[House Report 117-338]
[From the U.S. Government Publishing Office]


117th Congress    }                                   {       Report
                        HOUSE OF REPRESENTATIVES
 2d Session       }                                   {       117-338

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

 
 CUSTOMS TRADE PARTNERSHIP AGAINST TERRORISM PILOT PROGRAM ACT OF 2022

                                _______
                                

  May 24, 2022.--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. 6826]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Homeland Security, to whom was referred 
the bill (H.R. 6826) to require a pilot program on the 
participation of third-party logistics providers in the Customs 
Trade Partnership Against Terrorism, and for other purposes, 
having considered the same, reports favorably thereon without 
amendment and recommends that the bill do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     1
Background and Need for Legislation..............................     2
Hearings.........................................................     2
Committee Consideration..........................................     2
Committee Votes..................................................     2
Committee Oversight Findings.....................................     3
C.B.O. Estimate, New Budget Authority, Entitlement Authority, and 
  Tax Expenditures...............................................     3
Federal Mandates Statement.......................................     4
Duplicative Federal Programs.....................................     4
Statement of General Performance Goals and Objectives............     4
Congressional Earmarks, Limited Tax Benefits, and Limited Tariff 
  Benefits.......................................................     5
Advisory Committee Statement.....................................     5
Applicability to Legislative Branch..............................     5
Section-by-Section Analysis of the Legislation...................     5

                          PURPOSE AND SUMMARY

    H.R. 6826, ``Customs Trade Partnership Against Terrorism 
Pilot Program Act of 2022,'' establishes a 5-year pilot program 
for 10 non-asset-based third-party logistics providers and 10 
asset-based third-party logistics providers to participate in 
the Customs Trade Partnership Against Terrorism (CTPAT) pilot 
program upon meeting program requirements. The Act directs the 
Secretary of Homeland Security to publish a Federal Register 
Notice for eligible entities to apply to participate in the 
program and to submit a report to Congress assessing the 
entities' participation in the pilot program and recommending 
whether these types of third-party logistics providers should 
join CTPAT on a permanent basis. The legislation requires the 
U.S. Government Accountability Office (GAO) to issue a report 
analyzing CTPAT's effectiveness in preventing security 
incidents in the cargo supply chain, as well as 
recommendations, as appropriate, to improve the CTPAT program 
and its participant benefits.

                  BACKGROUND AND NEED FOR LEGISLATION

    Since November 2001, CTPAT has been a part of Customs and 
Border Protection's (CBP) multilayered approach of interdicting 
dangerous cargo at U.S. ports of entry (POE) and strengthening 
border security. The program incentivizes private companies to 
adopt tighter security measures throughout their global supply-
chain management in exchange for enhanced trade facilitation at 
POEs. Today, CTPAT members include more than 11,400 companies 
that are: U.S. importers-exporters; U.S.-Canada highway 
carriers; U.S.-Mexico highway carriers; consolidators; customs 
brokers; port authority operators; and manufacturers. At 
present, CBP blocks non-asset-based third-party logistics 
providers and certain asset-based third-party logistics 
providers from participating in the program because they lack 
an international component within their supply chain.
    To address this barrier to CTPAT participation, H.R. 6826 
directs CBP to undertake a pilot program to allow certain non-
asset-based third-party logistics providers and asset-based 
third-party logistics providers to participate in the program. 
The pilot program would examine whether the permanent 
participation of by such providers would enhance supply-chain 
security and expedite trade facilitation at POEs nationwide and 
prevent threats to the homeland.

                                HEARINGS

    For the purposes of clause 3(c)(6) of rule XIII of the 
Rules of the House of Representatives, the following hearings 
were used to develop H.R. 6826:
    The Committee did not hold a legislative hearing on H.R. 
6826 in the 117th Congress.

                        COMMITTEE CONSIDERATION

    The Committee met on March 2, 2022, a quorum being present, 
to consider H.R. 6826 and ordered the measure to be favorably 
reported to the House, without amendment, by voice vote.

                            COMMITTEE VOTES

    Clause 3(b) of rule XIII requires the Committee to list the 
recorded votes on the motion to report legislation and 
amendments thereto.
    No recorded votes were requested during consideration of 
H.R. 6826.

                      COMMITTEE OVERSIGHT FINDINGS

    In compliance with clause 3(c)(1) of rule XIII, the 
Committee advises that the findings and recommendations of the 
Committee, based on oversight activities under clause 2(b)(1) 
of rule X, are incorporated in the descriptive portions of this 
report.

CONGRESSIONAL BUDGET OFFICE ESTIMATE, NEW BUDGET AUTHORITY, ENTITLEMENT 
                    AUTHORITY, AND TAX EXPENDITURES

    With respect to the requirements of clause 3(c)(2) of rule 
XIII and section 308(a) of the Congressional Budget Act of 
1974, and with respect to the requirements of clause 3(c)(3) of 
rule XIII and section 402 of the Congressional Budget Act of 
1974, the Committee adopts as its own the estimate of any new 
budget authority, spending authority, credit authority, or an 
increase or decrease in revenues or tax expenditures contained 
in the cost estimate prepared by the Director of the 
Congressional Budget Office.

                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, March 23, 2022.
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. 6826, the CTPAT 
Pilot Program Act of 2022.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Madeleine 
Fox.
            Sincerely,
                                         Phillip L. Swagel,
                                                          Director.
    Enclosure.

