[Senate Hearing 113-368]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 113-368

 
  SAFEGUARDING OUR NATION'S SECRETS: EXAMINING THE NATIONAL SECURITY 
                               WORKFORCE

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

                                HEARING

                               before the

                   SUBCOMMITTEE ON THE EFFICIENCY AND
      EFFECTIVENESS OF FEDERAL PROGRAMS AND THE FEDERAL WORKFORCE

                                 of the

                              COMMITTEE ON
                         HOMELAND SECURITY AND
                          GOVERNMENTAL AFFAIRS
                          UNITED STATES SENATE


                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                           NOVEMBER 20, 2013

                               __________

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

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                        and Governmental Affairs


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        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

                  THOMAS R. CARPER, Delaware Chairman
CARL LEVIN, Michigan                 TOM COBURN, Oklahoma
MARK L. PRYOR, Arkansas              JOHN McCAIN, Arizona
MARY L. LANDRIEU, Louisiana          RON JOHNSON, Wisconsin
CLAIRE McCASKILL, Missouri           ROB PORTMAN, Ohio
JON TESTER, Montana                  RAND PAUL, Kentucky
MARK BEGICH, Alaska                  MICHAEL B. ENZI, Wyoming
TAMMY BALDWIN, Wisconsin             KELLY AYOTTE, New Hampshire
HEIDI HEIKAMP, North Dakota

                   Richard J. Kessler, Staff Director
               John P. Kilvington, Deputy Staff Director
               Keith B. Ashdown, Minority Staff Director
                     Laura W. Kilbride, Chief Clerk
                     Lauren Corcoran, Hearing Clerk


 SUBCOMMITTEE ON THE EFFICIENCY AND EFFECTIVENESS OF FEDERAL PROGRAMS 
                       AND THE FEDERAL WORKFORCE

                     JON TESTER, Montana, Chairman
MARK L. PRYOR, Arkansas              ROB PORTMAN, Ohio
CLAIRE McCASKILL, Missouri           RON JOHNSON, Wisconsin
MARK BEGICH, Alaska                  RAND PAUL, Kentucky
TAMMY BALDWIN, Wisconsin             MICHAEL B. ENZI, Wyoming
HEIDI HEITKAMP, North Dakota

                 Tony McClain, Majority Staff Director
                 Brent Bombach, Minority Staff Director
                       Kelsey Stroud, Chief Clerk


                            C O N T E N T S

                                 ------                                
Opening statement:
                                                                   Page
    Senator Tester...............................................     1
    Senator Portman..............................................    16

                               WITNESSES
                      Wednesday, November 20, 2013

Brian A. Prioletti, Assistant Director, Special Security 
  Directorate, National Counterintelligence Executive, Office of 
  the Director of National Intelligence..........................     4
Tim Curry, Deputy Associate Director for Partnership and Labor 
  Relations, Office of Personnel Management......................     6
Brenda S. Farrell, Director, Defense Capabilities and Management, 
  U.S. Government Accountability Office..........................     8
David Borer, General Counsel, The American Federation of 
  Government Employees...........................................    10
Angela Canterbury, Director of Public Policy, Project on 
  Government Oversight...........................................    11

                     Alphabetical List of Witnesses

Borer, David:
    Testimony....................................................    10
    Prepared statement...........................................    60
Canterbury, Angela:
    Testimony....................................................    11
    Prepared statement...........................................    66
Curry, Tim:
    Testimony....................................................     6
    Prepared statement...........................................    35
Farrell, Brenda S.:
    Testimony....................................................     8
    Prepared statement...........................................    39
Prioletti, Brian A.:
    Testimony....................................................     4
    Prepared statement...........................................    29

                                APPENDIX

Statement for the Record from Colleen M. Kelley, National 
  President, National Treasury Employees Union...................    76
Responses to post-hearing questions for the Record:
    Mr. Prioletti................................................    79
    Mr. Curry....................................................    85
    Ms. Farrell..................................................   278
    Mr. Borer....................................................   282


                   SAFEGUARDING OUR NATION'S SECRETS:
               EXAMINING THE NATIONAL SECURITY WORKFORCE

                              ----------                              


                       TUESDAY, NOVEMBER 20, 2013

                                 U.S. Senate,      
        Subcommittee on the Efficiency and Effectiveness of
                Federal Programs and the Federal Workforce,
                      of the Committee on Homeland Security
                                        and Governmental Affairs,  
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 2:01 p.m., in 
room SD-342, Dirksen Senate Office Building, Hon. Jon Tester, 
Chairman of the Subcommittee, presiding.
    Present: Senators Tester and Portman.

              OPENING STATEMENT OF SENATOR TESTER

    Senator Tester. I will call to order this hearing of the 
Subcommittee on Efficiency and Effectiveness of Federal 
Programs and Federal Workforce. This afternoon's hearing is 
entitled, Safeguarding our Nation's Secrets: Examining the 
National Security Workforce.
    I will say that Senator Portman is tied up. He is going to 
be here a little bit late and he is going to have to leave 
early, unfortunately. It is not because of the importance of 
this issue. It is because we have a Defense authorization bill 
on the floor and that is keeping a lot of the folks who wanted 
to be here today away. But we will do our best to get as much 
good information as we can on the record as we proceed through 
this so that they will have the ability to make good decisions 
with good information as those decisions arise.
    From the significant disclosures of classified information 
to the tragedy at the Washington Naval Yard, it is abundantly 
clear to the American people that the Federal Government is 
failing to properly vet the individuals who are granted access 
to our Nation's most sensitive information and secure 
facilities.
    And as we all see, there are real life consequences of 
these failures. In looking at the lessons learned, it is 
obvious that there is no single quick fix to such a broken 
system. It is about incomplete, falsified, and ultimately, 
background investigations and re-investigations. It is about 
agencies improperly adjudicating which employees and 
contractors should be granted a clearance, and it is about pure 
volume.
    Today there are nearly five million individuals with a 
security clearance. You heard me right. Five million. And there 
are no indications that number will decrease any time soon. But 
it only takes one individual to slip through the cracks, one 
individual who could do untold damage to our national security 
by exposing sensitive information about government actions and 
programs.
    One individual who, with no motive, with no warning, could 
kill 12 men and women in a secure government facility on a 
random Monday morning. Now, we have to get this right because 
there literally is no margin for error. This hearing will focus 
on the designation of positions in the Federal Government as 
sensitive to the national security, as well as the requirement 
for government personnel to have access to classified 
information.
    Lacking appropriate guidance for such designations, Federal 
agencies are currently relying on a patchwork of Executive 
Orders (EO), Federal regulations, and an Office of Personnel 
Management (OPM) position designation tool that was not created 
to address security-related issues.
    Meanwhile, OPM and the Office of Director of National 
Intelligence (ODNI) are finalizing a rule they claim will 
provide the update and guidance sought by the agencies and 
called for by the Government Accountability Office (GAO) and 
Members of this Committee.
    But others, including some of the witnesses that are here 
today, have real concerns that the proposed guidance is 
inadequate and that it could have negative and substantial 
implications on taxpayers, national security, and Federal 
employee rights.
    These concerns are compounded by this summer's Kaplan v. 
Conyers and Northover decision. This case involved two Federal 
employees who lost their jobs when their employing agency 
stripped them of their sensitive position status. Because the 
Conyers decision denied these employees their rights to due 
process through the Merit Systems Protection Board (MSPB), 
there is a real potential that tens of thousands of employees 
across the Federal Government have just lost their fundamental 
right to appeal a personnel decision, regardless of what drove 
that decision.
    With this in mind, Senator Portman and our Ranking Member 
and I wrote a letter to ODNI and OPM in September regarding 
their proposed rule. In that letter we said, ``From a fiscal 
and security perspective, far too many questions remain 
unanswered about the implications of this proposal, and due to 
the seriousness of the concerns we share, we urge you to defer 
finalizing this rule until the matter has been fully and 
publicly aired, and questions about its true scope, including 
the estimated cost and number of impacted Federal workers are 
answered.'' We are here today to get some of those answers.
    Now I would like to introduce our witnesses, and Senator 
Portman has an opening statement. He can do that when he gets 
here. But I want to introduce my witnesses to the panel here 
today and we want to welcome them all. This truly is a great 
panel of witnesses, very knowledgeable and distinguished in 
your own right.
    First we have Brian Prioletti, is Assistant Director of 
Special Security Directorate in the Office of the Director of 
National Intelligence. In that post, he is responsible for 
leading oversight and reform efforts of the security clearance 
process. Mr. Prioletti took the Assistant Director position 
this last May after more than three decades in the Central 
Intelligence Agency (CIA). He testified before the full 
Committee on security clearance issues last month, and I want 
to thank you for your service, Brian, and I want to thank you 
for joining us again today.
    Tim Curry is the Deputy Associate Director for Partnership 
and Labor Relations in the Office of Personnel Management. He 
is responsible for OPM's efforts to design and promulgate 
governmentwide programs for labor and employee relations. Prior 
to his current position, he served as the Executive Director of 
the Labor, Management, and Employees Relations at the 
Department of Defense (DOD). Tim, thank you for being here and 
getting through the traffic to be here.
    Brenda Farrell is a Director for the Defense Capabilities 
Management Team in the Government Accounting Office, a post 
that she has held since 2007. She is responsible for GAO 
oversight of military and civilian personnel issues and has 
worked extensively on the personnel security clearance program. 
She testified before this Subcommittee in June about the lack 
of clearly defined policy and procedures needed to consistently 
determine whether a position requires a security clearance. It 
is good to have you back, Brenda, and as with the previous two, 
we look forward to your testimony.
    David Borer is the General Counsel of The American 
Federation of Government Employees (AFGE). AFGE represents some 
650,000 Federal employees, including tens of thousands who 
currently occupy positions deemed sensitive to national 
security. He is a veteran on labor relations issues and is here 
today to discuss the impact of the proposed OPM/ODNI rule and 
its impact on Federal employees. Welcome. We look forward to 
what you have to say, David.
    Finally, Angela Canterbury. Angela is the Director of 
Public Policy for the Project on Government Oversight (POGO), 
where she has worked in that capacity since 2010. Founded in 
1981, POGO is a non-partisan, independent watchdog that 
champions good government efforts. In particular, they have 
aggressively advocated for more appropriate balance between 
national security and Civil Service rights with similar 
protections and taxpayer accountability. Angela's work focuses 
on advancing policies that help stamp out corruption and 
promote government openness and accountability. She is here 
today to help us understand how the OPM/ODNI rule might impact 
transparency and whistle-blower rights. We welcome you, Angela, 
and I want to thank you and everybody else for being here 
today.
    It is customary that we swear all witnesses in who appear 
before this Subcommittee. If you do not mind, I would ask you 
to stand and raise your right hand.
    Do you swear the testimony you will give before this 
Subcommittee will be the truth, the whole truth, and nothing 
but the truth, so help you, God?
    Mr. Prioletti. I do.
    Mr. Curry. I do.
    Ms. Farrell. I do.
    Mr. Borer. I do.
    Ms. Canterbury. I do.
    Senator Tester. Let the record reflect that the witnesses 
answered in the affirmative.
    With that, we will give each of you 5 minutes for your oral 
testimony. Know that your entire written testimony will be a 
part of the record. We will start with you, Brian. If you want 
to proceed, please do.

