[Congressional Record Volume 140, Number 146 (Saturday, October 8, 1994)]
[Extensions of Remarks]
[Page E]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: October 8, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
             THE U.S. CUSTOMS SERVICE--A GOOD REORGANIZATION

                                 ______


                            HON. J.J. PICKLE

                                of texas

                    in the house of representatives

                        Friday, October 7, 1994

  Mr. PICKLE. Mr. Speaker, I am submitting today for the Record a copy 
of the recent Washington Post article on reorganization of the U.S. 
Customs Service and a copy of a letter I recently received from Customs 
Commission Weise which describes the agency's plans in more detail.
  Briefly, the reorganization plan will eliminate its 7 regional and 45 
district/area offices as management layers, and will assign the 
employees to a nearby port or other Customs facilities. Also, the plan 
would reduce headquarters staffing by approximately one-third, moving 
those employees closer to the port level. Customs will not reduce 
services or personnel at any of its ports of entry. Customs also would 
reduce the number of Special Agent in Charge [SAC] offices from the 
existing 27 to 20 and establish 5 Strategic Trade Centers to identify 
and attack major trade enforcement issues facing the U.S. Customs 
entered into this plan with the cooperation and support of the Customs 
employees union. Reorganization of Customs is long overdue and we 
should all welcome the Commissioner's efforts.
  The Ways and Means Oversight Subcommittee has investigated Customs 
operations for as long as I have been subcommittee chairman, and 
coordinated our findings with the Subcommittee on Trade.
  For decades, Customs operated in a world of ``good old boy'' 
networks, ineffective enforcement strategies, and layers of management 
which stifled efficiency and focus. Allegations of wrongdoing within 
the agency plagued Customs and little was being done to address the 
situation. Part of the problem, I believe, was that Customs wasn't 
accountable to anyone at Treasury or in the Congress.
  In 1988, the subcommittee initiated a top to bottom review and 
investigation of Customs. As a result, the subcommittee issued a report 
titled, ``Abuse and Mismanagement in U.S. Customs Operations.'' This 
1990 report contained 16 findings and 57 administrative recommendations 
for change. The subcommittee found that: Customs' commercial services 
had deteriorated and its systems were seriously flawed; management 
decisions were made without supporting data or analysis; Customs' 
accounting controls were in total disarray, including evidence of lost 
money from duty collections and seized property auctions; and, abuse 
existed in the handling of employee complaints and management of 
inspector overtime pay.
  Since the subcommittee's report, most of the subcommittee's 
recommendations were implemented by Customs. Further, legislation 
adopted by the Congress in NAFTA contained the Customs Modernization 
Act provisions which allows for electronic processing of Customs 
transactions, and provides for uniform treatment of imports across 
ports. All of these administrative and legislative changes were 
critical to making Customs a first-class agency.
  Finally, the critical step required to bring Customs into the 21st 
century is the action Customs proposes in its reorganization plan. I 
applaud Commissioner Weise for his tenacity in taking on this tough 
issue and urge us all to support him.

                [From the Washington Post, Oct. 3, 1994]

Customs Service Begins a Major, Reorganization: First Restructuring in 
               30 Years Shifts 600 Jobs to Field Offices

                           (By Stephen Barr)

