a follow-up status report on the 176 recommended 
actions, GAO determined that nearly 80 percent of the issues identified 
that required Executive Branch action have been addressed.
    On the other hand, this Congress has addressed less than 40 percent 
of the GAO recommendations that required Congressional action.
    Many of the recommended Congressional actions could have been 
achieved by now, if the Majority would stop putting politics first and 
bring common-sense, cost-savings bills--even if introduced by 
Democrats--to the House floor.
    As the Ranking Member of a committee that shares its oversight 
jurisdiction with over 100 Congressional committees and subcommittees, 
watching my colleagues put politics first comes as no surprise.
    To illustrate this point, the Homeland Security Authorization Act 
that this committee ordered reported last October has yet to be 
considered by the House because, in part, the report has been held up 
due to jurisdictional challenges.
    Of relevance to this hearing, that measure contains a section that 
would require the Department to ``identify redundant, wasteful, or 
unnecessary capabilities and capacities where resources can be 
redirected.''
    Unless we get our house in order and reduce duplicative homeland 
security jurisdiction, good-intentioned provisions like this one that 
would result in efficiencies at the Department of Homeland Security, 
are unlikely to ever be enacted into law.
    With that Mr. Chairman, I yield back the balance of my time.

    Mr. McCaul. You, having served as a district attorney, and 
I as a Federal prosecutor, I think we make a pretty good team. 
I think our goal is not gotcha politics here, it is about how 
we can better improve the Department, which is so important to 
protect the lives of the American people.
    So with that, I want to introduce our distinguished panel 
of witnesses. First, the Honorable James Gilmore. He is a 
former Governor of Virginia. When I lived in Virginia, at DOJ, 
he was my Governor. He is Chairman of the Congressional 
Advisory Panel to Assess Domestic Response Capabilities for 
Terrorism Involving Weapons of Mass Destruction. Prior to 
serving as Governor, he was Virginia's attorney general. He 
also served in the U.S. Army as a counterintelligence agent. In 
2009, he became president and CEO of the Free Congress 
Foundation. He is also president of USA Secure.
    Next we have Ms. Cathleen Berrick, the Managing Director of 
Homeland Security and Justice Issues at the Government 
Accountability Office. In this position she oversees GAO's 
reviews of the Department of Homeland Security and Justice 
programs. Prior to being named Managing Director by Comptroller 
Gene Dodaro, she oversaw GAO's reviews of aviation and surface 
transportation security matters, as well as Department of 
Homeland Security management issues.
    We also have next Mr. Charles Edwards, the Acting Inspector 
General of the Department of Homeland Security. He assumed this 
position in February 2011. Previously, Mr. Edwards served as 
the Deputy Inspector General of the Department of Homeland 
Security. He has served over 20 years in the Federal 
Government, and has held leadership positions at several 
Federal agencies, including TSA, United States Postal Service 
Office of Inspector General, and the U.S. Postal Service. I 
have two extra reporters from two of my new counties in my new 
district that may want to talk to you about the Postal Service 
after this hearing.
    Mr. Scott Lilly is the senior fellow at the Center for 
American Progress. He writes and researches on areas including 
governance, Federal budgeting, National security, and the 
economy. He joined the center in 2004 after 31 years of service 
within the United States Congress. He served as a clerk and 
staff director on the House Appropriations Committee, minority 
staff director of that committee; executive director of the 
House Democrat Study Group; executive director of the Joint 
Economic Committee; and chief of staff in the office of 
Congressman David Obey from Wisconsin.
    It is good to have you here. You have a pretty extensive 
background in this institution. It is good to have you.
    So with that, I now recognize our first witness, the former 
Governor Gilmore, for his testimony.

  STATEMENT OF HON. JAMES S. GILMORE, III, FORMER GOVERNOR OF 
  VIRGINIA, FORMER CHAIRMAN, CONGRESSIONAL ADVISORY PANEL TO 
 ASSESS DOMESTIC RESPONSE CAPABILITIES FOR TERRORISM INVOLVING 
                  WEAPONS OF MASS DESTRUCTION

    Mr. Gilmore. Mr. Chairman, thank you very much. I thank you 
for the invitation, Mr. Chairman, Mr. Keating, Members of the 
subcommittee. My thanks also to Chairman Peter King for this 
invitation as well. I would ask, Mr. Chairman, that the oral 
remarks that I make today be extended in the record, with the 
permission of the subcommittee.
    Mr. McCaul. Without objection, so ordered.
    Mr. Gilmore. Mr. Chairman, I am here today, I think, to 
give you some sense of historical perspective of how we ended 
up where we are today, which may give some insight as to where 
we are really trying to go. I was approached in 1999--1998, 
really--by the Congress through its representative the 
Department of Defense, was delegated with the authority of 
setting up the official Commission of the United States 
Congress on Terrorism and Weapons of Mass Destruction, and 
asked to chair that Commission.
    I want the Members to know about your Commission. This was 
not a Commission of insiders. This was not a witch hunt. This 
was not an effort to try to find blame. This was an effort, 
instead, at a very early date, to investigate the state of 
preparedness of the United States. It was not a Washington- or 
Federal-centric Commission. The Congress, in its wisdom, put 
onto the membership people--police, fire, rescue, emergency 
services, people from across the States, as well as some 
specialists in intelligence and other areas.
    Jim Clapper, I asked him to serve as the Vice Chairman of 
our Commission, which he did for many years until he left to go 
back into the Government. As everyone is aware, General Clapper 
is now the Director of National Intelligence of the United 
States.
    Ray Downey was our fire representative. He died in the 
World Trade Center on 9/11. Paul Bremer was on the Commission. 
But frankly, the work was aided a great deal by our 
representatives from around the States in the various fields 
that were important to homeland security.
    We issued our first report in 1999. We issued our second 
report in 2000. I brought a copy of that along with me here 
today just to display to you. All the Congresspeople received 
all five of our reports. We just did three reports before the 
9/11 attack and two afterwards. The Congress extended the 
Commission, the 3-year Commission, for 2 years afterwards.
    This second report was issued December 15 in the year 2000, 
fully a year before the attack. In the opening cover letter we 
reported, ``We are impelled by the stark realization that a 
terrorist attack on some level inside our borders is 
inevitable, and the United States must be ready.'' This was not 
the first warning, either by other people or even by our 
Commission, as to the nature of things, but it was widely 
ignored.
    The second report, however, did address the issue of the 
Department of Homeland Security, and we did not endorse the 
Department. We investigated for a year the question of how you 
address this issue. We believed that to create a Department of 
Homeland Security would require at least 10 years to put 
together, to straighten it all out, to figure out who was in 
and who was out, what the chain of command would be, how the 
management pieces would be put into place. We just didn't think 
we had 10 years. So our recommendation, which is extensively 
discussed in our reports, was a White House coordinating body.
    Now, we did--in May 2010, General Clapper and I did brief 
the new administration. We sat with Vice President Cheney at 
length. We believed that the Bush administration was, in fact, 
beginning to set up the internal White House committee in order 
to coordinate all the different elements of the United States 
Government that would deal with homeland security issues. But 
sadly enough, we didn't have a year after the issuance of this 
report. The 9/11 attack, of course, occurred before that time.
    After the 9/11 attack, there was enormous political 
pressure in both the Congress and the administration to take 
decisive action. It didn't, I think, seem like the coordinating 
recommendations we made looked decisive enough after the 9/11 
attack. The Congress decided that they were going to move on 
their own and set up a Department of Homeland Security and toss 
these various agencies into one overarching department.
    It seemed apparent that that was going to happen, and I 
believe the Bush administration could fairly be said to be 
resisting it. But after a while, they concluded that Congress 
was going to act, and they wanted to be a part of shaping it, 
and they, in fact, submitted their own bill.
    Our position of the Gilmore Commission, even after all 
these years, would be, and still is today, that while we did 
not recommend this structure, nonetheless we wished them all 
success, because after 10 years, that is what we got. So we 
really ought to be going to work with these distinguished 
colleagues to my left in order to polish this up and find ways 
to eliminate duplication, and to work in order to make it a 
great success, as indeed we believed that it can be.
    Our review would indicate that of the initial reports that 
have come out, we are concerned about the original report of 
DHS of Homeland Security grants, fraudulent travel documents, 
passenger aviation fees, and domestic disaster assistance. We 
believe these areas are areas where duplication is realistic 
and could be addressed.
    We think much work has to be done. We believe that we still 
haven't completely answered the question of who is in charge in 
any particular area. The FBI is not in the Department. The CIA 
is not in the Department. Locals and States are not in the 
Department. Locals will always be the first responders, just as 
they were at the World Trade Center and at the Pentagon. They 
are not in the DHS structure, although there is some 
communication.
    We believe there has been woefully inadequate public 
communication to the people of the United States as to what the 
dangers are. We believe that there has been insufficient 
attention and seriousness paid to the risk of the use of the 
military in the homeland, one of our principal areas. The most 
recent National Defense Authorization Act, for example, has 
reckless language that authorizes, by construction, the 
detention of American citizens indefinitely and without trial. 
There is language in there that the Congress, I think, sought 
to correct that, and I think they failed to correct it.
    These are serious challenges as we see right now. We 
believe there is no training of the military to play a law 
enforcement role, nor should they play a law enforcement role. 
We believe that the locals and the States are not being 
sufficiently cut in, nor financed, in order to prepare for the 
inevitable additional attacks.
    You mentioned, Mr. Chairman, in closing, that I am now 
president and CEO of the Free Congress Foundation. We have 
several topics that we address. One of our topics that we are 
about to do is to begin now the Center for National Security at 
the Free Congress Foundation for the purpose of beginning to 
follow up on this work, which has not been followed up on, in 
our view, sufficiently. We would like to make a contribution to 
the community and to the Congress, and we will do it through 
the raising of private funds and through the use of a private 
nonprofit. Hopefully we can make a contribution to your work, 
Mr. Chairman, and that of your subcommittee, and that of the 
full committee. Thank you very much.
    [The statement of Mr. Gilmore follows:]
              Prepared Statement of James S. Gilmore, III
                             March 8, 2012
                              introduction
    Mr. Chairman it is honor to be here today. I commend you and House 
Homeland Security Chairman Peter King for holding these forward-
thinking hearings on reviewing American Homeland Security policy as an 
institution for the 21st Century. Communicating with the American 
public about the realities of terrorism and how our country is prepared 
is essential to keeping our liberty.
    I have singled out a few items to consider as objectives to save 
taxpayer dollars. I note that the Department of Homeland Security (DHS) 
isn't the only agency with duplication problems. This is a Government-
wide problem--but four Government Accountability Office (GAO) report 
items stand out.
    Homeland Security Grants.--The Department of Homeland Security 
needs better project information and coordination among four 
overlapping grant programs (current reform is underway with grant 
consolidation).
    Information Technology Investment Management.--The Office of 
Management and Budget, and the Departments of Defense and Energy need 
to address potentially duplicative information technology investments 
to avoid investing in unnecessary systems.
    Passenger Aviation Security Fees.--Options for adjusting the 
passenger aviation security fee could further offset billions of 
dollars in civil aviation security costs.
    Domestic Disaster Assistance.--The Federal Emergency Management 
Agency could reduce the costs to the Federal Government related to 
major disasters declared by the President by updating the principal 
indicator on which disaster funding decisions are based and better 
measuring a State's capacity to respond without Federal assistance.
           history of gilmore commission before & after 9/11
    After the fall of the Berlin Wall, Americans and most of the 
civilized world looked ahead to the future with little fear--especially 
of global war. A transcript of a Jan. 26, 1996 Bill Clinton 
Presidential radio address delivered on a Saturday morning following 
his recently delivered state of the union address sums up where he and 
most of Americans were focused--Domestic Policy:

``These are the seven challenges I set forth Tuesday night--to 
strengthen our families, to renew our schools, and expand educational 
opportunity, to help every American who's willing to work for it 
achieve economic security, to take our streets back from crime, to 
protect our environment, to reinvent our government so that it serves 
better and costs less, and to keep America the leading force for peace 
and freedom throughout the world. We will meet these challenges, not 
through big government. The era of big government is over, but we can't 
go back to a time when our citizens were just left to fend for 
themselves.''

