[House Report 110-752]
[From the U.S. Government Publishing Office]



110th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     110-752

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



 
PERSONNEL REIMBURSEMENT FOR INTELLIGENCE COOPERATION AND ENHANCEMENT OF 
                         HOMELAND SECURITY ACT

                                _______
                                

 July 10, 2008.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

 Mr. Thompson of Mississippi, from the Committee on Homeland Security, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 6098]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Homeland Security, to whom was referred 
the bill (H.R. 6098) to amend the Homeland Security Act of 2002 
to improve the financial assistance provided to State, local, 
and tribal governments for information sharing activities, and 
for other purposes, having considered the same, report 
favorably thereon with an amendment and recommend that the bill 
as amended do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     2
Background and Need for Legislation..............................     3
Hearings.........................................................     4
Committee Consideration..........................................     4
Committee Votes..................................................     5
Committee Oversight Findings.....................................     5
New Budget Authority, Entitlement Authority, and Tax Expenditures     5
Congressional Budget Office Estimate.............................     5
Statement of General Performance Goals and Objectives............     6
Congressional Earmarks, Limited Tax Benefits, and Limited Tariff 
  Benefits.......................................................     7
Federal Mandates Statement.......................................     7
Advisory Committee Statement.....................................     7
Constitutional Authority Statement...............................     7
Applicability to Legislative Branch..............................     7
Section-by-Section Analysis of the Legislation...................     7
Changes in Existing Law Made by the Bill, as Reported............     8
    The amendment is as follows:
    Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Personnel Reimbursement for 
Intelligence Cooperation and Enhancement of Homeland Security Act'' or 
the ``PRICE of Homeland Security Act''.

SEC. 2. FINDINGS.

  The Congress finds as follows:
          (1) After the terrorist attacks on September 11, 2001, State, 
        local, and tribal governments redoubled their efforts to combat 
        terrorism and expended tremendous energy and financial 
        resources to help the Federal Government fight the terrorist 
        threat.
          (2) States and localities have formed fusion centers, hired 
        intelligence analysts, and contributed a significant amount of 
        resources to the expansion of Federal homeland security 
        efforts.
          (3) These actions, in conjunction with the efforts of the 
        Federal Government and private industry, have materially 
        contributed to the common defense of this Nation and have 
        helped keep our homeland secure.
          (4) The National Strategy for Information Sharing issued by 
        the President in October 2007 plainly states that ``The Federal 
        Government may need to provide financial and technical 
        assistance, as well as human resource support, to these fusion 
        centers if they are to achieve and sustain a baseline level of 
        capability. The objective is to assist State and local 
        governments in the establishment and the sustained operation of 
        these fusion centers. A sustained Federal partnership with 
        State and major urban area fusion centers is critical to the 
        safety of our Nation, and therefore a national priority.''.
          (5) The Federal Government has endeavored to support these 
        State efforts through the State Homeland Security Grant Program 
        and other methods of Federal assistance but have placed 
        restrictions on the use of these funds that make long-term 
        planning for fusion centers unmanageable.
          (6) It is vital to the security of our homeland that States 
        and localities are able to continue to receive funding for the 
        participation of State and local analysts in fusion centers and 
        in their State and local efforts to combat terrorism and 
        terrorist-related activities.

SEC. 3. GRANT ELIGIBILITY FOR ANALYSTS.

  Section 2008(a) of the Homeland Security Act of 2002 (6 U.S.C. 
609(a)) is amended--
          (1) in the matter preceding paragraph (1) by striking 
        ``Grants'' and all that follows through ``plans, through'' and 
        inserting the following: ``The Administrator shall permit grant 
        recipients under section 2003 or 2004 to use grant funds to 
        achieve and sustain target capabilities related to preventing, 
        preparing for, protecting against, and responding to acts of 
        terrorism, consistent with a State homeland security plan and 
        relevant local, tribal, and regional homeland security plans, 
        through''; and
          (2) in paragraph (10) by inserting the following after 
        ``analysts'': ``regardless of whether such analysts are current 
        or new full-time employees or contract employees and such 
        funding shall be made available without time limitations placed 
        on the period of time that such analyst can serve under awarded 
        grants.''.