       The U.S. Customs Service, faulted in past years for 
     failures in enforcing trade laws and curbing illegal imports, 
     has embarked on a reorganization aimed at improving service 
     at 301 ports of entry nationwide.
       The restructuring will move 600 headquarters positions to 
     the field and eliminate the agency's seven regional and 45 
     district offices. Twenty Customs Management Centers will be 
     created to help with internal administration, and five 
     Strategic Trade Centers will be established to address 
     international trade issues.
       ``We're looking at this as a reinvestment of resources,'' 
     said Customs Commissioner George J. Weise, who notified 
     Congress last Friday that the agency was ready to overhaul an 
     organizational structure that has been in place for 30 years.
       ``The basic thrust of the reorganization is that we're 
     going to put more people on the front lines doing customer 
     work and have fewer people in administrative capacities and 
     managerial capacities.'' Weise said.
       The Customs Service is part of the Treasury Department, and 
     in announcing the reorganization. Treasury Secretary Lloyd 
     Bentsen said the department ``recognizes the need to adjust 
     our business practices in order to deliver improved 
     services.'' Vice President Gore,who has supported efforts to 
     streamline federal bureaucracies, said the Customs initiative 
     ``serves as a guide for other government agencies to 
     follow.''
       Established in 1789 to collect tariffs and duties, the 
     Customs Service has always been an important source of 
     revenue for the government. In 1993, it collected $21.5 
     billion, second only to the Internal Revenue Service.
       Besides collecting tariffs and inspecting imports, the 
     Customs Service also processes about 448 million people who 
     arrive in the United States each year by car, ship or plane.
       Customs employs about 18,000 people, with a staff of about 
     1,800 at its Washington headquarters. The headquarters 
     reorganization will begin immediately, with the field 
     restructuring to begin a year from now, said Weise, a former 
     staff director of the House Ways and Means trade 
     subcommittee.
       Planning for the reorganization began last year under the 
     direction of Deputy Customs Commissioner Michael H. Lane. 
     Lane's task force included officials from Customs, the 
     Immigration and Naturalization Service and representatives 
     from the National Treasury Employees Union (NTEU). The task 
     force met with groups from trade and shipping industries.
       Customs was ``not a sick or ailing agency,'' Weise said, 
     but in need of change. The agency had been criticized in 
     Congress and by the General Accounting Office for poor 
     management practices, including lax handling of seized drugs 
     and weapons, he said. Gore's ``reinventing government'' 
     report and budget constraints added to the impetus for 
     change, he said.
       Larger issues--such as the enactment of the North American 
     Free Trade Agreement (NAFTA) and the conclusion of the 
     Uruguay Round of trade talks under the auspices of the 
     General Agreement on Tariffs and Trade (GATT)--also will 
     provide challenges for the Customs Services, according to the 
     agency's reorganization report, ``People, Processes and 
     Partnerships.''
       To address major trade issues, Weise said Customs would 
     create Strategic Trade Centers in Los Angeles, Dallas-Fort 
     Worth, Chicago, Miami and New York. Miami, for example, would 
     specialize in Caribbean and South American issues, while the 
     Los Angeles office would develop expertise on the new 
     economic powers along the so-called Pacific Rim.
       Up to 20 employees with experience in inspection, imports, 
     intelligence and computers will staff each center.
       The staff at the trade centers ``will step back from our 
     day-to-day work,'' Weise said. ``We have traditionally 
     attempted to deal with trade problems on a case-by-case, 
     transaction-by-transaction basis, as we try to catch 
     violators. What this will do is try to deal with some of our 
     more difficult trade problems * * * [and] come up with a more 
     strategic approach to carrying out more effectively our 
     commercial trade responsibilities.''
       The trade centers, Weise said, will deal with old issues 
     like trade fraud in textiles and new issues like the 
     protection of intellectual property rights.
       But the biggest changes will hit the agency's mid-
     management and senior ranks, as Customs eliminates regional 
     and district offices, Weise said. Regional commissioners and 
     their deputies will move to new jobs, some with less status 
     or prestige.
       When the reorganization is finished in about three years, 
     tentative projections show that 800 to 1,400 positions will 
     be shifted to the Nation's ports.
       ``The fundamental building block of this is that we are 
     going to maintain and enhance all 300 ports of entry where we 
     serve the public today * * * where people enter the country 
     themselves or bring merchandise through. That's where we want 
     to deliver our service,'' Weise said.
       Under the reorganization, port directors will be granted 
     expanded authority to make decisions. Ten assistant 
     commissioners will provide oversight of Customs operations, 
     with a new assistant commissioner for field operations 
     expected to provide strong leadership in the agency.
       The 20 Customs Management Centers--ranging from San Diego 
     to Boston, from San Juan to Detroit--will provide 
     administrative support for the ports, with each center 
     employing only 15 to 20 people. Baltimore has been designated 
     as the home for the mid-Atlantic management center.
       ``It's a reorganization that has been done right from the 
     beginning,'' said NTEU President Robert M. Tobias. ``It was 
     started without preconceptions and a focus on the mission of 
     the Customs Service * * * I think this conceivably is a win 
     for everybody.''
                                  ____