    Little did we know then that by 2003 a Republican President would 
sign a bipartisan bill creating another Government cabinet agency 
called the ``Department of Homeland Security.''
    As a new Republican majority emerged in the mid-1990s in the House 
and Senate--there was much talk of reinventing Government and President 
Clinton and the Congress did balance the Federal budget for the first 
time in three decades in 1998.
    However, Congress and the Clinton administration were uneasy about 
the growing threat to the West which came in two major events--the 
August 7, 1998 U.S. Embassy bombings in Africa and the October 12, 2000 
bombing of the USS Cole.
    We worked tirelessly to deliver our first report to the Congress on 
Dec. 15, 1999. The Gilmore Commission was up and running by the time of 
the USS Cole incident--and probably did our best work in the second 
report--which was delivered to the Congress on Dec. 15, 2000. We kept 
our focus and delivered our final report to Congress and President Bush 
a week before September 11, 2001.
    The Commission was extended another 2 years after 9/11.
    From 1999 to 2003, I was proud to serve as Chairman of the 
Congressional Advisory Panel to Assess the Capabilities for Domestic 
Response to Terrorism Involving Weapons of Mass Destruction--the 
shortened name became known as ``The Gilmore Commission.'' To sum up 
what we did in those 5 years prior and after 9/11 is this: Our 
Commission was focused on local responders. One Gilmore Commission 
member, Ray Downey, served as a representative from the New York City 
Fire Department. Ray, unfortunately, died serving the people of his 
city and Nation while responding and saving lives on September 11, 
2001. Of our five reports--we delivered 164 recommendations. One 
hundred forty-six have now been adopted by the Congress and the 
Executive Branch.
    Prior to the horrendous attacks on 9/11 our Commission (myself and 
Gen. James Clapper) briefed former Vice President Dick Cheney at the 
White House in May 2001 to address the growing terrorist threat to this 
country and to begin to develop our counterterrorism office inside the 
White House. This would become the Office of Homeland Security which 
was announced by President Bush on September 20, 2001.
            congressional mandate for the gilmore commission
    The Advisory Panel was established by Section 1405 of the National 
Defense Authorization Act for Fiscal Year 1999, Public Law 105-261 
(H.R. 3616, 105th Congress, 2nd Session) (October 17, 1998). That Act 
directed the Advisory Panel to accomplish several specific tasks.
    It said: The panel shall----
    1. Assess Federal agency efforts to enhance domestic preparedness 
for incidents involving weapons of mass destruction;
    2. Assess the progress of Federal training programs for local 
emergency responses to incidents involving weapons of mass destruction;
    3. Assess deficiencies in programs for response to incidents 
involving weapons of mass destruction, including a review of unfunded 
communications, equipment, and planning requirements, and the needs of 
maritime regions;
    4. Recommend strategies for ensuring effective coordination with 
respect to Federal agency weapons of mass destruction response efforts, 
and for ensuring fully effective local response capabilities for 
weapons of mass destruction incidents; and
    5. Assess the appropriate roles of State and local government in 
funding effective local response capabilities.
    That Act required the Advisory Panel to report its findings, 
conclusions, and recommendations for improving Federal, State, and 
local domestic emergency preparedness to respond to incidents involving 
weapons of mass destruction to the President and the Congress three 
times during the course of the Advisory Panel's deliberations--on 
December 15 in 1999, 2000, and 2001. The Advisory Panel's tenure was 
extended for 2 years in accordance with Section 1514 of the National 
Defense Authorization Act for Fiscal Year 2002 (S. 1358, Public Law 
107-107, 107th Congress, First Session), which was signed into law by 
the President on December 28, 2001. By virtue of that legislation, the 
panel was required to submit two additional reports--one on December 
15, 2002, and one on December 15, 2003.
   advisory panel composition (a unique membership focused on first 
                              responders)
    Mister Chairman, please allow me to pay special tribute to the men 
and women who serve on our panel. This Advisory Panel is unique in one 
very important way. It is not the typical National ``blue ribbon'' 
panel, which in most cases historically have been composed almost 
exclusively of what I will refer to as ``Washington Insiders''--people 
who have spent most of their professional careers inside the Beltway. 
This panel has a sprinkling of that kind of experience--a former Member 
of Congress and Secretary of the Army, a former State Department 
Ambassador-at-Large for Counterterrorism, a former senior executive 
from the CIA and the FBI, a former senior member of the intelligence 
community, the former head of a National academy on public health, two 
retired flag-rank military officers, a former senior executive in a 
non-governmental charitable organization, and the head of a National 
law enforcement foundation. But what truly makes this panel special 
and, therefore, causes its pronouncement to carry significantly more 
weight, is the contribution from the members of the panel from the rest 
of the country:
   Three directors of State emergency management agencies, from 
        California, Iowa, and Indiana, two of whom now also serve their 
        Governors as Homeland Security Advisors;
   The deputy director of a State homeland security agency;
   A State epidemiologist and director of a State public health 
        agency;
   A former city manager of a mid-size city;
   The chief of police of a suburban city in a major 
        metropolitan area;
   Senior professional and volunteer fire fighters;
   A senior emergency medical services officer of a major 
        metropolitan area;
   And, of course--in the person of your witness--a former 
        State governor.
    These are representatives of the true ``first responders''--those 
heroic men and women who put their lives on the line every day for the 
public health and safety of all Americans. Moreover, so many of these 
panel members are also National leaders in their professions: Our EMS 
member is a past president of the national association of emergency 
medical technicians; one of our emergency managers is the past 
president of her national association; our law officer now is president 
of the international association of chiefs of police; our 
epidemiologist is past president of her professional organization; one 
of our local firefighters is chair of the terrorism committee of the 
international association of fire chiefs; the other is chair of the 
prestigious national Interagency Board for Equipment Standardization 
and InterOperability.
    Those attacks continue to carry much poignancy for us, because of 
the direct loss to the panel. Ray Downey, Department Deputy Chief and 
chief-in-charge of Special Operations Command, Fire Department of the 
City of New York, perished in the collapse of the second tower in the 
September 11 attack on the New York World Trade Center.
                             panel reports
    In the history of the Panel, we produced five advisory reports to 
the Congress and to the President of the United State. The first report 
in 1999 assessed threat. The second report in 2000 developed the 
fundamentals of a National strategy for combating terrorism.
    The third report, dedicated to Ray Downey who lost his life in the 
World Trade Center, filled out a National strategy in five key subject 
areas: State and local response capabilities, health and medical 
capabilities, immigration and border control, cybersecurity, and use of 
the military. Our fourth report in 2002, issued in the year following 
the 9/11 attacks, further made recommendations on how to marshal the 
National effort towards a National strategy. It paid special attention 
to the needs of intelligence sharing and the proper structure for 
counterterrorism activities inside the United States. Our last report 
was issued on December 15, 2003. That final report sought to express 
some end-vision and direction for the United States as it develops its 
National strategy and makes the country safer.
   fifth report (2003)--forging america's new normalcy: securing our 
                    homeland, preserving our liberty
    Mister Chairman, the Advisory Panel released its fifth and final 
report on December 15, 2003. In that report, the strategic vision, 
themes, and recommendations were motivated by the unanimous view of the 
panel that its final report should attempt to define a future state of 
security against terrorism--one that the panel has chosen to call 
``America's New Normalcy.''
    That strategic vision offered by the panel reflects the guiding 
principles that the panel has consistently enumerated throughout its 
reports:
   It must be truly National in scope, not just Federal.
   It should build on the existing emergency response system 
        within an all-hazards framework.
   It should be fully resourced with priorities based on risk.
   It should be based on measurable performance.
   It should be truly comprehensive, encompassing the full 
        spectrum of awareness, prevention, preparedness, response, and 
        recovery against domestic and international threats against our 
        physical, economic, and societal well-being.
   It should include psychological preparedness.
   It should be institutionalized and sustained.
   It should be responsive to requirements from and fully 
        coordinated with State and local officials and the private 
        sector as partners throughout the development, implementation, 
        and sustainment process.
   It should include a clear process for strategic 
        communications and community involvement.
   It must preserve civil liberties.
    In developing the report, panel members all agreed at the outset 
that it could not postulate, as part of its vision, a return to a pre-
September 11 ``normal.'' The threats from terrorism are now recognized 
to be a condition must face far into the future. It was the panel's 
firm intention to articulate a vision of the future that subjects 
terrorism to a logical place in the array of threats from other sources 
that the American people face every day--from natural diseases and 
other illnesses to crime and traffic and other accidents, to mention a 
few. The panel firmly believes that terrorism must be put in the 
context of the other risks we face, and that resources should be 
prioritized and allocated to that variety of risks in logical fashion.
    In 2004 our panel proffered a view of the future--5 years hence--
that it believes offers a reasonable, measurable, and attainable 
benchmark. It believes that, in the current absence of longer-term 
measurable goals, this benchmark can provide Government at all levels, 
the private sector, and our citizens a set of objectives for readiness 
and preparedness. The panel did not claim that the objectives presented 
in this future view are all-encompassing. Neither do they necessarily 
reflect the full continuum of advances that America may accomplish or 
the successes that its enemies may realize in the next 5 years. The 
view is a snapshot in time for the purpose of guiding the actions of 
today and a roadmap for the future.
    The panel said that America's new normalcy by January 2009 should 
reflect:
   Both the sustainment and further empowerment of individual 
        freedoms in the context of measurable advances that secure the 
        homeland.
   Consistent commitment of resources that improve the ability 
        of all levels of government, the private sector, and our 
        citizens to prevent terrorist attacks and, if warranted, to 
        respond and recover effectively to the full range of threats 
        faced by the Nation.
   A standardized and effective process for sharing information 
        and intelligence among all stakeholders--one built on moving 
        actionable information to the broadest possible audience 
        rapidly, and allowing for heightened security with minimal 
        undesirable economic and societal consequences.
   Strong preparedness and readiness across State and local 
        government and the private sector with corresponding processes 
        that provide an enterprise-wide National capacity to plan, 
        equip, train, and exercise against measurable standards.
   Clear definition about the roles, responsibilities, and 
        acceptable uses of the military domestically--that strengthens 
        the role of the National Guard and Federal Reserve Components 
        for any domestic mission and ensures that America's leaders 
        will never be confronted with competing choices of using the 
        military to respond to a domestic emergency versus the need to 
        project our strength globally to defeat those who would seek to 
        do us harm.
   Clear processes for engaging academia, business, all levels 
        of government, and others in rapidly developing and 
        implementing research, development, and standards across 
        technology, public policy, and other areas needed to secure the 
        homeland--a process that focuses efforts on real versus 
        perceived needs. Well-understood and shared process, plans, and 
        incentives for protecting the Nation's critical infrastructures 
        of Government and in the private sector--a unified approach to 
        managing our risks.
    The panel's Future Vision back in 2009 included specifics details 
involving:
   State, Local, and Private Sector Empowerment;
   Intelligence;
   Information Sharing;
   Training, Exercising, Equipping, and Related Standards;
   Enhanced Critical Infrastructure Protection;
   Research and Development, and Related Standards;
   Role of the Military.
    The GAO and DHS have prepared lengthy reports to enhance homeland 
security of our Nation and the Congress is doing its due diligence. 
Hearings like we are having today move forward the idea of making 
progress happen, but we must always consider the role of the military 
as we decide on our future homeland policy.
                             in conclusion
    Civil liberties are the foundation of the Gilmore Commission. The 
panel addressed the on-going debate in the United States about the 
tradeoffs between security and civil liberties. It concluded that 
history teaches, however, that the debate about finding the right 
``balance'' between security and civil liberties is misleading, that 
the traditional debate implies that security and liberty are competing 
values and are mutually exclusive. It assumes that our liberties make 
us vulnerable and if we will give up some of these liberties, at least 
temporarily, we will be more secure.
    It concluded that civil liberties and security are mutually 
reinforcing. The panel said that we must, therefore, evaluate each 
initiative along with the combined effect of all initiatives to combat 
terrorism in terms of how well they preserve all of the ``unalienable 
rights'' that the founders believed were essential to the strength and 
security of our Nation--rights that have become so imbedded in our 
society and ingrained in our psyche that we must take special 
precautions, take extra steps, to ensure that we do not cross the line.

    Mr. McCaul. Well, thank you, Governor. It is a real honor 
to have somebody of your experience and magnitude appear before 
this committee. Thank you for being here.
    The Chairman now recognizes Ms. Berrick for her testimony.

 STATEMENT OF CATHLEEN A. BERRICK, MANAGING DIRECTOR, HOMELAND 
 SECURITY AND JUSTICE ISSUES, GOVERNMENT ACCOUNTABILITY OFFICE

    Ms. Berrick. Thank you, Mr. Chairman, Ranking Member 
Keating, the Members of the subcommittee. I am pleased to be 
here to discuss GAO's work assessing overlap, potential 
duplication, and cost-saving opportunities at DHS, as well as 
challenges that have affected the Department's implementation 
efforts.
    As you know, DHS is now the third-largest department in the 
Federal Government. Given the significance of its mission, and 
in a time of building fiscal pressures, it is critical that its 
programs are operating effectively and efficiently, are 
sustainable, and continue to mature to address pressing 
security needs.
    Last week, as you mentioned, GAO issued its second annual 
report identifying areas across the Federal Government, 
including DHS, that have duplicating goals or activities, as 
well as opportunities to reduce costs or enhance revenue. Our 
report identified 15 such areas across the Department.
    For example, we found that the Department lacked oversight 
to prevent unnecessary duplication, and four overlapping grant 
programs which together constitute over $20 billion in grant 
funding since 2002. As a result, DHS could not be assured that 
it wasn't awarding multiple grants to the same recipients for 
the same or similar purposes.
    We also found that Federal agencies are paying for their 
own security assessments, as you mentioned, while also paying 
FPS within DHS for assessments that it is not conducting.
    In the area of cost savings, we reported that deploying 
more efficient, in-line baggage screening systems at airports 
could result in about $450 million in savings over the next 5 
years because of reduced staffing costs. They would need fewer 
screeners to man this equipment.
    Regarding border security, we found that delaying proposed 
investments in border-surveillance technology until DHS better 
defines the measures' benefits and estimates life-cycle costs 
could help ensure their effective and efficient deployment.
    In another example we found that DHS could reduce the 
billions of Federal dollars spent on major disasters by 
adjusting the indicator used for assistance awards to better 
reflect a State's capability to respond.
    In total, we recommended 40 actions that either DHS or the 
Congress could take to address these issues and achieve 
savings. Of the 22 actions GAO suggested in our report last 
year, our first annual report, 2 have been fully implemented, 
14 have been partially implemented, and 6 have not been 
addressed. Moving forward, we will continue to monitor DHS's 
efforts in these areas.
    In a report we issued last year commemorating the 10th 
anniversary of 9/11, we talked about a lot of the important 
progress DHS has made across its mission since its 
establishment. However, we also reported on work remaining 
needed to strengthen the efficiency and effectiveness of DHS's 
operations, as well as themes that have impacted the 
Department's progress. These themes were drawn from more than 
1,200 reports we have issued studying DHS since its creation, 
and over 1,600 recommendations we have made to strengthen their 
operations.
    For example, we reported that while DHS has enhanced its 
management functions and has plans for further enhancement, 
which we think are very positive, it has not always effectively 
executed these functions for results. This, as you know, has 
contributed to schedule delays, cost increases, and performance 
issues in a number of major acquisitions that are aimed at 
delivering important mission capabilities. A number of these 
programs have had to be canceled as a result.
    We also found that while DHS has made important strides in 
coordinating efforts with its many, many stakeholders, 
including State and local law enforcement, it needs to take 
additional action to forge and leverage these partnerships and 
share information, such as sharing information with private-
sector stakeholders on threats to critical infrastructure.
    Moving forward, as declining budgets are likely to be a 
reality, it will be important for DHS to address these issues 
as well as take action to proactively identify areas to reduce 
duplication and enhance cost savings throughout the Department.
    Mr. Chairman, thank you for the opportunity to testify. I 
look forward to your questions.
    [The statement of Ms. Berrick follows:]
               Prepared Statement of Cathleen A. Berrick
                             March 8, 2012
                            gao highlighths
    Highlights of GAO-12-464T, a testimony before the Subcommittee on 
Oversight, Investigations, and Management, Committee on Homeland 
Security, House of Representatives.
Why GAO Did This Study
    The terrorist attacks of September 11, 2001, led to profound 
changes in Government agendas, policies, and structures to confront 
homeland security threats facing the Nation. Most notably, DHS began 
operations in 2003 with missions that included preventing terrorist 
attacks in the United States, reducing the Nation's vulnerability to 
terrorism, and minimizing damages from attacks. DHS is now the third-
largest Federal department, with more than 200,000 employees, and has 
an annual budget of almost $60 billion. Since 2003, GAO has issued over 
1,200 products on DHS's operations in such areas as transportation 
security and emergency management, among others. Moreover, GAO has 
reported that overlap and fragmentation among Government programs, 
including DHS, can cause potential unnecessary duplication, and 
reducing it could save billions of tax dollars annually and help 
agencies provide more efficient and effective services. As requested, 
this testimony addresses: (1) Opportunities for DHS to reduce potential 
unnecessary duplication in its programs, save tax dollars, and enhance 
revenue, and (2) crosscutting and management issues that have affected 
DHS's implementation efforts. This testimony is based on GAO reports 
issued from March 2011 through February 2012.
What GAO Recommends
    While this testimony contains no new recommendations, GAO 
previously made about 1,600 recommendations to DHS. The Department has 
addressed about half of them, has efforts to address others, and has 
taken action to strengthen its operations.
department of homeland security.--actions needed to reduce overlap and 
potential unnecessary duplication, achieve cost savings, and strengthen 
                           mission functions
What GAO Found
    In March 2011 and February 2012, GAO reported on 6 areas where the 
Department of Homeland Security (DHS) or Congress could take action to 
reduce overlap and potential unnecessary duplication, and 9 areas to 
achieve cost savings. Of the 22 actions GAO suggested be taken in March 
2011 to address such issues, 2 were fully implemented, 14 were 
partially implemented, and 6 have not been addressed. GAO's February 
2012 report identified 18 additional actions to address overlap, 
potential duplication, and costs savings, including the following 
examples.

