[Senate Hearing 112-196]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 112-196
 
 THE HOMELAND SECURITY DEPARTMENT'S BUDGET SUBMISSION FOR FISCAL YEAR 
                                  2012

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

                                HEARING

                               before the

                              COMMITTEE ON
               HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
                          UNITED STATES SENATE


                                 of the

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               __________

                           FEBRUARY 17, 2011

                               __________

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

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




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        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

               JOSEPH I. LIEBERMAN, Connecticut, Chairman
CARL LEVIN, Michigan                 SUSAN M. COLLINS, Maine
DANIEL K. AKAKA, Hawaii              TOM COBURN, Oklahoma
THOMAS R. CARPER, Delaware           SCOTT P. BROWN, Massachusetts
MARK L. PRYOR, Arkansas              JOHN McCAIN, Arizona
MARY L. LANDRIEU, Louisiana          RON JOHNSON, Wisconsin
CLAIRE McCASKILL, Missouri           JOHN ENSIGN, Nevada
JON TESTER, Montana                  ROB PORTMAN, Ohio
MARK BEGICH, Alaska                  RAND PAUL, Kentucky

                  Michael L. Alexander, Staff Director
  Christian J. Beckner, Associate Staff Director for Homeland Security
                       Prevention and Protection
   Mary Beth Schultz, Associate Staff Director and Chief Counsel for 
                                Homeland
                   Security Preparedness and Response
     Brandon L. Milhorn, Minority Staff Director and Chief Counsel
   Brendan P. Shields, Minority Director of Homeland Security Policy
                  Luke P. Bellocchi, Minority Counsel
                  Trina Driessnack Tyrer, Chief Clerk
         Patricia R. Hogan, Publications Clerk and GPO Detailee
                    Laura W. Kilbride, Hearing Clerk


                            C O N T E N T S

                                 ------                                
Opening statements:
                                                                   Page
    Senator Lieberman............................................     1
    Senator Collins..............................................     2
    Senator Landrieu.............................................    12
    Senator McCain...............................................    14
    Senator Johnson..............................................    17
    Senator Tester...............................................    19
    Senator Portman..............................................    22
    Senator Akaka................................................    24
    Senator McCaskill............................................    29
Prepared statements:
    Senator Lieberman............................................    33
    Senator Collins..............................................    35

                                WITNESS
                      Thursday, February 17, 2011

Hon. Janet A. Napolitano, Secretary, U.S. Department of Homeland 
  Security:
    Testimony....................................................     4
    Prepared statement...........................................    38
    Responses to post-hearing questions for the Record...........    49

                                APPENDIX

Department of Homeland Security Budget-in-Brief, Fiscal Year 2012   129


 THE HOMELAND SECURITY DEPARTMENT'S BUDGET SUBMISSION FOR FISCAL YEAR 
                                  2012

                              ----------                              


                      THURSDAY, FEBRUARY 17, 2011

                                     U.S. Senate,  
                           Committee on Homeland Security  
                                  and Governmental Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 2:39 p.m., in 
room SD-342, Dirksen Senate Office Building, Hon. Joseph I. 
Lieberman, Chairman of the Committee, presiding.
    Present: Senators Lieberman, Akaka, Landrieu, McCaskill, 
Tester, Collins, McCain, Johnson, and Portman.

            OPENING STATEMENT OF CHAIRMAN LIEBERMAN

    Chairman Lieberman. The hearing will come to order. Thank 
you all for being here, particularly thanks to Secretary 
Napolitano.
    This is our Committee's annual hearing on the Department of 
Homeland Security's budget request, in this case, of course, 
for fiscal year 2012.
    Before we begin, as you know, Madam Secretary, the 
Department of Homeland Security emerged as a legislative 
proposal from this Committee. We feel close to the Department 
and to everybody who works for the Department and in the 
Department. In that sense, we felt the loss this week of 
Immigration and Customs Enforcement (ICE) Agent Jaime Zapata, 
who was shot and killed Tuesday in an ambush on a Mexican 
highway, and his colleague Victor Avila, who was also shot and 
remains hospitalized. Perhaps you could give us a report, but 
he is in our prayers, and I gather that he is doing better.
    This savage attack--and, coincidentally, a suicide bombing 
that killed a retired Customs and Border Protection (CBP) 
officer in Afghanistan last week--reminds us of the risks 
assumed every day on our behalf by the men and women who work 
at the Department of Homeland Security (DHS). And so I wanted 
just at the beginning to express our thanks to all of them, 
each of them for their commitment, through you, their leader, 
and tell them how much we honor and appreciate their service.
    These attacks also remind us of the variety of threats our 
Nation faces and, therefore, the Department's equally varied 
set of responsibilities and missions to protect us from those 
threats. Clearly one of the most important missions DHS has is 
to prevent terrorism against our homeland. It was the 
motivating event for the creation of the Department. As you 
noted last week, the threat of terrorism today ``may be at its 
most heightened state'' since the attacks of September 11, 
2001, and I would like to talk to you during the question-and-
answer period about that.
    But to get to the bottom line here, the President's budget 
request for fiscal year 2012 asks for $43.2 billion in net 
discretionary funding. That is an increase of 1.5 percent from 
the current level of funding, and it is a decrease of 0.8 
percent from the Department's request for fiscal year 2011.
    Given the enormous deficits and national debt that we are 
struggling with today, it seems to me, generally speaking, that 
the President's budget request for the Department of Homeland 
Security is responsible and it is fair. It does not include 
everything I would have wanted in the best of times, but I 
appreciate that we are not living in the best of times 
economically, and that the President and you have had to make 
some tough decisions in putting the budget together.
    I do want to say I was pleased that the budget request does 
put additional resources into critical mission areas, such as 
terrorist travel security and cybersecurity, and I think those 
are the right priorities.
    I also want to express my appreciation for the fact that 
the budget funds these increases and a few other programmatic 
increases by cutting administrative costs by $800 million, 
including a significant and, from my perspective, welcome 
reduction in personal services contracts. That is just about 
the best way to fund some of the critical needs for extra 
support in the budget, which is to say by finding economies 
within your own budget. And you have also identified selected 
programmatic decreases across the Department, as you must in 
tough times.
    There are some reductions which I am sure trouble other 
Members of the Committee, as they do me, and we will 
undoubtedly talk about them with you. The Federal Emergency 
Management Agency (FEMA) takes a hit in its operating budget. 
There are some cuts in the program of Federal grants for local 
fire departments, which have a lot of support here in Congress. 
But, overall, I repeat what I said at the beginning, in a tough 
time for our Federal Government with probably the major focus 
that all of us have, as you can see from the day-to-day 
developments around here: How do we bring Federal spending back 
into balance with revenues? I think this is a fair and 
responsible budget. I almost said ``fair and balanced,'' but I 
got worried that it would be confused with other activities in 
Washington.
    So I look forward to your testimony and, of course, to 
continuing to work with you in this session Congress, as we 
very productively in the last one, to ensure that the 
Department of Homeland Security has the resources and the 
authority it needs to carry out its critical mission on our 
behalf.
    Senator Collins.

              OPENING STATEMENT OF SENATOR COLLINS

    Senator Collins. Thank you, Mr. Chairman.
    Mr. Chairman, in the interest of time, I am just going to 
make a few comments, and I would ask that my full statement be 
inserted in the record.
    Chairman Lieberman. Without objection.
    Senator Collins. First, Mr. Chairman, let me associate 
myself with your comments about the two ICE agents, one of whom 
was killed, and the other wounded. It does remind us of the 
tremendous risks that law enforcement officials at every level 
of government face--particularly since we are here today with 
the Department of Homeland Security, we want to recognize those 
efforts, law enforcement at every level makes on our behalf of 
us each and every day.
    When Congress and the Administration formulate the budget 
for this country, we are in essence establishing our national 
priorities. Controlling spending, reducing our ruinous level of 
debt, and funding highly effective programs to protect our 
Nation are among those priorities.
    Many of us are disappointed in the President's budget. We 
believe that it does far too little to rein in spending to 
bring the Federal debt under control. It spends and borrows too 
much. It will lead to a record $1.6 trillion deficit in the 
next fiscal year. It would double the publicly held debt by the 
year 2013 and triple it by 2020. That is simply not sustainable 
and puts our Nation on a ruinous fiscal course.
    Today we are gathered to review one component of that 
budget: The proposal for the Department of Homeland Security. 
Protecting our Nation and our citizens is not just a line item. 
It has to be a top priority. In fact, I think most people would 
agree that the number one responsibility of a government is the 
protection of its citizens. With tight budgets, we must work 
together to eliminate wasteful and unproductive programs and to 
increase the effectiveness and efficiency of government 
operations.
    The criteria used by the Administration in making these 
decisions for the Department of Homeland Security, however, 
seem to be opaque because some very important programs appear 
to have been cut while others remain unscathed.
    For example, the homeland security grants that help our 
local first responders improve their effectiveness and serve as 
a force multiplier for Federal resources have been reduced. 
That could undermine our State and local partners who are the 
first on the scene whenever disaster strikes, whether it is a 
natural disaster or a terrorist attack.
    In testimony before the House last week, Secretary 
Napolitano stated that ``in some ways, the [terrorist] threat 
facing us is at its most heightened state since September 11, 
2001,'' and that is why we have to take a close look at the 
funding levels.
    I am also disappointed that the Administration again has 
proposed to limit Operation Stonegarden to just the Southwest 
Border. This effective program, which relies on partnerships 
with State and local law enforcement, should be used to help 
secure both our Northern and Southern Borders.
    Senator Lieberman and I recently released a Government 
Accountability Office (GAO) report that found, shockingly, that 
the Border Patrol has effective control of only 32 miles of the 
4,000-mile Northern Border and has situational awareness of 
only about a quarter of that border. And while the Northern 
Border does not have as many problems as the Southern Border, 
it is vulnerable, nonetheless, to illegal crossers, including 
individuals seeking to illegally come to this country, 
criminals trafficking in humans and drugs, and, potentially, 
terrorists.
    I have mentioned before that the smuggling of 
methamphetamine is one example of the growing problem along our 
Northern Border, and it is a particular problem in the State of 
Maine.
    The Stonegarden funds have been extremely successful in my 
State in allowing local, county, and State law enforcement to 
work with the Border Patrol and other Federal officials.
    The Chairman has mentioned the fire grant program, a 
program that works with a minimum of bureaucracy to ensure that 
fire departments have the support they need.
    Let me just finally mention one area of great concern to 
me, and that is the budget for the Coast Guard. The Coast 
Guard's fleet is among the oldest in the world, yet the men and 
women of the Coast Guard continue to perform ever expanding 
missions with a high degree of success. They deserve a fleet 
worthy of their efforts, but the President's budget proposes a 
22-percent reduction in the Coast Guard's Deepwater program. 
That is a cut of $259 million. Much of this cut is due to the 
fact that no funding is proposed for the sixth National 
Security Cutter. This will push completion of the eighth, and 
final, cutter back to 2018. And as we know, the High Endurance 
Cutters, of which there are 12, are aging rapidly and causing a 
great number of problems for the Coast Guard.
    I am, like the Chairman, pleased to see the increases in 
the cybersecurity budget. I think this is an emerging threat 
that is getting worse with each passing day.
    Finally, I will be pursuing in my questions that I remain 
disturbed that FEMA has done so little to recoup the improper 
payments that occurred in the wake of Hurricane Katrina. The 
investigation we did showed that those improper payments 
approached $1 billion, and the inspector general (IG) has 
identified more than 160,000 applicants that have received 
improper payments totaling more than $643 million that have yet 
to be recouped.
    Again, I look forward to discussing these issues with the 
Secretary. I do want to acknowledge that I appreciate the 
efficiencies and business practices that the Secretary has 
worked very hard to achieve. Thank you.
    Chairman Lieberman. Thanks, Senator Collins.
    Secretary Napolitano, it is great to welcome you back. It 
has been a real pleasure to work with you the last couple 
years, and we look forward to the next two as well.

