Personnel Security Clearances: Preliminary Observations on Joint 
Reform Efforts to Improve the Governmentwide Clearance		 
Eligibility Process (30-JUL-08, GAO-08-1050T).			 
                                                                 
Over the past decade a number of requirements have been 	 
established with regard to the processing of security clearances 
for federal employees. The Intelligence Reform and Terrorism	 
Prevention Act (IRTPA) of 2004 established statutory clearance	 
requirements for the executive agencies, military departments,	 
and intelligence community. These requirements include, among	 
other things, milestones for the reduction in length of time to  
complete personnel security investigations and adjudications,	 
reciprocity of security clearance and access determinations, the 
establishment of an integrated database to track investigative	 
and adjudication information with the authorization of		 
appropriations for its implementation, and continuous evaluation 
of available technology in investigations and adjudications. The 
most recent security clearance reform efforts include the Joint  
Security and Suitability Reform Team's (hereafter referred to as 
the joint reform team) Security and Suitability Process Reform	 
initial report, which was issued on April 30, 2008 in response to
a memorandum from the President, and the President's Executive	 
Order 13467, which was released on June 30, 2008. The joint	 
reform team's initial report contains a reform plan that outlines
a new 7-step process for determining clearance eligibility, and  
the executive order establishes a Performance Accountability	 
Council to implement that plan. The joint reform team's initial  
plan and the executive order reflect the collaborative efforts of
several key agencies, including the Office of the Director of	 
National Intelligence (ODNI), DOD, OPM, and the Office of	 
Management and Budget (OMB).					 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-08-1050T					        
    ACCNO:   A83217						        
  TITLE:     Personnel Security Clearances: Preliminary Observations  
on Joint Reform Efforts to Improve the Governmentwide Clearance  
Eligibility Process						 
     DATE:   07/30/2008 
  SUBJECT:   Accountability					 
	     Classified defense information			 
	     Data collection					 
	     Data integrity					 
	     Data storage					 
	     Data transmission					 
	     Employees						 
	     Executive orders					 
	     Federal agency reorganization			 
	     Information management				 
	     Investigations by federal agencies 		 
	     Investigations into federal agencies		 
	     Military intelligence				 
	     Performance measures				 
	     Program evaluation 				 
	     Program management 				 
	     Regulatory agencies				 
	     Reporting requirements				 
	     Reports management 				 
	     Security assessments				 
	     Security clearances				 
	     Security investigations				 
	     Security policies					 
	     Security regulations				 
	     Strategic planning 				 
	     program goals or objectives			 
	     GAO High Risk Series				 

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GAO-08-1050T

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United States Government Accountability Office: 
GAO: 

Testimony: 

Before the Subcommittee on Intelligence Community Management, House 
Permanent Select Committee on Intelligence, U.S. House of 
Representatives. 

For Release on Delivery: 
Expected at 2:30 p.m. EDT: 
Wednesday, July 30, 2008: 

Personnel Security Clearances: 

Preliminary Observations on Joint Reform Efforts to Improve the 
Governmentwide Clearance Eligibility Process: 

Statement of Brenda S. Farrell, Director: 
Defense Capabilities and Management: 

GAO-08-1050T: 

July 30, 2008: 

Madam Chairwoman and Members of the Subcommittee: 

Thank you for the opportunity to be here today to discuss our 
preliminary observations of the federal governmentï¿½s efforts to reform 
the security clearance process. Over the past several years, we have 
performed extensive work and gained experience on government 
transformation. The expertise gained from these efforts, coupled with 
our decades of experience reviewing the DOD security clearance process, 
positions GAO to help guide the governmentwide security clearance 
reform efforts. [Footnote 1] Moreover, we have identified useful 
practices and lessons learned from our work on transformation that 
agencies could use to successfully transform their cultures. Since 
January 2005, when we first placed the Department of Defenseï¿½s (DOD) 
personnel security clearance program on our list of high-risk 
government programs and operations,[Footnote 2] we have testified 
several times on clearance-related issues. We testified most recently 
before this Subcommittee in February 2008. [Footnote 3] 