 TABLE 1.--EXAMPLES OF OVERLAP, POTENTIAL DUPLICATION, AND COST SAVINGS
                                  AREAS
------------------------------------------------------------------------
           Example
------------------------------------------------------------------------
Homeland security grants.....  DHS lack of oversight contributed to the
                                risk of funding unnecessarily
                                duplicative projects among 4 overlapping
                                programs that in total constituted $20
                                billion in grants from fiscal years 2002
                                through 2011.
Immigration inspection fees..  Air passenger immigration inspection fees
                                should be reviewed and adjusted to fully
                                recover the cost of inspection
                                activities conducted by U.S. Immigration
                                and Customs Enforcement (ICE) and CBP.
Border security technology...  Delaying proposed border security
                                technology investments until DHS better
                                measures benefits and estimates life-
                                cycle costs could help ensure the most
                                effective use of program funding.
Domestic disaster assistance.  DHS could reduce the billions of Federal
                                dollars spent on major disasters by
                                adjusting the indicator used for
                                disaster assistance awards and better
                                measuring a State's capacity to respond.
Federal facility risk          Agencies are making duplicate payments by
 assessments.                   funding their own assessments, and
                                paying the Federal Protective Service
                                millions for assessments it is not
                                performing.
------------------------------------------------------------------------
Source: GAO analysis.

    In September 2011, GAO reported on three key themes that should be 
addressed to enhance the effectiveness and efficiency of DHS's 
operations.
    Leading and coordinating the homeland security enterprise.--DHS has 
made important strides in providing leadership and coordinating efforts 
among its stakeholders. However, DHS needs to take additional action to 
forge effective partnerships and strengthen the sharing and utilization 
of information, which has affected its ability to effectively satisfy 
its missions, such as sharing information with private-sector 
stakeholders on cyber-based threats to critical infrastructure.
    Implementing and integrating management functions for results.--DHS 
has enhanced its management functions, and has plans to further 
strengthen the management of the Department. However, DHS has not 
always effectively executed or integrated these functions, which has 
contributed to schedule delays, cost increases, and performance issues 
in a number of programs aimed at delivering important mission 
capabilities, such as border security technologies.
    Strategically managing risks and assessing homeland security 
efforts.--While progress has been made, limited strategic and program 
planning and limited assessment to inform approaches and investment 
decisions have contributed to DHS programs not meeting strategic needs 
in an efficient manner, such as the lack of risk-based plans for 
deploying aviation security technologies.
    Chairman McCaul, Ranking Member Keating, and Members of the 
subcommittee: I am pleased to be here today to discuss our work on 
opportunities for the Department of Homeland Security (DHS) to reduce 
overlap and potential unnecessary duplication in its programs, save tax 
dollars, enhance revenue, and address crosscutting and management 
issues that have affected its mission implementation efforts. Last 
September, the Nation passed the 10-year anniversary of the September 
11, 2001, terrorist attacks. The events of that day led to profound 
changes in Government agendas, policies, and structures to confront the 
homeland security threats facing the Nation. Given DHS's significant 
leadership responsibilities in homeland security, it is critical that 
its programs are operating as efficiently and effectively as possible, 
are sustainable, and continue to mature to address pressing security 
needs.
    DHS began operations in 2003 with key missions that include 
preventing terrorist attacks from occurring within the United States, 
reducing U.S. vulnerability to terrorism, minimizing resulting damages, 
and helping the Nation recover from any attacks that may occur. DHS is 
now the third-largest Federal department, with more than 200,000 
employees, and has an annual budget of almost $60 billion. We have 
evaluated numerous departmental programs and efforts since DHS began 
its operations, and issued more than 1,200 reports and Congressional 
testimonies in areas such as border security and immigration, 
transportation security, and emergency management, among others. We 
have made more than 1,600 recommendations to DHS designed to strengthen 
its operations, such as to improve performance-measurement efforts, 
strengthen management processes, enhance coordination and information 
sharing, and increase the use of risk information in planning and 
resource allocation decisions, as well as to address gaps and 
challenges in its mission operations that have affected DHS's 
implementation efforts. As of September 2011, DHS had implemented about 
half of these recommendations, had actions underway to address others, 
and had taken additional steps to strengthen its operations. However, 
as we have previously reported, the Department has more to do to ensure 
that it conducts its missions efficiently and effectively, while 
simultaneously preparing to address future challenges that face the 
Department and the Nation.
    In March 2011 and February 2012, we reported on areas across the 
Federal Government, including DHS, that had duplicative goals or 
activities to inform Government policymakers as they address the 
rapidly building fiscal pressures facing our National Government.\1\ 
These reports included more than 100 areas, some of which related to 
homeland security, where agencies, offices, or initiatives had similar 
or overlapping objectives or provided similar services to the same 
populations; or where Government missions were fragmented across 
multiple agencies or programs. We reported that overlap and 
fragmentation among Government programs or activities that can be 
harbingers of potential unneccessary duplication and that reducing or 
eliminating potential unnecessary duplication, overlap, or 
fragmentation could potentially save billions of tax dollars annually 
and help agencies provide more efficient and effective services. These 
reports also included opportunities for Federal departments, including 
DHS, to consider taking action that could either reduce the cost of 
Government operations or enhance revenue collections for the Treasury.
---------------------------------------------------------------------------
    \1\ GAO, Opportunities to Reduce Potential Duplication in 
Government Programs, Save Tax Dollars, and Enhance Revenue, GAO-11-
318SP (Washington, DC: Mar. 1, 2011); 2012 Annual Report: Opportunities 
to Reduce Duplication, Overlap, and Fragmentation, Achieve Savings, and 
Enhance Revenue, GAO-12-342SP (Washington, DC: Feb. 28, 2012); Follow-
up on 2011 Report: Status of Actions Taken to Reduce Duplication, 
Overlap, and Fragmentation, Save Tax Dollars, and Enhance Revenue, GAO-
12-453SP (Washington, DC: Feb. 28, 2012).
---------------------------------------------------------------------------
    Moreover, in September 2011, we issued a report summarizing 
progress made by DHS in implementing its homeland security missions 10 
years after the terrorist attacks of September 11, 2001.\2\ We reported 
that DHS had implemented key homeland security operations and achieved 
important goals in many areas to create and strengthen a foundation to 
reach its potential. We also reported, however, that as DHS continues 
to mature, more work remains for it to strengthen the efficiency and 
effectiveness of those efforts to achieve its full potential. As part 
of this work, we identified three key themes that affected DHS's 
implementation efforts.
---------------------------------------------------------------------------
    \2\ GAO, Department of Homeland Security: Progress Made and Work 
Remaining in Implementing Homeland Security Missions 10 Years after 9/
11, GAO-11-881 (Washington, DC: Sept. 7, 2011).
---------------------------------------------------------------------------
    My statement today, as requested, is based on these reports and 
addresses: (1) Opportunities for DHS to reduce overlap and potential 
unnecessary duplication in its programs, save tax dollars, and enhance 
revenue, and (2) crosscutting and management issues that have affected 
DHS's program-implementation efforts.
    For these past reports, among other things, we analyzed DHS 
documents; reviewed and updated our past reports, supplemented by DHS 
Office of Inspector General (IG) reports, issued since DHS began its 
operations in March 2003; and interviewed DHS officials. We conducted 
this work in accordance with generally accepted Government auditing 
standards. More detailed information on the scope and methodology from 
our previous work can be found within each specific report.
  dhs could take actions to reduce overlap and potential unnecessary 
                  duplication and achieve cost savings
Overlap and Potential Unnecessary Duplication at DHS
    Our March 2011 and February 2012 reports identified 6 areas across 
DHS where overlap or potential unnecessary duplication exists, and 17 
specific actions that the Department or Congress could take to address 
these areas. In our March 2011 report we suggested that DHS or Congress 
take 11 actions to address the areas of overlap or potential 
unnecessary duplication that we found. Of these 11 actions, 1 has been 
fully addressed, 4 have been partially addressed, and the remaining 6 
have not been addressed. In many cases, the existence of overlap, 
potential unnecessary duplication, or fragmentation can be difficult to 
determine with precision due to a lack of data on programs and 
activities. Where information has not been available that would provide 
conclusive evidence of overlap, duplication, or fragmentation, we often 
refer to ``potential unnecessary duplication.'' In some cases, there is 
sufficient information available to show that if actions are taken to 
address individual issues, significant financial benefits may be 
realized. In other cases, precise estimates of the extent of potential 
unnecessary duplication, and the cost savings that can be achieved by 
eliminating any such unnecessary duplication, are difficult to specify 
in advance of Congressional and Executive Branch decision making. 
However, given the range of areas we identified at DHS and the 
magnitude of many of the programs, the cost savings associated with 
addressing these issues could be significant. Tables 1 and 2 summarize 
the areas of overlap and potential unnecessary duplication that we 
identified at DHS, the actions we identified for DHS and Congress to 
consider to address those areas, and the status of those actions.\3\
---------------------------------------------------------------------------
    \3\ For the purposes of our reports, we considered ``duplication`` 
to occur when two or more agencies or programs are engaged in the same 
activities or provide the same services to the same beneficiaries. We 
used the term ``overlap'' when multiple agencies or programs have 
similar goals, engage in similar activities or strategies to achieve 
them, or target similar beneficiaries. We used the term 
``fragmentation`` to refer to those circumstances in which more than 
one Federal agency (or more than one organization within an agency) is 
involved in the same broad area of National need. The presence of 
fragmentation and overlap can suggest the need to look closer at the 
potential for duplication. In certain instances in this statement, we 
use the term ``potential duplication`` to include duplication, overlap, 
or fragmentation.







  TABLE 2.--OVERLAP AND POTENTIAL UNNECESSARY DUPLICATION AREAS AT DHS
                 INCLUDED IN GAO'S FEBRUARY 2012 REPORT
------------------------------------------------------------------------
  Areas of Overlap or Potential Unnecessary
                 Duplication                      Actions To Consider
------------------------------------------------------------------------
FEMA needs better project information and      Action 1: FEMA should
 coordination to identify and prevent           take steps to ensure
 potential unnecessary duplication among four   that it collects project
 overlapping grant programs.--Of the $37        information with the
 billion in appropriated homeland security      level of detail needed
 preparedness grant programs from fiscal        to better identify any
 years 2002 through 2011, FEMA allocated        potential unnecessary
 about $20.3 billion to grant recipients        duplication.
 through four programs intended to enhance     Action 2: FEMA should
 the capacity of States, localities, and        explore opportunities to
 other entities to prevent, respond to, and     enhance its internal
 recover from a terrorism incident. However,    coordination and
 we found that the four FEMA grant programs     administration of the
 had multiple areas of overlap, including       programs.
 overlap among grant recipients, goals, and    Action 3: Congress may
 geographic locations, combined with the        want to consider
 limited project information FEMA had           requiring DHS to report
 available regarding grant funding levels,      on the results of its
 grant recipients, and grant purposes.          efforts to identify and
 Specifically, we found that 140 projects       prevent unnecessary
 constituting about $183 million in grant       duplication and consider
 funding lacked sufficient detail to            these results in making
 determine whether they were unnecessarily      future funding decisions
 duplicative or had involved coordination to    for these programs.
 prevent any unnecessary duplication. Upon
 gathering additional information from State
 and local grant recipients, however, we
 determined that none of the projects were
 duplicative. In its budget request for
 fiscal year 2013, DHS proposed consolidating
 most of FEMA's current preparedness grant
 programs into one comprehensive program.
Agencies are making duplicate payments for     Action 1: FPS should
 facility risk assessments by completing        develop interim
 their own assessments, while also paying the   solutions for completing
 Federal Protective Service (FPS) for           risk assessments while
 assessments that it is not performing.--FPS    addressing the risk
 received $236 million from Federal agencies    assessment tool's
 for risk assessments and other security        challenges.
 services in fiscal year 2011, but multiple    Action 2: FPS should make
 agencies, including DHS, expend additional     information about the
 resources to assess their own facilities.      estimated costs of key
 Moreover, DHS has not taken actions to         activities and the basis
 address this unnecessary duplication.          for these estimates
 Further, it is not clear whether FEMA's        available to affected
 planned risk assessment tool that will be      parties.
 used to complete risk assessments will help   Action 3: DHS should work
 minimize the unnecessary duplication. In our   with Federal agencies to
 February 2012 report, we reiterated two        determine their reasons
 recommendations made in previous reports and   for duplicating the
 suggested additional action to further         activities and identify
 mitigate duplicative efforts. DHS agreed       measures to reduce this
 with our previous two recommendations and      unnecessary duplication.
 has begun action on both, but it did not
 comment on the new suggested action.
------------------------------------------------------------------------
Source: GAO.

Cost-Saving and Revenue Enhancing Areas
    Our 2011 and 2012 annual reports also identified 9 areas describing 
other opportunities for DHS or Congress to consider taking action that 
could either reduce the cost of Government operations or enhance 
revenue collection for the Treasury. We identified 23 specific actions 
that the Department or Congress could take to address these areas. In 
our March 2011 report, we suggested that DHS or Congress take 11 
actions to either reduce the cost of Government operations or enhance 
revenue collection. Of these 11 actions, 1 has been fully addressed and 
10 have been partially addressed. In some cases, there is sufficient 
information to estimate potential savings or other benefits if actions 
are taken to address individual issues. In other cases, estimates of 
cost savings or other benefits would depend upon what Congressional and 
Executive Branch decisions were made, including how certain GAO 
recommendations are implemented. Additionally, information on program 
performance, the level of funding in agency budgets devoted to 
overlapping or fragmented programs, and the implementation costs that 
might be associated with program consolidations or terminations, are 
factors that could impact actions to be taken as well as potential 
savings. Tables 3 and 4 summarize the cost savings and revenue-
enhancing areas that we reported on in March 2011 and February 2012. 