   TESTIMONY OF HON. JANET A. NAPOLITANO,\1\ SECRETARY, U.S. 
                DEPARTMENT OF HOMELAND SECURITY

    Secretary Napolitano. Well, thank you, Chairman Lieberman, 
Senator Collins, and Members of the Committee, for the 
opportunity to discuss President Obama's fiscal year 2012 
budget for the Department of Homeland Security.
---------------------------------------------------------------------------
    \1\ The prepared statement of Secretary Napolitano appears in the 
Appendix on page 38.
---------------------------------------------------------------------------
    The demands on DHS have never been greater. This is 
especially true as we remember those at the Department who have 
given their lives in service to our mission of securing 
America, including, as you have noted, most recently Border 
Patrol Agent Brian Terry, ICE Special Agent Jaime Zapata, and 
our retired CBP agent in Kandahar this past week.
    Now, Mexico is leading the criminal investigation into the 
death of Agent Zapata, and we are supporting them through a 
joint Department of Justice (DOJ)-DHS task force that the 
Attorney General and I announced yesterday. I can speak for the 
entire Administration when I say we are not only saddened by 
the loss of an agent, but we are outraged by this act of 
violence against an officer of the United States. And make no 
mistake, justice will be brought to those involved. We owe 
nothing less to the memory of Agent Zapata and to those who are 
still on the job in Mexico.
    We remain relentless in our efforts to keep our borders 
secure and to assist Mexico in breaking up the cartels that are 
plaguing that country. The loss of these brave agents is a 
stark reminder of the sacrifices made by the men and women of 
the Department of Homeland Security every day. It also 
strengthens our resolve to do everything we can in our power to 
protect against, mitigate, and respond to threats and to make 
our Nation more resilient for years to come.
    It is also a reminder of the solemn duty of the Congress 
and this Committee to support and oversee the Department. And I 
want to thank you, Mr. Chairman and Members of the Committee, 
for the support you have shown to the men and women who carry 
out our many missions.
    Today's threat picture features adversaries who evolve 
quickly and are determined to strike us here at home--from the 
aviation system and the global supply chain to surface 
transportation systems, critical infrastructure, and cyber 
networks. We are leading the Administration's unprecedented 
effort to strengthen Southwest Border security coupled with a 
smart and effective approach to enforcing immigration laws in 
the interior of our country. And we continue to prepare for, 
respond to, and recover from disasters of all types.
    President Obama's fiscal year 2012 budget for the 
Department allows us to continue to meet these evolving threats 
and challenges by prioritizing our essential operational 
requirements, while reflecting an unprecedented commitment to 
fiscal discipline that maximizes the effectiveness of every 
security dollar that we receive.
    Reflecting the current fiscal environment and building the 
fiscal year 2012 budget, all DHS components identified savings 
associated with the Department's 33 efficiency review 
initiatives, and we cut Administration and overhead, including 
my own office's budget, by over $800 million. Savings were 
realized through efficiencies in acquisition, asset and real 
property management, as well as employment vetting and 
credentialing, hiring and on-boarding of personnel, and 
information technology. And we cut professional services 
contracts, travel, and non-mission-critical training.
    We also delayed construction of FEMA at the new DHS 
headquarters at St. Elizabeths and deferred numerous office 
collocations as well as building maintenance and enhancements 
that would have furthered our mission.
    My written statement includes a comprehensive list of the 
operational priorities in our budget request, and today I would 
like to highlight a few of them for you here.
    As you mentioned, Mr. Chairman, our first priority is 
preventing terrorism and enhancing security. This was the 
founding mission of the Department and remains our top priority 
today.
    The budget safeguards transportation modes through a 
layered detection system, including the deployment of 
additional transportation security officers, behavioral 
detection officers, canine teams, and advanced imaging 
technology machines at domestic airports. While expanding 
watchlist vetting through the Secure Flight Program and 
enhancing screening and targeting of international travelers 
before they board U.S.-bound flights through the Immigration 
Advisory Program.
    The budget also strengthens surface transportation security 
by supporting 12 new multi-modal Visible Intermodal Prevention 
and Response (VIPR) teams which conduct operations throughout 
the transportation sector to prevent potential terrorist 
activity.
    The request also provides funding for the Securing the 
Cities Program to protect our highest risk cities from a 
radiological or nuclear attack, and it makes a significant 
investment in the National Bio and Agro Defense Facility 
(NBAF), which will provide enhanced diagnostic capabilities to 
protect our country from foreign animal and emerging diseases.
    The request expands support for the national network of 
State and local fusion centers to enhance baseline capabilities 
and provide local law enforcement with the tools to address 
threats in their own communities.
    Our second mission is to secure and manage our borders. The 
request continues the Administration's historic border security 
efforts by supporting 21,370 Border Patrol agents and 21,186 
U.S. Customs and Border Protection Officers, both all-time 
highs. The budget includes $242 million for the continued 
deployment of proven effective surveillance technology along 
the highest trafficked areas of the Southwest Border to better 
meet the operational requirements of our agents on the front 
lines.
    For the Northern Border, the budget request supports 
investments in technology tailored to the maritime and cold 
weather environment, including proven stand-alone technology to 
provide immediate operational benefits.
    And for our Nation's maritime borders, this budget includes 
funding to continue the essential National Security Cutter 
program and makes historic investments to recapitalize the 
Coast Guard's aging assets, including six fast response 
cutters, 40 response boats, as well as a sizable investment in 
the renovation and restoration of shore facilities. I look 
forward to talking about that part of the budget with you, 
Senator Collins.
    The budget request also continues the Department's focus on 
smart and effective enforcement of our country's immigration 
laws, while streamlining and facilitating the legal immigration 
process. Building on our record over the past 2 years, the 
Department will continue to prioritize the identification and 
removal of criminal aliens who pose a threat to public safety, 
and we will target employers who knowingly and repeatedly break 
the law. This request enables U.S. Customs and Immigration 
Enforcement to fund 33,400 detention beds, remove over 200,000 
criminal aliens, and deploy secure communities to 96 percent of 
all jurisdictions nationally in fiscal year 2012, while 
promoting compliance with worksite-related laws through 
criminal prosecution of egregious employers, Form I-9 
inspections, and continued expansion and enhancement of E-
Verify.
    The request also funds immigrant integration efforts, 
including programs supporting English language and citizenship 
education and continues detention reform efforts currently 
underway.
    To safeguard and secure cyberspace, the budget increases 
resources to identify and reduce vulnerabilities in our 
Nation's key cyber networks. The request includes significant 
investments to expedite the deployment of EINSTEIN 3 to prevent 
and detect intrusions on government computer systems, increase 
Federal network security of large and small agencies, and 
continue to develop a robust cybersecurity workforce to protect 
against and respond to cybersecurity threats. The budget also 
focuses on combating cyber crime and preventing attacks against 
our critical infrastructure.
    To ensure resilience to disasters, our next mission area, 
the budget request focuses on moving resources out of
    Washington, DC, and into the hands of State and local 
responders who are often best positioned to detect and respond 
to terrorism, natural disasters, and other threats by 
sustaining Federal funding for State and local preparedness 
grants, providing over $3.8 billion in fiscal year 2012.
    The funding includes $670 million for assistance to 
firefighter grants, including $420 million to rehire an 
estimated 2,300 laid-off firefighters and retain veteran first 
responders. And to lead and support essential national and 
economic security efforts, the budget expands the Coast Guard's 
operational capacity by funding 50,682 military and civilian 
positions and establishing the Coast Guard's first Incident 
Management Assistance Team, which will be deployed rapidly to 
support incidents of national significance.
    The request also continues to support ICE and CBP's 
enforcement and investigative efforts to protect U.S. 
intellectual property rights as well as the Secret Service's 
state-of-the-art forensic support to several missions, 
including the National Center for Missing and Exploited 
Children.
    This budget is the culmination of a major first-of-its-kind 
effort by the Department through the Quadrennial Homeland 
Security Review and the Bottom-Up Review to align our resources 
with a comprehensive strategy to ensure a safe, secure, and 
resilient homeland, while making an unprecedented commitment to 
fiscal discipline.
    I would be remiss, however, if I did not note that all of 
this progress is at risk in the continuing resolution currently 
being debated in the House. It is somewhat of a moving target, 
as we know, but the current proposal cuts technology 
investments and security improvements on the Southwest and 
Northern Borders, aviation security measures including new 
technology, funding to sustain the progress that has been made 
in enforcing our immigration laws, critical cybersecurity tools 
and operations, intelligence personnel, and State and local 
fusion centers, Coast Guard funding to support the war efforts 
abroad, and grants that support counterterrorism and disaster 
response at the local level. I would be happy to answer some of 
those questions as well.
    Chairman Lieberman, Senator Collins, and Members of the 
Committee, thank you for this opportunity to testify. I ask 
that my full statement be included in your record, and I am 
happy to answer your questions.
    Chairman Lieberman. Thanks, Madam Secretary, and, of 
course, we will include the full statement in the record 
without objection.
    Let me ask you to begin by focusing on, in a sense, the 
catalyzing mission of the Department after September 11, 2001, 
which is the terrorist threat, and the statement you made last 
week that the terrorist threat may be at its most heightened 
state since the attacks nearly 10 years ago.
    Talk a little bit, if you would, about why you said that, 
what you had in mind.
    Secretary Napolitano. I said that because, in addition to 
core al-Qaeda, we now have spin-off groups of al-Qaeda, 
including, I think importantly, Al-Qaeda in the Arabian 
Peninsula (AQAP), who have demonstrated their intent to attack 
the West and to attack the United States. They continue to 
focus on transportation modes, particularly aviation security, 
which is why the aviation part of this budget is so important. 
But combined with that, we now are seeing the rise in the so-
called homegrown terrorism, which is, I think, accelerated by a 
connection with the Internet. So we are dealing with more 
dissipated sources abroad, but also from within the country. 
That means that we have to be working both things at the same 
time. That is why the fusion centers are so important here in 
the country and our effort to push information and intelligence 
analysis out to States and to cities, but it is also why we are 
so focused on aviation security at domestic airports and 
internationally, as well as adding support to surface and other 
transportation. As we know from the Najibullah Zazi case, for 
example, just a very recent one with the attempt to attack 
surface transportation.
    Chairman Lieberman. Right. Let me ask you outcome about the 
threat of homegrown radicalization. As I am sure you know, 
Senator Collins and I recently released a bipartisan staff 