We placed DODï¿½s personnel security clearance program on our high-risk 
list in 2005 because of a variety of long-standing problems in the 
program. In the 2007 update to our high-risk report,[Footnote 4] we 
described some of those problems, which included (1) delays in
completing the end-to-end clearance processing; (2) incomplete 
investigative reports from the Office of Personnel Management (OPM), 
the agency that supplies about 90 percent of all federal clearance 
investigations, including those for DOD; and (3) the granting of some 
clearances by adjudicators even though required data were missing from 
the investigative reports used to make such determinations. Further, 
before this Subcommittee in February 2008, we identified four factors 
key to reforming the security clearance process.[Footnote 5] These 
factors are (1) having a sound requirements-determination process in 
place, (2) building quality into every step of the clearance process, 
(3) having a valid set of metrics for evaluating efficiency and 
effectiveness, and (4) providing Congress with the long-term funding 
requirements of security clearance reform. I would also like to add, 
however, that the security clearance reform process is evolving and a
number of noteworthy actions have been taken to improve the security 
clearance process since our high-risk designation in 2005. We have 
reported on and testified about these actions regularly since our 
designation. 

Over the past decade a number of requirements have been established 
with regard to the processing of security clearances for federal 
employees. The Intelligence Reform and Terrorism Prevention Act 
(IRTPA)[Footnote 6] of 2004 established statutory clearance requirements
for the executive agencies, military departments, and intelligence 
community. These requirements include, among other things, milestones 
for the reduction in length of time to complete personnel security 
investigations and adjudications, reciprocity of security clearance and 
access determinations, the establishment of an integrated database to 
track investigative and adjudication information with the authorization 
of appropriations for its implementation, and continuous evaluation of 
available technology in investigations and adjudications. 

The most recent security clearance reform efforts include the Joint 
Security and Suitability Reform Teamï¿½s (hereafter referred to as the 
joint reform team) Security and Suitability Process Reform initial 
report, which was issued on April 30, 2008 in response to a memorandum 
from the President, and the Presidentï¿½s Executive Order 13467, which 
was released on June 30, 2008. The joint reform teamï¿½s initial report 
contains a reform plan that outlines a new 7-step process for 
determining clearance eligibility, and the executive order establishes 
a Performance Accountability Council to implement that plan. The joint 
reform teamï¿½s initial plan and the executive order reflect the 
collaborative efforts of several key agencies, including the Office of 
the Director of National Intelligence (ODNI), DOD, OPM, and the Office 
of Management and Budget (OMB). 

Today, you asked us to discuss the personnel security joint reform 
efforts. As requested, my statement today will address our initial 
observations on (1) elements of the most recent security clearance 
reform efforts and (2) the extent to which the recent reform efforts 
address key factors that should be considered in efforts to reform the 
security clearance process. We also identified best practices that 
agencies can use to successfully transform their cultures and, 
accordingly, can guide the implementation of these personnel security 
clearance reform efforts. My statement is based on our preliminary 
review of the joint reform teamï¿½s initial plan, issued April 30, 2008, 
the appendix to that plan, and Executive Order 13467, as well as our 
prior work on security clearance processes, which included reviews of 
clearance-related documents and interviews of senior officials at OMB, 
DOD, and OPM. In addition, this statement is based on key practices and 
implementation steps we developed from our institutional knowledge on 
organizational transformation.[Footnote 7] Our preliminary review was 
performed in July 2008 in accordance with generally accepted government 
auditing standards. Those standards require that we plan and perform 
the audit to obtain sufficient, appropriate evidence to provide a 
reasonable basis for our findings and conclusions, based on our audit
objectives. We believe that the evidence we obtained provides a 
reasonable basis for our findings and conclusions based on our 
objectives. We also discussed this statement with the Deputy Director 
of OMB, who shared with us the progress the joint reform team has
made toward meeting timeliness goals in completing clearance 
determinations. In addition, he noted that the Performance 
Accountability Council, which was established in Executive Order 13467, 
intends to submit a more detailed implementation plan for the reformed 
security clearance process to the President in December 2008. 

As you know, the Chairman of the Permanent Select Committee on 
Intelligence of the U.S. House of Representatives and you, in your 
capacity as Chairwoman of this Subcommittee, have also requested that 
we conduct an in-depth review of ongoing security clearance reform, 
assess these reform efforts relative to best practices that we have 
used to evaluate other government transformation, and review the 
criteria that the administration is using to assess the effectiveness 
of its initiatives in this area. We have recently begun this work and 
expect to fully report on our findings at a future date. 