 TABLE 4.--NEW COST-SAVINGS AND REVENUE-ENHANCING AREAS AT DHS INCLUDED
                      IN GAO'S FEBRUARY 2012 REPORT
------------------------------------------------------------------------
    Cost Saving or Revenue-Enhancing Areas        Actions to Consider
------------------------------------------------------------------------
Options for adjusting the passenger aviation   Action 1: Congress,
 security fee could further offset civil        working with TSA, may
 aviation security costs.--From fiscal years    wish to consider
 2002 through 2011, TSA collected about $18     increasing the passenger
 billion in passenger and air carrier           security fee according
 security fees, compared to the approximately   to one of the options we
 $63 billion appropriated for aviation          identified.
 security activities over the same time
 frame; thus, security fees offset about 29
 percent of amounts appropriated. We found
 that increasing the passenger security fee
 could help further offset billions of
 dollars in the Federal budget for aviation
 security programs and activities in outlying
 fiscal years. We identified options Congress
 may wish to consider using to increase the
 passenger security fee that could increase
 fee collections from about $2 billion to $10
 billion over 5 years. In addition, we
 reported that TSA's fiscal year 2012 budget
 proposal to incrementally increase the
 passenger security fee by 2014 could reduce
 total enplanements from fiscal years 2012
 through 2014 by 1 percent. This would reduce
 expected fee collections of $4.4 billion by
 about $120 million over this 3-year period.
 In its budget request for fiscal year 2013,
 DHS included a proposal to gradually raise
 the passenger security fee to $7.50 per one-
 way trip by 2018 and devote $18 billion of
 this fee increase for deficit reduction.
FEMA could reduce the costs to the Federal     Action 1: FEMA should
 Government related to major disasters          reexamine the basis for
 declared by the President.--From fiscal        the Public Assistance
 years 2004 through 2011, the President         per capita indicator and
 approved 539 major disaster declarations at    determine whether it
 a cost of $78.7 billion. We found that FEMA    accurately reflects a
 could reduce the costs to the Federal          State's capacity to
 Government related to major disasters          respond to and recover
 declared by the President by updating the      from a disaster without
 principal indicator on which disaster          Federal assistance.
 funding decisions are based and better        Action 2: FEMA should
 measuring a State's capacity to respond        reexamine the method
 without Federal assistance. We reported that   used to update the per
 we expected to reiterate two recommendations   capita indicator to
 from August 2001 related to the principle      ensure that the
 indicator and further recommend that the       indicator accurately
 Secretary of Homeland Security direct the      reflects annual changes
 FEMA Administrator to implement them. We       in a State's capacity to
 also expect to make a recommendation related   respond to and recover
 to the metrics to assess a State's disaster    from a disaster.
 preparedness and capabilities, so that it     Action 3: FEMA should
 can be used to better measure State capacity   examine the usefulness
 to respond to disasters. We are currently      of supplementing or
 conducting a review of the disaster            replacing the per capita
 declaration process and plan to report the     damage indicator with
 results in 2012.                               the metrics required by
                                                both statute and
                                                Presidential Policy
                                                Directive to assess a
                                                State's disaster
                                                preparedness and
                                                capabilities.\1\
Delaying proposed investments until DHS        Action 1: CBP should
 better defines and measures benefits and       determine the mission
 estimates life-cycle costs for future          benefits to be derived
 acquisitions of border surveillance            from implementation of
 technology could help ensure the most          the plan.
 effective use of future program funding.--We  Action 2: CBP should
 found that CBP's Arizona Border Surveillance   develop and apply key
 Technology Plan, the successor of CBP's        attributes for metrics
 nearly $1 billion Secure Border Initiative     to assess program
 Network (SBInet) technology program for        implementation.
 securing the border between points of entry,  Action 3: CBP should
 is at an increased risk of not cost-           update its cost estimate
 effectively accomplishing its goal in          for the plan using best
 support of Arizona border security because     practices.
 CBP has not provided support for its          Action 4: Congress may
 business case for investing in the plan. We    wish to consider
 made three recommendations in November 2011    limiting future program
 to increase CBP's likelihood of successfully   funding until CBP has
 implementing the Arizona Border Surveillance   more fully defined the
 Technology Plan, minimize performance risks,   benefits and costs of
 help justify program funding, and increase     its new plan for
 the reliability of CBP's cost estimate. DHS    Arizona.
 concurred with our recommendations and
 identified steps it planned to take to
 implement them, along with estimated dates
 for their completion, but not all actions
 fully addressed our recommendations. In
 addition, in February 2012, we reported that
 Congress may wish to consider limiting
 future program funding. The President's
 fiscal year 2013 budget requests $91.8
 million for Integrated Fixed Towers that are
 part of the Arizona Border Surveillance
 Technology Plan.
The air passenger immigration inspection user  Action 1: Congress may
 fee should be reviewed and adjusted to fully   wish to direct DHS to
 recover the cost of the air passenger          require ICE and CBP to
 immigration inspection activities conducted    regularly report total
 by U.S. Immigration and Customs Enforcement    cost of air passenger
 (ICE) and CBP.--We estimated that fee          immigration inspections
 collections available to ICE and CBP to pay    and the amount of
 for costs incurred in providing inspection     associated fee
 services totaled about $600 million in         collections.
 fiscal year 2010. However, we found that air  Action 2: Congress may
 passenger immigration fee collections did      wish to direct DHS to
 not fully cover CBP's costs in fiscal years    adjust the fee as needed
 2009 and 2010. Although ICE does not track     so that collections are
 air passenger costs separately from sea        aligned with total
 passenger costs, ICE officials stated that     inspection costs.
 its portion of total air and sea passenger    Action 3: Congress may
 collections did not cover ICE's total air      wish to require DHS to
 and sea passenger costs in fiscal year 2007    direct ICE to amend its
 through 2009. We reiterated in our February    cost study methodology.
 2012 report four items for Congressional      Action 4: Congress may
 consideration to allow ICE and CBP to better   wish to require DHS to
 align air passenger immigration inspection     direct ICE and CBP to
 fee revenue with the costs of providing        establish a regular
 these services and achieve cost savings by     schedule to review and
 reducing the reliance on general fund          coordinate costs of
 appropriations.                                inspection activities.
------------------------------------------------------------------------
Source: GAO.
\1\ See 6 U.S.C.  749 and Presidential Policy Directive--8 (PPD-8):
  National Preparedness, March 30, 2011.

 dhs can improve the efficiency and effectiveness of its operations by 
      continuing to address themes that have impacted its progress
    Our work at DHS has identified three key themes--leading and 
coordinating the homeland security enterprise, implementing and 
integrating management functions for results, and strategically 
managing risks and assessing homeland security efforts--that have 
impacted the Department's progress since it began operations.\4\ As 
these themes have contributed to challenges in the Department's 
management and operations, addressing them can result in increased 
efficiencies and effectiveness. For example, DHS can help reduce cost 
overruns and performance shortfalls by strengthening the management of 
its acquisitions, and reduce inefficiencies and costs for homeland 
security by improving its R&D management. These themes provide insights 
that can inform DHS's efforts, moving forward, as it works to implement 
its missions within a dynamic and evolving homeland security 
environment. DHS made progress and has had successes in all of these 
areas, but our work found that these themes have been at the foundation 
of DHS's implementation challenges, and need to be addressed from a 
Department-wide perspective to effectively and efficiently position DHS 
for the future and enable it to satisfy the expectations set forth by 
the Congress, the administration, and the country.
---------------------------------------------------------------------------
    \4\ DHS defines the homeland security enterprise as the Federal, 
State, local, Tribal, territorial, non-Governmental, and private-sector 
entities, as well as individuals, families, and communities, who share 
a common National interest in the safety and security of the United 
States and the American population.
---------------------------------------------------------------------------
    Leading and coordinating the homeland security enterprise.--While 
DHS is one of a number of entities with a role in securing the 
homeland, it has significant leadership and coordination 
responsibilities for managing efforts across the homeland security 
enterprise. To satisfy these responsibilities, it is critically 
important that DHS develop, maintain, and leverage effective 
partnerships with its stakeholders, while at the same time addressing 
DHS-specific responsibilities in satisfying its missions. Before DHS 
began operations, we reported that the quality and continuity of the 
new department's leadership would be critical to building and 
sustaining the long-term effectiveness of DHS and achieving homeland 
security goals and objectives.\5\ We further reported that to secure 
the Nation, DHS must form effective and sustained partnerships between 
components and also with a range of other entities, including Federal 
agencies, State and local governments, the private and nonprofit 
sectors, and international partners.\6\
---------------------------------------------------------------------------
    \5\ GAO, Homeland Security: Critical Design and Implementation 
Issues, GAO-02-957T (Washington, DC: July 17, 2002).
    \6\ GAO, Department of Homeland Security: Progress Report on 
Implementation of Mission and Management Functions, GAO-07-454 
(Washington, DC: Aug. 17, 2007).
---------------------------------------------------------------------------
    DHS has made important strides in providing leadership and 
coordinating efforts. For example, it has improved coordination and 
clarified roles with State and local governments for emergency 
management. DHS also strengthened its partnerships and collaboration 
with foreign governments to coordinate and standardize security 
practices for aviation security. However, DHS needs to take additional 
action to forge effective partnerships and strengthen the sharing and 
utilization of information, which has affected its ability to 
effectively satisfy its missions. For example, in July 2010, we 
reported that the expectations of private-sector stakeholders have not 
been met by DHS and its Federal partners in areas related to sharing 
information about cyber-based threats to critical infrastructure.\7\ In 
2005, we designated information-sharing for homeland security as high-
risk because the Federal Government faced serious challenges in 
analyzing information and sharing it among partners in a timely, 
accurate, and useful way.\8\ Gaps in sharing, such as agencies' failure 
to link information about the individual who attempted to conduct the 
December 25, 2009, airline bombing, prevented the individual from being 
included on the Federal Government's consolidated terrorist watchlist, 
a tool used by DHS to screen for persons who pose risks to the country. 
The Federal Government and DHS have made progress, but more work 
remains for DHS to streamline its information sharing mechanisms and 
better meet partners' needs. Moving forward, it will be important that 
DHS continue to enhance its focus and efforts to strengthen and 
leverage the broader homeland security enterprise, and build off the 
important progress that it has made thus far. In addressing ever-
changing and complex threats, and with the vast array of partners with 
whom DHS must coordinate, continued leadership and stewardship will be 
critical in achieving this end.
---------------------------------------------------------------------------
    \7\ GAO, Critical Infrastructure Protection: Key Private and Public 
Cyber Expectations Need to Be Consistently Addressed, GAO-10-628 
(Washington, DC: July 15, 2010).
    \8\ GAO, High-Risk Series: An Update, GAO-05-207 (Washington, DC: 
Jan. 2005).
---------------------------------------------------------------------------
    Implementing and integrating management functions for results.--
Following its establishment, the Department focused its efforts 
primarily on implementing its various missions to meet pressing 
homeland security needs and threats, and less on creating and 
integrating a fully and effectively functioning department from 22 
disparate agencies. This initial focus on mission implementation was 
understandable given the critical homeland security needs facing the 
Nation after the Department's establishment, and the enormous challenge 
posed by creating, integrating, and transforming a department as large 
and complex as DHS. As the Department matured, it has put into place 
management policies and processes and made a range of other 
enhancements to its management functions, which include acquisition, 
information technology, financial, and human capital management. 
However, DHS has not always effectively executed or integrated these 
functions. In 2003, we designated the transformation and integration of 
DHS as high-risk because DHS had to transform 22 agencies into one 
department, and failure to effectively address DHS's management and 
mission risks could have serious consequences for U.S. National and 
economic security. Nine years later, DHS remains on our high-risk 
list.\9\ DHS has demonstrated strong leadership commitment to address 
its management challenges and has begun to implement a strategy to do 
so. Further, DHS developed various management policies, directives, and 
governance structures, such as acquisition and information technology 
management policies and controls, to provide enhanced guidance on 
investment decision making. DHS also reduced its financial management 
material weaknesses and developed strategies to strengthen human 
capital management. For example, in fiscal year 2011, DHS moved from a 
Disclaimer of Opinion to a Qualified Audit Opinion on its Balance Sheet 
and Statement of Custodial Activity for the first time since 2003. 
However, DHS has not been able to obtain an unqualified audit opinion 
on its consolidated financial statements (i.e., prepare a set of 
financial statements that are considered fairly presented) though its 
current goal is to receive an unqualified, or clean opinion, on the 
Department-wide consolidated financial statement for fiscal year 2013.
---------------------------------------------------------------------------
    \9\ GAO, High-Risk Series: An Update, GAO-11-278, (Washington, DC: 
Feb. 2011).
---------------------------------------------------------------------------
    DHS needs to continue to demonstrate sustainable progress in 
addressing its challenges, as these issues have contributed to schedule 
delays, cost increases, and performance problems in major programs 
aimed at delivering important mission capabilities. For example, we 
reported on numerous cost, schedule, and performance risks, and 
concluded that DHS had not economically justified its investment in the 
Secure Border Initiative Network, DHS's border security technology 
program.\10\ More specifically, DHS did not adequately define 
requirements, perform testing, or oversee contractors, delaying 
security enhancements on the Southwest Border. After initiating a 
Department-wide assessment of the program, the Secretary of Homeland 
Security froze program funding and, at the completion of the assessment 
in January 2011, the Secretary decided to end the Secure Border 
Initiative Network as originally conceived after investing nearly $1 
billion in the program. DHS also has not yet fully implemented its 
roles and responsibilities for developing and implementing key homeland 
security programs and initiatives. For example, FEMA has not yet 
developed a set of target capabilities for disaster preparedness or 
established metrics for assessing those capabilities to provide a 
framework for evaluating preparedness, as required by the Post-Katrina 
Emergency Management Reform Act of 2006.\11\ Moreover, DHS does not yet 
have enough personnel with required skills to carry out activities in 
various areas, such as acquisition management; and is in the process of 
modernizing its financial management system, impacting its ability to 
have ready access to reliable information for informed decision making. 
Moving forward, addressing these management challenges will be critical 
for DHS's success, as will be the integration of these functions across 
the Department to achieve efficiencies and effectiveness.
---------------------------------------------------------------------------
    \10\ See, for example, GAO, Secure Border Initiative: DHS Needs to 
Strengthen Management and Oversight of Its Prime Contractor, GAO-11-6 
(Washington, DC: Oct. 18, 2010); Department of Homeland Security: 
Assessments of Selected Complex Acquisitions, GAO-10-588SP (Washington, 
DC: June 30, 2010); Secure Border Initiative: DHS Needs to Reconsider 
Its Proposed Investment in Key Technology Program, GAO-10-340 
(Washington, DC: May 5, 2010); Secure Border Initiative: DHS Has Faced 
Challenges Deploying Technology and Fencing Along the Southwest Border, 
GAO-10-651T (Washington, DC: May 4, 2010); and Secure Border 
Initiative: DHS Needs to Address Testing and Performance Limitations 
That Place Key Technology Program at Risk, GAO-10-158 (Washington, DC: 
Jan. 29, 2010).
    \11\ See 6 U.S.C.  749.
---------------------------------------------------------------------------
    Strategically managing risks and assessing homeland security 
efforts.--Forming a new department while working to implement 
statutorily-mandated and Department-initiated programs and responding 
to evolving threats, was, and is, a significant challenge facing DHS. 
Key threats, such as attempted attacks against the aviation sector, 
have impacted and altered DHS's approaches and investments, such as 
changes DHS made to its processes and technology investments for 
screening passengers and baggage at airports. It is understandable that 
these threats had to be addressed immediately as they arose. However, 
limited strategic and program planning by DHS, as well as assessment to 
inform approaches and investment decisions, have contributed to 
programs not meeting strategic needs or doing so in an efficient 
manner. For example, we previously reported that TSA's program for 
research, development, and deployment of passenger checkpoint screening 
technologies was not risk-based and did not reflect some of the key 
risk-management principles, such as conducting a risk assessment based 
on the three elements of risk--threat, vulnerability, and consequence--
and including a cost-benefit analysis and performance measures.\12\ As 
a result, TSA had limited assurance that its strategy targeted the 
most-critical risks and that it was investing in the most cost-
effective new technologies or other protective measures. In addition, 
we reported that DHS coordinated the development of a strategic plan 
for the global nuclear detection architecture--a multidepartment effort 
to protect against terrorist attacks using nuclear and radiological 
materials through coordinated activities.\13\ However, the strategic 
plan for the architecture did not include some key components, such as 
funding needed to achieve the strategic plan's objectives, or 
monitoring mechanisms for determining programmatic progress and 
identifying needed improvements.
---------------------------------------------------------------------------
    \12\ GAO, Aviation Security: DHS and TSA Have Researched, 
Developed, and Begun Deploying Passenger Checkpoint Screening 
Technologies, but Continue to Face Challenges, GAO-10-128 (Washington, 
DC: Oct. 7, 2009).
    \13\ GAO, Combating Nuclear Smuggling: DHS has Developed a 
Strategic Plan for its Global Nuclear Detection Architecture, but Gaps 
Remain, GAO-11-869T (Washington, DC: July 26, 2011).
---------------------------------------------------------------------------
    Further, DHS has made important progress in analyzing risk across 
sectors, but it has more work to do in using this information to inform 
planning and resource-allocation decisions. Risk management has been 
widely supported by Congress and DHS as a management approach for 
homeland security, enhancing the Department's ability to make informed 
decisions and prioritize resource investments. Since DHS does not have 
unlimited resources and cannot protect the Nation from every 
conceivable threat, it must make risk-informed decisions regarding its 
homeland security approaches and strategies.
    Moreover, we have reported on the need for enhanced performance 
assessment, that is, evaluating existing programs and operations to 
determine whether they are operating as intended or are in need of 
change, across DHS's missions.\14\ Information on the performance of 
programs is critical for helping the Department, Congress, and other 
stakeholders more systematically assess strengths and weaknesses and 
inform decision making. In recent years, DHS has placed an increased 
emphasis on strengthening its mechanisms for assessing the performance 
and effectiveness of its homeland security programs. For example, DHS 
established new performance measures, and modified existing ones, to 
better assess many of its programs and efforts. However, our work has 
found that DHS continues to miss opportunities to optimize performance 
across its missions due to a lack of reliable performance information 
or assessment of existing information; evaluation among possible 
alternatives; and, as appropriate, adjustment of programs or operations 
that are not meeting mission needs. For example, we reported that CBP 
had invested $2.4 billion in tactical infrastructure (fencing, roads, 
and lighting) along the Southwest Border, but could not measure the 
impact of this investment in tactical infrastructure on border 
security.\15\ As the Department further matures and seeks to optimize 
its operations, DHS will need to look beyond immediate requirements; 
assess programs' sustainability across the long term, particularly in 
light of constrained budgets; and evaluate trade-offs within and among 
programs across the homeland security enterprise. Doing so should 
better equip DHS to adapt and respond to new threats in a sustainable 
manner as it works to address existing ones.
---------------------------------------------------------------------------
    \14\ For a list of GAO reports related to performance assessment, 
see GAO-11-881.
    \15\ GAO, Secure Border Initiative: Technology Deployment Delays 
Persist and the Impact of Border Fencing Has Not Been Assessed, GAO-09-
896 (Washington, DC: Sept. 9, 2009).
---------------------------------------------------------------------------
                        concluding observations
    Given DHS's significant leadership responsibilities in securing the 
homeland, it is critical that the Department's programs and activities 
are operating as efficiently and effectively as possible, are 
sustainable, and that they continue to mature, evolve, and adapt to 
address pressing security needs. Since it began operations in 2003, DHS 
has implemented key homeland security operations and achieved important 
goals and milestones in many areas. These accomplishments are 
especially noteworthy given that the Department has had to work to 
transform itself into a fully functioning cabinet department while 
implementing its missions--a difficult undertaking for any organization 
and one that can take years to achieve even under less-daunting 
circumstances. However, our work has shown that DHS can take actions to 
reduce overlap and potential unnecessary duplication to improve the 
efficiency of its operations and achieve cost-savings in several areas. 
Further, while DHS has made progress, additional actions are needed to 
strengthen partnerships with stakeholders, improve its management 
processes and share information, and enhance its risk management and 
performance-measurement efforts to enhance effectiveness and achieve 
efficiencies throughout the Department.
    Chairman McCaul, Ranking Member Keating, and Members of the 
subcommittee, this concludes my prepared testimony. I would be pleased 
to respond to any questions that Members of the subcommittee may have.