investigation into the murders at Fort Hood in November 2009, 
and in addition to specific recommendations to the Department 
of Defense, the Federal Bureau of Investigation (FBI), etc., we 
recommended that there be a review done, preferably under the 
auspices of the White House, probably by John Brennan, which 
would include DHS, to determine what we can do to better, with 
a whole-of-government approach, counter homegrown 
radicalization. We had a hearing on our report this week with a 
group of excellent witnesses. One of them, Phil Mudd, who as 
you know was with the Central Intelligence Agency (CIA) for a 
long time and was almost with DHS, was with the FBI, said this 
is a needle-in-the-haystack problem. And Charlie Allen, your 
former Director of Intelligence and Analysis, was here and he 
quoted--I do not remember exactly, but from September 11, 2001, 
to 2009, there was something like 46 or 48 cases of homegrown 
radicalization, 13 of them in 2009. So there was an increasing 
pace. Obviously, 46 or 48 over a 9-year period is a very small 
percentage of the Muslim-American population, though an 
individual, as we saw with Nidal Malik Hasan at Fort Hood, can 
do terrible damage: 13 people killed, 32 injured, some 
seriously.
    Do you have any ideas about what the Department can do, 
along with other Federal agencies, to better identify, counter, 
and prevent the existence, certainly the spread of homegrown 
radicalization of Muslim-Americans into Islamist terrorists?
    Secretary Napolitano. Well, first of all, I read your 
report even though it was about the Department of Defense 
(DOD), FBI, and the Hasan matter, but I thought it was a very 
important report to review. So I thank you for having that 
review done. It was very well written, well done. I do not know 
if the actual scripter was--you wrote it yourselves. 
[Laughter.]
    I thought you did a very nice job.
    Chairman Lieberman. Thank you.
    Secretary Napolitano. Here is where we have been focused. 
We looked at this, and we had the Homeland Security Advisory 
Committee, which is chaired by William Webster, the former head 
of the FBI, especially look at this whole issue of homegrown 
and countering violent extremism. And we decided that the most 
effective way from the homeland security perspective was to 
focus on local police departments and techniques that have been 
shown to work in the past, neighborhood and community policing, 
where you have police who are specially trained, but who really 
are located in a particular area all the time. They get to know 
the people. The people get to know them. You begin to build 
trust. That is how information can flow.
    So just this past week at the Federal Law Enforcement 
Training Center (FLETC), we test drove a training curriculum on 
this kind of homegrown violent extremism, and we had 
representatives there from a number of different police and 
sheriffs' organizations to give us their comments so that we 
can rule that out. But this homeland security architecture that 
we are building, I think one of the things we have to recognize 
is that the Federal Government alone is not going to be the 
only player here. The folks who are really front lines are 
State and local police, sheriffs, medical personnel, the people 
who are in the detention facilities who work as guards in our 
jails and our prisons, these are all people who need to be 
woven into what we are doing.
    We also met this past week with the FBI and have joined 
efforts with them on the detention populations and their 
potential when they are released for radicalization. So there 
are a whole number of efforts underway there, but our key 
focus, Mr. Chairman, is on what we can do to support State and 
local law enforcement from a community-oriented policing 
strategy to identify tactics and techniques and behaviors that 
could be a real tip-off to a terrorist.
    Chairman Lieberman. I think that is a very significant 
conclusion. It makes a lot of sense to me. We know in a couple 
of cases, as in the New York City Police Department (NYPD), 
they are operating something like that quite effectively. We 
also know, just from years of local law enforcement experience, 
that the cop-on-the-beat programs in previous years dealing 
with crime have a very positive effect. So I am actually 
heartened to hear that.
    I guess the final question, bottom line, is: Are there 
resources in this budget that will allow you to begin to move 
forward on assisting local police departments that do not have 
that kind of program going now?
    Secretary Napolitano. Mr. Chairman, a few things. One, 
there are resources in this budget for the fusion centers, and 
we have been, first of all, upgrading the quality of the fusion 
centers. It is a nascent kind of development. We looked at all 
72 of them this last year, and identified which ones were 
meeting certain baseline standards, which needed to come up. We 
are making sure that they all have access to classified 
information, networks, and we are moving intelligence analysts 
from Washington, DC, to the fusion centers in the country not 
only to help with intel analysis, but to train State and locals 
on intel analysis. So there is money in the budget for fusion 
centers.
    There is money in the budget to support grant programs that 
can be used by State and local police and first responders, and 
when I get to Senator Collins, I think we can have a colloquy 
perhaps about how the grant money is actually budgeted in the 
President's budget.
    The third part of this, however is the Community Oriented 
Policing Services (COPS) program. That, of course, is not in 
our budget. That is in DOJ's. And so that part I do not have.
    Chairman Lieberman. That is great. I take you to say you 
are going to be driving training, at least, of local police 
departments in a counter-homegrown radicalization program.
    Secretary Napolitano. That is true.
    Chairman Lieberman. That is great. Senator Collins.
    Senator Collins. Thank you, Mr. Chairman.
    Before I get to the Coast Guard and the grant money, there 
are two other issues that I want to bring up with you. First is 
the improper payment problem at FEMA. Hurricane Katrina was 
back in 2005, and the American people were very generous in 
responding, as I know Senator Landrieu would attest. But they 
are also very frustrated when they see improper payments. It 
was disheartening to see the latest IG report which indicates--
and here we are 6 years after Hurricane Katrina--that there is 
still outstanding at least $643 million in improper payments 
related to Hurricanes Katrina and Rita.
    Now, I know there were some court developments which slowed 
the recoupment process, but the fact is, according to the IG, 
FEMA has yet to implement a new process to recoup those 
payments.
    We just cannot afford to have $643 million in improper 
payments at a time when the budget is under such pressure. We 
cannot afford it at any time. It is unacceptable.
    Why aren't we recouping that money or prosecuting the cases 
of fraud that exist within those 160,000 cases?
    Secretary Napolitano. Well, Senator Collins, this is an 
area that I think we need to work with the Congress on, and you 
and I may have a respectful difference of opinion here. But, 
first of all, one of the problems is an IG report that comes 
out so many years after the fact, and there are, I must say, 
some disagreements with their conclusions on some of the 
payments.
    Second, it is not as if one, two, three, or four entities 
received that money. It is spread over literally thousands and 
thousands of beneficiaries, most of whom are spread across the 
country now. And I am informed by FEMA that the average 
overpayment, even accepting the IG's conclusions, would be 
about $2,500. So it is a lot of money when you add it all 
together, and believe me, I respect the value of a dollar. But 
this is now going back years and years after the fact to try to 
find people to recoup relatively small amounts of money.
    We may want to look at this whole recoupment process as it 
affects Hurricanes Katrina and Rita. It was such an unusual 
disaster with such unusual requirements that I do not think it 
should be the pattern. So I really would like the opportunity 
to meet and talk with you more about that as we move along in 
this budget process.
    Senator Collins. I would be glad to, but let me suggest 
that I have talked to the IG just within the past week about 
this, and he has told me that the discouraging part of his 
report is that the same problems and lack of internal controls 
that allowed these improper payments to occur have been evident 
for decades, literally, and they have just never been remedied.
    I think to most people who are struggling right now, $2,500 
is a lot of money.
    Secretary Napolitano. It is a lot of money.
    Senator Collins. And in the aggregate, it is a huge amount 
of money.
    Secretary Napolitano. Agreed.
    Senator Collins. I would be glad to work with you, but FEMA 
needs to actually start recovering this money and making sure 
that the controls are in place so that when the next disaster 
strikes--and inevitably it will--the same thing does not happen 
again. In talking to Inspector General Richard Skinner, he said 
he could go back to 1993 and show me the same kinds of 
problems. I held hearings prior to Hurricane Katrina that 
showed improper payments with Florida hurricanes.
    So this seems to be a systemic problem in FEMA, and it is 
one that we need to correct once and for all.
    Secretary Napolitano. And it may be--and, again, I do not 
know--that it merits a more substantial conversation, 
particularly with the Hurricanes Katrina and Rita victims or 
survivors are concerned. But there is a real tension between 
getting money out quickly to people who immediately need monies 
to get a home, to get re-established and so forth and the 
controls on that, versus 4 or 5 years after the fact going back 
and saying, well, it should have been this much, not this much, 
that sort of thing.
    That is different from actual cases of fraud. Fraud should 
be prosecuted.
    Senator Collins. Of which there were many. I remember in 
our investigation that we discovered prisoners who were 
applying for housing assistance after Hurricane Katrina and 
received checks in jail for housing assistance. I mean, there 
really were some blatant fraudulent schemes.
    Secretary Napolitano. Indeed.
    Senator Collins. Let me switch to another issue. I was 
surprised to see that the President's budget includes a 
proposal to begin imposing a $5.50 inspection fee on travelers 
entering the United States by air or sea from Canada, Mexico, 
and the Caribbean. Now, as you know, Canada is our biggest 
trading partner. There is $1.5 billion in commerce transacted 
between the two nations on a daily basis. People are flying and 
arriving by ferry back and forth all the time.
    What is the rationale for this fee? My concern, for 
example, is that it will discourage cruise ships from coming to 
the State of Maine from Canada. That is a popular route right 
now. But if there is going to be this additional inspection fee 
on the thousands of people who may be on a cruise ship, that 
may discourage the cruise ship from even stopping here. And I 
am also concerned about the impact on tourism and families 
going back and forth in general.
    What is the rationale? And did the Department look and 
assess what the impact would be on commerce and tourism?
    Secretary Napolitano. Yes, the rationale is fairness. We 
charge that fee for travelers from every other country except 
Canada, Mexico, and the Caribbean. It has always, in my 
understanding, been the intent to implement that fee. It is not 
for land. It is just for the air and sea. We thought and looked 
at potential impacts, but to give you an example, if you have a 
traveler coming from London to the United States, they fly 
direct, they pay that fee. But if their plane stops in Canada, 
so they are coming from Canada, they do not pay the fee. So you 
have some real discrepancies in the system.
    In terms of effects on tourism and travel, I think we can 
look at the Electronic System For Travel Authorization (ESTA) 
fee, which went into effect. These are things that get added to 
the ticket price, and so that the travelers from other parts of 
the world are not essentially underwriting travelers who are 
from Canada or Mexico.
    Senator Collins. Thank you, Mr. Chairman.
    Chairman Lieberman. Thanks, Senator Collins.
    In order of both arrival and seniority at the gavel, 
Senator Landrieu, Senator McCain, Senator Johnson, and Senator 
Tester. I asked about that, and I was reminded that when the 
gavel falls, it goes whoever is here by seniority on the 
Committee. It is the Armed Services rule.