Summary: 

The recent security clearance reform efforts, as reflected in the joint 
reform teamï¿½s initial plan and Executive Order 13467, consist of 
several elements, including responsiveness to the Presidentï¿½s direction 
with an initial plan that identifies several primary near-term actions 
to follow, input from key stakeholders, and support from and 
accountability of high-level leadership. First, the joint reform teamï¿½s 
plan responds to the Presidentï¿½s direction for an initial plan and 
identifies several primary near-term actions. For example, the plan 
states that the joint reform team will develop an automated records
check capability to expedite clearance investigations. Second, the 
reform efforts contain input from key stakeholders. In our previous 
work, we have found that stakeholder involvement in strategic planning 
is particularly important because of complex political environments and 
the potential for stakeholders to disagree strongly about missions and
goals. A third element, consistent with the best practices we have 
identified for guiding agencies undergoing cultural transformation, is 
that the reform efforts have the support of high-level governmentwide 
leadership and hold this leadership accountable to the President to 
achieve the reform. We have previously reported that committed, 
sustained leadership and persistent attention by all parties is 
indispensable for the successful implementation of organizational 
transformations, such as making lasting changes to the governmentwide 
security clearance reform effort. The reform plan was developed under
the leadership of four senior executivesï¿½the Director of National 
Intelligence, the Director of OPM, the Deputy Director for Management 
at OMB, and the Under Secretary of Defense (Intelligence)ï¿½who are 
described in the plan as reform champions. The executive order 
identifies specific positions that are accountable, and we believe it 
is significant that the order established a framework for key 
accountable leadership before the upcoming change in administrations 
because the senior leadership currently occupying these positions will 
change with the transition of presidential administrations after the 
2008 elections. Our experience has shown that successful major change
management initiatives can often take at least 5 to 7 years to help 
create the accountability needed to ensure that the transformation 
initiatives are successfully completed. This length of time and the 
frequent turnover of political leadership in the federal government 
have often made it difficult to obtain the sustained attention needed
to make changes in government reform efforts. 

Our review of the joint reform teamï¿½s initial plan and Executive Order 
13467 showed these documents begin to but do not fully address the four 
factors that we identified in February 2008 as key to reforming the 
security clearance process. First, the joint teamï¿½s plan states that a 
reformed security clearance process would begin with a step to validate 
the need for a clearance. However, neither the plan nor the executive 
order includes discrete actions for implementing a sound requirements 
determination process across all of the government agencies that issue 
security clearances. We previously reported that any reform effort 
should address whether the quantity and level of clearances are 
appropriate and include discrete actions or milestones for implementing 
a sound requirements determination process. We noted that unnecessary 
requirements or increases in the number or level of requested 
clearances result in increased costs and investigative and adjudicative 
workloads. Second, while the plan provides some information on building 
quality into the clearance process, it provides limited details on how 
the new automated processes will ensure quality. In February 2008, we 
identified quality control and quality monitoring as key factors in a 
reformed security clearance process. As we reported in September 2006, 
lack of full reciprocity of clearances is an outgrowth of agenciesï¿½ 
concerns over the quality of other agenciesï¿½ investigation and 
adjudication processes. Third, the reform efforts emphasize timeliness 
but do not discuss the use of additional metrics that the joint reform 
team and the Performance Accountability Council could use to evaluate 
the performance of a reformed process. In February 2008, we noted that 
the reformed clearance process should have a valid set of metrics 
beyond those measuring timeliness to evaluate the efficiency and 
effectiveness of the process. We believe that including metrics on both 
the efficiency and effectiveness of clearance processes could add value 
in current and future reform efforts as well as supply better 
information for greater congressional oversight. Finally, neither the 
plan nor the executive order contain information about funding 
requirements, which limits its utility as a tool for decision makers. 
In February 2008, we noted that the plan should provide long-term 
funding requirements to implement the proposed changes. In addition
to limiting the executive branchï¿½s ability to compare and prioritize 
the reform plan, we believe the absence of any funding requirements to 
implement the reforms limits the utility of the reform efforts as a 
tool for decision makers in both the executive and legislative branches 
to carry out their budgetary development and oversight functions. These 
factors may be addressed in a more detailed plan that OMB says it will 
issue in December 2008. 