 TESTIMONY OF BRIAN PRIOLETTI,\1\ ASSISTANT DIRECTOR, SPECIAL 
 SECURITY DIRECTORATE, NATIONAL COUNTERINTELLIGENCE EXECUTIVE, 
        OFFICE OF THE DIRECTOR OF NATIONAL INTELLIGENCE

    Mr. Prioletti. Thank you, Senator. Chairman Tester, Ranking 
Member Portman, and distinguished Members of the Subcommittee, 
thank you for inviting me here today to discuss our proposed 
updates to the Federal Government's position designation 
system.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Prioletti appears in the Appendix 
on page 29.
---------------------------------------------------------------------------
    Recently, the ODNI and OPM jointly proposed changes to the 
existing regulations outlining the position designation 
process. These revisions, which include more detail than 
previous regulations, are geared to ensure that a consistent 
process is applied across the government for designating 
positions as sensitive or requiring a security clearance.
    This foundational step helps ensure that individuals are 
investigated at a level appropriate to the risks inherent to 
the position they hold, thereby mitigating risks to national 
security interests. Our proposed rule for the designation of 
national security positions was published in the Federal 
Register for a 30-day public comment in May 2013 with comments 
due in June. We are in the process of reviewing those comments 
and working to finalize the proposed regulations by February 
2014.
    The events of September 11, 2001, drove a dramatic increase 
in the number of positions requiring a security clearance, a 
trend which has continued in recent years. Our office reported 
this year that about 4.9 million Federal Government and 
contractor employees either hold or have been determined to be 
eligible to hold security clearances. The potential risk to 
national security and costs associated with this volume of 
cleared individuals underscore the need for executive branch 
agencies to have a uniform and consistent process to accurately 
designate the sensitivity of a position based on the position 
duties and the potential impact to national security, and 
ensure that the individuals holding these positions are 
appropriately investigated and adjudicated commensurate with 
that risk.
    The concern with position designation is not a recent 
phenomenon. Civilian positions within the Federal Government 
have been designated as sensitive based on the duties and 
responsibilities for over 60 years, when Executive Order 10450 
first established the requirement for the Federal employment 
process to consider national security interests, and charged 
the heads of Federal departments and agencies to establish 
effective programs to ensure that employee hiring and retention 
is clearly consistent with the interests of national security. 
EO-10450 requires a position to be designated as sensitive if 
the occupant of that position could, by virtue of the nature of 
position, bring about a material adverse effect on national 
security. EO-12968, which was issued in 1995, establishes a 
uniform Federal personnel security program for individuals to 
have access to classified information which only may be granted 
on the basis of a demonstrated foreseeable need for that 
access. EO-12968 also makes agency heads responsible for 
establishing and maintaining an effective program to ensure 
that eligibility for access to classified information is 
clearly consistent with the interests of national security.
    The existing designation system requires revision to align 
with other recently updated aspects of the clearance reform 
effort, such as the revised Federal Investigative Standards 
(FIS) signed in December 2012, and to ensure a common 
understanding by Federal agencies as to how to designate 
positions and ensure accurate and consistent position 
designation across the U.S. Government.
    Under EO-13467, the DNI, as Security Executive Agent, and 
the Director of OPM, as the Suitability Executive Agent, both 
have related roles to ensure that a uniform system for position 
designation related to each, to their respective populations of 
authority.
    The proposed regulation is not intended to increase or 
decrease the total number of national security-sensitive 
positions within the Federal Government; but, rather, to ensure 
that each position is designated accurately. The intent is to 
issue national-level policy guidance to promote consistency in 
designating positions and address changed national security 
concerns post-9/11. This approach will improve consistency and 
the level of investigation performed for similar positions in 
other agencies; thereby, promoting efficiency and facilitating 
reciprocity. Additionally, the proposed regulations align with 
the GAO recommendations in its July report entitled, Security 
Clearances: Agencies Need a Clearly Defined Policy for 
Determining Civilian Position Requirements. In that report, the 
GAO noted the need for standardized and clearly defined policy 
for agencies to designate positions as sensitive, or requiring 
a security clearance and for the existing position designation 
tool to be updated to include such guidance. The proposed 
regulations also incorporate the GAO's recommendation that the 
executive branch agencies periodically review and validate or 
revise designations of existing positions. This guidance is 
expected to have positive implications for both national 
security and the Federal workforce.
    The proposed rule and revised position designation tool 
will provide executive branch agencies with consistent guidance 
and a concrete process to accurately reassess the sensitivity 
level assigned to the current positions, and ensure future 
positions are designated accurately and consistently.
    The proposed rule will help guide agency heads in 
designating a position as sensitive with respect to national 
security, even if the position does not require access to 
classified information. The enhanced guidance will facilitate 
more uniform designations across agencies, which are better 
aligned with the actual national security implications and 
sensitivities inherent with the position. This process is 
expected, in some cases, to result in a re-designation of 
positions to a lower sensitivity level or public trust 
designation, thereby reducing costs associated with 
investigations and adjudications required for the higher 
clearance levels. Conversely, there may be instances in which a 
sensitivity designation of a position increases, therefore 
requiring more extensive background investigation, depending 
upon that we designate its sensitivity level. If that happens, 
the workforce can be assured that the change is necessary, and 
based upon the measured execution of the updated guidance 
deemed necessary to protect national security interests. The 
new regulations are intended to clarify the position 
designation requirements and provide additional details over 
the previous regulations in order to ensure that positions are 
accurately designated in a manner that appropriately mitigates 
the risk.
    The Federal workforce will benefit from accurately 
designated positions and that employees will not be required to 
complete extensive background application paperwork or undergo 
investigations for positions that do not warrant it. Further, a 
consistent designation and investigative approach promotes 
clearance reciprocity, and therefore, personnel mobility 
between positions of equivalent position designation or between 
agencies.
    It is imperative that we develop a sound position 
sensitivity designation process because the sensitivity level 
of a position determines the complexity and cost of the 
investigation conducted on the individual selected to occupy 
its position. ODNI will continue to work with OPM and other 
executive branch agencies to ensure that position designation 
policy and procedures include requirements for agencies to 
conduct periodic reviews to validate the accuracy of the 
existing position designations.
    Thank you at this time for the opportunity to testify and 
this concludes my statement.
    Senator Tester. Thank you, Brian. Tim, you are up next.