             OPENING STATEMENT OF SENATOR LANDRIEU

    Senator Landrieu. Thank you.
    Madam Secretary, thank you for being here today, and I look 
forward to having you before my new Appropriations Subcommittee 
very soon, March 2, as I am taking the chairmanship of that 
subcommittee. I have to say I want to commend you. This has 
been a very tough year for the Department. The Coast Guard has 
fought to contain the largest oil spill in American history. 
The Department has responded to terrorist attacks at Fort Hood 
and Times Square. ICE and Border Patrol agents mobilized to 
quell unprecedented violence along the Southwest Border. The 
Transportation Security Administration (TSA) learned of a 
terrorist plot to detonate air cargo. FEMA has responded to 106 
separate incidents this year. So I want to say I appreciate 
your leadership of this Department.
    I also appreciate your willingness to cut, reduce, and 
modify based on the challenges before us. But I do want to say 
that we have to be very careful about how we go about that 
exercise so that we can continue to provide the security that 
our Nation needs and has come to depend on under your 
leadership and with this Department.
    My first question has to do with disaster relief, and it is 
concerning because it is a big number. The Senator from Maine 
was just referring to a number associated with failure to 
recover in large measure $2,000 payments equaling about $640 
million. That is a lot of money, and I want to comment on that 
in a minute. But there is an issue over $1.6 billion in this 
year's budget, and I think you are aware that in the House 
continuing resolution that is being debated and in the 
President's proposal, they are both recommending that we 
basically fund disaster recovery out of the base budget of 
homeland security, which in my mind is a radical departure from 
the past and will absolutely, if left unchecked, undermine your 
Department's ability to respond to all the threats that I just 
mentioned and that have been pointed out.
    Could you comment? And what is your position on that? And 
are you prepared to work with us and the President to fund 
known recovery costs for previous disasters on an emergency 
basis?
    Secretary Napolitano. Thank you, Senator, and I do look 
forward to appearing before you at the Appropriations 
Subcommittee hearing.
    Yes, what is going on, this is the Disaster Relief Fund 
(DRF), and the way we budget the DRF is to take a 5-year 
rolling average of what is basically the emergency response 
cost. But added to that, then, you have so-called catastrophic 
disasters, and those are disasters that are over $500 million. 
And, it is difficult to predict when you are going to have 
those, how many you will have in a given year, or if you will 
have any. And so historically what the Congress has done is 
approve the 5-year rolling average, and then via supplemental 
when we know what we are looking at, then they appropriate the 
rest.
    By not proceeding in that fashion, you have two challenges. 
One is it requires us to have perfect crystal balls to tell how 
many disasters of a catastrophic type we will have in any given 
year. And our crystal balls are not that clear.
    Second, we have to pay for disaster response. It is really 
non-negotiable. So what that means is that if you do not have a 
mechanism to fund them, it is just a hidden cut to FEMA, and it 
is a substantial one, as you have noted.
    Senator Landrieu. Well, I just want to bring this to the 
Committee's attention. Of course, as the Appropriations 
subommittee chair, I will be focusing on it, but I really want 
the Members to fully appreciate the numbers here. It is $1.56 
billion in fiscal year 2011 that is missing from this year's 
budget. But for fiscal year 2012 through 2014, FEMA is 
estimating $6.7 billion. Those are outlying bills from 
Hurricanes Katrina, Rita, Gustav, Ike, and flooding in the 
Midwest, Rhode Island, and Tennessee. These costs are not 
accounted for in the President's budget request. And it most 
certainly cannot come out of the basic homeland security 
budget. We have to designate this funding as the emergency that 
it is so that this Department can adequately support its other 
components, including the Border Patrol, the Coast Guard, etc. 
So I just really wanted to bring that up.
    The National Disaster Recovery Framework is very important, 
Madam Secretary, and I understand that it is not yet fully 
operational. And it gets a little bit back to what Senator 
Collins was saying about we know Hurricane Katrina was an 
exception. It was not blanket fraud, but it was just 
mismanagement of distribution of monies, of $2,000 on average 
per family. We did not have the right software to verify 
addresses. We double-paid some families. It is going to be 
difficult. But we can find a better way, a more accurate way to 
make sure we are making appropriate payments. But for this 
National Recovery Framework, I understand that it is still not 
in place.
    So do you know what the status of that initiative is? Does 
this budget include sufficient funding to complete it? Because 
it is very important that we get it completed before we have an 
earthquake in Memphis or some other catastrophic event.
    Secretary Napolitano. Yes, Senator. But it also crosses 
many lines and many agencies, and it also crosses State and 
local. So there has been, as you might imagine, a lot of 
consultation that has gone into drafting recovery framework 
responses. The immediate stuff you do right away. Recovery is 
how you restore communities, housing, small businesses, and the 
like.
    In terms of the departments that are impacted, we have made 
a strong recommendation to the White House about how this 
should appear and be organized. We are waiting now for the 
White House to agree, concur, amend, or disagree. And my 
understanding is at that point we may need to make some 
adjustments. But under the current practice with what we have 
now, the budget request is adequate.
    Senator Landrieu. Thank you.
    Chairman Lieberman. Thank you, Senator Landrieu. Senator 
McCain.

              OPENING STATEMENT OF SENATOR MCCAIN

    Senator McCain. Thank you, Mr. Chairman, and Madam 
Secretary, for being here. Thank you for your hard work. Thank 
you for the frank and very candid conversations we have 
concerning the issue of border security. And I also want to 
appreciate the time and effort you take to keep me and the 
other Members from the Border States informed as to the efforts 
you are making on border security. And I think it is important 
that we continue the conversation, and I appreciate the 
briefing that you gave me just the other day.
    As you know, there is a February 15, GAO report that 
contains some very interesting information, and in that report 
it says, ``As of February 2011, CBP did not have an estimate of 
the time and efforts that are needed to secure the Southwest 
Border as it transitions to a new methodology for measuring 
border security.''
    I think this is part of our problem and our dialogue, 
because you, I think very appropriately, point out that there 
has been an increase in assets, an increase in apprehensions, 
certainly increases in efficiencies. And yet at the same time, 
if you look at the same situation from another viewpoint, we 
have seen the violence in Mexico grow dramatically. As I 
predicted to you, an American was just killed and another one 
injured, and I am convinced, tragically, that if the status quo 
remains, that violence will continue to spill over onto our 
side of the border.
    Everyone knows that these drug cartels have become more 
aggressive, better armed, better equipped, more efficient, and 
the level of violence in Mexico continues to go up 
dramatically. Some 30,000 Mexican citizens or more, have been 
killed during President Felipe Calderon's presidency. So you 
can look at it from one viewpoint that we have made some 
significant improvements and investments. But I also find, when 
I go to the Southern part of my State, as you have on numerous 
occasions, one, they do not feel safe; two, they are still 
subject to home invasions; three, in the Tucson sector, 91,000 
illegal aliens were apprehended on Federal lands, and the 
estimates are by almost every objective observer that three 
times as many get through. Well, if you do the math on that, 
you still have over 200,000 people crossing through the Tucson 
sector illegally and not being apprehended. I do not think that 
is acceptable.
    And then last week I had a meeting with the High Intensity 
Drug Trafficking Areas (HIDTA) Program office, friends of 
yours, in fact--the great U.S. Attorney, a former assistant of 
yours, was there--and they said that there is anywhere from 100 
to 200 spotters positioned in mountain ranges of Arizona using 
two-way radios to communicate with marijuana load drivers or 
human smugglers.
    Now, it does not give my constituents a feeling of 
confidence if there are 200 spotters in Arizona living on 
mountaintops directing drug smugglers. And they maintain that 
Arizona has become the funnel from Nogales up through Pinal 
County into Maricopa County and then all over the country 
because the Sinaloa cartel is a major distributor to the entire 
country of these drugs.
    Again, I have had the privilege of visiting with your 
people and knowing them. They are outstanding, hard-working, 
and dedicated. Those that are working in the forward operating 
bases on our border, it is a hardship duty. And obviously we 
have seen cases where it is not without danger.
    I am sorry for the long opening comment. We have to agree 
on certain criteria on what is successful securing of our 
border. Senator Jon Kyl and I have a 10-point plan. We think 
that secures the border. I think it would be very helpful to 
all of us if you could lay out what assets need to be devoted 
and what statistics would show us that the border is being 
secured. And at that time, I think we could move forward with 
comprehensive immigration reform. Thank you.
    Secretary Napolitano. Well, thank you, and there is no one 
more committed to securing that border than I am. I have spent 
the greater part of my professional life on border-related 
issues. I used to chair the HIDTA to which you refer, and a 
number of the same members are there. And I know the men and 
women that we have working for us and that you have helped 
supply for us are so committed as well.
    We can talk about and arrive at some common metrics, and 
that also merits probably a different and longer conversation. 
But I think, of the metrics we do have, they are all going in 
the right direction. The problem is they are not going in the 
right direction fast enough in the Tucson sector, and that is 
the sector to which you refer.
    And so our plan is to increase and to be pouring even more 
resources into that sector from supplying monies for State and 
locals down there--this is the Operation Stonegarden issue to 
which Senator Collins referred--to radios, to other technology 
that they can actually work.
    When we get to discussing SBInet, as we might during 
another round of questions, I would be happy to explain how 
some of those monies have been redeployed on the ground for 
front-line detection.
    I will say that it is a system. You have to have troops or 
boots on the ground at or near the border, you have to have 
checkpoints, and you have to have interior enforcement. And, it 
is a three-legged stool. And so it is boots, it is technology, 
it is that infrastructure that gives us security. And at a 
certain point--and I do not know if it is subject to an actual 
absolute number, because these numbers jump around all the 
time. But at a certain point, we have to be able to agree that 
the Tucson sector has become akin to, say, El Paso, for 
example, and at that point proceed with the other discussion to 
which you refer.
    Senator McCain. Well, thank you. I would like for you to 
think about certain benchmarks and certain criteria that we 
could use to gauge success or failure that both of us could 
agree, all of us, and we could say we have achieved X amount of 
apprehensions, a certain amount of fencing, whatever it is, 
which obviously the results would be obvious from that.
    Mr. Chairman, I have overstayed my time. I just wanted to 
say one word about SBInet. It is a colossal failure, a waste of 
over $1 billion, and that cannot be fixed. I still think that 
the contractor ought to be held responsible, but maybe that is 
a subject for a conversation another day. But I would urge you 
to look at what the Armed Services Committee has passed 
legislation which helps us track better the progress or lack of 
progress of weapons systems that we purchase, such as the Nunn-
McCurdy trigger that Congress has to be notified once there is 
a certain cost overrun. There are certain benchmarks and 
criteria which the Congress has to be informed of and 
participate in decisionmaking. So I would like for you to look 
at what we do as regards to weapons procurement in DOD because 
I think maybe it would be very useful and helpful to us in 
tracking these situations.
    I thank you, Mr. Chairman. I thank you, Madam Secretary, 
for your hard work.
    Chairman Lieberman. Thank you, Senator McCain.
    Madam Secretary, as we discussed the other day, we did 
announce at our organization meeting the other morning that 
border security is going to be one of our priorities this year, 
and we are going to start a series of hearings, hopefully in 
March--that is, we will start in March. And the point that 
Senator McCain raises is an important one, which is whether we 
can find a metric, a set of standards we can agree on where we 
can say we are doing as much as we all agree together we can do 
to secure our border. And that will not only achieve security, 
it may also here in a broader context enable us to deal with 
the possibility of comprehensive immigration reform, which I 
know you are also interested in.
    Secretary Napolitano. Very good.
    Chairman Lieberman. Thank you. Nest is Senator Johnson, 
then Senator Tester, and then Senator Portman.