Moving forward, we believe that the reform efforts could benefit from 
clearly incorporating additional best practices we identified for 
agencies to successfully transform their cultures. These best practices 
include, among other things (1) establishing a coherent mission and 
integrating strategic goals to guide the transformation, (2) focusing 
on a key set of principles and priorities at the outset of the 
transformation, (3) setting implementation goals and a timeline to 
build momentum and show progress from day one, and (4) establishing a 
communication strategy to create shared expectations and report related 
progress. For example, using these practices to meet long-term IRTPA 
requirements can assist in the development of a coherent mission, guide 
the transformation, and focus efforts on key principles and priorities. 
OMB informed us in July 2008 that the Performance Accountability 
Council plans to issue a report detailing the implementation of the 
reformed security clearance process in December 2008. Going forward, 
incorporating these best practices could help to better ensure 
successful implementation of reform efforts as the Council prepares its
December report. These practices become even more important given the 
upcoming change in administrations. 

Background: 

In considering ways in which to reform the governmentï¿½s security 
clearance process, it is helpful to note that since 1997, all agencies 
have been subject to a common set of personnel security investigative 
standards and adjudicative guidelines for determining whether 
servicemembers, federal workers, industry personnel, and others are 
eligible to receive a security clearance. [Footnote 8] Clearances are 
categorized into three levels: top secret, secret, and confidential. 
The level of classification denotes the degree of protection required 
for information and the amount of damage that unauthorized disclosure 
could
reasonably cause to national security. The degree of expected damage 
that unauthorized disclosure could reasonably be expected to cause is 
ï¿½exceptionally grave damageï¿½ for top secret information, ï¿½serious 
damageï¿½ for secret information, and ï¿½damageï¿½ for confidential 
information. [Footnote 9] 

The President issued Executive Order 13381, Strengthening Processes 
Relating to Determining Eligibility for Access to Classified National 
Security Information in June 2005[Footnote 10] as part of the efforts 
to improve the security clearance process and to implement the 
statutory clearance requirements in IRTPA. Among other things, this 
order tasked OMBï¿½s Deputy Director for Management with ensuring the 
effective implementation of policy regarding appropriately uniform, 
centralized, efficient, effective, timely, and reciprocal agency 
functions relating to determining eligibility for access to classified 
national security information. Since 2005, OMBï¿½s Deputy Director for 
Management has taken several actions to improve the security clearance 
process. These actions include establishing an interagency working 
group to improve the reciprocal acceptance of clearances issued by 
other agencies and taking a lead role in preparing a November 2005
strategic plan to improve the timeliness of personnel security 
clearance processes governmentwide. The November 2005 strategic plan 
included quarterly timeliness goals for initial investigations of 
clearances for the 13 months between the issuance of the plan and the 
date on which agencies are to be held accountable to the IRTPA 
timeliness requirements. 

In June 2007 the OMB Deputy Directorï¿½in collaboration with the Director 
of National Intelligence and the Under Secretary of Defense for 
Intelligenceï¿½established the joint reform team to develop a reformed 
DOD and intelligence community security clearance process. [Footnote 
11] The joint reform team submitted a reform plan to the President 
dated April 30, 2008, which presents the design of a transformed hiring 
and clearing process. The plan developed a new process for determining 
clearance eligibility that involves several steps, including (1) 
validating the need for a clearance, (2) an electronic application, (3) 
automated records checks, (4) electronic adjudication, (5) an enhanced
subject interview, (6) an expandable focused investigation, and (7) 
continuous evaluation between clearance investigations. 

Since the release of the joint reform teamï¿½s plan, the President issued 
Executive Order 13467 on June 30, 2008 that lists policy requirements 
to ensure an efficient, practical, reciprocal, and aligned system for 
investigating and determining suitability for government employment, 
contractor employee fitness, and eligibility for access to classified 
information. Specifically, it establishes a Performance Accountability 
Council with designated executive agents that are accountable to the 
President to achieve the goals of the reform effort stated in the 
order, which are ultimately to streamline the background investigation 
and clearance eligibility determinations across the federal government. 
The order also designates the Deputy Director for Management at OMB as
the chair of the Council, who will have the authority to designate 
officials from additional agencies to serve as members, and the Deputy 
Director expressed his intention to us to reach out to federal 
agencies. 