  TESTIMONY OF TIM F. CURRY,\1\ DEPUTY ASSOCIATE DIRECTOR FOR 
PARTNERSHIP AND LABOR RELATIONS, OFFICE OF PERSONNEL MANAGEMENT

    Mr. Curry. Thank you, Senator. Mr. Chairman, Ranking Member 
Portman, and Members of the Subcommittee. Thank you for the 
invitation to testify on behalf of the Office of Personnel 
Management on regulations affecting the designation of 
positions in the Federal Government as national security-
sensitive, as well as the Kaplan v. Conyers  case.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Curry appears in the Appendix on 
page 35.
---------------------------------------------------------------------------
    The obligation to designate national security positions is 
not a new authority. It is outlined in an Executive Order which 
was published in 1953. Additionally, the Code of Federal 
Regulations (CFR) presently requires each agency to follow 
established procedures to identify national security positions.
    In this vein, OPM and the Office of Director of National 
International, jointly proposed regulations in May of this year 
regarding the designation of national security positions in the 
competitive service. Similar regulations have been in effect 
for over 20 years. The proposed rule is one of a number of 
initiatives OPM and ODNI have undertaken to simplify and 
streamline the system of Federal Government investigative and 
adjudicative processes to make them more efficient and 
equitable. OPM originally proposed amendments on this issue in 
December 2010, with a publication to the Federal Register. 
Those proposed amendments were later withdrawn and reissued in 
May 2013 by OPM and ODNI jointly, pursuant to a Presidential 
Memorandum directing OPM and ODNI to issue amended regulations. 
The Presidential Memorandum recognizes responsibility both 
agencies possess with respect to the relevant rulemaking 
authority. The current proposed rule simply reissues the 2010 
proposal under joint authority with technical modifications and 
clarifications, and provides the public an opportunity to 
submit additional comments.
    The purpose of the proposed rule, both as originally 
published and as republished, is to clarify the requirements 
and procedures agencies should observe when designating as 
national security positions, positions in the competitive 
service, positions in the excepted service where the incumbent 
can be non-competitively converted to the competitive service, 
and Senior Executive Service (SES) positions filled by career 
appointment.
    The proposed rule is not intended to increase or decrease 
the number of positions designated as national security-
sensitive, but is intended to provide more specific guidance to 
agencies in order to enhance the efficiency, accuracy, and 
consistency with which agencies make position designations. The 
older regulations provide only general guidance. The newer 
proposed regulations are intended to clarify the requirements 
and procedures agencies should follow when designating national 
security positions by providing more detail and concrete 
examples.
    In addition, the newer proposed regulations will help 
agencies correctly determine the specific level of sensitivity 
for a position that is determined to affect national security, 
which in turn will help determine the type of background 
investigation that will be required.
    Finally, the proposed rule addresses periodic 
reinvestigations in order to better coordinate the 
reinvestigation requirements for national security positions 
with requirements already in place for security clearances. 
This will help ensure that the same reinvestigations can be 
used for multiple purposes and prevent costly duplication of 
effort.
    The proposed rule was published in the Federal Register on 
May 28, 2013, with a comment period that closed 30 days later. 
OPM and ODNI are presently reviewing comments from members of 
the public.
    This Subcommittee also invited OPM to testify on a separate 
topic, the Kaplan v. Conyers case. As you know, the U.S. Court 
of Appeals for the Federal Circuit, in a 7-3 decision, held 
that the Merit Systems Protection Board, lacks jurisdiction to 
review the merits of executive branch risk determinations 
regarding eligibility to hold national security sensitive 
positions.
    Conyers examined whether the MSPB, in reviewing an appeal 
of an adverse personnel action against an employee, may review 
the merits of the Department of Defense's predictive judgment 
of national security risk. On appeal of the MSPB decision, the 
Federal Circuit concluded that the MSPB can review whether 
DOD's action is procedurally correct, but cannot review whether 
DOD correctly exercised its predictive judgment of national 
security risk. The Federal Circuit held that Congress did not 
give the MSPB this authority. The Federal Circuit based its 
decision on long-standing precedent, specifically the Supreme 
Court's 1988 decision in Department of the Navy v. Egan, that 
the MSPB, in reviewing an appeal of an adverse action cannot 
review the merits of an agency decision to deny an employee 
security clearance. The Federal Circuit held that Egan 
controlled all such national security determinations, not just 
those related to access to classified information.
    Thank you again for the opportunity to testify and I look 
forward to answering any questions you may have.
    Senator Tester. Thank you, Tim. Brenda, you may proceed.

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

    Ms. Farrell. Chairman Tester, thank you for the opportunity 
to be here today to discuss the requirements for personnel to 
have access to classified information. As you know, my 
testimony on the governmentwide security clearance process 
before your Subcommittee this past June included a discussion 
of our work on the steps that agencies use to first determine 
whether a Federal civilian position requires access to 
classified information. Today, I am here to elaborate on that 
process and report on the extent of progress by the agencies in 
implementing our recommendations and actions still needed.
---------------------------------------------------------------------------
    \1\ The prepared statement of Ms. Farrell appears in the Appendix 
on page 39.
---------------------------------------------------------------------------
    Over the years, GAO has conducted a broad body of work on 
security clearance issues that gives us a unique historical 
perspective. My remarks today are based primarily on our July 
2012 report on defining policy and guidance for national 
security positions. My main message today is that actions are 
still needed to help ensure that a sound requirements process 
is in place to determine whether a position requires a security 
clearance for access to classified information.
    My written statement is divided into two parts. The first 
addresses guidance to determine if a civilian position requires 
a security clearance. In July 2012, we reported that the DNI, 
as Security Executive Agent, had not provided agencies clearly 
defined policy and procedures to consistently determine if a 
position requires a clearance. Absent such guidance, agencies 
are using an OPM tool to determine the sensitivity and risk 
levels of positions, which in turn informed the type of 
investigation needed.
    The sensitivity level is based on the potential of an 
occupant of a position to bring about a material, adverse 
affect on national security. OPM audits, however, found 
inconsistencies among agencies using this tool to determine the 
proper sensitivity level.
    For example, in an April 2012 audit, OPM assessed the 
sensitivity level of 39 positions and its designations differ 
from the agency in 26 of them. In our July 2012 report, we 
recommended that the DNI, in coordination with OPM, issue 
clearly defined policy and procedures for Federal agencies to 
follow when first determining if a position requires a 
clearance.
    ODNI concurred with our recommendation and has moved 
forward with actions to address it. We found that in January of 
this year, the President authorized the DNI and OPM to jointly 
address revisions to the Federal regulations that are intended 
to provide guidance for the designation of national security 
positions. We believe that the proposed regulation is a good 
step toward meeting the intent of our recommendation. However, 
implementation guidance still needs to be developed and the 
proposed regulation recognizes that point.
    The second part of my statement addresses the guidance in 
place to periodically reassess civilian positions that require 
security clearance. We also reported in July 2012 that the DNI 
had not established such guidelines requiring agencies to 
review existing positions.
    Without such a requirement, agencies may be hiring or 
budgeting for initial and periodic personnel security clearance 
investigations using position descriptions and security 
clearance requirements that do not reflect current national 
security needs.
    Further, since such reviews are not done consistently, 
agencies cannot have assurances that they are keeping the 
number of positions that require clearances to a minimum, as 
required by Executive Order 12968. Moreover, conducting 
background investigations is costly. We found the Federal 
Government spent over $1 billion to conduct background 
investigations in fiscal year (FY) 2011.
    We recommended in July 2012 that the DNI, in coordination 
with OPM, issuance guidance to require agencies to periodically 
reassess the designation of all Federal civilian positions. 
ODNI and OPM concurred with this recommendation. The proposed 
regulations do not appear to require a periodic reassessment, 
as we have recommended. We still believe that this needs to be 
done.
    For more than a decade, GAO has emphasized the need to 
build and monitor quality throughout the personnel security 
clearance process to promote oversight and positive outcomes 
such as maximizing the likelihood that individuals who are 
security risks will be scrutinized more closely, the first step 
to ensure that a sound process is in place to determine whether 
or not positions need access to classified information.
    We will continue to monitor the outcome of the final 
Federal regulation, as well as other agency actions to address 
our remaining recommendations. Mr. Chairman, this concludes my 
remarks. I will be happy to take questions when you are ready.
    Senator Tester. Well, thank you, Brenda. I appreciate your 
comments. David, you may proceed.