SEC. 4. USE OF FUNDS FOR PERSONNEL AND OPERATIONAL COSTS.

  Section 2008(b)(2) of the Homeland Security Act of 2002 (6 U.S.C. 
609(b)(2)) is amended by striking so much as precedes subparagraph (B) 
and inserting the following:
          ``(2) Personnel and operational costs.--
                  ``(A) In general.--The recipient of a grant under 
                section 2003 or 2004 may, at the recipient's 
                discretion, use up to 50 percent of the amount of the 
                grant awarded for any fiscal year to pay for personnel 
                and operational costs, including overtime and backfill 
                costs, in support of the uses authorized under 
                subsection (a).''.

                          Purpose and Summary

    The purpose of H.R. 6098 is to amend the Homeland Security 
Act of 2002 to improve the financial assistance provided to 
State, local, and tribal governments for information sharing 
activities, and for other purposes.

                  Background and Need for Legislation

    A ``fusion center'' has been defined as ``a collaborative 
effort of two or more agencies that provide resources, 
expertise, and information to the center with the goal of 
maximizing its ability to detect, prevent, investigate, and 
respond to criminal and terrorist activity.'' Fusion centers 
have been established by State and local governments to address 
gaps in information sharing with the Federal Government and to 
provide a conduit for information within a particular State or 
locality. Fusion centers may include a range of Federal, State, 
and local entities that collect and analyze information related 
to homeland security. There is no one fusion center ``model''. 
The potential value of fusion centers is clear: by integrating 
the various streams of information and intelligence from the 
Federal, State, local, and tribal governments, as well as the 
private sector, a more accurate picture of risks to people, 
economic infrastructure and communities can be developed and 
translated into protective action. The ultimate goal of this 
information fusion is to prevent terrorist attacks and to 
respond to natural disasters and manmade threats quickly and 
efficiently should they occur.
    While fusion centers are increasingly seen as national 
assets given their central role in sharing information across 
the country, the cost of their operation has been a continuing 
concern. Both Congress, in the Implementing Recommendations of 
the 9/11 Commission Act of 2007 (P.L. 110-53) (``Implementing 
9/11 Commission Act''), and the Administration in its October 
2007 National Strategy for Information Sharing, recognized that 
sustainment funding for fusion centers necessarily involves 
Federal support for the hiring and retention of intelligence 
analysts at fusion centers.
    Section 101 of the Implementing 9/11 Commission Act amended 
section 2006 of the Homeland Security Act of 2002 (P.L. 107-
296) to allow terrorism prevention funds to be used for paying 
salaries and benefits for personnel, including individuals 
employed by the grant recipient on the date of the relevant 
grant application, to serve as qualified intelligence analysts. 
Congress' intent was to allow State and local grant recipients 
to have flexibility to use Federal funds to pay for both new 
and existing intelligence analysts. The Federal Emergency 
Management Agency (FEMA) issued grant guidance in early 2008, 
however, that limited to two years the period during which 
grant funds could be allocated to pay the salary and benefits 
for a specific intelligence analyst. Although the guidance was 
subsequently revised to allow for a third year of funding for 
this purpose, Congress' intent was to allow continued use of 
Federal funds to fund specific analysts regardless of their 
date of hire or their time in service. Moreover, FEMA's grant 
guidance limited to 25 percent the amount of State Homeland 
Security Grant Program (SHSGP) and Urban Area Security 
Initiative (UASI) funding that could be used for fusion center 
and other personnel costs. The 9/11 Commission Act had included 
a cap of 50 percent for those costs.
    H.R. 6098 clarifies that SHSGP and UASI funds may be used 
by States and localities to pay the salaries and benefits of 
both new and existing intelligence analysts, without time 
limitations. It likewise clarifies that grant recipients may 
use up to 50 percent of an awarded grant for any fiscal year to 
pay for personnel and associated operational costs.