              OPENING STATEMENT OF SENATOR JOHNSON

    Senator Johnson. Thank you, Mr. Chairman. Madam Secretary, 
it was nice meeting you earlier and welcome to our hearing.
    Secretary Napolitano. Thank you, Senator.
    Senator Johnson. Are you aware or have you been watching 
what has been happening in my home State of Wisconsin in terms 
of public sector employees?
    Secretary Napolitano. Yes, I have seen a few clips.
    Senator Johnson. Does that give you any pause in terms of 
the announcement to allow the TSA employees to collectively 
bargain?
    Secretary Napolitano. No. I think this is a totally 
different situation. First of all, we were ordered by the 
Federal Labor Relations Authority (FLRA) to conduct such an 
election, and I think the way the administrator, who is the 
former Deputy Director of the FBI, has gone about it is the 
right way, which is to say we will have an election, but issues 
that affect security are off the table from a collective 
bargaining standpoint.
    As you know, a number of collective bargaining units are in 
law enforcement already, including some that are within the 
private airports that have been discussed. I want to say San 
Francisco and Kansas City have privatized the security, which 
have collective bargaining units in those companies. So I did 
not find that argument particularly persuasive, and I think the 
way we are going about it is legally mandated and the right 
way.
    Senator Johnson. I would hope it would never get to this 
point, but TSA Administrator Pistole was asked, I believe last 
week, if work stoppages or slowdowns occurred, would he be 
willing to fire TSA screeners en masse, and he answered yes.
    Secretary Napolitano. Yes.
    Senator Johnson. If it got to that point, would you support 
that decision?
    Secretary Napolitano. Yes. This is a security organization, 
and the bargaining will take place in that context. It will 
also take place in the context of the need to be able to move 
people around quickly when we need to to supplement particular 
areas of the country.
    Senator Johnson. Well, I appreciate that answer.
    Let us go back to border security. I am a new kid on the 
block here, so these may be some basic questions. But I am 
interested in metrics. What metrics are we currently using?
    Secretary Napolitano. Well, we the number of apprehensions 
of illegals. We use seizures of drugs. We use seizures of guns. 
We use seizures of what we call ``bulk cash,'' which is 
normally associated with drug smuggling. So those are four of 
the major metrics that are used.
    Senator Johnson. Do you estimate number of crossings? Do 
you use any type of----
    Secretary Napolitano. Well, it is hard. As Senator McCain 
said, for every one we pick up, there are two or three who get 
through. There is a difference of opinion in the law 
enforcement world. They actually think we are picking up a 
greater percentage than that now. The one-in-three metric is an 
outdated metric. But when we look at where the high point was 
in illegal immigration, particularly over the Southwest Border, 
we see now that apprehensions are at their lowest point in 
decades. And so as apprehensions go down, we extrapolate that 
illegal crossings have gone down as well.
    Senator Johnson. What would that number be then based on 
the current extrapolation? What is your estimate of current 
crossings?
    Secretary Napolitano. Well, I can give you those actual 
numbers, let me see if I have it right here. The apprehension 
number is around 196,000 in the Tucson sector of the Border 
Patrol, which is the most heavily trafficked. The others are 
much smaller.
    Senator Johnson. In your estimation----
    Secretary Napolitano. So you have to assume that the Tucson 
sector represents about 45 percent of the apprehensions. So 
take 195,000 and then do the math.
    Senator Johnson. Now, I will say at the onset I realize it 
is not an easy problem, but we have been talking about securing 
our borders for years. I would just like to ask your opinion. 
What is the number one problem preventing us from doing that?
    Secretary Napolitano. Well, you have to look at borders not 
just as the physical line on the map, but what needs to be done 
before people get to that border and then after they get into 
the interior of our country. So we absolutely need to be 
working with Mexico to prevent, detect illegal immigration, 
drug smuggling, human smuggling, and money laundering. A number 
of efforts are underway in that regard.
    At the border itself, you need manpower, you need 
technology, you need infrastructure. Some of the things in the 
President's budget will really assist in this regard because 
they will allow us to complete some interoperability projects 
in terms of communications along the border. And also we put 
more into technology and boots on the ground nearer the border 
than at sector stations, for example. So we have increased the 
number of forward-operating camps. We have an agreement from 
the Tohono O'odham Nation that we can put more camps on their 
lands, those sorts of things.
    And then you have to deal realistically and very firmly 
with creating a culture of immigration compliance among 
employers in the United States. That is why we support E-
Verify. That is why we are doing more and more audits. That is 
why we are referring more companies for debarment and for 
prosecution because that is the incentive for much illegal 
immigration. It is narcotics, but the big numbers are people 
coming in search of work.
    Senator Johnson. So those are three different issues. One 
of those would be resources, correct?
    Secretary Napolitano. Sure, yes.
    Senator Johnson. How much do you think it would cost to 
secure the border?
    Secretary Napolitano. Well, I think the President's budget 
gives us the resources we need to fit into the plan we have for 
the Southwest Border. That is our part. The budget for the DOJ 
part in terms of what you do by way of prosecution, detention, 
and so forth, that is in the DOJ budget. But I think the 
President's budget is adequate to meet our plan. I would not go 
below that, that is for sure.
    Senator Johnson. Well, thank you.
    Chairman Lieberman. Thanks, Senator Johnson. Next is 
Senator Tester.