   TESTIMONY OF DAVID A. BORER,\1\ GENERAL COUNSEL, AMERICAN 
               FEDERATION OF GOVERNMENT EMPLOYEES

    Mr. Borer. Mr. Chairman, Senator Portman, and Members of 
the Subcommittee. On behalf of AFGE and the more than 650,000 
Federal employees we represent, including tens of thousands who 
occupy positions designated as sensitive, I thank you for the 
opportunity to testify today.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Borer appears in the Appendix on 
page 60.
---------------------------------------------------------------------------
    AFGE has grave concerns about the recent decision issued by 
the U.S. Court of Appeals for the Federal Circuit in Kaplan v. 
Conyers, and about the proposed rules on the designation of 
positions as national security sensitive issued jointly by OPM 
and ODNI.
    The Conyers decision and the proposed regulations strike at 
the heart of the merit system, which for decades has been the 
foundation in the Federal Civil Service. Conyers eliminated the 
right to a meaningful hearing before the U.S. Merit Systems 
Protection Board. The proposed regulations exacerbate this 
problem by allowing agencies to pick and choose which employees 
will have the right to due process before the MSPB. Conyers and 
the proposed regulations are only the latest injustices 
inflicted upon Federal workers.
    Thanks to a 3-year pay freeze, sequestration in which over 
half of the Federal employees lost 30 percent of their take-
home pay for 6 weeks, and a 16-day furlough with the shutdown, 
many were left unsure of how or when they would be able to pay 
their bills. Some untold number fell into debt or fell deeper 
into debt. That additional debt now potentially exposes 
thousands of Federal employees to unfair removal from so-called 
sensitive positions without so much as a hearing before the 
MSPB.
    To be clear, Conyers does not pertain to individuals with 
security clearances. It is not a case about classified 
information. The individuals in that litigation, Rhonda Conyers 
and Devon Northover, were an accounting technician and a 
grocery story clerk, respectively. Both lost their eligibility 
because of a modest amount of delinquent debt due to 
circumstances beyond their control. They were penalized because 
of their credit scores, and worse, they had to face the loss of 
their jobs.
    This is deeply troubling to AFGE and it should be a real 
concern for this Committee. The implication that financial 
hardship equates to disloyalty, even for employees with no 
access to classified information, is unsupported and offensive. 
In fact, AFGE has found that the practice of penalizing 
employees based on their credit scores has had a 
disproportionate impact on employees, over 40 female employees, 
and employees of color.
    Conyers is an ill-founded extension of an earlier case 
involving security clearances. In 1988, the Supreme Court 
decided the Department of Navy v. Egan, holding that the MSPB 
could not review the merits of a security clearance 
determination in the course of adjudicating an adverse action.
    Later, in Conyers and Northover, the MSPB held that in the 
absence of a security clearance, Egan did not apply. In its 
Conyers' decision, the Federal Circuit opened the door to 
arbitrary and unchecked Executive agency action. The Conyers' 
ruling rejected the text, the structure, and the history of the 
Civil Service Reform Act (CSRA), along with the plain language 
of Egan to hold that the MSPB may not review the merits of an 
agency determination that an employee is ineligible to hold a 
sensitive position.
    The proposed regulations provide no real oversight for 
agency position designation determinations. By contrast to the 
rule proposed by OPM in 2010, these new rules fail to direct 
the agencies that in order to designate a national security 
position, they must make an affirmative determination that the 
occupant of that position could cause a material, adverse 
effect on national security through neglect, action, or 
inaction.
    In both Conyers and the proposed regulations are allowed to 
stand, executive branch agencies will have the unreviewable 
power to deprive hundreds of thousands of employees the 
protections that Congress gave them in the CSRA. That, 
Senators, is likely to be an irresistible invitation to abuse.
    To counter this loss of due process rights, Delegate 
Eleanor Holmes Norton introduced H.R. 3278 to clarify that 
workers or applicants are entitled to be heard by the MSPB even 
if it implicates a sensitive position determination. AFGE 
strongly urges introduction of a companion bill in the Senate 
with the same bipartisan support shown in the House.
    AFGE also looks forward to working with the Members of this 
Committee to restore fairness and common sense to the due 
process protections and other rights that have historically 
protected the Federal workforce. This concludes my statement 
and I would be happy to respond to any questions.
    Senator Tester. Thank you for your statement, David. 
Angela.

 TESTIMONY OF ANGELA CANTERBURY,\1\ DIRECTOR OF PUBLIC POLICY, 
                PROJECT ON GOVERNMENT OVERSIGHT

    Ms. Canterbury. Chairman Tester and Ranking Member Portman, 
thank you very much for your oversight of the national security 
workforce and for inviting me to testify here today. I am 
speaking on behalf of POGO, but also on behalf of the Make it 
Safe Coalition which represents more than 50 groups and 
millions of Americans very concerned with whistleblower 
protections in both the public and the private sector.
---------------------------------------------------------------------------
    \1\ The prepared statement of Ms. Canterbury appears in the 
Appendix on page 66.
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    We are deeply concerned that the national security claims 
here and throughout the government really threaten to engulf 
our government and, with cruel irony, will make us less safe. 
In August of this year, this Court decision in Conyers stripped 
Federal employees in national security sensitive positions of 
their right to an appeal an adverse action, setting the stage 
to also strip due process rights for actions that are 
discriminatory or in retaliation for whistle blowing.
    This deeply flawed decision in Kaplan v. Conyers armed 
agencies with sweeping power that affects untold numbers of 
civil servants, untold because OPM cannot say exactly how many 
position holders there are. The definition under the Executive 
Order 10450 for personnel who may have material adverse affect 
on national security must have objective, credible boundaries.
    Yet, in Conyers, the government did not provide adequate 
boundaries or justifications for national security sensitive 
designations. Indeed, Rhonda Conyers was an accounting 
technician and David R. Northover was a commissary stocker, and 
neither had any real credible national security role.
    While there is a need for additional screening for a very 
limited number of civilian positions with specific national 
security responsibilities but no access to classified 
information, extensive background checks should never be a 
predicate for denying due process rights. Quite the opposite.
    Congress gave the Civil Service and whistleblower 
protections to this critical workforce to foster accountability 
for waste, fraud, and abuse. These workers had, for years, been 
able to challenge adverse personnel actions at the Merit 
Systems Protection Board, but not anymore.
    Now if an agency fires a national security sensitive 
employee for having made a legally protected whistleblower 
disclosure, or because of that employee's race or religion, the 
employee likely will not be able to seek justice. It is just a 
matter of time, as was noted from the bench in oral arguments 
in Conyers after the Egan decision removed due process rights 
for security clearance actions, it was inevitable that the 
Board would do the same for whistleblower retaliation as it did 
in Hesse v. Department of State.
    Because Conyers is so broad, it flouts the congressional 
intent of the Civil Service Reform Act, as well as the 
Whistleblower Protection Act, and the recently passed and 
strongly bipartisan Whistleblower Protection Enhancement Act, 
reforms that we worked for years to enact.
    Of course, even before Conyers, there was a jaw dropping 
lack of oversight of these seemingly arbitrary and overused 
designations. At the direction of the President, OPM and DNI 
issued a joint proposed rule to clarify the proper use. We 
agree, it is about time, but unfortunately, it does nothing to 
assure us that the Obama Administration plans to curb the 
practically unlimited discretion afforded to agencies, 
improved, efficient oversight, or protect critical rights for 
whistleblowers and Civil Service.
    In fact, the proposed rule is poised to expand the use of 
these designations to overly broad categories of positions such 
as senior managers and undefined key programs and fact finding 
positions. Before a final rule, far more needs to be known 
about the scope and cost, policy impacts, due process 
protections, and oversight of these designations.
    We would welcome a directive from the President clarifying 
access to the MSPB and for OPM and DNI to curb the expansive 
use of these designations and conduct proper oversight. 
However, we believe that ultimately Congress must re assert the 
rights it previously provided. We urge you to advance an easy 
legislative fix. Simply clarify that an employee appealing an 
action arising from an eligibility determination for a position 
that does not require a security clearance may not be denied 
MSPB review. This is the Delegate Holmes Norton legislation 
that was mentioned.
    We also urge you to consider the broader context of the 
growing national security State. In the wake of the Snowden 
disclosures, we caution you to guard against over reactions. 
Excessive secrecy undermines our democracy and threatens our 
national security by making it harder for us to protect our 
legitimate secrets.