                                Hearings

    No hearings were held on H.R. 6098, however, the Committee 
held oversight hearings listed below.
    In the 109th Congress, the Subcommittee on Intelligence, 
Information Sharing, and Terrorism Risk Assessment held a 
hearing on September 7, 2006, entitled ``State and Local Fusion 
Centers and the Role of DHS.'' The Subcommittee received 
testimony from Mr. Charles E. Allen, Chief Intelligence 
Officer, Department of Homeland Security; Col. Kenneth Bouche, 
Deputy Director, Information & Technology Command, Illinois 
State Police; Ms. Amy Whitmore, Analyst Supervisor, Virginia 
Fusion Center, Virginia State Police; and Mr. Richard L. Canas, 
Director, New Jersey Office of Homeland Security and 
Preparedness.
    On September 27, 2007, the Subcommittee on Intelligence, 
Information Sharing, and Terrorism Risk Assessment held a 
hearing entitled ``The Way Forward With Fusion Centers: 
Challenges and Strategies for Change.'' The Subcommittee 
received testimony from Ms. Eileen Larence, Director, Homeland 
Security and Justice, Government Accountability Office; Mr. 
Todd Masse, Specialist, Domestic Intelligence and 
Counterterrorism, Congressional Research Service; Mr. John 
Rollins, Specialist, Terrorism, International Crime, 
Intelligence, and Homeland Security, Congressional Research 
Service; Mr. Jack Tomarchio, Principal Deputy Assistant 
Secretary, Intelligence and Analysis, Department of Homeland 
Security; Mr. Michael Mines, Deputy Assistant Director, 
Directorate of Intelligence, Federal Bureau of Investigation, 
Department of Justice; Mr. Norman Beasley, Coordinator for 
Counter Terrorism, Maricopa County Sheriff's Office.

                        Committee Consideration

    H.R. 6098 was introduced in the House on May 20, 2008, by 
Mr. Reichert and referred solely to the Committee on Homeland 
Security. Within the Committee, H.R. 6098 was referred to the 
Subcommittee on Intelligence, Information Sharing, and 
Terrorism Risk Assessment.
    The Subcommittee on Intelligence, Information Sharing and 
Terrorism Risk Assessment considered H.R. 6098 on June 11, 
2008, and ordered the measure favorably forwarded to the Full 
Committee for consideration, amended, by unanimous consent.
    The following amendment was offered:
          An Amendment in the Nature of a Substitute offered by 
        Mr. Reichert (#1), was AGREED TO by unanimous consent.
    On June 26, 2008, the Full Committee considered H.R. 6098 
and ordered the measure to be reported to the House favorably, 
as amended, by voice vote.
    The following amendment was offered:
          An amendment offered by Mr. Reichert (#1); was AGREED 
        TO by unanimous consent.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the recorded 
votes on the motion to report legislation and amendments 
thereto.
    No recorded votes were requested during Committee 
consideration.

                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee has held oversight 
hearings and made findings that are reflected in this report.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

     In compliance with clause 3(c)(2) of rule XIII of the 
Rules of the House of Representatives, the Committee finds that 
H.R. 6098, the Personnel Reimbursement for Intelligence 
Cooperation and Enhancement of Homeland Security Act, would 
result in no new or increased budget authority, entitlement 
authority, or tax expenditures or revenues.

                  Congressional Budget Office Estimate

     The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974.

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, July 8, 2008.
Hon. Bennie G. Thompson,
Chairman, Committee on Homeland Security,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 6098, the PRICE of 
Homeland Security Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Daniel 
Hoople.
            Sincerely,
                                         Robert A. Sunshine
                                   (For Peter R. Orszag, Director).
    Enclosure.