              OPENING STATEMENT OF SENATOR TESTER

    Senator Tester. Thank you, Mr. Chairman.
    Madam Secretary, it is good to see you again. I think the 
last time I saw you, we were enjoying a steak in Great Falls, 
Montana.
    Secretary Napolitano. No; I was dropping you off in your 
pasture by helicopter.
    Senator Tester. That is true. I forgot about that. Yes, 
that is right. [Laughter.]
    And I appreciate that, too.
    Secretary Napolitano. I was giving you a ride.
    Senator Tester. That is right, you were. And I appreciate 
Commissioner Alan Bersin coming in. I know that his nomination 
is still hung up, and I would hope that gets through--
yesterday, as a matter of fact, because I think he has done a 
great job, and I think a reappointment with a different person 
would not help you and your position at all. So hopefully we 
can get that moving.
    We recently had some issues--and this might seem parochial, 
but I do not think it is, actually--with the CBP policy that 
would prohibit airports from processing planes that had 
international flights with over 20 or more passengers. They 
have been doing it for years and years and years. I arrived in 
Great Falls last week, and they informed me that the airport 
there in Great Falls was not going to be able to process those 
international flights anymore. It saved a lot of time, a lot of 
headaches for folks to avoid some of the larger, busier 
airports. It generated revenue. And quite honestly, as I think 
about it, a plane flying and landing on a place further south 
does not make a lot of sense from my perspective. So it is not 
just parochial. I think it is a homeland security issue.
    I do not know if the decision was made locally or if it was 
made above the chain, but it was made somewhere in the chain 
where they found a rule that said we cannot do this anymore, 
and so they decided not to do it. I am a little upset with 
that. That is the bad part. The good part is that your staff 
helped clear a flight for us, but we need to work on a long-
term solution.
    What further compounds the fact that I was a little upset 
with it--and it is the second time this has happened--the 
person in Customs declined to make a meeting with my staff in 
Great Falls. And, quite frankly, when they declined a meeting 
with one of my staff members, they have declined a meeting with 
me. So we will take it to a higher person, you being the one.
    Secretary Napolitano. That will not happen again.
    Senator Tester. That would be really good. Quite frankly, I 
have zero tolerance for that personally.
    Secretary Napolitano. I understand.
    Senator Tester. Could I get a commitment from you--I mean, 
this needs to be solved. I think from a homeland security 
standpoint there are a lot of small airports along the Northern 
tier that have done this in the past, and if this is just in 
the sector in Great Falls, that is not good. And if it is all 
the way across the Northern Border, I do not think it is good 
either. I think these stations that have been doing this work 
need to continue to do it, and all I am asking for is your 
ability to work with us to make sure that happens and 
continues. You got the drift on the whole thing?
    Secretary Napolitano. I will look into it, and we will 
respond to you directly.
    Senator Tester. Thank you.
    I recently sent a letter to Secretary of Defense Robert 
Gates and you on the increased rate of drug smuggling across 
the Northern Border by low-flying aircraft. Low-flying aircraft 
is a real problem. We have heard from folks on the ground that 
you can hear them but you cannot see them. And we have been 
working for low-level radar for some time now. It is something 
that I think that you need to work with the DOD. I think it is 
the same report that Senator McCain talked about. It talked 
about the Northern Border not being as secure as we wanted by a 
long shot. So we need technology as a comprehensive part of 
that.
    The National Guard in Montana has done a pilot project up 
there. I think they have done some good work. I really think 
that if a low level of radar was implemented, it may save some 
manpower and may make that border more secure. I do not know 
how you move forward on it, but I think we need to get started 
on it. Any thoughts on this at all, on the low-level radar?
    Secretary Napolitano. There is actually money in the 
President's budget for a low-level radar project, and we have 
that in mind for both borders.
    Senator Tester. Good. And I was going to ask you, you 
talked about the President's budget as applied to the Southern 
Border. What about the President's budget as it applies to the 
Northern Border and getting it secured?
    Secretary Napolitano. Yes, the President's budget actually 
has a lot of enhancements for the Northern Border, but it is a 
different border, so we need different types of equipment.
    Senator Tester. Absolutely.
    Secretary Napolitano. We need equipment that can survive 
extreme cold. We need more maritime equipment up there. And so 
that is where you will see the enhancements, is in that sort of 
thing. It does recognize and provide agents at the Northern 
Border but it meets all of Congress' requirements there. It is 
not just the agents. It is really the technology and the 
maritime assets that we need to augment that agent support.
    Senator Tester. I could not agree more. In fact, I think 
that if we were to get some more technology up there, in the 
long haul I think it is going to make the border more secure. 
And I think that it really would not have to cost us more 
money. In fact, it could save us more money in manpower. I 
really believe that. You are the professional in that area, and 
I respect your perspective. But I am just saying that from my 
perspective I think if we could get some of that technology 
implemented, it could really save us some money and make the 
border more secure in the process.
    The next question is one that you and I have visited about 
a number of times. No one is more firmly aware of our Nation's 
responsibility to protect animal agriculture and public health 
from biological threats and foreign animal diseases, but I 
still have some major concerns about the $150 million that is 
included in the President's budget for the National Bio and 
Agro-Defense Facility to be built in the middle of Tornado 
Alley, where I think about 10 percent of this Nation's cattle 
are within 200 miles of it. And I think food security is 
critically important. The economic harm that could happen if 
there were to be an exposure is incredible. We received a risk 
assessment, and one of the things it found was that there was a 
70-percent chance that a release of foot-and-mouth disease 
would result during this 50-year lifetime. That would be 
catastrophic. Whether it happened next year or 25 years from 
now, it would be catastrophic.
    It is a lot of money. I would ask you to reconsider the 
proposal. And I was just wondering if you have looked at the 
report, if there was any redesign that was done, or if you are 
going to move forward.
    Secretary Napolitano. Yes, I read the report. You are 
talking about the National Academy of Sciences (NAS) report?
    Senator Tester. Yes, I am.
    Secretary Napolitano. I reviewed it. Actually, we responded 
to it. I think you have to view it, Senator, as a preliminary 
report based on a preliminary design. And that allowed us or 
enables us to make adjustments or changes in the design to deal 
with some of the issues that were raised. It has not caused us, 
however, to revisit the basic decision of that, Tornado Alley 
aside. I do not make light of that except to say that was 
already taken into account when this project was peer reviewed 
up the wazoo when it was originally awarded. Then we have re-
reviewed it and re-looked at it compared to the alternatives, 
and now we have the NAS report, which we will be very 
responsive to as this project moves forward.
    But we think overall this is the best place to host such a 
facility, these three and four labs, and so we do intend to 
proceed, and the President's budget has finances in there for 
that.
    Senator Tester. My time has run out. I have said this 
before. And I have to say it again. I very much respect the job 
you are doing. I think you have a very difficult job, and I 
think you have done a remarkable job. There is always room for 
improvement. You know that. And I think you are working hard on 
doing that. But as far as the animal defense, as a farmer I 
cannot figure it out. I would not want it at Bozeman, Montana. 
I think where it is at on Plum Island is right--and the New 
Yorkers might be unhappy with me, but it is off the shore of 
the mainland. And I know it is hard to get researchers out 
there, but there is a bigger issue than even that here. I mean, 
these are highly contagious diseases, and if they have an 
outbreak, it could--the economic and the food security issues 
that revolve around that are huge, and I cannot get that off of 
my front burner, to be honest with you. I cannot get the 
assurances, and then compound it by being someplace where they 
have some pretty doggone wicked weather patterns. Anyway, the 
decision has been made, but I really wish it would be 
revisited.
    With that, I want to thank you, Mr. Chairman, and thank 
you, Madam Secretary. I appreciate your work.
    Secretary Napolitano. Thank you, Senator.
    Chairman Lieberman. Thanks, Senator Tester.
    I want to share with both of you that I have a vision, 
after one of your exchanges, that your helicopter has picked up 
that recalcitrant Customs employee official, and he is now 
being dropped on the roof of the building in which Senator 
Tester has his office. The meeting is about to begin. 
[Laughter.]
    Secretary Napolitano. From a very high height. We will deal 
with that particular issue. You know what, Senator? That one I 
can deal with.
    Chairman Lieberman. I am going to stop myself from 
suggesting he may be dropped onto Plum Island. [Laughter.]
    Senator Portman.

              OPENING STATEMENT OF SENATOR PORTMAN

    Senator Portman. That poor person.
    Madam Secretary, thank you for appearing before the 
Committee and for your willingness to go through some of the 
tough issues that you face every day. We talked a lot about 
border security, the Northern and Southern Borders, and I 
appreciate the fact that you have asked for an increase in 
funding for Border Patrol again. And I think there is a 
consensus that border protection is important here, not just 
for immigration but, of course, for drug smuggling, guns, and 
particularly with the violence that we have seen on the 
Southern Border.
    But having said that, I continue to believe that money is 
better spent on trying to avoid the magnet, which is getting at 
what I think is the fundamental cause, which is primarily jobs, 
and, therefore, employer sanctions and, therefore, some kind of 
verifiable identification. And I think the more effort and time 
we put against that, the more success we will have ultimately 
in dealing with our immigration problem.
    I think in a sense you have seen the proof of that with our 
economic downturn and the reduction in the number of people 
even attempting to cross. Much of it is, of course, 
economically driven.
    So my question to you is about E-Verify. It expires next 
year, and I am told that only 11 percent of the 7.7 million 
employers in the country participate in E-Verify. And I would 
ask you today two things: One, do you support a permanent 
reauthorization of E-Verify? And, second, how can we improve 
the participation rate? Do you think it is the right program?
    Secretary Napolitano. Yes, indeed, Senator. We are adding 
companies to E-Verify at approximately 1,300 per week. When I 
was Governor of Arizona, I think I was the first governor in 
the country to require our contractors to use E-Verify. And I 
think one of the things we want to be looking at is not only 
its permanent reauthorization but, as I said earlier, a culture 
of compliance in the employer community, that this is something 
that they need to do--they do not like it, but they have to pay 
their taxes. I mean, it is just part and parcel of being in 
this country. You have to make sure that your employees are 
legally residing in the United States.
    Senator Portman. Different than taxes, though, because 
having that verifiable identification is a challenge, 
particularly for smaller employers.
    Secretary Napolitano. Yes.
    Senator Portman. People are showing a Social Security card 
and showing a driver's license, and it is fraudulent, and they 
accept it on its face.
    Secretary Napolitano. Well, and so there are a couple of 
things to consider.
    First of all, E-Verify itself, the system is being improved 
to be less susceptible to identity theft, for example, if 
somebody is using a Social Security number that has also 
appeared somewhere else, it will be able to pick something like 
that up.
    Second, I think in its early iterations there were some 
false entries into the system or inaccurate entries. The 
accuracy of the system now is very high. We have also wanted to 
make it easy for small businesses to have and to operate, and I 
have seen it and used it myself. As people who work with me 
know, I am not exactly the world's best computer person, and it 
is pretty easy to operate. So that is part of it.
    And if and when--and we hope it is sooner rather than 
later--the Congress takes up immigration reform, one of the 
things we would like to work with Congress on are the actual 
charges that can be brought against employers and the elements 
of the burden of proof because the way the statutes are written 
now, even when we have somebody that everybody knows very well 
that has been hiring illegal labor, actually proving that under 
the elements of the current statute is very difficult. 
Therefore, it is difficult to get U.S. Attorneys to take those 
cases and so forth. So we look forward to working with the 
Congress on improving those statutes.
    Senator Portman. Likewise, and it takes resources and it 
takes focus in coming up with a system that is, as you say, 
easy to use and relatively low cost for the employer. Given our 
economy, we do not want to burden employers more, but we do 
need, I think, to get at the issue where it is most effective, 
and that is going to be through the employer and through the 
interior enforcement.
    I was involved in the Department of Homeland Security 
organization, consolidating 20 or so agencies and departments 
when you were still governor, and I cannot say that I am proud 
of everything that has happened in the interim period. There 
have been some management challenges, obviously, including with 
the way FEMA was brought in, including with just some of the 
different cultures--I will use that word again--that had to 
mesh together.
    Now I am in the position with Senator McCaskill to be on 
the Ad Hoc Subcommittee on Contracting Oversight which deals 
with acquisitions. I have noticed in the budget proposal we 
have before us that you have made a request to provide more 
funds, $24 million more, to strengthen your acquisition 
workforce, 150 new positions throughout the Department.
    First, I guess I would ask you, Why are you asking for 
those additional resources? And what can we do to ensure that 
those additions, should they be approved, actually promote 
efficiency, transparency, avoid some of the management 
breakdowns we have seen and, therefore, save taxpayer dollars? 
If you can talk a little about that.
    Secretary Napolitano. Yes, Senator. Actually, this is part 
of creating the department, having that internal management 
structure and the assets with which to do that. It is a big 
department. We do a lot of acquisitions, and we are often 
criticized for some of those acquisitions. There have been 
different standards used by different elements of the 
Department, different requirements employed, different 
oversight done. But what we want to do is create a 
professionalized acquisition workforce that knows the DHS 
missions, that understands how things fit together. So part of 
bringing the additional workforce in is also training into the 
department and consistency of training so that anybody who is 
working in the acquisitions area is--there is some consistency. 
It is a real part of the professional development of the 
department.
    I think you can tell by the money we have already saved 
through the efficiency review process, where part of that has 
been acquisitions reform and also some comments made in some 
recent--even I think the GAO has made some comments about 
improvements they have already seen in the way that we do 
acquisitions and acquisition oversight.
    Senator Portman. We look forward to working with you. Our 
job is to look at, of course, all agencies and departments, but 
because this is the Homeland Security Committee, DHS may get 
special attention, which I am sure you are looking forward to. 
But I look forward to having you or your representative before 
the Subcommittee at the appropriate time to talk more about 
that.
    Secretary Napolitano. Very good.
    Senator Portman. Thank you, Madam Secretary.
    Chairman Lieberman. Thanks, Senator Portman. It is great to 
have you and all the experience you have had on our Committee. 
Thank you very much.
    Senator Akaka.