    Mr. McCaul. Thank you, Ms. Berrick.
    The Chairman now recognizes Mr. Edwards for his testimony.

  STATEMENT OF CHARLES K. EDWARDS, ACTING INSPECTOR GENERAL, 
                DEPARTMENT OF HOMELAND SECURITY

    Mr. Edwards. Good morning, Chairman McCaul, Ranking Member 
Keating, and Members of the committee. Thank you for inviting 
me to discuss waste, fraud, abuse, and duplication at DHS.
    Since its inception in 2003, the Department has made 
strides toward establishing, building, and maintaining a 
cohesive, effective, and efficient organization. While the 
Department is taking positive steps, it still faces significant 
challenges in achieving effective and economic operations.
    Today I will discuss the results of recent audits that 
underscore the need for continued improvement in three areas: 
Acquisition management, disaster response, and transportation 
security.
    Acquisition management, including adequate planning, 
oversight, and controls, is critical to the Department's effort 
to prevent fraud, waste, and abuse. Our recent review of CBP's 
purchase and storage of steel for fence construction under the 
Secure Border Initiative illustrates what can happen without 
adequate planning and oversight. CBP purchased steel based on 
needs it estimated before legally acquiring land or meeting 
treaty obligations. Then it did not provide effective contract 
oversight; for example, not paying invoices on time, and not 
thoroughly reviewing and documenting selection of the 
subcontractor. As a result, CBP purchased more steel than 
needed, incurred additional storage costs, paid interest on 
late payments, and approved a high-priced subcontractor, all of 
which led to additional expenditures. We estimate that CBP 
could have avoided about $69 million in costs if it had managed 
this acquisition more effectively.
    We also conducted an audit that looked into DHS oversight 
of acquisition programs managed by the components. Although DHS 
generally had management oversight and controls over component 
acquisition programs, it needed to further refine some policies 
and strengthen oversight. Some components were subjecting 
acquisitions to increased regulatory requirements because the 
DHS acquisition management directive was not clearly 
understood. These requirements may have resulted in increased 
costs.
    Additionally we found the Department could benefit from 
more use of strategic sourcing. Specifically, DHS had eight 
different procurement officers purchasing detection equipment, 
was not facilitating strategic sourcing, and was using multiple 
equipment models to meet similar missions. The Department could 
decrease acquisition costs by strategically sourcing this 
equipment.
    We also recently reviewed OneNet, an information technology 
infrastructure platform designed to consolidate DHS's component 
networks. The goal of OneNet is to allow DHS's components to 
share data in support of cross-organizational missions. DHS has 
made some progress, but needs to make a number of improvements 
in order to ensure transition to OneNet.
    As a result of our review, we made recommendations to the 
Department's Chief Information Officer that we believe will 
help ensure this transition.
    FEMA's Individuals and Households Program, which is used to 
quickly disburse money to disaster survivors, is at risk to 
fraud, waste, and abuse, and therefore requires fiscal 
responsibility and program integrity. We looked at the progress 
FEMA has made in preventing fraudulent losses of Federal funds. 
The agency still needs to increase fraud prevention awareness, 
and develop, establish, and enhance internal controls, 
including the checking of the validity of data. The process of 
recouping improper payments, which had been halted, has been 
restarted, and should continue until all cases are resolved.
    Another critical mission of DHS is transportation security. 
As part of this mission, TSA must provide sufficient oversight 
to ensure that individuals working at airport locations are 
properly screened before receiving a badge, giving them 
unfettered access to secure areas. We determined that TSA had 
limited oversight of the badging process. Badges were issued 
despite inaccurate or omitted application data or improper 
vetting. Airport employees were not always trained how to use 
the available tools to detect fraud. TSA did not require 
airports to conduct recurrent criminal history checks. As a 
result, TSA has no assurance that individuals who pose threats 
could not obtain badges to access secure areas.
    In closing, I would like to note that DHS and its 
components concurred with the majority of our report 
recommendations, and in most cases have already begun 
implementing them. I commend the Department for continuing to 
meet and work on these management challenges and improve its 
operations and performance.
    Mr. Chairman, this concludes my prepared remarks, and I 
would be happy to answer any questions that you or other 
Members may have.
    [The statement of Mr. Edwards follows:]
                Prepared Statement of Charles K. Edwards
                             March 8, 2012
    Good morning Chairman McCaul, Ranking Member Keating, and 
distinguished Members of the committee: I am Charles K. Edwards, Acting 
Inspector General of the Department of Homeland Security (DHS). Thank 
you for the opportunity to testify today on our on-going efforts to 
identify and eliminate waste, fraud, abuse, and duplication in the 
Department.
    As you know, the DHS Office of Inspector General (OIG) was 
established in January 2003 by the Homeland Security Act of 2002 by 
amendment to the Inspector General Act of 1978. The DHS OIG seeks to 
promote economy, efficiency, and effectiveness in DHS programs and 
operations and reports directly to both the DHS Secretary and the 
Congress. We fulfill our mission primarily by issuing audit, 
inspection, and investigative reports that include recommendations for 
corrective action, and by referring cases to the United States Attorney 
General for prosecution.
    I would like to begin by noting the strides DHS has taken toward 
building a cohesive agency that addresses its key mission objectives to 
protect our borders, improve our response to manmade and natural 
threats, and implement transportation and trade security. DHS, by 
virtue of the breadth and importance of its mission, the scope of its 
activities, and the number of employees, must overcome some especially 
difficult challenges.
    Each year we publish a report on the most significant management 
challenges facing the Department including acquisition management, 
grants management, and transportation security. Today, my testimony 
will highlight important issues in those three areas.
    I am pleased to report that not only did DHS and its components 
concur with majority of our recommendations in these areas; in most 
cases they are already taking steps to implement these recommendations.
                         acquisition management
    The Department continues to streamline its management of 
acquisitions, but is still challenged by their magnitude and 
complexity. Good acquisition management is critical to the Department's 
efforts to prevent fraud, waste, and abuse, particularly good 
acquisition planning and adequate oversight and controls, as well as 
best practices such as strategic sourcing of common equipment. I would 
like to highlight four of our 2011 reports focusing on these issues.
    In our report, U.S. Customs and Border Protection's Management of 
the Purchase and Storage of Steel in Support of the Secure Border 
Initiative (OIG-12-05), we determined that U.S. Customs and Border 
Protection (CBP) did not effectively manage the purchase and storage of 
steel in support of the Secure Border Initiative. Since 2008, CBP spent 
approximately $1.2 billion to construct physical barriers along the 
Southwest Border as part of this initiative. About $310 million of the 
cost was to purchase and store steel in support of fence construction. 
CBP purchased steel based on an estimate before legally acquiring land 
or meeting international treaty obligations. In addition, it did not 
provide effective contract oversight during the project: It paid 
invoices late, did not reconcile invoices with receiving documents, and 
did not perform a thorough review of the contractor's selection of a 
higher-priced subcontractor or document the reasons for its approval of 
the subcontractor. As a result, CBP purchased more steel than needed, 
incurred additional storage costs, paid interest on late payments, and 
approved a higher-priced subcontractor, with additional expenditures of 
about $69 million that could have been put to better use.
    CBP did not efficiently plan the purchase and storage of steel for 
the Supply and Supply Chain Management (SSCM) task order. It purchased 
27,557 tons of extra steel, with a value of about $44 million, which 
remained in storage at the end of the task order. Additionally, CBP did 
not obtain necessary approval to build all planned fence segments 
before acquiring the steel. In September 2009, CBP purchased 34 tons of 
steel for $23,000, even though it had significant quantities of the 
same steel already in storage. CBP was not proactive and did not 
efficiently plan for the storage of steel remaining from the task 
order. Instead of moving the extra steel to a cost-efficient location, 
CBP extended the original contract and awarded a supplemental storage 
contract. CBP's decision to extend the storage contracts for 2 years 
resulted in $9.8 million in avoidable storage costs.
    CBP did not reconcile or promptly pay invoices from the SSCM task 
order. The cost of the task order increased because CBP paid invoices 
late, which resulted in late payment interest charges. Furthermore, CBP 
could not guarantee the Government received what it paid for under the 
task order. CBP did not have policies and procedures for submitting and 
reviewing invoices. There was no clear guidance on the proper office to 
route invoices to, no time line for the review process, and no 
notification process to remind offices of invoices coming due.
    CBP did not perform a thorough review of the consent to subcontract 
documentation and did not document the reasons for its approval of the 
higher-price subcontractor. Its approval of a subcontractor may have 
added about $13.5 million to the project. The DHS Office of the Chief 
Procurement Officer recognized the importance of component oversight of 
subcontractor selection and issued an acquisition alert in April 2011 
to DHS heads of contracting activities.
    We noted that CBP should ensure it applied lessons learned from 
this project to future projects. To that end, we made five 
recommendations to improve CBP's management of future fence 
construction and contract oversight. CBP concurred with four 
recommendations, and DHS proposed an alternative to the fifth 
recommendation that met the intent of that recommendation. CBP was 
acting to implement the recommendations.
    In DHS Oversight of Component Acquisition Programs (OIG-11-71), we 
reported that DHS generally had management oversight and controls over 
components' acquisition programs, but needed to further refine some 
policies and strengthen oversight in some areas.
    The Department had made progress in its acquisition oversight 
processes and controls by implementing a revised Acquisition Management 
Directive (Directive 102-01) and accompanying Acquisition Instruction 
Guidebook (102-01-001). The directive and guidebook addressed many 
previously identified oversight and control problems related to 
acquisition management. However, the guidance needed further refining 
to provide additional details and improve controls in some areas.
    The Department had not fully defined for its components what 
constituted an acquisition program, and had not developed consistent 
guidance for reporting the three levels of acquisition programs in its 
standard reporting system. Components were not completing and reporting 
all key information into the next Generation Periodic Reporting System 
(nPRS), and were thus distorting the acquisition portfolio position 
through inconsistent reporting of programs. In July 2010, data from 
nPRS showed progress in entering level 3 acquisition program 
components, but the system still only reflected half the total number 
of level 3 programs that components were reporting outside nPRS. By 
mandating use of nPRS for all acquisition programs, the Department 
would have visibility into components' acquisition programs and could 
provide better oversight of its acquisition portfolio.
    The Department did not ensure that components were using all 
available acquisition tools, including nPRS and the Strategic Sourcing 
Program Office (SSPO). Component personnel had developed or were 
developing their own data tracking systems because the Department had 
not consistently mandated use of nPRS or its tools. The Department also 
did not ensure that components were using the SSPO to manage 
acquisition programs, which would have created transparency and 
efficiency in their acquisition programs. As a result, components may 
have awarded contracts without considering the SSPO, and the Department 
may have incurred increased costs for procurements. In addition, 
components may have conducted duplicative market research for 
procurements that had already been done by the SSPO. The Department 
should ensure components were at least considering the use of the SSPO 
before awarding contracts.
    DHS did not ensure that all components had developed adequate 
policies and procedures to manage and oversee acquisition programs. The 
Department's Acquisition Management Directive 102-01 states that 
components are authorized to establish internal acquisition processes 
and procedures consistent with the Directive. However, not all 
components had created such processes and procedures. Others had 
created program management offices to manage simple procurements, were 
not properly reporting programs into the standard system, or were not 
applying strategic sourcing strategies to support program development. 
The Department had not ensured the adequacy of the processes and 
procedures that components developed. As a result, some components 
unnecessarily created acquisition programs, which potentially increased 
administrative costs without adding value to the programs. In addition, 
the Department did not always know what is in its acquisition 
portfolio.
    We made four recommendations to the Chief Procurement Officer to 
strengthen the Department's management oversight and controls over 
component acquisition programs, including requiring reporting of 
acquisitions in nPRS, implementing a plan of action or deadline to 
finalize acquisition management policies and procedures, and requiring 
components to consider using the SSPO and other resources in planning 
acquisitions. The Chief Procurement Officer agreed with our 
recommendations, and DHS initiated corrective actions.
    The report, DHS Continues to Face Challenges in the Implementation 
of Its OneNet Project (OIG-11-116), presented the results of our audit 
of DHS' efforts to consolidate its components' networks into a single 
wide-area network, OneNet. In 2005, DHS began to consolidate and 
transform existing individual component networks into a single, world-
class information technology (IT) infrastructure. As part of an IT 
Infrastructure Transformation Program, OneNet's goal was to provide a 
reliable, cost-effective IT platform for data sharing among components 
in support of cross-organizational missions.
    DHS had made some progress toward consolidating the existing 
components' IT infrastructures into OneNet. The Department had 
established a centralized Network Operations Center/Security Operations 
Center to manage and oversee OneNet and to monitor, detect, and respond 
to IT security incidents. All but three components were signing 
memorandums of agreement with CBP to obtain network and security 
services; as the OneNet steward, CBP had elected not to prepare an 
agreement. All components had converted their sites to Multiple 
Protocol Label Switching architecture to read and access audit trails 
captured on firewall and intrusion detection devices. The Department 
had also established a redundant trusted internet connection (RTIC) to 
provide a redundant network infrastructure and essential OneNet 
services (e.g., internet, extranet, and application hosting) to all DHS 
components.
    At the time of our review, the Department needed to improve its 
implementation of OneNet. DHS needed to establish component connections 
(peering) to OneNet and ensure that all components transitioned to the 
RTIC. At the time of our audit, only two components had peered all 
their sites to OneNet; the remaining seven components identified the 
lack of Policy Enforcement Points (PEP), which support controlled 
cross-communication among component Trust Zones, as the primary reason 
for their delayed transition to OneNet. DHS components had established 
different and unique levels of IT security policies, as well as 
different PEPs, to enforce these policies. Not all DHS components had 
completely transitioned to the RTIC. As of February 2011, two 
components had completed their transition. Three of the remaining seven 
components had signed waivers with extension dates until 2012 to defer 
their transition to the RTIC. Finally, DHS had not completed required 
OneNet management documents, such as the Concept of Operations, which 
describes how to use desired capabilities to carry out operations. 
Three components did not have required interconnection security 
agreements, and three other such agreements had expired.
    We recommended that the DHS Chief Information Officer complete the 
transition and connection (peering) of components and develop and 
implement key planning documents, network service agreements, and 
interconnection security agreements for OneNet. DHS generally agreed 
with our findings and recommendations.
    In DHS Department-wide Management of Detection Equipment (OIG 11-
47), we found the Department could better manage acquisition of 
detection equipment by developing processes to standardize equipment 
purchases and identifying common mission requirements among components. 
DHS had eight different procurement offices purchasing detection 
equipment and did not have a process to facilitate strategic sourcing. 
The Department was using multiple models to meet similar missions, and 
thus, was incurring higher administrative, logistical support, and 
maintenance costs. We identified about $170 million worth of small X-
ray machines, metal detectors, and personal and hand-held radiation 
detectors that DHS could acquire through strategic sourcing strategies. 
To strategically source, DHS would need to standardize purchases of 
explosive, metal, and radiation detection equipment; and identify 
common mission requirements among components. Limiting the models and 
types of equipment would increase procurement, maintenance, and 
personnel efficiencies.
    Components were also maintaining separate inventories, and the 
inventory systems were not based on standard inventory data elements 
and standard nomenclature for similar detection equipment. Without a 
dictionary of common data elements and nomenclature, the Department did 
not have timely visibility over on-hand balances of equipment and could 
not be sure inventory data was complete and accurate.
    We made two recommendations to the Deputy Under Secretary for 
Management. First, we recommended that DHS establish a standard data 
dictionary, consolidate data descriptions, and make sure components use 
consistent inventory terms; second, we recommended that DHS re-
establish a Joint Requirements Council to identify cross-cutting 
opportunities and common requirements. DHS concurred with both 
recommendations and reported it was developing standard data elements 
to manage its inventory accounts and was planning to revive the Joint 
Requirements Council.
                       disaster assistance fraud
    The report, Assessment of FEMA's Fraud Prevention Efforts (OIG-11-
84), included results of our review of FEMA's Individuals and 
Households Program (IHP), through which the agency quickly disburses 
billions of dollars to disaster survivors. The program's vulnerability 
to fraud, waste, and abuse requires FEMA to implement procedures 
designed to ensure assistance is provided in proper amounts and only to 
eligible recipients. While FEMA had made progress in preventing 
fraudulent losses of Federal funds, challenges remained in reporting 
and identifying fraud; increasing fraud prevention awareness; 
developing and maintaining proper internal controls; and recouping 
improper disaster assistance payments.
    The report highlighted the fact that FEMA had not established an 
environment in which employees understand that fraud prevention is 
integral to the agency's mission. This is partially caused by FEMA not 
training disaster assistance employees how to prevent and detect fraud, 
waste, and abuse. Rather, FEMA offered non-mandatory ad hoc training to 
those employees who wanted to take the training. FEMA's leaders must 
continually demonstrate the importance of fiscal responsibility and 
program integrity. Mandating fraud prevention training for all 
employees would increase the agency's attention to fraud prevention and 
deterrence.
    The agency had improved its internal controls since Hurricanes 
Katrina and Rita. However, OIG and Government Accountability Office 
reviews, as well as agency assessments, continued to identify needed 
improvements in internal controls over its assistance programs. For 
example, in September 2009, we reported that FEMA substantially 
improved internal control weaknesses that existed during Hurricanes 
Katrina and Rita. While these changes resulted in fewer instances of 
payments made to registrations with duplicate and invalid key data, 
FEMA does not always use all of its validity checks for key 
registration data. Consequently, FEMA continued to make improper 
disaster assistance payments that should have been avoided. FEMA needs 
to consistently apply its existing business rules, and monitor payment 
activities to update its internal controls when it indentifies new 
vulnerabilities.
    The goal of the Fraud Prevention and Investigation Branch (FPIB) is 
to assist in identifying, mitigating, and preventing fraud in FEMA 
programs through fraud awareness training and, in partnership with DHS, 
recoupment of losses. FEMA should issue a management directive 
establishing FPIB as an agency-wide entity with authority to review all 
FEMA-funded programs and recommend improvements to internal controls to 
deter and prevent fraud, waste, and abuse. FEMA needs also to provide 
additional staffing to enable the FPIB to achieve that goal and adopt 
measures used by the Recovery Accountability and Transparency Board, 
such as the fraud-mapping tool, to foster accountability and 
transparency of FEMA programs and improve internal controls. Finally, 
FPIB's visibility would be enhanced if it reported directly to the FEMA 
Office of the Administrator, or one of his direct reports.
                        transportation security
    Transportation security is one of the critical missions for which 
DHS was created. Since its inception, the Department has invested 
considerable resources to establish a secure transportation 
environment, particularly at our Nation's airports. We have audited 
many of the layers of security established or overseen by TSA. One of 
our recent reports, TSA's Oversight of the Airport Badging Process 
Needs Improvement, examined TSA's controls over the issuance of airport 
badges to individuals.
    Individuals who pose threats may obtain airport badges and gain 
access to secured airport areas, endangering the safety of airport 
workers, passengers, and aircraft. We identified badges issued to 
individuals with one or more omissions or inaccuracies in key applicant 
data used for vetting. For example, badges were issued to individuals 
without a complete security threat assessment (STA). Individuals were 
not always properly vetted, and badges were issued without the required 
information such as STA status, birthdate, and birthplace. Airport 
operators and local TSA officials were not fully aware of the details 
of the complex vetting process and the ramifications of entering 
inaccurate biographical data.
    TSA had designed and implemented only limited oversight of the 
badge application process. Specifically, the agency did not ensure that 
airport operators had quality assurance procedures to safeguard the 
completeness and accuracy of the data used for vetting. Despite its 
reliance on designated airport operator employees, TSA did not always 
ensure that airports were properly training these employees. Only one 
airport had a formalized training program focused on airport operator 
employees' duties and responsibilities. TSA also did not ensure that 
airport operator employees were using available tools to perform their 
assigned duties.
    In addition, TSA did not require its inspectors to verify airport 
data during interviews. TSA inspectors reviewed the airport badging 
process during inspections; however, this limited coverage did not 
ensure that vetting information was complete and accurate. Inspectors 
did not always have direct access to the Transportation Security 
Clearinghouse database and were not required to compare or cross-
reference records. Therefore, inspections of badging office records may 
have been insufficient to determine the airports' level of compliance 
with vetting process requirements. Direct access to clearinghouse data 
would enable inspectors to verify records for approved STAs in a timely 
manner and take immediate corrective action if necessary.
    TSA did not require airports to conduct recurrent Criminal History 
Records Checks (CHRC) to ensure that badge holders maintained their 
reputable status. According to airport and TSA officials, these checks 
should be conducted on a recurrent basis. These officials also 
indicated the self-reporting policy was ineffective because most 
employees would not report themselves for fear of losing their job. 
Some airports were proactive in mitigating risk in the CHRC process. 
According to TSA officials, the agency recognized the need for more 
frequent criminal checks. The Transportation Threat Assessment and 
Credentialing office, in cooperation with the agency's Office of Chief 
Council, was exploring implementation of a requirement to conduct 
recurrent CHRCs.
    Some sites we visited had best practices that could be implemented 
at other airports to ensure authenticity of documentation and data 
accuracy. In addition, in response to our preliminary findings, the 
Airports Council International--North America established a task force 
of its member airports to identify and evaluate best practices for 
airport identification badging. Some practices included conducting 
badging application audits to identify common errors to incorporate 
into training classes, providing advanced training on fraudulent 
document identification and document handling procedures, establishing 
checks to prevent duplicate records, and establishing a quality control 
process to review applicant information before it is submitted for an 
STA.
    We presented our findings to the airport operators, local TSA 
officials, and inspectors. Our analysis generated 101 updates, which 
airport operators sent to the Transportation Security Clearinghouse. We 
made recommendations to establish and implement quality assurance 
procedures for the badging process, ensure that airport operator 
employees receive proper training and tools to perform their assigned 
duties, require independent verification of approved applications, 
provide real-time reports on active badge holders, and conduct 
recurrent CHRCs. TSA concurred with all but one recommendation--on 
real-time reporting--with which it partially concurred.
    In closing, I would like to commend the Department for acting 
quickly on our recommendations in an effort to improve its operations 
and performance. The Office of Inspector General remains committed to 
performing audits and inspections, identifying issues, and making 
recommendations to assist DHS in carrying out its mission effectively 
and efficiently.
    Mr. Chairman, this concludes my prepared statement. Thank you for 
the opportunity to testify, and I welcome any questions from you or 
Members of the committee.

    Mr. McCaul. Thank you, Mr. Edwards.
    The Chairman now recognizes Mr. Lilly for his testimony.