    The evidence for the growing national security State is 
disturbing. As you mentioned, Chairman, we have almost five 
million security clearance holders. Approximately 20 million 
four-drawer filing cabinets could be filled with the amount of 
classified data accumulated every 18 months by just one 
international agency, according to the GAO.
    It is time for Congress to be far less deferential to the 
executive branch on claims of national security. You can begin 
by reining in the nearly unbridled power of agencies to misuse 
national security labels and make whole swaths of our 
government hidden and accountable. We must be able to hear from 
whistle-blowers.
    Thank you again for inviting me to testify today and I look 
forward to your questions.
    Senator Tester. Well, thank you for your testimony, Angela, 
and I thank all of you for your testimony. We will get to the 
questions right now. Some of this is going to be repetition 
from what some of the panelists said, but this is for anybody 
who wants to answer it.
    In terms of the Conyers decision, we are talking about two 
Federal employees without a security clearance or any need for 
access to classified information. One was an accounting 
technician. I assume that is similar to a Certified Public 
Accountant (CPA) maybe, or not even at that level?
    Mr. Borer. Lower level accounting.
    Senator Tester. Lower level accounting for the Defense 
Department, in that position for 20 years. One was a clerk in a 
commissary, which indicates to me he probably ran a cash 
register. Is that fairly accurate?
    Mr. Borer. He was a grocery store clerk, essentially, yes. 
He ran a cash register.
    Senator Tester. And stocked shelves?
    Mr. Borer. Stocked shelves.
    Senator Tester. And because of delinquent debts brought 
about by a divorce of one and a death in the family of another, 
they were stripped of their ability to hold a government 
position designated as sensitive to national security. The 
designation is consistently and arbitrarily applied to 
positions across government as Angela just got done saying.
    They were subsequently stripped of their rights to appeal 
these personnel decisions of the Merit Service Protection 
Board, a basic right of Federal employees. There are so many 
questions to be asked about this. I will just start with the 
basic one and that is, can somebody explain to me how these 
actions were carried out in the best interest of our national 
security? Do you want to jump in on that one? No? OK.
    So just let me ask you this. You have a position that is 
designated as sensitivity, and then you have a person in that 
position that does not have any level of security clearance. 
Correct so far? And yet, that person is fired because they have 
accrued some debt beyond their control. And that is deemed as 
being OK? That is the first question. No? Anybody want to talk 
about that? Do you want to tell me why that is OK?
    Mr. Curry. Senator, as you may know, AFGE has filed an 
appeal to the Supreme Court related to these issues and I may 
be limited on what I can say about the case because the Justice 
Department represents the executive branch on that.
    Senator Tester. Sure.
    Mr. Curry. But I guess the point I would make on this is, 
one, that under Executive Order 10450, positions could have 
national security impact whether they have access to classified 
information or not. And the reason that we have--OPM went 
forward on challenging the MSPB's decision on this is the 
Director of OPM has authority, under the law, when it believes 
that MSPB has rendered an erroneous decision, which is--an 
erroneous interpretation of Civil Service law, rule, or 
regulation.
    Senator Tester. OK.
    Mr. Curry. And so, when the Director sought reconsideration 
from MSPB on this, the intent was to preserve the executive 
branch's authority to make risk determinations regarding 
national security positions.
    Senator Tester. I got it. So, I mean, let me put it on one 
hand. I get it where if you have somebody that has a high 
security clearance and they owe somebody some money, that could 
possibly compromise what is going on. These guys did not have a 
security clearance at all. They were working in sensitive 
positions, but they did not have a security clearance.
    And it escapes me, it totally escapes me, and we are going 
to get further down, because, I mean, you have to start here to 
get down into the real problems of this. It escapes me how a 
grocery store clerk could be put at the same level as somebody 
that is dealing in the Department of Defense with really 
sensitive information, or in the CIA with really sensitive 
information that owes somebody some money.
    I honest to God do not get it. First of all, I do not get 
how you can have a person working in a position that is deemed 
as sensitive and not have a security clearance. I do not get 
that at all. And second, if they do not have the security 
clearance, I do not understand why they can be fired for that 
reason and not have any appeal rights. Fired because they 
basically accrued debt.
    Am I on a different level here? Does this make sense to you 
guys?
    Mr. Prioletti. Senator, I am not in a position to determine 
what level you are on, but I can say to you----
    Senator Tester. I will take that as a compliment.
    Mr. Prioletti [continuing]. It was meant as a compliment, 
sir. In this particular case, it is difficult for us to speak 
on behalf of DOD, but as you mentioned, there are two points 
here. One, in fact, they were in what were deemed at that time 
sensitive positions.
    Senator Tester. But they did not have a personal clearance. 
They had not been vetted.
    Mr. Prioletti. There is a difference between the sensitive 
position and having a clearance, as we know, and the reason 
that the position was considered sensitive is not based upon 
whether they were going to have access to classified 
information. It was whether the position could cause any type 
of adverse impact to national security. And in this particular 
case, if you have access to a food supply, you could, in fact, 
have an adverse affect to national security, if that food 
supply, in this particular case, is DOD.
    Senator Tester. Would you think the folks down in the 
Dirksen Service Southern Buffet are in sensitive positions? 
They have access to food. I eat, as you can tell, more 
regularly than I should there.
    Mr. Prioletti. Again, sir, I would not comment on that last 
statement, for sure. The designations are done by the 
individual organizations and I would leave that to the 
appropriate organization to determine.
    Senator Tester. OK. So let us get back to where you are 
going, and that is, you are laying down--ODNI and OPM are 
laying down in concert, laying down some regulations that 
agencies can follow, right? Once those regulations are laid 
down, will you be able to tell me whether the folks down in the 
server will be designated as sensitive positions?
    Mr. Prioletti. Once the regulation is enacted, sir, it will 
provide you much clearer guidance so that we have uniform 
consistency across the determination factors, so that when you 
are making a determination on a particular position, the 
guidelines and the standards by which the position will be 
judged against will be consistent across the U.S. Government.
    Senator Tester. So regardless if you are working in the 
Food and Drug Administration (FDA) or the Small Business 
Administration (SBA), the same guidelines will apply, correct?
    Mr. Prioletti. Well, sir, the CFR 1400 applies to the 
competitive service. But the idea is to apply that eventually 
across the U.S. Government for consistency.
    Senator Tester. Just to get your point, I mean, once you 
get the regulations down, they will apply across State--every 
Federal agency equally, correct?
    Mr. Prioletti. Yes, sir.
    Senator Tester. OK. So who is going to make sure that the 
agency actually utilizes--and I do not want to pick on you, 
Brian. Tim, you can answer, too. Who is going to make sure that 
the agency actually utilizes the rules that you promulgate?
    Mr. Curry. Senator, I echo Brian's remarks. The idea here 
is, the current rules at 5 CFR Part 732, they provide some very 
general guidelines, where the proposed rule is providing 
concrete examples, more detail.
    Senator Tester. Got you.
    Mr. Curry. And so, the goal here is to allow for more 
precision in making a position sensitivity designation. So OPM 
and ODNI both have oversight roles that they can assess how 
agencies are implementing these rules. We expect to also 
develop implementing guidance and also update the position 
designation tool which will also provide for more consistency 
across the government.
    Senator Tester. Got you.
    Mr. Curry. And what we are trying to minimize is under 
designation of positions where it might impact national 
security and minimize over designation of positions which might 
increase costs.
    Senator Tester. OK. Where is the oversight of the agencies 
to use the rules that you are putting down? Is it voluntary or 
is somebody--where is the oversight coming from? That is the 
question. The question is, you can put down the rules and if 
they decide not to use them, you do not have rules, you do not 
have consistency, you are not going to achieve the goals that I 
think you want to achieve. So the question is, who has 
oversight?
    Mr. Prioletti. Sir, oversight is a dual role in this case. 
Both OPM from the suitability side and ODNI from the security 
exec side.
    Senator Tester. So you are going to be--I mean, pick an 
agency. Department of Justice (DOJ), CIA, DOD. You are going to 
be providing oversight to see that they use those rules?
    Mr. Prioletti. Yes, sir. That would be our responsibility.
    Senator Tester. And so, we have how many sensitive 
positions do we have? I have to be quiet here. I will come 
back. Senator Portman.
    Senator Portman. Thank you, Chairman. You will give them 
time to think about that question.
    Senator Tester. Exactly.