               OPENING STATEMENT OF SENATOR AKAKA

    Senator Akaka. Thank you very much, Mr. Chairman. I would 
like to welcome Secretary Napolitano to this hearing today.
    Before I begin, I want to express my deepest sympathy and 
condolences to the families of the ICE special agent who was 
tragically killed and his colleague who was wounded in the line 
of duty this past Tuesday. Our thoughts and prayers are with 
them.
    I am pleased that, despite budget constraints, DHS is 
making investments in the workers who are critical to 
protecting the Nation. DHS is taking positive steps to develop 
its acquisition workforce, recognize collective bargaining 
rights for Transportation Security officers, and create a 
wellness program.
    Madam Secretary, TSA proposes to remove the statutory cap 
on airline security fees so it can raise them without Congress 
acting. As an initial increase, TSA would lift airline security 
fees by 60 percent to raise more than $1 billion annually. I 
understand that TSA needs substantial funding to address very 
real air security threats, but that is quite a large increase.
    Has the Department analyzed what effect an airfare tax 
increase of $1 billion a year would have on the airline and 
tourism industries?
    Secretary Napolitano. Well, I think, Senator, the request 
is for $1.5 per enplanement. That fee has not been increased 
since 2002, and I think we all recognize that the security of 
aviation, international and domestic, is absolutely key. And 
given the kind of threats that we have seen just in the past 2 
years, we know it remains a concern, and it requires constant 
evolution of technology, manpower, and the like. So the fee is 
associated, the $1.50 per enplanement is associated directly 
with the threat we confront.
    With respect to impact on the industry, we already have, as 
I mentioned earlier, the ESTA fee, which has already migrated, 
and we did not see any impact that I could see on that.
    The way I looked at it, Senator, was when the airlines 
charge fees for checking a bag or for buying a Coke, we can 
certainly have a fee to protect the safety and security of the 
passengers. And that is what this is about. Or Pepsi. I did not 
mean to pick.
    Senator Akaka. Madam Secretary, the Department's budget 
requests $7.3 million for security costs for the Asia-Pacific 
Economic Cooperation (APEC) summit. This national security 
special event will take place in November in my home State of 
Hawaii and includes earlier events in Montana and California as 
well. The summit requires extensive coordination between 
Federal, State, and local officials to protect President Obama 
and other world leaders attending. Please discuss why these 
funds are necessary to enable the Secret Service to fulfill its 
responsibilities.
    Secretary Napolitano. Well, thank you, Senator Akaka. We 
requested those monies because of the importance of the summit, 
because of the protection issues that it entails. The money is 
based on estimates from other similar type events where you 
have groups of international leaders combining in one place. We 
want to make sure safety and security is taken care of and is 
done very smoothly, is done in cooperation with the State and 
local entities, and that everybody can rest assured that that 
part of the summit has been taken care of, as I said. So the 
actual money request is based in part on our experience with 
other similar events.
    Senator Akaka. Madam Secretary, in its budget submission, 
the Department proposed pay and retirement changes for certain 
CBP employees. However, draft language to make these changes 
has not been provided to this Committee. I have focused on pay 
and retirement issues as Chairman of the Federal Workforce 
Subcommittee. In the months ahead, will you pledge to work 
closely with your authorizing committees on your proposal?
    Secretary Napolitano. Absolutely, Senator, and part of this 
is our process, and it goes to something Senator Portman 
referenced, is from a management perspective, how you unit all 
these disparate pay systems that we have as well. And one of 
the big changes that the Congress approved last year was the 
conversion or the eligibility to journeyman pay in CBP. And so 
part of what you are seeing is that conversion over and now 
streamlining how we are organizing pay, whereas, before ICE and 
CBP were treated very differently, trying to harmonize all 
those systems. So we will look to working with your Committee 
on that. But that is the underlying purpose.
    Senator Akaka. Madam Secretary, our focus today is, of 
course, the fiscal year 2012 budget, but I want to ask you 
about the fiscal year 2011 continuing resolution (CR) the House 
is considering. While I support responsible and targeted 
reductions to address our budget deficit, I am troubled by 
draconian cuts that would harm job growth and may hamper the 
government's ability to keep this country safe.
    How would the proposed cuts in the continuing resolution 
put forth by House Republicans affect the Department's mission?
    Secretary Napolitano. Well, it is not good, and, of course, 
it is a moving target. So changes are being made even as we 
speak. But it cuts technology investments that we need for both 
borders, Southern and Northern. It cuts new technology for 
airports that we need to make sure that individuals who are 
trying to move explosives onto planes are not able to do that. 
It cuts cybersecurity, which is a very important area that we 
have large responsibilities for. It cuts the intelligence 
personnel for the fusion centers and for State and locals that 
I referenced earlier as part of the architecture that we need 
to have. And it cuts grants to state and locals. Now, one 
amendment restored some of those grants this morning, I 
understand, but not the bulk of them. So that is just a few of 
the things that the House CR would do.
    Senator Akaka. Thank you very much for your responses. 
Thank you, Mr. Chairman.
    Chairman Lieberman. Thanks, Senator Akaka.
    If your time allows, we will do one more round of a couple 
of questions each. We will do it with a maximum of 7 minutes.
    Let me ask you about two items relating to DHS that were on 
the GAO's high-risk list yesterday. One was what I would 
describe as cybersecurity, government's efforts to protect 
Federal systems and critical infrastructure. As you know, 
cybersecurity legislation is a top priority for this Committee. 
Senator Harry Reid has made it a top priority. Senator Collins 
and I are working on reintroducing the bill that we introduced 
last year.
    It is very important to note, as you have, that the 
President's budget before us now proposes increasing the 
Department's, your Department's cybersecurity funding by 17 
percent, a very sizable increase in these times, but in my 
opinion definitely a necessary increase. And to the extent that 
you can in open session, I wanted to ask you to spend a minute 
or two just describing what that increase in funding will 
enable the Department to do that you are not doing now to 
protect our cyber systems.
    Secretary Napolitano. Well, it will enable us to deploy 
EINSTEIN 3, which is the name for the new protection and 
prevention of intrusion technology across the Federal family, 
including the medium and smaller sized agencies. Without the 
money, we will not be able to do that. That is probably the 
most important thing.
    Chairman Lieberman. OK.
    Secretary Napolitano. I think the second thing is that it 
will enable us to continue to expand the cybersecurity 
workforce. We are pretty bare bones on that now. It is 
difficult to bring cyber experts into the Federal Government, 
much less into a new Department. But we have been given direct 
hiring authority by the Office of Personnel Management, and we 
are making some headway there. But we want to make sure we have 
the resources for that full time equivalent employee.
    Then the third thing is that it will enable us to 
strengthen the obligations we have undertaken pursuant to the 
memorandum of understanding we forged with the Department of 
Defense this summer on how we each can use the technological 
resources of the National Security Agency (NSA).
    Chairman Lieberman. Well, we will follow that. Obviously, 
this Committee, Senator Collins, and I are very focused on 
strengthening the Department's role as the lead agency for 
protecting Federal Government non-defense Web sites and the 
critical private infrastructure.
    I received a note that you have to leave at 4:30, so let me 
ask----
    Secretary Napolitano. I think I have a meeting at the White 
House with----
    Chairman Lieberman. Do you think that is more important?
    Secretary Napolitano. No, never.
    Senator Collins. The old White House excuse. [Laughter.]
    Secretary Napolitano. And I will be glad to come back.
    Chairman Lieberman. That is OK. So you have a number of 
programs focusing on assisting critical infrastructure owners 
in identifying and remediating cybersecurity risks. But they 
proportionally receive a lot less funding, those programs, than 
the ones focused on protecting the Federal Government Web sites 
in cyber space.
    Do you have enough to do what you need to do in that area 
since so much of our critical infrastructure is in private 
hands?
    Secretary Napolitano. It is, but it also is getting 
resources from the private sector. The operators, for example, 
of the grids know--the operators of our financial institutions, 
the big critical infrastructure institutions, as we all know, 
are so important to us and potentially subject to cyber attack. 
They are putting resources into this as well. We are working 
closely with them. But this is going to be a multi-year and it 
is probably going to be an ongoing type of expenditure that we 
have. And I think where we were prioritizing is where we think 
we need to start and where we have the greatest need, and that 
is, making sure that the Federal Government itself is 
protected.
    Chairman Lieberman. And the note has now been amended to 
say you have to be at the White House at 4:30. I am going to 
wrap up and give my colleagues----
    Secretary Napolitano. We have to leave at 4:30.
    Chairman Lieberman. Well, I am much relieved.
    Secretary Napolitano. I will try to keep my answers 
shorter.
    Chairman Lieberman Rather than ask you another question, I 
am going to end with an appeal. The second item on the GAO I 
was going to talk about, the high-risk report, is implementing 
and transforming the Department of Homeland Security. It has 
been on the high-risk list since the beginning, since 2003, 
remains there in this new report, although GAO says the 
Department has made progress in the last years toward an 
improvement in the management and integration of the 
Department. I want to set a joint goal with you that, as we 
approach the 10th anniversary of at least September 11, 2001, 
that we work together to see if we can get you off the list 
next year.
    Secretary Napolitano. I am with you.
    Chairman Lieberman. Thank you. Senator Collins.
    Senator Collins. Thank you, Mr. Chairman. I am mindful of 
the fact that Senator McCaskill is here and undoubtedly has 
very tough questions, so I am going to submit most of mine for 
the record, but I do want to ask you one question about the 
Coast Guard, which, as you know from our conversations, I am 
very concerned about whether the Coast Guard has the assets for 
its very important maritime security role which has been so 
critical since September 11, 2001. And the plan is to replace 
12 high endurance cutters with only eight National Security 
Cutters. And the problem is that, as I understand the budget 
request, it provides no funding for the sixth National Security 
Cutter and pushes the completion date for all eight from 2016 
to 2018.
    I am told that every 1-year delay in the acquisition 
program increases the cost per cutter by $45 to $60 million. So 
if this plan goes through, it is going to cost $180 million 
more than it would if you stayed on schedule. And we see this 
in navy shipbuilding all the time, that when you push off the 
acquisition, you end up paying more.
    It strikes me that this was a short-term decision that buys 
you some budget relief this year but ends up costing more in 
the long run.
    Secretary Napolitano. I would disagree, Senator, and I will 
tell you what we did. The budget does pay for some of the 
after-acquisition costs associated with number five, and so 
that is all paid for by 2012.
    What we did not do was set aside for 2012 what are called 
the long lead time expenses for number six, and the reason we 
did not do that is because, while we fully intend to build them 
and we fully intend to build them on the current schedule--and 
the schedule has been pushed back not by money as much as it is 
just taking longer to build these things than was originally 
predicted. But the reason we did not set aside the long lead 
material is that there was no way it was going to be spent in 
fiscal year 2012. So rather than spending it on long lead 
material and just parking it, we decided we would rather buy 
more response boats and smaller boats, as I described in my 
opening statement.
    So we put the money there. OMB has issued a letter saying 
that we intend to fund number six, so if there is any hesitancy 
by the contractor, they have us and OMB all saying we intend to 
fund number six, but we are not going to simply park that 
precious fiscal year 2012 dollar. So you have extra assurance 
that we are going to do that.
    Senator Collins. Well, I am glad to hear that. I still 
think a 2-year delay in the overall acquisition is going to end 
up costing us more, but that is a discussion we can continue.
    Secretary Napolitano. Yes, and if I might Senator?
    Senator Collins. Yes.
    Secretary Napolitano. It is not a delay caused by this. It 
is that the construction of these cutters has become--their 
missions have expanded, and so their actual construction is 
taking longer than was originally predicted.
    Senator Collins. Thank you. I am going to submit the rest 
of my questions.
    I regret we did not get into air cargo security given the 
Yemen package plot. There are so many issues. But I do want to 
allow time for questions.
    Chairman Lieberman. Thank you, Senator Collins. Senator 
McCaskill.