Reform Documents Show That Reform Efforts to Date Are Responsive to
Presidentï¿½s Direction, Include Stakeholder Input, and Emphasize 
Accountability: 

Based on our preliminary observations, the recent security clearance 
reform efforts in the joint reform teamï¿½s plan and the June 30, 2008, 
executive order contain several important elements, including 
responsiveness to the Presidentï¿½s direction, input from key 
stakeholders, and support from and accountability of high-level 
leadership. The first element of the plan is that it responds to the 
Presidentï¿½s direction with an initial plan that identifies several 
primary near-term actions. The President issued a memorandum on 
February 5, 2008, that directed the team to submit an initial reform 
plan no later than April 30, 2008. As directed, the joint reform team 
submitted an initial plan to the President dated April 30, 2008, which 
describes several near-term actions that will be taken to transform the 
security clearance process across the federal government. These actions 
include (1) establishing an executive branch governance structure to 
achieve the goals of reform and sustain reform momentum through the 
upcoming administration transition, (2) developing and initiating 
automated systems for the application, adjudication, and record 
checking steps, and (3) developing an information technology strategy 
to enable improvements governmentwide. 

In addition, progress has already been made in implementing one of 
these near-term actions. Executive Order 13467 was issued in response 
to the joint reform teamï¿½s initial plan. This order establishes a 
formal structure for reform and directs changes to the oversight 
structure of the agencies spearheading the reform effort. It 
establishes the governance structure called for in the joint reform 
teamï¿½s planï¿½called the Performance Accountability Councilï¿½and holds the 
council accountable to the President to achieve the goals listed in the 
executive order. These goals include (1) ensuring the alignment of the 
investigation and adjudication processes, (2) holding agencies 
accountable for implementation of processes/procedures, (3) 
establishing requirements for information technology, (4) establishing 
goals and metrics and preparing annual reports on results of the 
metrics, (5) overseeing development of tools/techniques for enhancing 
investigations and eligibility determinations, (6) arbitrating 
disparities in procedures between the executive agents, (7) ensuring 
sharing of best practices, and (8) advising executive agents on 
policies affecting alignment of investigations and adjudications. The 
level of direction in the executive order and the establishment of a 
very specific, centralized structure make this latest reform effort 
stand out from past efforts. 

Second, the reform efforts to date contain input from key stakeholders. 
In our previous work, we found that stakeholder involvement in 
strategic planning is particularly important because of complex 
political environments and the potential for stakeholders to disagree 
strongly about missions and goals. In a letter accompanying the joint 
reform teamï¿½s plan, OMBï¿½s Deputy Director for Management highlights 
that the plan is the product of the collaborative efforts of several 
key agencies, including the ODNI, DOD Office of the Under Secretary of 
Defense (Intelligence), OPM, the Office of the Assistant to the 
President for National Security Affairs, and OMB. These agencies are key
stakeholders given their various roles in government security clearance 
programs and processes. Furthermore, the joint reform team was composed 
of and consulted with government and industry subject matter experts. 
These experts included representatives from (1) ODNIï¿½s Special Security 
Center Director, (2) DODï¿½s Personnel Security Research Center, (3) 
DODï¿½s Defense Security Service, (4) OPMï¿½s Federal Investigative 
Services Division, and (5) intelligence community subject matter 
experts. 

Furthermore, the reform efforts also have the support of high-level 
governmentwide leadership and hold this leadership accountable. 
Committed, sustained, highly qualified, and inspired leadership and 
persistent attention by all parties is a best practice that we have 
previously identified as indispensable for the successful 
implementation of organizational transformations, such as making 
lasting changes to the governmentwide security clearance reform effort. 
The joint reform teamï¿½s plan was developed under the leadership of four 
senior executives who are described in the plan as reform champions. 
These four senior executives are the Director of National Intelligence, 
the Director of OPM, the Deputy Director for Management at OMB, and the 
Under Secretary of Defense (Intelligence). In February 2008, we 
reported additional indicators of high-level governmentwide leadership 
support in addressing problems in the security clearance process. 
[Footnote 12] For example, we noted that an August 9, 2007, memorandum 
from the Deputy Secretary of Defense indicates that DODï¿½s clearance 
program is drawing attention at the highest levels of the department. 
Streamlining security clearance processes is one of the 25 DOD 
transformation priorities identified in the memorandum. The leadership 
involved in the development of the reform efforts is also held 
accountable to the President to ensure that the reform goals are 
achieved. For example, the new executive order is more directive than 
reform efforts in the past decade because it assigns specific 
responsibilities to the high-level leadership that it appoints to be 
members of the Performance Accountability Council. The order designates 
the Deputy Director of OMB as Chair of the Council, the Director of OPM 
as the Suitability Executive Agent, and the Director of National 
Intelligence as the Security Executive Agent. [Footnote 13] In 
addition, the order states that the Council is held accountable to the 
President for the implementation of reform and to achieve the reform 
effortï¿½s goals. The order identifies the positions that are 
accountable, and we believe it is significant that the order 
established a framework for the involvement and accountability of key 
leadership before the upcoming change in administrations because much 
of the senior leadership currently occupying these positions could 
change with the transition of presidential administrations after the 
2008 elections. In fact, it is possible that these positions could be 
vacant for a period of time or be temporarily filled during the 
transition. Our experience has shown that successful major change 
management initiatives in large public and private sector organizations 
can often take at least 5 to 7 years to help create the accountability 
needed to ensure that long-term management and transformation 
initiatives are successfully completed. This length of time and the 
frequent turnover of political leadership in the federal government 
have often made it difficult to obtain the sustained attention needed 
to make changes in other government reform efforts. 