 STATEMENT OF SCOTT LILLY, SENIOR FELLOW, CENTER FOR AMERICAN 
                            PROGRESS

    Mr. Lilly. Thank you very much, Mr. Chairman. I want to 
congratulate this subcommittee. I have felt that over the past 
decade we have seen a general degradation in the capability of 
the Federal Government to do the things it needs to do, and I 
think one reason for that is a decline in effective oversight 
by the Congress. The Congress has the capability of breaking 
down walls within bureaucracies, forcing the bureaucracy to 
share information with itself, as well as help the American 
people understand what the people who are paid with their tax 
dollars are doing. I think this hearing is a very good step in 
the right direction.
    Of all the departments in the Federal Government that I 
think need oversight, the Department of Homeland Security is 
the most, and that is for a number of reasons. I would say, 
first of all, I would like to very strongly agree with Governor 
Gilmore with respect to the mistake that I believe the Congress 
and the President made in creating this Department. There is a 
very good reason that the United States did not combine the 
Departments of Navy and War before World War II, but did so 
afterwards. I think after 
9/11 was the worst time we could have tried to combine 20 
disparate agencies with little background.
    There is an important lesson to be learned here, and that 
is politicians very often want to do the easiest and most 
visible thing when there is a problem, and that is to rearrange 
the boxes. But in fact, rearranging the boxes is almost always 
the wrong thing to do. If you had looked at the entire Federal 
Government and tried to identify the most troubled agencies, 
certainly the Immigration and Naturalization Service in the 
Department of Justice would have been among them on September 
11, 2001. Those problems should have been dealt with directly 
within the Justice Department at that time rather than trying 
to deal with the failings of that agency after combining it 
into a large and largely out-of-control Department. So I think 
that gives us some context as to why we have the problems we 
have.
    I think we also had serious leadership problems in the 
early days of the Department. I think a lot of less effective 
staff from other agencies were transferred to the Department, 
which compounded those problems. I think the Department 
developed a culture of excluding one another and the Congress 
from information that has to be shared within departments in 
order to make the Department work better.
    Of all the things that we could look at to try to improve 
the Department, I am not sure that duplication would be at the 
top of my list. We certainly need to be mindful of duplication.
    With respect to the local grants, it is a program that is 
declining in budget already. I think largely local governments 
don't want to spend even Federal money to solve the same 
problem twice.
    I am concerned about duplication, and we should look for 
opportunities--we should always be mindful of it and check for 
it, but I am much more concerned about the general lack of 
managerial talent within the Department, and within the 
Government generally, to make the large-type procurements that 
we are talking about with the Arizona border. This is obviously 
a project that takes a huge amount of skill. It has never been 
done. We need the best management the country has, and you 
can't always hire those on contract. If you don't have some of 
them working for the Government, you are going to have a 
problem.
    I want to say one other thing that I think this committee 
should look at. It is not directly in your jurisdiction, but I 
think it is an enormous problem. We talked about weapons of 
mass destruction. I think there is one area where we are 
failing pretty dramatically in that regard, and that is with 
respect to biological weapons.
    The threshold for nuclear weapons is quite high, as the 
efforts that Iran is making today show. The efforts for 
biological weapons are much lower. The ability to track them 
and the expertise necessary to produce them is far more 
difficult. The efforts that we are making in terms of producing 
antidotes or helping defend the American people or first 
responders I think have fallen completely flat.
    So with that I will conclude my testimony and am happy to 
take questions.
    [The statement of Mr. Lilly follows:]
                   Prepared Statement of Scott Lilly
    I want to congratulate the committee on their work in overseeing 
the operations of the Department of Homeland Security. The Department 
was created during my tenure as Minority Staff Director of the House 
Appropriations Committee and I have watched it struggle for more than 8 
years now. I must say that I have never witnessed greater chaos in 
Government than in the early years of this Department.
    There was an extended period in which they could not produce a 
directory of the names and phone numbers of their key employees. I did 
a report in 2005 detailing the data from an Office of Personnel 
Management study which showed that DHS employees ranked the performance 
of their Department dramatically lower than employees of other Federal 
agencies. During that period we had Departmental IG reports indicating 
that leaders of the deeply troubled Transportation Security 
Administration had awarded themselves $1.5 million in year-end 
bonuses--amounts one-third higher than handed out by any other Federal 
agency. TSA also spent $462,000 on an awards ceremony including nearly 
$2,000 for seven sheet cakes.
    In 2006, that same IG told ABC News that he had not been 
reappointed because the Secretary of the Department had labeled him a 
``traitor and a turn coat'' for his effort.
    We are finally seeing some improvement but DHS continues to need 
all of the oversight that the Congress can give it and it needs the 
support and understanding of Congress in mutual efforts to solve some 
of its most intractable and enduring problems.
    Having said that, I do not see the first issue raised by the 
General Accountability Office in their February 28 report, the 
potential for duplicative projects resulting in DHS local grants, as a 
particularly something that merits a lot of time and attention. We 
should be mindful of the possibility of duplication and agencies have a 
responsibility to get sufficient information about projects for which 
Federal funds are being requested to know whether they are likely to 
duplicate efforts in the same or neighboring jurisdictions.
    On the other hand, one would have to expect that local governments, 
having far greater planning resources to address local needs than the 
Federal Government, would also be concerned about using their Federal 
funds wisely and in a way that does not provide two solutions to the 
same problem. Frankly, I would be more concerned about local 
governments using funds requested under the banner of counterterrorism 
and security as a means of solving other problems not associated with 
that purpose. Ultimately GAO did not find duplication but simply a lack 
of optimal reporting.
    Federal Facilities Risk Assessment by the Federal Protective 
Service is different problem and a more troubling one. FPS is currently 
expected to make these assessments for about 2,300 facilities a year. 
They charge agencies occupying these facilities for the cost of the 
assessments at a rate that appears to be somewhere between $80,000 and 
$100,000 per facility. One problem is that at least some agencies seem 
to lack confidence in FPS to competently perform this work. In 
addition, there appears to be a problem with FPS being able to simply 
execute these assessments at all. Finally, the question has been raised 
as to whether FPS is charging an unreasonable price for such services.
    The committee should get to the bottom of these problems. There are 
at least two sides to every problem. It would strike me as entirely 
plausible that FPS simply lacks the expertise and management 
capabilities to effectively perform this function. It is also plausible 
that other agencies are unwilling to give up turf to a central provider 
of services even thought that would be a more logical and less costly 
approach. It is also plausible that both of those scenarios are 
accurate. The amount of money involved is not small but the importance 
of protecting Federal facilities is even bigger. The committee should 
insure that the facilities are protected and at a reasonable cost to 
the taxpayer. It may take a lot of time and patience but that is what 
good oversight is all about.
    Finally, I noticed that an issue not in the latest GAO report was 
mentioned in the Chairman's comments about this hearing on the 
committee website. Those comments involved the Arizona Border 
Surveillance Technology Plan which is simply the latest iteration of 
efforts that now date back 15 years and previously known as Secure 
Border Initiative Network. Over time we have spent close to a billion 
dollars on these efforts and they have yet to demonstrate anything like 
the capability we had all hoped for.
    It is tempting in a political season to assign blame for such 
failure. I could point out that this particular contract was crafted in 
2005 and signed in 2006. But I don't think that accomplishes much if we 
want to solve the problem. Good oversight is not about who does the 
best job of playing ``gotcha'' but finding out why bureaucracies fail 
to perform. Is this problem simply lacking the managerial competence in 
DHS to organize a task of this dimension? Is it that smart people were 
sold on technologies that were still not mature enough to work in the 
real world? Is poor contract performance to blame? Is this a problem 
that will simply take a lot of time, money, and patience to solve? Is 
it some portion of all of these?
    The answers to these questions are important and this committee can 
play a vital role in forcing out the truth--but only if it truly seeks 
the truth and unfortunately that is sometimes not the real objective of 
oversight investigation.
    Again, I congratulate you on holding this hearing and would be 
happy to answer any questions the subcommittee may choose to ask.