             OPENING STATEMENT OF SENATOR MCCASKILL

    Senator McCaskill. Thank you both, Chairman Lieberman and 
Ranking Member Collins.
    Let me start with how excited I get when I see an Advanced 
Imaging Technology (AIT) machine.
    Secretary Napolitano. Or when it sees you?
    Senator McCaskill. Yes, because that means I get to go 
through fairly quickly because I have an artificial knee, and 
so I have to be patted down everywhere there is not an AIT 
machine. So I am always disappointed when I see it approaching 
in an airport--and I have been in four different major airports 
in the last 6 weeks, and then I see the little tape in front of 
it, and I realize it is not operable. And so I have now started 
asking every time as these machines are sitting idle, and 
without fail, Madam Secretary, I ask for the supervisor. I am 
always very polite and tell them what a great job they are 
doing and how friendly they are and how efficient they are. But 
why isn't the machine operating? And they always say, ``We do 
not have the personnel.''
    In fact, the supervisor in Miami actually said to me, ``Can 
you help us? We never have personnel to operate it because it 
takes too many people, and we just do not have enough people 
here.''
    One supervisor told me it took seven people to operate it. 
Another one said it took five. I am confused why we would be 
spending money on deploying these machines, and I look and 
there seems to be an inconsistency in the numbers, because at 
one point it says 6.25 people to operate one of them, and then 
in your budget request it looks like it is 2.5. So I am 
confused as to how many people it takes to operate the AITs, 
and we should not deploy them if we cannot run them, right?
    Secretary Napolitano. Well, first of all, it does not take 
two. It takes more than six because it is not just the machine. 
It is the people who are reviewing the screens. Sometimes they 
are not operable because the machines are installed while they 
are still building out the area for where the actual images are 
going to be screened, and a lot of this differs airport by 
airport.
    I will get for you the list because typically when they are 
installed, it comes with it, the training for the personnel in 
how to operate and screen via the AIT. And, quite frankly, you 
are the first person that has ever raised this with me. So I 
think overall the transition has been going very well. So we 
are going to have to follow up with you on the specifics.
    Senator McCaskill. That would be great. I assumed it was an 
isolated event because it happened to me a couple times in St. 
Louis in the Southwest terminal because we do not have them in 
the concourse. My typical concourse is American in the other 
terminal. And so a couple of times I went out of my way, and 
they said, ``No, it is not that they are not trained. They just 
do not have enough manpower on the floor at any given moment.'' 
And none of these had a problem with operability in terms of 
buildout. They all just said, ``We do not have enough people on 
shifts to operate them.''
    Secretary Napolitano. Well, that may be a different issue, 
so let us look into that.
    Senator McCaskill. Yes. I think that is the theme I am 
hearing from people, that they are not able to manage the shift 
power to make them work. So we will stay with that and talk and 
figure that out.
    I know you have made a real effort about the contractors. I 
know you have. And I know that you identified 3,500 contractor 
positions last year that you are converting to Federal 
positions. Can you tell us if there has been cost savings from 
the conversions from contractor personnel to Federal personnel?
    Secretary Napolitano. Yes, and we can give you some 
numbers, but there have been cost savings, and we are this year 
accelerating that conversion because as contracts come up, we 
can review and not renew. So I will get you some actual 
numbers, but when this Department was established, just because 
of the various mission sets it had and just the business of 
standing up a department, it had to rely a lot on outsiders to 
help. But as we mature, then we can start reducing that, and we 
are being very aggressive about that effort.
    Senator McCaskill. Well, the cost savings is really 
important, frankly, I do not have anything against contractors. 
I just want to make sure that they are saving us money if we 
are using them.
    Secretary Napolitano. Right.
    Senator McCaskill. So if we are saving money by converting, 
I would be thrilled to hear about that. And I bet we are.
    Secretary Napolitano. Yes, we are, and in some--it is not 
just saving money. It is, ``Are they doing work that we can do 
with our own folks?''
    Senator McCaskill. Right. I know you also did an efficiency 
review that you initiated in March 2009. My staff has attended 
many if not all of the budget briefings that you presented this 
week about the various components. It is clear from those 
presentations that your 2012 budget request, that cuts were 
made. Can you identify the areas where the efficiency review 
has provided the savings to the Department? Because I would 
like to carry this message to other departments and tell them 
that there really is savings that can be realized by this kind 
of effort.
    Secretary Napolitano. Contracting, acquisition, 
procurement, on-boarding--i.e., vetting and identifying--also 
simple office expenses that when you extrapolate to a large 
department save a lot of money. There are several others. We 
have a whole briefing just on this that we can provide for you. 
The contractor conversion saves money and will save more money 
over time.
    Senator McCaskill. Right.
    Secretary Napolitano. So we have identified in this budget 
$800 million or so, and that is a lot.
    Senator McCaskill. That is a lot; $800 million is a lot.
    Finally, I know you have to go, but I wanted to ask you--
last year, Senator Chuck Schumer and I were successful in 
getting some legislation passed that provided for additional 
Border Patrol personnel. It is my understanding that the House 
in its action yesterday on the CR, or the day before, has cut a 
lot of that money that we identified as additional resources to 
be brought to the border.
    I have to tell you, I get whiplash sometimes around here. I 
listen to sanctimonious speeches about more resources for 
border security that is the only thing that we must focus on, 
securing our border as it relates to all the immigration issues 
in our country. And then 5 minutes later, the same people that 
are giving the sanctimonious speeches are yanking out the money 
in the budget that we need to secure the border.
    I assume that what they did yesterday basically wiped out 
what we were able to add to this effort last year?
    Secretary Napolitano. Yes, it was an experience in 
whiplash.
    Senator McCaskill. Yes. I just think we have to call folks 
on this. I am sick of hearing lectures about border security 
and people not being willing to put the resources behind it. 
This is nobody's responsibility but the Federal Government's. 
We could probably afford to pull back a little bit of the big 
checks we are writing to the oil companies to secure our 
borders. And I would like someone to get that set of priorities 
straight and say, maybe we give a billion less to the oil 
companies this year. Maybe they will not be the most profitable 
corporations on the planet, but almost the most profitable 
corporations on the planet, and we actually put real resources 
into securing the border.
    But I for one am sick of hearing them talk about it if they 
are not going to put their money where their mouth is, and I 
wanted to get that out of my system, and I knew that you would 
let me. Thank you, as always, for the great work you are doing. 
I think you are a shining star in the Administration and doing 
very good work. And I want you to stay on those contractors.
    Secretary Napolitano. All right. Thank you.
    Senator McCaskill. Thank you, Madam Secretary.
    Chairman Lieberman. I cannot top ``shining star.'' 
[Laughter.]
    I think you are good. Anyway, thanks, Secretary Napolitano. 
What we have tried to do after these hearings is to sit and 
reason ourselves, we will talk to you and your folks, and then 
make recommendations to the Budget Committee and the 
Appropriations Committee as we go through the process. But 
thanks for your time, and good luck on the trip to the White 
House.
    Secretary Napolitano. Well, thank you, and I think the 
Appropriations Subcommittee hearing is March 2, so we have some 
time to work together.
    Chairman Lieberman. Excellent. We will keep the record of 
the hearing open for 15 days for additional questions and 
statements.
    The hearing is adjourned.
    [Whereupon, at 4:30 p.m., the Committee was adjourned.]


                            A P P E N D I X

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