              OPENING STATEMENT OF SENATOR PORTMAN

    Senator Portman. Well, first, thanks for holding the 
hearing. This is, as you all know, maybe our second hearing we 
have held. There has also been a hearing at the full Committee 
level on this same issue. I think we have acknowledged there is 
a need for significant reform with regard to the security 
clearance process.
    This is not our last hearing, so we will continue to work 
on this. We appreciate your being here and giving us some 
input. Sorry I was a little late. This is kind of a crazy time 
right now with the budget conference I am on and so on. But I 
am pleased we have made a little progress, even in the last 
couple of months.
    We have a legislation that Senator Tester and I introduced 
that actually passed called the SCORE Act, and it gives some 
important oversight responsibilities on this to the Inspector 
General (IG) at OPM, Mr. Curry, as I think you are familiar 
with. We are actually working on additional legislation now 
that we think will also be able to be moved pretty quickly 
because this is bipartisan and I think it makes the system more 
accountable and more efficient.
    On the Defense Authorization Bill, which is on the floor 
this week, we have an amendment that asks GAO to examine 
quality metrics and reciprocity as it pertains to the process. 
And along those same lines, we asked OMB's Performance 
Accountability Council (PAC) to examine how we can improve the 
processes for access to State and local law enforcement records 
in the background investigation process.
    That came out of the tragic incident at the Navy Yard with 
Aaron Alexis. Some of you may have followed that. That came up 
in one of our hearings. That again, better access to State and 
local law enforcement records would have been very helpful in 
that investigation, in the background investigation for him, 
and it would be a way to shortcut some of these investigations.
    Today, as we have heard, we are focusing more broadly on 
the question of who should have access to information, how much 
information should be classified, how can we more efficiently 
and effectively again go through the clearance process. I have 
appreciated your testimony. I have had a chance to hear from 
some of you and look at some of your other testimony.
    I am going to focus in on over classification because I 
think that is one of our issues here. Ultimately, we are not 
going to be able to keep up with the clearance process if we 
continue to classify so much information. And so, I think we 
need to get back to the root of the problem. And then if we 
have time, I will also ask some more questions along the lines 
the Chairman was asking.
    But on over classification or on classification, not to 
have a bias here, we have had, in our Committee hearings, and 
in the full Committee hearing, this consistent theme come up 
that there is more information being classified. It is a 
concern, one, because it is hard for people we represent, our 
constituents, to have access to this information to understand 
how the government works and how it is conducting itself.
    And two, if everything is classified, sort of nothing is 
classified, in my view. I mean, to the extent you are not being 
careful about what you prioritize, it is tough to protect 
information that really is of national security importance.
    I think, not making that information available to the 
public might be one reason the national security sector 
sometimes is interested in classifying, even when it might not 
have a national security implication. So this Public Interest 
Declassification Board (PIDB), which was established by 
Congress back in 2000, has said that a single intelligence 
agency classifies one petabyte of data every 18 months. That is 
the equivalent of 20 million filing cabinets filled with text, 
or approximately 13 years of high-definition video.
    So that is a single intelligence agency classifying that 
much every year-and-a-half. And so, I guess volume should not 
be the only indication, the only metric we use, but that 
certainly seems like a lot of information that, frankly, is 
very tough to keep up with.
    So starting with this notion of how much should we be 
keeping under lock and key, I have a couple questions. And by 
the way, the cost of this is growing, too. From 2001 to 2011, 
that 10-year period, until a couple years ago, the cost went 
from $4.7 billion to $13.6 billion a year. So now, $13.6--
$13.4--$13.36 billion a year in simply costs associated with 
storing this vast amount of information.
    And by the way, that does not include the over $1 billion 
needed every year just to clear the personnel authorized to 
have contact with this information, or to work with this 
material.
    So maybe starting with ODNI, Mr. Prioletti, appreciate your 
being here today because I think you probably have the most 
expertise on the national security side to be able to talk 
about this. Do you think we are classifying too much, too 
little, and talk a little bit about what goes into the 
decisionmaking process for information to be labeled classified 
or sensitive?
    Mr. Prioletti. Thank you, Senator. I think what we do is 
classify what we feel is necessary at the time. I do not 
believe I am in a position to say whether we over classify or 
not. The volume that you mentioned is epic, but there are 
guidelines that are set specifically to determine what 
information needs to be classified and that set of guidelines 
are used to determine what information goes under a 
classification or a non-classification status.
    I think we are using those as judicially as possible. The 
pace of business and the emerging threats environment that we 
are working in necessitates that we look at information on a 
daily basis and make that determination using those guidelines 
that I referred to.
    Senator Portman. And these new tools that we are talking 
about, the new regulations and so on, is for determining 
whether somebody has a position that should be designated as 
sensitive. But you have also got tools that you are using to 
try to determine whether something is classified or not.
    And do you believe that the kind of tools that you have 
available to you are appropriate to make those decisions?
    Mr. Prioletti. Yes, sir, I believe they are appropriate, 
but they are evolutionary in nature and change to meet the 
changing environment in which we work in.
    Senator Portman. So here is one of the other data points we 
have from this PIDB, which is charged with looking at, how much 
classified information we have and whether it is growing or 
not. They are the ones that have indicated that it is growing 
so dramatically from $4.7 billion to protect it, roughly 12 
years ago, to over $11 billion today.
    But they say that it would take two millions employees 1 
year to review even one petabyte of information. And as I have 
indicated, one petabyte of data is now being collected every 18 
months by a single intelligence agency. So two millions 
employees 1 year to review it. So obviously we do not have the 
workforce to review that information. Is that a concern?
    Mr. Prioletti. Sir, if you mean is there a concern over the 
numbers that you just listed, or the lack of personnel to do--
--
    Senator Portman. Well, I mean, it is not practical. I am 
sure you guys would like a bigger budget, but there is not 
going to be two million employees to review even this one 
petabyte we talked about. I guess, just give me a sense of 
whether ODNI is tackling this issue of declassification and 
trying to ensure that we have the classification of materials, 
but do not over classify.
    And if not, how can this be justified? We are not going to 
have the employees to be able to review that. It will not be 
useful information. So what is ODNI's latest effort on 
declassification?
    Mr. Prioletti. Well, sir, what we do is we provide that 
oversight and that guidance to the organizations, and as I 
referred to the standards earlier before in one of your earlier 
questions, that particular guidance is Executive Order 13526, 
which lays out the standards for classifying information, and 
basically that information is tied to two areas.
    It is tied to potential damage to national security in the 
event of an unauthorized disclosure, and what that damage would 
be to national security. And that is the overriding guidance 
that is provided to organizations. EO-13526 is looked at on a 
periodic basis to see if there is any need for change. And that 
is how we continue to provide oversight to the organizations.
    Senator Portman. OK. Let me take you off the hot seat for a 
minute and go to Brenda Farrell, if she would comment on it, 
from a sort of oversight perspective, more general perspective. 
Do you think it is a problem of over classification, and if so, 
do you think ODNI and others are doing the right things to try 
to de-classify information so it is more useful?
    Ms. Farrell. GAO, as noted earlier, has looked at the area 
of what is in place for classified material, but it has been 
several years. We have just initiated work in this area and I 
would be more than happy to have that team come and explain the 
scope of that work to you or your staff if you would like.
    Senator Portman. And is GAO doing a specific research 
project on this issue of classification?
    Ms. Farrell. Yes.
    Senator Portman. That would be terrific if you could 
provide the Subcommittee with that and that may be the subject 
of a future hearing.
    Ms. Canterbury, you talked about it earlier. You mentioned, 
as I recall, that you think that the legislative branch 
provides too much deference to the executive branch on 
classification. Can you tell us why you think that and what you 
think ought to be done?
    Ms. Canterbury. Well, I think it is on a range of issues. I 
think classification is one of them. I think the national 
security claim is being used in more and more contexts now, and 
it sounds to me like the executive branch itself is not 
conducting proper oversight. And I thank you very much for this 
hearing because this is such a--and the previous hearings that 
you have had in this area because I think it has been long 
overdue.
    So now, all of this congressional attention in this space, 
hopefully, will spur some action and create some internal 
controls that are really lacking.
    Senator Portman. Thank you. My time is over. I appreciate 
you all being here today. And again, this is just another 
hearing in our attempt to try to get at this issue, not just of 
over classification of material, but also on the security 
clearance process and how do you make it more efficient and 
more effective to avoid the problems we saw at the Navy Yard. 
So thank you, Mr. Chairman.
    Senator Tester. Thank you, Senator Portman. I appreciate 
your work on this issue. I know you are busy. Appreciate your 
being here while you can. So thank you.
    I am going to go back to where I left off, and that was, we 
were talking about sensitive positions. We were talking about 
security clearances for people, both those issues. This is for 
anybody and if more than one of you want to answer, you can. 
How many sensitive positions have been designated?
    Mr. Curry. Senator, it is difficult to estimate the number 
of sensitive positions across the government, but I would note 
that the number of sensitive positions does not necessarily 
equate to the number of security clearances, because not only 
our regulations are dealing with competitive service employees. 
We also have excepted service in the Federal Government. And, 
of course, security clearances apply to excepted service 
employees as well as contractors.
    Senator Tester. I got it.
    Mr. Curry. It is difficult to estimate that right now.
    Senator Tester. David.
    Mr. Borer. Mr. Chairman, yes, it is impossible probably to 
estimate, but under the proposed regulations, virtually anybody 
in the Department of Defense could be designated as holding a 
sensitive position. So we are talking about hundreds of 
thousands of employees who are being potentially denied MSPB 
rights.
    Now, let me illuminate something based on what you said 
earlier, that the Conyers and the regulations are so insidious 
for two more reasons we have not discussed today. One is that 
Conyers and Northover were both serving in their positions for 
years before their position was suddenly re-designated as a 
sensitive position.
    And with that re-designation, they were suddenly 
scrutinized for their credit ratings and, summarily brought 
before the agency and action was taken that was later deemed 
unreviewable. So that is one thing which fine public servants, 
long service, no problem at all, it is invisible to the 
government what their credit looks like, who cares, and 