                                  The Commissioner of Customs,

                               Washington, DC, September 30, 1994.
     Hon. J.J. Pickle,
     House of Representatives, Washington, DC.
       Dear Congressman Pickle: Today, I am proud to provide you 
     with the Customs Reorganization Plan Report, ``People, 
     Processes and Partnerships.'' The Treasury Department and the 
     Vice President's National Performance Review have endorsed 
     this plan. I trust that you will also find it to be an 
     excellent concept which embodies the spirit and substance of 
     the Administration's National Performance Review (NPR). It is 
     a plan which will enable Customs to be one of the most 
     effective, efficient and adaptable agencies in the Federal 
     sector and better able to meet the challenges of the 21st 
     century.
       Customs proposes to reorganize around its core business 
     processes and to emphasize the needs of its customers. The 
     focal point of the reorganization will be Customs 301 ports 
     of entry--the operational field level. Under this 
     reorganization plan, Customs will not reduce services or 
     personnel at any of its ports of entry. Under this plan, 
     Customs will not consolidate or close any of its ports. 
     Customs will eliminate its 7 regional and 45 district/area 
     offices as management layers, and will assign the employees 
     of those offices to the port operation in the same location 
     or to nearby ports or other Customs facilities. In this 
     reorganization, Customs will do its utmost to keep its field 
     employees in the locations where they are presently working.
       Although specific details of our reorganization are 
     provided in the enclosed report, I would like to bring to 
     your attention several key issues and concepts, which relate 
     to our central theme ``People, Processes and Partnerships.''
       Our relationship with the National Treasury Employees Union 
     (NTEU), the legal representative of Customs employees, now 
     also embodies the concepts of the NPR. Representatives of 
     NTEU were members of the reorganization study team, and the 
     union has expressed its support for the recommendations in 
     the report. We believe it is essential that Customs 
     management work together with NTEU to bring about the 
     improvements to our work force that are needed to achieve our 
     vision. I am pleased to advise you that on June 13, 1994, 
     Customs entered into a partnership agreement with NTEU. We 
     will build on this partnership during the implementation 
     of the reorganization to minimize negative impact on our 
     employees and to empower employees to make their maximum 
     contributions to the mission and goals of the Customs 
     Service.
       During the reorganization study, every effort was made to 
     involve the trade community, industry, and other Government 
     agencies. Their concerns and needs are incorporated in the 
     report's recommendations. The report's recommendations have 
     also incorporated the wisdom of experts from numerous outside 
     sources whose advice and counsel we actively sought 
     throughout our study process. The Brookings Institution, the 
     Federal Quality Institute (FQI), and the National Academy of 
     Public Administration (NAPA) provided invaluable assistance 
     during the effort.
       In order to improve our organizational alignment, we will 
     reduce Headquarters staffing by approximately one-third, 
     moving those employees closer to the port level, where 
     possible. Headquarters will be restructured to include a 
     Chief Operating Officer and new Assistant Commissioners with 
     a renewed focus on core business processes. Our new 
     organization will have only three levels instead of the 
     existing four levels. This will be accomplished by 
     eliminating the existing 7 regions and 45 district/area 
     offices as management layers. In their place, we will 
     establish 20 Customs Management Centers (CMC)--very small 
     area field management entities, transparent to day-to-day 
     port operations, performing internal oversight and support 
     functions and providing administrative services to the ports. 
     A list of the CMC locations is enclosed for your information.
       We will also reduce the number of Special Agent In Charge 
     (SAC) offices from the existing 27 to 20. Where possible, the 
     SAC offices will be collocated with the CMC's. In addition, 
     we will establish five Strategic Trade Centers (STC) to 
     identify and attack major trade enforcement issues facing the 
     United States. A list of the STC locations is also enclosed 
     for your information.
       We anticipate that the organizational restructuring 
     contemplated under the reorganization will permit a more 
     effective use of personnel and resources. For example, our 
     strategy calls for the retraining and reallocation of 
     approximately 600-750 positions from central control and 
     administrative type offices to locations where our core 
     services are provided. Of course, any final decisions about 
     reinvestment of resources will be made by the President and 
     the Congress.
       To improve the overall management of Customs, we will 
     implement a method of managing the Customs Service through 
     business processes. We will develop a portfolio of management 
     tools and statistically based compliance measurement systems 
     to support this new management approach. We will improve 
     service and performance by identifying customer expectations 
     and establishing customer service standards.
       This organization and its people have made vast 
     contributions to almost every aspect of American life over 
     the history of the Nation. The proposed reorganization is 
     intended to ensure the continuation of that proud tradition 
     and to even greater contributions in the future.
       Customs is available for briefings to provide further 
     detail on our reorganization and our approach to 
     implementation of process management. I ask your support to 
     help Customs achieve our new vision and organizational 
     realignment.
           Sincerely,
                                                   George J.Weise,
                                                     Commissioner.
     Enclosures.

         CUSTOMS MANAGEMENT CENTERS AND SPECIAL AGENT IN CHARGE         
------------------------------------------------------------------------
                  Management area                            City       
------------------------------------------------------------------------
North Atlantic......................................  Boston.           
New York............................................  New York.         
Mid Atlantic........................................  Baltimore.        
South Atlantic......................................  Atlanta.          
North Florida.......................................  Tampa.            
South Florida.......................................  Miami.            
Puerto Rico/Virgin Islands..........................  San Juan.         
Gulf................................................  New Orleans.      
East Texas..........................................  Houston.          
South Tezas.........................................  Laredo.           
West Texas/New Mexico...............................  El Paso.          
Arizona.............................................  Tucson.           
Southern California.................................  San Diego.        
South Pacific.......................................  Los Angeles.      
Mid Pacific.........................................  San Francisco.    
North Pacific.......................................  Seattle.          
Great Plains........................................  Denver.           
Mid America.........................................  Chicago.          
West Great Lakes....................................  Detroit.          
East Great Lakes....................................  Buffalo.          
------------------------------------------------------------------------


                         STRATEGIC TRADE CENTER                         
------------------------------------------------------------------------
                     Trade area                              City       
------------------------------------------------------------------------
Pacific Rim.........................................  Los Angeles.      
Mexico/Central America..............................  Dallas/Ft. Worth. 
Canada..............................................  Chicago.          
Caribbean/South America.............................  Miami.            
Europe/Africa/Middle East...........................  New York.         
------------------------------------------------------------------------

                                                      

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