    Mr. McCaul. Thank you, Mr. Lilly. We appreciate your 
remarks about oversight. You of all people know how important 
it is for the Congress to provide oversight. You know, we 
legislate, we pass laws, but through oversight we can make the 
Executive Branch more effective. I think a lot of times we 
introduce bills that go nowhere, and particularly in this 
Congress we see a lot of gridlock. I think oversight, and what 
we are doing here today, we can make changes for the better. As 
you mentioned, this Department probably needs more oversight 
than any other. So thank you for your testimony.
    My first question has to do with--you know, when I got the 
information from the IG report and GAO, I was very alarmed by 
the corruption within the Border Patrol, Customs and Border 
Patrol, particularly the case involving the agent who 19, 20 
different times facilitated cartels with drug transactions, 
bringing cash and weapons into the airports, getting past 
screening with a badge, and taking those cash and weapons out 
of this country to groups I consider to be terrorists. Then I 
saw there were over 200 active investigations, cases.
    I guess, Mr. Edwards and Ms. Berrick, I mean, how extensive 
is this problem? How can we stop it? Because as a former public 
corruption prosecutor, I see nothing more offensive than 
somebody that has sworn an oath to our country and our 
Constitution then betraying our country and our Constitution by 
these acts.
    Mr. Edwards. Mr. Chairman, preventing employee corruption 
is a difficult task, especially the value a corrupt employee 
brings to the criminal enterprise, mainly involving the drug 
trade. The Department uses pre-employment screening, CBP uses 
polygraphs, and they also do a periodic background 
investigation to help address the corrupt employees and to 
identify infiltrators. But that alone is not enough.
    We, along with the components, do integrity briefing and 
training to alert employees on signs of corruption and the 
consequences of corruption, and also invite employees to come 
to us and let us know if they see corruption that exists. We 
also work with law enforcement entities and components to 
detect and to arrest corrupt employees. Besides civil rights 
violations, this is our highest domestic priority. Last year, 
in fiscal year 2011, we arrested 403 employees.
    But to answer your question, we need to have effective, 
strong internal controls, which is critical to detecting, 
deterring, and preventing these type of incidents.
    Mr. McCaul. Well, over 400 arrests?
    Mr. Edwards. Four hundred and three, sir.
    Mr. McCaul. Border Patrol agents?
    Mr. Edwards. All arrests per fiscal year 2011.
    Mr. McCaul. I mean, this is sort of like an enemy within 
that we need to pay attention to. I was not aware of the 
extensive nature of this corruption within the Department, and 
thank you for calling that to our attention.
    Ms. Berrick, do you have anything to add to that?
    Ms. Berrick. Mr. Chairman, while the IG does criminal 
investigations of these cases, GAO's role is more to look at 
what controls the agencies have in place to detect and prevent 
this prior to some criminal act happening. We actually have 
some on-going work now looking into these issues. There is more 
Congressional interest in this.
    For example, we are looking at the integrity of border 
agents and what controls DHS has in place to ensure that. We 
are going to be reporting out this summer. We have some similar 
work at TSA as well. We would be happy to brief you and your 
staff when that work is completed.
    Mr. McCaul. I am also concerned about some of these 
employees that work in fast-food restaurants in the airport, 
and they have these badges to get in without screening. You 
often wonder what kind of background checks are done on these 
individuals as well.
    When I was working counterterrorism, we initially did a 
sweep of all the airports of illegals who were working within 
the airports who had these badges because they can be 
compromised.
    So the other issue that is so important to me being from 
Texas is the border, and what are we doing to better secure the 
border? In the technology piece, you know, we have done a lot 
with the fencing and all that, and added more agents, but the 
technology piece is the piece that has not been completed. When 
I hear the Secretary say it is going to be another 10 years 
before that can be done, you know, a lot of my constituents get 
very frustrated about that.
    So SBInet in the Arizona Tucson sector was a colossal 
failure to the tune of almost $1 billion. What is the 
Department doing now? I know, Ms. Berrick, you have called into 
question the technology piece in the Tucson sector today in 
terms of they are not doing it the right way.
    Ms. Berrick. Right. Thank you, Mr. Chairman.
    With respect to SBInet deployed along 53 miles of the 
highest-risk area within Arizona, we found that Border Patrol 
generally thinks it is providing value. They are happy with the 
increased support it is providing. However, the Army Test and 
Evaluation Command did a study that actually found SBInet is 
only providing a marginal improvement in interdiction 
capability when you compare it to what was already on the 
ground, ground sensors and other things.
    So we actually recommended that DHS do a post-
implementation review, because they are spending money 
maintaining that system, as you mentioned, along the 53 miles, 
to really see is it worth the investment that we are paying for 
this?
    The second piece to this is DHS's new strategy for securing 
the Southwest Border, starting in Arizona. They are calling it 
the Arizona Technology Plan. There is a lot of similar 
technologies that they are planning on using that they were 
going to be using for the failed SBInet. We have called into 
question the need for CBP to do better planning, to make sure 
that they can justify the specific technologies, the locations, 
the numbers that they are going to pursue so that Congress can 
make informed decisions about those and also have better life-
cycle cost estimates. We found that the estimates were a very 
rough order of magnitude. We think there is a potential for 
significant more funds being needed to roll this out as DHS has 
envisioned it. So we think they need more rigor in how they go 
about pursuing this part two of securing the border.
    Mr. McCaul. In this time of budgetary constraints as well, 
Congressman Cuellar and I--he is from Laredo, and I am from 
Austin--we talked a lot about leveraging existing technologies 
within the Federal Government. I mean, too often we are 
stovepiped. So the DOD has some great sensor surveillance 
technology that already exists, and the private sector has a 
lot of this already. We don't need to start from scratch. As we 
draw down our operations in Iraq and Afghanistan, I think that 
we ought to be reallocating those technologies to the Southwest 
Border. In fact, on a recent trip to Afghanistan and Pakistan 
and Iraq, we talked to the generals about that. I think that 
would be an effective use of the Federal Government's 
resources.
    The final question, because my time--well, I am about 2, 
almost 3 minutes over, but, Governor, I just wanted to, with 
all of your vast experience in this issue--to some extent I 
agree with you, you know, merging 22 agencies. I mean, what a 
difficult task. I don't envy any Secretary of this Department. 
It is a monumental task they have. What, in your opinion--just 
a very general question: What do we need to do to fix this 
Department?
    Mr. Gilmore. Mr. Chairman, I think that this is a good 
time, 10 years on after the 9/11 attack, to simply do a 
management assessment of whether or not the structure of the 
Department of Homeland Security is the best way to carry out 
the mission of protecting the Nation. There are other 
alternatives that we offered and that other people have 
offered.
    We do not wish this Department any ill. We wish it success, 
particularly because the security of the Nation depends on it. 
But an overall management assessment, particularly the work 
that is being done by the GAO and the inspector general, we 
think are productive. But I would be cautious about only 
looking at the granular issues that have been addressed here 
this morning, this person or that person, or the badge is not 
right, or you can't get into the fast food areas. I think an 
overall management look at the Department and the mission that 
needs to be carried out 10 years on would be a very healthy 
thing. The Congress, of course, could lead in that way and make 
that happen.
    Mr. Chairman, if I might add one more thought about this, 
we believe at Free Congress that there are several serious 
threats to the Nation. We think that the lack of growth and the 
economic downturn is the greatest challenge to our National 
security that exists. But also the threat to the Southern 
Border is very serious, in our view. I don't think that any 
consistent policy has been articulated yet as to what we are 
trying to do down there other than build fences and perhaps 
capture people in the desert.
    At the end of the day, people are corrupt because of money, 
because of the great deal of money that can be offered to 
people, which means that I believe that a public statement from 
the Congress would be very healthy to say that it isn't just a 
matter of taking money and being publicly corrupt in violation 
of the criminal laws. I myself was a prosecutor. The public 
statement really ought to be that people who take money from 
drug people in order to smuggle and set up abilities to be 
corrupt are actually betraying their country.
    In fact, the people who are using these products that are 
being offered in the United States of America, when they use 
them, they aren't just breaking the criminal law, they are 
betraying their country, because they are setting up an 
opportunity here for insecurity. These corruptions and 
methodologies that are going on along the Southern Border, you 
wait until we get into another major conflict in this country 
and people want to strike inside this country. The vehicles and 
methods and routes to do damage to this country exist on that 
Southern Border.
    Mr. McCaul. Thank you. I couldn't agree with you more. I 
have been talking a lot, this is my fourth term, 8 years, about 
that border and the threat that is posed from the Southern 
Border. You know, just recently with what is going on in Iran, 
with Israel, the Iranian operative thinking he is contracting 
with Los Zetas, the drug cartels, to take out the Saudi 
Ambassador in Washington, they are becoming more operational. 
We know that the Qods Forces and Hezbollah have a presence now 
in this hemisphere. That Southern Border, I think, poses a 
serious threat. Thank you for identifying that.
    I am well over my time. With that, I recognize Ranking 
Member Mr. Keating.
    Mr. Keating. Thank you, Mr. Chairman.
    I thank Mr. Lilly for recognizing that Congress has a role 
in viewing this, but I have got to tell you I think we are 
going to be here time and time again--it is like shining a 
sneaker--trying to see what DHS can do. Until we address the 
fundamental issues, there is going to be inherent waste and 
duplication.
    I think there is an estimate, Mr. Lilly, that Homeland 
Security is subject to one of the most fractured jurisdictions 
in terms of responsibility. It is estimated it reports to over 
100 Congressional committees and subcommittees. How has this 
disjointed jurisdiction affected this duplication? Until we can 
start to--how can Congress approach this if things are so 
fractured? What do we have to do ourselves on these 
jurisdictional issues? Because I will tell you, we are going to 
be here long after I am gone talking about the same thing until 
we do some fundamental restructuring.
    Mr. Lilly. Well, I think Congress plays a role in this. I 
really prepared my remarks with respect to the Executive Branch 
issues. But a number of agencies, or a number of departments 
have multiple jurisdictions in the Congress. But I don't think 
there is any example that is as divided as this is. Even where 
there is multiple jurisdictions, for instance--well, the 
jurisdictions split pretty cleanly within the organization of 
the executive department, so it is clear which agency or which 
committee of the Congress has jurisdiction over what. You 
normally end up with one authorizing committee that plays the 
lead role and one appropriations subcommittee, and I think that 
can work quite effectively.
    I think that there needs to be more coordination between 
the authorizing committees and the Appropriations Committee, 
because I think you can dig into things a lot more deeply than 
the Appropriations Committee can. But certainly if the Congress 
would clean up its act and try to streamline jurisdictions, 
that would be a big assistance to oversight.
    Mr. Keating. I don't think I can do my job with the current 
situation as effectively as I can. I don't think DHS can do 
their job with the current situation.
    Mr. Lilly. I will give you an example of an issue that I 
don't think is being addressed right now, and that is the flood 
insurance under FEMA, which is not under the control of this 
committee, but the banking committee. We are paying insurance 
companies about 8 percent in order to basically do the 
paperwork on this. They have no risk at all. I think the price 
that we are paying is way out of line. Somebody needs to be 
looking at that. As far as I can tell, the banking committee 
isn't.
    Mr. Keating. Most of us were in Philadelphia just a few 
days ago. You know, there is a perimeter breach that was there. 
Yet when we had our hearing at Logan Airport in Boston earlier 
this year, we found out that that is just a local 
responsibility. There is no Federal responsibility at all on 
those issues the way it is set up.
    Governor Gilmore, I mean, we could be here forever dealing 
with this, but those jurisdictional lines have to be combined. 
We are asking an agency that has day-to-day responsibility with 
our safety on one hand to be over here, and there is just a 
myriad of different agencies they have to deal with. No one 