suddenly with this stroke of a pen, they are hauled into this 
process.
    Second, because it is unreviewable, we have not even been 
told to this day what it was about Mr. Northover's or Ms. 
Conyers' positions that merited this kind of treatment. The 
government, at some point in the Northover case, mumbled 
something to the effect that, Well, he might be able to tell 
how many sunglasses we were ordering. I fail to see, as I am 
sure the Chairman does, how that is a security risk to the 
Nation, unless we are rolling out an amphibious assault on the 
city of Seattle where the sun never shines.
    Senator Tester. Go ahead, Brenda.
    Ms. Farrell. Mr. Chairman, our work that we conducted in 
2011 and 2012 found that there was a lack of guidance to help 
determine the sensitivity. The current 732 was in place, but it 
was very broad. And, of course, in our work at DOD and DHS, we 
repeatedly had officials tell us that the definition was so 
broad that it could capture just about any Federal position.
    So the steps that have been taken to put some parameters 
around that is much needed. It is not to say that by itself, 
that Federal regulation can answer the mail, but it is a start.
    Senator Tester. You are talking about the one that was 
initially put on the books, or are you talking about the one 
that was presented in May 2010?
    Ms. Farrell. May 2010, which does repeat quite a bit of 
what was previously put on the books. The difference is, some 
of the problems that we discovered in 2011 and 2012 was that 
the ODNI had not taken an active involvement with OPM in this 
particular area, and that was due to their evolving roles, that 
they both received their respective designations which was ODNI 
as Security Executive Agent, and OPM as the Suitability Agent 
in 2008.
    So there was a period when they have been determining 
exactly how their roles would interrelate.
    Senator Tester. OK. And I may not have the month right, but 
I think it was May 2010. Is that right? Or is it December 2010?
    Mr. Curry. I can. Senator, the original regulation was 
proposed in December 2010.
    Senator Tester. OK. Good enough.
    Mr. Curry. And I would like to clarify a point----
    Senator Tester. Go ahead.
    Mr. Curry [continuing]. With regard to every position in 
DOD being designated as sensitive. As we noted in the 
explanation in the supplemental of that proposed rule in 
December 2010, each position designation is going to be based 
on a review of each individual position based on their duties 
and nature of their work, not a broad class of the employees 
across an agency based on their mission.
    Senator Tester. Mr. Borer can speak for himself, but I am 
not sure that he said that. I think what he said was if you 
could take each position and designate it, you could literally 
designate the whole DOD.
    Let me get to the rule of 2010, which--and I do not want to 
put words in your mouth, Brenda--you said was not adequate. Am 
I correct?
    Ms. Farrell. Well, it did not have the involvement of ODNI 
and the DNI is the Security Executive Agent responsible for 
making sure there is uniform policy, and now the current 
proposed regulation does acknowledge the DNI's role.
    Senator Tester. So ODNI is involved now?
    Ms. Farrell. Yes.
    Senator Tester. Does that make the rule--have you seen the 
rule, the February 14th, the rule that they were going to get 
put in stone? Have you seen that rule?
    Ms. Farrell. The current proposed regulation?
    Senator Tester. Yes.
    Ms. Farrell. Yes. And it does----
    Senator Tester. Is that adequate?
    Ms. Farrell. By itself, no. And the rule does note that 
implementation guidelines are the responsibility of ODNI with 
OPM----
    Senator Tester. Right.
    Ms. Farrell [continuing]. And that is definitely what will 
be needed to make sure that there is the oversight you are 
talking about, and quality controls in place for the agencies 
to implement it.
    Senator Tester. But ultimately in the end, is it giving the 
agencies the kind of guidance they need to develop some 
uniformity? Does it give them the metrics to both determine 
which positions need to be designated as sensitive? And I 
assume it deals with security clearances, too?
    Ms. Farrell. It provides more detail. Some of it is very 
similar to the old rule in terms of the definition of national 
security positions.
    Senator Tester. Was the old rule adequate as far as that 
goes?
    Ms. Farrell. Apparently not based on the work that we 
conducted in 2011 and 2012 because it was so broad the agencies 
had difficulty interpreting it.
    Senator Tester. So where are we heading here? Are we 
heading here back to the same spot? I mean, the new rule is 
very similar to the old rule and the old rule was not adequate?
    Ms. Farrell. Well, the new rule does expand on the 
definition of national security positions. It includes some of 
the key positions that were named, but then it tweaks it and it 
expands much more so.
    Senator Tester. Still not adequate?
    Ms. Farrell. I do not know. I do not know because----
    Senator Tester. I thought you said there were studies that 
were done in 2010 and 2011 that said it was not adequate.
    Ms. Farrell. When we did our review that we issued last 
year, we found that the guidance not adequate to help the 
agencies determine the suitability of positions.
    Senator Tester. OK.
    Ms. Farrell. The 2010 proposed rule was never implemented.
    Senator Tester. OK. David, you had something else?
    Mr. Borer. Yes, Mr. Chairman. The new rule, the new version 
of the rules that were published in 2010 omit key provisions 
that talk about what the agencies have to do in order to 
designate a position as a national security position.
    The 2010 rule would have required an affirmative 
determination that the occupant could cause a material, adverse 
effect on national security. That has been deleted. So there is 
no direction, and certainly it will be easier for the agencies 
if they do not have to make that hurdle.
    Senator Tester. OK.
    Mr. Borer. As you talk about oversight, for our money, the 
oversight that is required here is MSPB review on the back end.
    Senator Tester. Yes. Tim, you want to talk about that for a 
second? Why was that deleted?
    Mr. Curry. Yes. Senator, OPM and ODNI, by these regulations 
and by our implementing guidance, will provide detail on 
uniformity and consistency across the government. But under the 
Executive Order 10450, each agency has had responsibility to 
make the position designation.
    So what we are trying to do is assist them in exercising 
their authority by trying to ensure uniformity across the 
government.
    Senator Tester. So why would material, adverse effect be 
taken out of the rule?
    Mr. Curry. No, sir, that is a requirement of the Executive 
Order. This rule is implementing that Executive Order.
    Senator Tester. OK. Getting back to the part about 
different agencies, and you are right, the head makes that 
call. Are they bound by anything other than just their respect 
for you to utilize the rules that you put forth?
    Mr. Curry. Well----
    Senator Tester. The agencies, yes.
    Mr. Curry. For purposes of consistency, yes, they will 
apply these rules, but they ultimately make the designation 
themselves.
    Senator Tester. Just to be clear, and this is not picking 
on anybody here. To be clear, the agencies can determine 
whether to use or whether to go their own way when it comes to 
those designations?
    Mr. Curry. No, sir.
    Senator Tester. They have to use your rules?
    Mr. Curry. They have to use our rules, but they make the 
ultimate final decision when applying these rules.
    Senator Tester. OK.
    Mr. Curry. And, Senator, just for clarification, when they 
are applying these rules, they are in the best position to look 
at the positions in their agencies, the nature of those duties 
of that position, and determine the adverse impact on national 
security if there is action, inaction, or neglect to duty by 
the person in that job.
    Senator Tester. OK.
    Mr. Borer. Mr. Chairman.
    Senator Tester. Yes, sir.
    Mr. Borer. Just so there is no misconception on the part of 
the Committee about the consistency and the integrity of this 
process, I would point out that in Ms. Conyers' case, 
Northover's agency reversed itself and cited, expressly cited, 
the pending litigation as the reason why they were going to 
drop the re-designation of her position.
    And in Mr. Northover's case, he was later restored to this 
position as a result of an unrelated Equal Employment 
Opportunity (EEO) claim and has since been promoted. So we can 
talk about consistency and about applying rules and so forth. 
The reality is on a ground level at these agencies, it does not 
happen. These managers are manipulating the process.
    Senator Tester. I hear you. Look, what I want to get to is 
I want to make sure that--and I think that Angela brought this 
up in her opening statement--cost oversight, due process, all 
those things need to be handled. And I am an open government 
guy. I think the more transparent government is, the better 
government works.
    I also understand that there are people who want to do a 
lot of harm to this country, so we have to make sure that the 
folks that really do have access to sensitive information are 
properly vetted. Why we do not know how many sensitive 
positions are classified within government is disturbing to me, 
and maybe I should not feel that way, but I do.
    I think that if we have agencies out there that are 
arbitrarily--and I know that was part of the goal for the rule, 
is to get rid of the arbitrary nature of designations, but if 
they can still do that and the only person that knows that 
without a doubt are you guys, probably everybody at the table, 
as a matter of fact.
    But if they can arbitrarily do what they want as far as 
determining which positions are sensitive, because they can 
find something out there that would do that--I mean, the 
example of food was a fine example because we all eat--why--I 
guess the question is, are we going to end up with another 
Snowden incident or another Naval Yard shooter incident, 
because we have so many of these things to do that folks end up 
cutting corners in the process?
    I do not mean to verbalize too much about this. Angela 
brought it up. I mean, the fact is, we have a situation where 
we have so many people out here with security clearances that 
corners are being cut now to get those clearances done.
    And a person could deny that, but the proof is in the 
pudding and look what happened with Alexis. So I guess 
oversight by the legislative branch is something that I think 
we ought to take back a lot of the power that we have to make 
three equal branches of government and hearings like this help.
    Any other suggestions that you might have, Angela, as far 
as what we could do here to make sure that the rules that ODNI 
and OPM are putting in place actually do what I think you guys 
want them to do; and yet, does not break the bank, protects due 
process of workers, and, go ahead.
    Ms. Canterbury. Thank you very much, Chairman. First and 
most importantly, Congress is going to have to fix the law and 
make sure that these civil servants and whistleblowers have 
access to review at the Merit Systems Protection Board. That is 
an absolute first must.
    Second, these positions need to be better understood and 
categorized before a proposed rule, before a finalized rule. It 
should have been done before the proposed rule, in our 
estimation. I might suggest a process similar to that with the 
analogous information.
    We had all of these strange, secret markings that 
proliferated. Right? And the agencies were just marking things 
for official use only, secret but unclassified, and so, the 
Obama Administration put together a process to try to rein that 
in and have some rationale for information that is not 
classified, but is controlled but unclassified.
    And so, an inventory took place. I might recommend 
something along those lines for these positions. If we really 
want to get a handle on legitimate designations, then tell us 
what those are. I mean, I am a little confused like you. Like, 
if there is not a security clearance, then what are the 
legitimate designations for national security? Tell us, 
agencies, and then base a rule upon that designation.
    Senator Tester. You are saying tell us what the metrics are 
for determining the position?
    Ms. Canterbury. Yes, absolutely, and which positions you 
are using now, and have a really good, thorough look at whether 
or not those can be streamlined into very narrow, very specific 
concrete categories so that the agencies do not have wiggle 
room.