    	   [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    

    H.R. 6826 would require the Department of Homeland Security 
(DHS) to carry out a five-year pilot program to include certain 
third-party logistics providers in the customs trade 
partnership against terrorism (CTPAT) program. CTPAT is a 
voluntary program that encourages entities involved in 
international trade to cooperate with Customs and Border 
Protection (CBP) to strengthen international supply chains, 
improve border security, and facilitate the movement of secure 
cargo through the supply chain. Interested entities would need 
to apply to DHS.
    The bill would require CBP to publish participation 
requirements for the pilot program in the Federal Register 
within one year of the bill's enactment and submit a report to 
the Congress on its findings about the pilot program six months 
after it ends. H.R. 6826 also would require the Government 
Accountability Office (GAO) to report to the Congress on the 
effectiveness of the CTPAT program within 18 months.
    Using information from the agency, CBO estimates that any 
new activities required under H.R. 6826 would not require 
substantial action by DHS and would cost less than $500,000 
over the 2022-2026 period. Furthermore, based on the cost of 
similar activities, CBO estimates the cost to GAO of producing 
the report would be less than $500,000 over the 2022-2026 
period. Taken together, CBO estimates implementing the bill 
would cost $1 million over the 2022-2026 period. All spending 
under the bill would be subject to the availability of 
appropriated funds.
    On December 22, 2021, CBO transmitted a cost estimate for 
S. 2322, the CTPAT Pilot Program Act of 2021, as ordered 
reported by the Senate Committee on Homeland Security and 
Governmental Affairs on November 3, 2021. The two pieces of the 
legislation are similar, and CBO's estimates of their budgetary 
effects are the same.
    The CBO staff contact for this estimate is Madeleine Fox. 
The estimate was reviewed by Leo Lex, Deputy Director of Budget 
Analysis.

                       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.

                      DUPLICATIVE FEDERAL PROGRAMS

    Pursuant to clause 3(c) of rule XIII, the Committee finds 
that H.R. 6826 does not contain any provision that establishes 
or reauthorizes a program known to be duplicative of another 
Federal program.

         STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES

    Pursuant to clause 3(c)(4) of rule XIII, the objective of 
H.R. 6826 is to establish a 5-year pilot program allowing 10 
non-asset-based third-party logistics providers and 10 asset-
based third-party logistics providers to participate in CTPAT 
upon meeting the Secretary of Homeland Security's requirements 
published in their Federal Register notice. The pilot program's 
goal is to help determine whether the participation of these 
entities would enhance port security, combat terrorism, prevent 
United States supply-chain security breaches, or otherwise 
satisfy the goals of CTPAT.

   CONGRESSIONAL EARMARKS, LIMITED TAX BENEFITS, AND LIMITED TARIFF 
                                BENEFITS

    In compliance with rule XXI, 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 rule XXI.

                      ADVISORY COMMITTEE STATEMENT

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

                  APPLICABILITY TO LEGISLATIVE BRANCH

    The Committee finds that H.R. 6826 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 the Act may be cited as the 
``Customs Trade Partnership Against Terrorism Pilot Program Act 
of 2022'' or the ``CTPAT Pilot Program Act of 2022''.

    Sec. 2. Pilot program on participation of third-party 
logistics providers in CTPAT.

    This section establishes a pilot program to assess whether 
the participation of non-asset-based third-party logistic 
providers and asset-based third-party logistics providers in 
the CTPAT program would enhance port security, combat 
terrorism, prevent domestic supply-chain security breaches, and 
advance the goals of the program.
    The Secretary of Homeland Security is required to publish 
in the Federal Register a notice for entities eligible to apply 
to the pilot program and describing the pilot's application 
process and requirements. No more than 10 non-asset-based 
third-party logistics providers and 10 asset-based third-party 
logistics providers can participate in the pilot program on a 
voluntary basis for a period of not less than 1 and not more 
than 5 years.
    Non-asset-based third-party logistics providers are 
entities that arrange international transportation of freight 
and are licensed or bonded by the Federal Maritime Commission, 
the Transportation Security Administration, U.S. Customs and 
Border Protection, or the Department of Transportation. Asset-
based third-party logistics providers are entities that 
facilitate cross-border activity and are licensed or bonded by 
the Federal Maritime Commission, the Transportation Security 
Administration, U.S. Customs and Border Protection, or the 
Department of Transportation. The asset-based third-party 
logistics providers must also manage and execute logistics 
services using its own assets on behalf of customers.
    The Secretary must also submit a report to Congress 180 
days after the termination of the pilot program and detail the 
findings of the pilot and recommendations regarding 
participation in CTPAT.

    Sec. 3. Report on effectiveness of CTPAT.

    This section directs GAO to submit a report to Congress no 
later than 18 months after the enactment of this Act. The 
report shall include an analysis of security incidents in the 
United States cargo supply chain during the 5-year period 
preceding the submission of the report and describe whether 
incidents involved CTPAT participants. The report shall also 
include an analysis of causes for the suspension or removal of 
CTPAT members, the number of active CTPAT members involved in 
security incidents, and CTPAT benefits for its participants. 
Lastly, the report shall include recommendations, as 
appropriate, to improve the CTPAT program and enhance CTPAT 
benefits.

    Sec. 4. Definitions.

    This section defines ``appropriate congressional 
committees'' and ``CTPAT.''

                                  [all]