could do their job as efficiently as they could unless we get 
that resolved.
    Mr. Gilmore. Congressman Keating, I think you are right, 
and I appreciate your leadership on that. You will find that 
our Commission reports, all five of them, are replete with 
recommendations to the Congress that they simplify their 
oversight capabilities by reducing the number of committees 
that the Department and that the Homeland Security authorities 
have to respond to. That has not been done. Why not? Because 
territorial--because the Congresspeople want to protect their 
territory, and their authority, and so on. So in order to 
protect that territory inside the Congress, they are 
sacrificing the National security of the United States. It is a 
simple trade-off. In fact, this report right here on page 16 
starting on that is an admonition to the Congress to simplify 
their oversight capabilities by reducing the number of 
committees. Actually, this committee and this subcommittee 
exist today because of those reforms, but they didn't undo all 
the other oversight as well.
    Mr. Keating. Ms. Berrick, would you like to comment on 
that?
    Ms. Berrick. Thank you, Representative Keating.
    I can certainly see it causing challenges for the 
Department day in and day out working with them, with reporting 
to multiple committees. GAO is sometimes asked this question 
directly since, of course, we work for the Congress.
    I think that the key issue is how well the committees work 
together and coordinate. Frankly, we are not doing any more 
investigations at DHS; we are not being asked by Congress to do 
any more than we are doing for similar-sized organizations. Our 
experience has been that the committees generally have worked 
together well, usually have multiple requesters on engagements 
that GAO is asked to do.
    So I think the key, again, is how well those committees 
work together, but certainly can sympathize with DHS on the 
multiple reporting requirements and oversight.
    Mr. Keating. I will just close and say that we are looking 
at duplication, we should look at ourselves first right here in 
Congress.
    Thank you. With that, I yield back.
    Mr. McCaul. I associate myself with the Ranking Member's 
remarks. We talked about how the Federal Government is 
stovepiped and doesn't work well together, and yet on this very 
issue--and it was a recommendation of the 9/11 Commission--was 
that the Congress consolidate under one committee oversight and 
authorizing of the Department, and yet you have got so many 
other committees that have that responsibility as well. It 
should be consolidated.
    With that, I recognize the gentleman from Missouri, former 
auctioneer, Mr. Long.
    Mr. Long. Thank you, Mr. Chairman.
    Mr. Gilmore, in February, the DHS Under Secretary of 
Management told the subcommittee that some of the existing 
contracting offices within DHS and its components may be 
duplicative and unnecessary, which, from your testimony, I am 
sure you agree with. How might DHS restructure its contracting 
offices to maximize the efficiency and then eliminate 
duplication?
    Mr. Gilmore. Congressman, the way I would approach it would 
be to ask: What is the mission? What are we trying to 
accomplish? The various components need to harmonize and work 
together in order to complete the mission. Procurement within 
those different agencies needs to be directed towards the 
accomplishment of the overarching mission. There is no reason 
why you couldn't simply have the ability to combine much of the 
procurement into one place with one's ability to oversee the 
procurement so that instead of a mission for each individual 
agency, as disparate as they may be, they could be combined to 
carry out the overarching Homeland Security mission. So in 
other words, there could be a combination of this in a 
consolidation.
    Mr. Long. Is the turf battles why you see so much 
duplication, you think?
    Mr. Gilmore. No. Well, as I have said, I think there is a 
turf battle in Congress. I don't know whether there is a turf 
battle----
    Mr. Long. I am talking about within the----
    Mr. Gilmore. I do know that. I think that within the 
Department itself, the Secretary would have a feel for whether 
or not she is obstructed by turf battles within the different 
agencies. I think it is more likely that each of the agencies 
came in, 10 years ago, into the Department with disparate 
missions and different structures and different ideas about how 
to carry things out, and they are trying to do all of that. Now 
the question is whether that combines into the overall mission 
of the Department of Homeland Security. That will be a good 
study, I think, for GAO.
    Mr. Long. Thank you.
    Mr. Lilly, you have said that you are not as concerned 
about duplication, or at least duplication would not be No. 1 
on your priority list. If you are just going to name three 
things that we should be the most concerned with, what would be 
your top three priorities?
    Mr. Lilly. Well, I think the first thing is just attracting 
the caliber of management to the Department, to the Federal 
Government.
    Mr. Long. Okay. You have mentioned that a couple of times. 
Where are we falling short on that? What caused the current 
morass?
    Mr. Lilly. Well, I think there are a number of things that 
have happened. One is I think we had a pretty talented 
generation of managers that came into the Government in the 
1960s and 1970s, and they came in in a bunch, and they are 
leaving in a bunch. So you have got kind of a vacuum as a 
result of that.
    Also, I know there are people up here that are wanting to 
talk about how much Federal employees are overpaid, and there 
may be some levels where that is true. The recent CBO study 
showed that for employees with less than a college degree, the 
Federal Government pays more. But at the very top end, when you 
are talking about program managers and contract officers, we 
don't pay enough to hold them.
    You can go to any department, and you can see our best 
people in Government are being hired by the contractors that 
work for the Government and paid $20,000, $30,000, $50,000 more 
than they are making working for the Government. So we just 
have a continuous system of dumbing down our best talent 
because we are not competitive at that level.
    If you wanted a project officer that is going to be able to 
figure out how to use information technology to protect the 
border, you are talking about a very high-priced piece of 
talent, and if you are not willing to pay for it, you won't get 
it. I don't think we do have it.
    Mr. Long. Okay.
    Ms. Berrick, why does DHS maintain three separate 
information-sharing mechanisms for the public transit agencies?
    Ms. Berrick. Thank you. This was an issue we reported on 
last year. I think the reason is in DHS's early years, they 
were very focused on getting out as much security information 
as possible to stakeholders, so they used many different 
methods to do that, which is understandable wanting to get that 
information out. They paid less attention to are these systems 
duplicating each other and also, frankly, how useful the 
information is to the recipients.
    Now that DHS is maturing, we have been looking at this 
issue and have made a number of recommendations that DHS 
streamline these information-sharing mechanisms, and also 
solicit feedback from the recipients of this information to 
make sure it is, in fact, what they need, because what we have 
heard in a number of cases--one example is in the 
transportation security area--is stakeholders, you know, rail 
operators are getting information from so many different 
sources that they tend to stop looking at it because they are 
getting overwhelmed.
    Mr. Long. Right.
    Ms. Berrick. So I think that is the reason. Again, DHS is 
moving in the right direction, I think. They have already taken 
action to consolidate some of these information-sharing 
networks for transit operators, for example. But I still think 
that there is more that can be done.
    Mr. Long. Okay. Thank you.
    I thank you all for your testimony. I yield back.
    Mr. McCaul. I thank the gentleman.
    The Chairman now recognizes Mr. Duncan from South Carolina.
    Mr. Duncan. Thank you, Mr. Chairman.
    Before I ask any questions, I want to talk about a comment 
that was just made about turf battles, and related to a hearing 
we had on border and maritime security this week dealing with 
these overstays. During the testimony and questioning, it was 
brought up that the agencies involved, whether it is CBP or ICE 
and even the Department of State, aren't communicating. I hear 
the word ``turf battles,'' and I think about the 9/11 
Commission report and the fact that they revealed that these 
agencies that were charged with protecting our great land--the 
FBI, and the CIA, and NCIS, and all these others--weren't 
communicating; that there were walls often put up between 
agencies.
    It alarms me, Governor Gilmore, that we are talking about 
turf battles. We shouldn't have turf battles. The battle that 
we are fighting is for American turf and American liberty here 
in this country. The 9/11 Commission report clearly indicated 
that agencies needed to communicate in order to keep this 
country safe.
    So, Mr. Chairman, I ask that we have an oversight hearing 
on this particular issue, of agencies communicating, because I 
think we are charged with--in this whole committee and 
subcommittee--with doing that. So I appeal to you.
    A question I have is a question that I brought up with 
Secretary Napolitano, and it is an area of duplication. One 
area of possible duplication seems to be the International 
Affairs Division. The President's fiscal year 2013 request 
seeks to realign the DHS Office of International Affairs as an 
independent office responsible directly only to the Secretary. 
In addition to the DHS' office, the components, such as CBP, 
ICE, and TSA, all run their own international affairs offices. 
So I guess for Ms. Berrick, has GAO investigated whether there 
is duplication and overlap in this area? If so, what did you 
find?
    Ms. Berrick. We haven't looked at the specific issue of the 
nine offices within DHS, our international affairs offices. 
However, in our report that we issued last week, we did look at 
duplication among different agencies' internal affairs offices 
and delivering training to foreign posts in other countries and 
found that just among the internal affairs offices among 
multiple agencies, there was a lack of coordination on what 
this training should be. So as a result, these foreign posts, 
the CBP officers and others, were getting similar training from 
multiple sources. So I think there is certainly a potential 
there, since we found that on a broader scale, but we haven't 
specifically looked at that within DHS.
    Mr. Duncan. I think at a time when we need to streamline 
Government, and that is what I think this Congress is trying to 
do--I understand Customs and Border Patrol is basically looking 
at protecting folks coming into our borders and our ports; and 
TSA, transportation, making sure that the terrorists aren't 
flying into this country with weapons of mass destruction. Then 
ICE, if we do have an immigration or customs issue, they are 
going to enforce that. Hopefully they are going to remove that 
element and enforce the laws on the books.
    So I get that they are all different missions. I guess what 
I am looking at is an international office under the DHS 
necessary to streamline that, or is there true duplication?
    So I will ask Mr. Lilly there if he wants to answer.
    Mr. Lilly. I would just say I think what you are talking 
about there is--the goal would be to consolidate all of this so 
there is one voice for the Department of Homeland Security. But 
I think you have to recognize that you still have these 
different cultures operating within the Department. The 
immigration people are competent to deal with their 
counterparts overseas, and that is very important because we 
have a lot of expectations with foreign governments in terms of 
the way they deal with this.
    But the sharing of information is something that is a 
process that takes time. So your goal is to get to one DHS 
office in an embassy in Rome, or wherever, but right now you 
may have to sacrifice that in order to make sure that you are 
communicating agency by agency with your foreign counterparts.
    Mr. Duncan. Well, I guess I am looking at--the NCTC was 
created after 9/11, the Department of Homeland Security was 
created after 9/11, and with the intent purpose of making sure 
that all of our agencies charged with security are 
communicating and are doing the mission to defend this great 
country. I think we have grown Government so much that we are 
actually--it seems to me we are working counter to that 
original 9/11 Commission report that charged us and created 
this agency.
    So I am alarmed that information sharing isn't happening, 
and that we are so large that maybe we are cumbersome and not 
able to fulfill the mission. Sometimes simple and smaller is 
more efficient and better.
    So I yield back the balance of my time.
    Mr. McCaul. I appreciate the gentleman's comments. I think, 
you know, when each of the 22 have their own procurement 
officer, acquisition, Mr. Lilly, One DHS really is the goal, 
and I think that hopefully we will get to that point. I think 
the gentleman from South Carolina is correct. We have created 
so many different organizations--now the DNI, for instance--I 
mean, it just, I think, complicated things.
    I just want to close by saying on the public corruption 
issue, to me, it is appalling that we have Federal officers, 
Federal agents facilitating working with drug cartels or 
terrorists. That, to me, is unacceptable. That is no different 
than Hanssen within the FBI or Aldrich Ames in the CIA 
betraying their countries, as Governor Gilmore stated.
    So with that, I want to thank the witnesses for their 
testimony. This has been an outstanding hearing. With that, 
this hearing is adjourned.
    [Whereupon, at 10:18 a.m., the subcommittee was adjourned.]

                                 