H.R. 6098--PRICE of Homeland Security Act

    CBO estimates that implementing H.R. 6098 would have no 
significant cost over the next five years. Enacting this 
legislation would not affect direct spending or revenues.
    H.R. 6098 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would impose no costs on state, local, or tribal governments. 
The bill would benefit those governments by authorizing grant 
programs for homeland security; any costs to those governments 
would be incurred voluntarily.
    H.R. 6098 would permit state and local governments to use 
funds provided through the State Homeland Security Grant 
Program (SHSP) and the Urban Area Security Initiative (UASI) to 
pay the salaries and expenses of individual intelligence 
analysts beyond two years. The bill also would allow recipients 
to use such funding to pay for operational costs incurred under 
the grant.
    The SHSP provides grants to states for identified planning, 
equipment, and training needs in preparation for recovery from 
acts of terrorism and other catastrophic events. The UASI 
provides grants to high-threat, high-density urban areas for 
similar purposes. Grant funds from either program may be used 
to pay for personnel costs, including the salaries and expenses 
of intelligence analysts; however, under rules implemented by 
the Department of Homeland Security (DHS), costs must be 
assumed by the grantee following a period of two years. After 
this period, grant funds may be used to hire a new analyst but 
may not be used to continue funding an existing analyst. H.R. 
6098 would prevent DHS from continuing this requirement as a 
condition of a grant award.
    Under current law, the Congress has authorized 
appropriations totaling $8.25 billion for SHSP and UASI through 
fiscal year 2012 and such sums as may be necessary thereafter 
(see Public Law 110-53). CBO does not expect that the changes 
included in H.R. 6098 would significantly alter the 
expenditures of the grantees or the federal grant programs. As 
such, we estimate that implementing the bill would have no 
effect on the federal budget over the next five years.
    The CBO staff contact for this estimate is Daniel Hoople. 
This estimate was approved by Peter H. Fontaine, Assistant 
Director for Budget Analysis.

         Statement of General Performance Goals and Objectives

     Pursuant to clause 3(c)(4) of rule XIII of the Rules of 
the House of Representatives, H.R. 6098, contains the following 
general performance goals, and objectives, including outcome 
related goals and objectives authorized.
    H.R. 6098 ensures that the will of both the Congress and 
the Administration are properly executed by FEMA and the 
Department of Homeland Security generally when it comes to 
funding State and local fusion centers. In order to sustain 
fusion centers going forward, and to help solidify their 
critical information sharing role as part of the Nation's 
overall homeland security effort, this measure will allow 
States and locals to use homeland security grant funding to 
hire and keep intelligence analysts in fusion centers for 
however long they deem necessary. Consistent with the 
requirements of the Implementing 9/11 Commission Act (P.L. 110-
53), moreover, they will be required to provide rigorous 
privacy and civil liberties training to all intelligence 
analysts at fusion centers to ensure fusion centers strictly 
adheres to all privacy, civil liberties, and other applicable 
Constitutional requirements. This will ensure more and better 
information sharing to make the Nation safer while safeguarding 
the rights of all Americans in the process.

   Congressional Earmarks, Limited Tax Benefits, and Limited Tariff 
                                Benefits

    In compliance with rule XXI of the Rules of the House of 
Representatives, this bill, as reported, contains no 
congressional earmarks, limited tax benefits, or limited tariff 
benefits as defined in clause 9(d), 9(e), or 9(f) of the rule 
XXI.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that the 
Constitutional authority for this legislation is provided in 
Article I, section 8, clause 1, which grants Congress the power 
to provide for the common Defense of the United States.

                  Applicability to Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

             Section-by-Section Analysis of the Legislation


Section 1. Short title

    This section states that this measure may be cited as the 
``Personnel Reimbursement for Intelligence Cooperation and 
Enhancement of Homeland Security Act'' or the ``PRICE of 
Homeland Security Act''.