    Then you need to have some oversight over that process. OPM 
has not been doing its job. They were given responsibility by 
President Eisenhower in Executive Order 10450 and they are 
supposed to be overseeing how the agencies designate these.
    I mean, what we have heard today is they are just letting 
them do whatever, and after this rule, they also will be 
completely deferential to the heads of these agencies. They 
have no plans to go back and check whether or not their rule 
will be applied properly.
    Senator Tester. OK. I will let you respond to that, Tim.
    Mr. Curry. Well, as I noted earlier, OPM and ODNI do have 
the joint oversight rule with regard to these rules and there 
will be oversight and assessment of how the agencies are 
applying these rules. So I would respectfully disagree with 
that.
    Senator Tester. OK. And excuse me for not knowing this 
answer. Are there metrics within the rule?
    Mr. Curry. OK. I am consulting with my advisor.
    Senator Tester. That is perfectly all right. I do the same 
thing.
    Mr. Curry. There are reporting requirements, so based on 
the reporting requirements, we can learn information on how 
they are implementing this, but there is no specific metrics.
    Senator Tester. So if there are not metrics in the rule, do 
you have metrics to know that they are implementing the rule in 
a way that it is intended?
    Mr. Curry. OK, sir. Just what we are proposing in the rule 
is to comply with process efficiency requirements. Additional 
data may be collected from agencies conducting investigations 
or taking action under this part. These collections will be 
identified in separate OPM guidance issued as necessary under 5 
CFR 732.103, which is our current regulations which deal with 
national security positions.
    So there is an opportunity for us that we would collect 
additional data.
    Senator Tester. OK. So do you feel confident that what you 
have done with the rule and your ability to collect additional 
data and you have the manpower to be able to ensure that 
security clearances are given to those who only absolutely need 
them?
    Mr. Curry. Well, I would note that this rule is unrelated 
to security clearances. It is only related to position 
sensitivity designation, so I would have to defer to Mr. 
Prioletti on security clearances.
    Senator Tester. That is fine. Apply it to the designation 
of the position.
    Mr. Curry. Well, in addition to the rules and the 
implementing guidance and the updates to the position 
designation tool, those are tools that are going to help the 
agencies in making those designations being consistent. There 
will be training that is offered by our Federal Investigative 
Services and that training will be updated for agencies to, 
again, assist agencies when they are making those 
determinations.
    Senator Tester. So putting that in Montana talk, do you 
have the ability then to make sure that the positions that are 
classified are positions that necessarily need to be 
classified?
    Mr. Curry. Sir, I cannot answer that question right now. I 
think as we are developing implementing guidance, those are 
kind of----
    Senator Tester. Is that a goal the Department--I do not 
want to----
    Mr. Curry. We certainly, as part of our oversight 
responsibilities, would want to ensure that the proper 
designations are being made.
    Senator Tester. OK. Brian, do you want to speak about the 
security clearance angle for the same group of questions as far 
as making sure that the folks who absolutely need them get them 
and folks who do not, do not?
    Mr. Prioletti. Right. I agree with what Mr. Curry had 
mentioned. The CFR 1400 that we were originally talking about 
here was, in fact, the position designation tool, not a 
security clearance tool.
    And if I may speak to what Angela mentioned earlier, asking 
for more detail, that is exactly what the proposed rule would 
do. It would provide more detail to the organizations in terms 
of guidance on how to determine those designations of the 
positions. And we believe that this rule will get us a lot 
farther than we were in the past.
    This is not new, sir. As we mentioned in our testimony, all 
of us mentioned, designation of positions has been going on 
since 1953 and it is an evolutionary process, and I think we 
continue to build and make a better product to address those 
issues.
    Senator Tester. Got you. I want to talk about security 
clearances for people, though. OK? That is part of the other 
part of this, because we have five million of them, 1.4 million 
top secret. Is there anything being done in that realm to make 
sure that the people who need them have them and the folks that 
do not need them do not have them?
    I do not know about you, but five million seems like a heck 
of a lot of folks to have a security clearance, and 1.4 million 
top secret security clearances seems like a pile. That is more 
than live in the State in Montana by about 40 percent. Can you 
give me an idea on, if there is any metrics or any advice, any 
guidance that is being to agencies on that?
    Mr. Prioletti. Sir, we have existing guidance under 12968 
and 13467 Executive Orders.
    Senator Tester. How old are those rules?
    Mr. Prioletti. 12968 was amended in 1995 and 13467 came out 
in 2008, so they are not quite as old as 10450.
    Senator Tester. Right.
    Mr. Prioletti. And those are the guidelines that are given 
to all organizations to determine clearance-granting for 
individuals. It includes your adjudicative guidelines, it 
includes your investigative guidelines, and those are what are 
used by all organizations to make a determination if a security 
clearance is required for an individual or not.
    Senator Tester. In your opinion, is that adequate? Are we 
making sure that security clearances are going to those who 
absolutely need that access to that information to be able to 
do their jobs?
    Mr. Prioletti. Yes, sir, I believe they are, because they 
are continually reviewed and revisited to ensure that they are 
meeting today's environment in which we work.
    Senator Tester. Brenda, I want to get back to the rules and 
codification of them. Do you think there is a worth in 
codifying the guidance, the updated guidance along with quality 
controls, periodic reviews, guidance beyond the 24 months 
proposed in the rule? Do you think codification is a good thing 
in this case or do you think it is not necessary?
    Ms. Farrell. What we do see missing is the periodic 
reassessments. There will be a one-time assessment that the 
agencies would be required to conduct within 2 years after the 
rule is finalized. But periodic reviews are still a missing 
piece. We still do not know what the implementation guidelines 
will provide--which I agree, which should be developed after 
the rule. But the implementation guidelines will be critical in 
order to understand what the oversight will be and what the 
quality controls will be used for oversight.
    The rule, the proposed rule is an improvement over the 
current rule. The current rule, again, is so broad it is 
subject to interpretation across the board. The proposed rule 
does provide more information to help the agencies. But again, 
by itself and without proper oversight, it is still unknown 
whether this will increase the number of clearances, decrease 
the number of clearances, or whether there will be some other 
issues, as some of the panel members have raised.
    Senator Tester. OK. Well, I think we will wrap this up. I 
want to thank everybody for being a part of the hearing. Look, 
I will just say this. If we are going to--hopefully, we all 
have the same goals and I think they were goals that set out 
that I think Angela put forth in her opening statement, and if 
she did not do maybe somebody else did that dealt with cost and 
due process and oversight and all that stuff, over 
classification.
    If those are not the goals, then somebody has to tell me 
what the goals are, because those ought to be the goals. I 
think the only way we are going to get to a position where, No. 
1, this does not break the bank and that we can do a good job 
really classifying the positions that need to be classified, is 
we really laser in and give these agencies some directive and 
have oversight to make sure that they are following your 
directives.
    I am not sure that is going to happen, but I can tell you 
that if it does not happen, these kind of sessions are not 
going to stop; they are going to continue. These Committee 
hearings and asking folks to be accountable for what is going 
on are going to continue.
    So I would just say that if there are ideas, either from 
the private sector, non-profit sector, from the union groups or 
from the agencies, that we can help you with to be able to help 
you do your job to make sure that we are able to achieve what 
we are trying to get here with truly having positions that are 
designated sensitive that need to be designated sensitive, and 
not because it is convenient to designate them as sensitive for 
some other reason.
    Or the same thing with security clearances, making sure 
that the folks who have them need them and they are not just 
handed out like candy at Halloween. I think it is really going 
to be important. And so, I will offer, as Chairman of this 
Committee, and I know Senator Portman will do his level best, 
too, to make sure that we fix what I think is a very serious 
problem that I talked about in my opening remarks.
    I would just say that this will only get fixed if we work 
together, and I mean between branches on this and with the 
private sector.
    So I just want to thank you all for being here. This 
afternoon I am going to be introducing legislation, the 
Clearance Accountability and Reform Enhancement Act, along with 
Ranking Member Portman, McCaskill, and Johnson and others to 
bring more accountability the security clearance process. 
Hopefully that will help you do your job.
    A key part of this legislation will require an updated 
guidance to agencies, along with quality controls, from you 
folks, OPM and ODNI, who will require periodic reviews and 
guidance to ensure it is regularly updated to reflect our 
current requirements.
    I would argue, in fact, that there is a lack of clear 
guidance that has led us down a path where we now have five 
millions folks with security clearances and access to our 
Nation's most sensitive information and facilities. Would you 
like to speak about that, Brian? Go ahead.
    Mr. Prioletti. Sir, if I may?
    Senator Tester. Sure.
    Mr. Prioletti. And I do not mean to interrupt.
    Senator Tester. No.
    Mr. Prioletti. I just wanted to clarify, we are very 
sensitive to what you say about that number, and the five 
million number that you are referring to covers both people 
with security clearances as well as people eligible for access. 
And being sensitive to that number, as you mentioned, five 
million of anything is a lot.
    Senator Tester. That is.
    Mr. Prioletti. And because of that, recently, and speak of 
the devil, as you mentioned, on Halloween, the DNI signed an 
Executive Correspondence going out to all the government 
agencies stating that they are required to go through their 
clearance lists, validate the numbers, come back with the 
people who are being debriefed from their clearances, and get 
back with us with that information.
    Senator Tester. When will they get back to you with that 
information?
    Mr. Prioletti. They were given 90 days, sir.
    Senator Tester. And you did it on Halloween, OK. Well, my 
next question would be, if there are five million that either 
have clearances or are eligible, how many have clearances? And 
you will have that in about, what, 75 days or so? OK. That is 
good. Right?
    Mr. Prioletti. Yes, sir.
    Senator Tester. Would love to have that as soon as you get 
it.
    Anyway, I look forward to working with the folks that are 
on this panel today and I want to express my appreciation for 
you being here. I think it was a worthwhile discussion about 
where we are and, potentially, where we are going. And I look 
forward to working with my colleagues on this Subcommittee and 
throughout the Senate to get legislation on this done.
    I am confident that in a time of hyper-partisanship that we 
can act responsibly and put the partisanship aside and 
buildupon the passage of the SCORE Act and take further steps 
to improve the security clearance process for the security of 
this country.
    And so, with that, I will say this record will remain open 
for 15 days for any additional comments or questions that might 
want to be submitted. Once again, thanks to the panel for being 
here. This Committee meeting is adjourned.
    [Whereupon, at 3:29 p.m., the hearing was adjourned.]


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