Section 2. Findings

    This section outlines a series of Congressional findings, 
including: (1) since the 9/11 attacks, State, local, and tribal 
governments have expended tremendous energy and financial 
resources to help the Federal Government fight terrorism; (2) 
among other things, they have established fusion centers, hired 
intelligence analysts, and contributed a significant amount of 
resources to the expansion of Federal homeland security 
efforts; (3) these efforts have materially contributed to the 
common defense and security of the homeland; (4) the 
Administration's October 2007 National Strategy for Information 
Sharing States that the Federal Government may need to provide 
financial and other support--including human resources 
support--to fusion centers in order to help establish and 
sustain them going forward; (5) restrictions on Federal funding 
have made long-term planning for fusion centers unmanageable; 
and (6) States and localities need to continue to receive 
funding for intelligence analysts in fusion centers in order to 
combat terrorism and terrorist-related activities.

Section 3. Grant eligibility for analysts

    This section modifies Section 2008(a) of the Homeland 
Security Act of 2002 (P.L. 107-296) to permit States and 
localities receiving funds under either State Homeland Security 
Grant Program (SHSGP) and the Urban Area Security Initiative 
(UASI) grant program to use grant funds to achieve and sustain 
target capabilities related to preventing, preparing for, 
protecting against, and responding to acts of terrorism, 
consistent with State homeland security plan and relevant 
local, tribal, and regional homeland security plans. The 
section further allows such funding to be used towards salaries 
for analysts regardless of whether such analysts are current or 
new full-time employees or contract employees and without 
limitations on the period of time that such analysts can serve 
under awarded grants.

Section 4. Use of funds for personnel and operational costs

    This section modifies Section 2008(b)(2) of the Homeland 
Security Act of 2002 (P.L. 107-296) to clarify that a recipient 
of a grant under the aforementioned programs may use up to 50 
percent of the amount of the grant awarded for any fiscal year 
to pay for personnel and operating costs, including overtime 
and backfill costs, in support of the uses authorized in this 
measure.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

HOMELAND SECURITY ACT OF 2002

           *       *       *       *       *       *       *


TITLE XX--HOMELAND SECURITY GRANTS

           *       *       *       *       *       *       *


Subtitle A--Grants to States and High-Risk Urban Areas

           *       *       *       *       *       *       *


SEC. 2008. USE OF FUNDS.

  (a) Permitted Uses.--[Grants awarded under section 2003 or 
2004 may be used to achieve target capabilities related to 
preventing, preparing for, protecting against, and responding 
to acts of terrorism, consistent with a State homeland security 
plan and relevant local, tribal, and regional homeland security 
plans, through] The Administrator shall permit grant recipients 
under section 2003 or 2004 to use grant funds to achieve and 
sustain target capabilities related to preventing, preparing 
for, protecting against, and responding to acts of terrorism, 
consistent with a State homeland security plan and relevant 
local, tribal, and regional homeland security plans, through--
          (1) developing and enhancing homeland security, 
        emergency management, or other relevant plans, 
        assessments, or mutual aid agreements;

           *       *       *       *       *       *       *

          (10) paying salaries and benefits for personnel, 
        including individuals employed by the grant recipient 
        on the date of the relevant grant application, to serve 
        as qualified intelligence analysts regardless of 
        whether such analysts are current or new full-time 
        employees or contract employees and such funding shall 
        be made available without time limitations placed on 
        the period of time that such analyst can serve under 
        awarded grants;

           *       *       *       *       *       *       *

  (b) Limitations on Use of Funds.--
          (1) * * *
          [(2) Personnel.--
                  [(A) In general.--Not more than 50 percent of 
                the amount awarded to a grant recipient under 
                section 2003 or 2004 in any fiscal year may be 
                used to pay for personnel, including overtime 
                and backfill costs, in support of the permitted 
                uses under subsection (a).]
          (2) Personnel and operational costs.--
                  (A) In general.--The recipient of a grant 
                under section 2003 or 2004 may, at the 
                recipient's discretion, use up to 50 percent of 
                the amount of the grant awarded for any fiscal 
                year to pay for personnel and operational 
                costs, including overtime and backfill costs, 
                in support of the uses authorized under 
                subsection (a).

           *       *       *       *       *       *       *