Moreover, the plan also formalizes a specific role for the intelligence 
community, one of the key stakeholders in the security clearance 
process. Specifically, the leadership arrangement established by the 
executive order formalizes the role of the Director of National 
Intelligence in the reform process as the Security Executive Agent. 
Under the order, the Security Executive Agent is responsible for, among 
other things, developing policies and procedures for making clearance 
eligibility determinations and for ensuring governmentwide reciprocity 
of clearances. Formalizing leadership roles is essential to ensuring 
that the reform effort moves forward through the transition of the 
administration following the 2008 presidential election. Together, the 
joint reform teamï¿½s plan and the Presidentï¿½s executive order develop 
and assign leadership roles and establish a formal structure that was 
not previously in place and that intends to streamline the security 
clearance process. 

Reform Efforts Could Benefit from More Fully Incorporating Four Factors 
Key to Reforming the Security Clearance Process: 

Based on our preliminary analysis, while recent security clearance 
reform documents begin to address key factors, the recent documents do 
not yet fully address the four factors that we identified in February 
2008 as key to reforming the security clearance process. First, the 
joint teamï¿½s plan mentions that a reformed security clearance process
would begin with a step to validate the need for a clearance, but does 
not include discrete actions for implementing a sound requirements 
determination process across all of the government agencies that issue 
security clearances. Second, the reform efforts provide some 
information on building quality into the clearance process, but provide
limited details on how the new automated processes will ensure quality. 
Third, the reform efforts emphasize timeliness but do not discuss the 
use of additional metrics that the team and stakeholders would use to 
evaluate the performance of a reformed process. Finally, neither the 
plan nor the executive order contain information about funding 
requirements, which limits their utility as tools for decision makers. 

Plan Mentions the Need for a Step to Validate the Need for a Clearance, 
but Does Not Include Discrete Actions for Implementing a Sound 
Requirements Determination Process: 

Of the two recent reform efforts, only the joint reform team plan 
mentions the need for the reformed process to begin with a step to 
validate the need for a clearance, but it does not include discrete 
actions for implementing a requirements determination process across 
all of the government agencies that issue security clearances. The 
executive order does not establish any requirements or steps for 
clearance requirements determination In February 2008, we noted that 
the joint reform team should address whether the numbers and levels of 
clearances are appropriate, since this initial stage in the clearance
process can affect workloads and costs in other clearance stages. The 
joint reform teamï¿½s plan states that the first step in a reformed 
clearance process would be to validate the need for a clearance request 
against mission needs. The plan states that this step would focus on 
optimizing policy, procedures, and tools before investigations are 
requested and that the new clearance design would provide a process 
whereby managers only submit individuals to the clearance process as 
needed. The plan describes the benefits of validating needs, which 
include actively managing investigation requests to potentially result 
in the reduction of unnecessary investigative activity. While it is 
positive that the joint reform teamï¿½s plan begins with a step to 
validate clearance needs, the plan does not include any discrete 
actions or milestones for implementing a clearance need process. As we 
noted in February 2008, [Footnote 14] it will be important for the 
joint reform team to continue to ensure a strong requirements 
determination process is a part of its reforms as it develops its plans 
further. 

As we noted in our testimony before this Subcommittee in February 2008, 
an increase in the number or level of requested clearances increases 
the investigative and adjudicative workloads. We have previously 
reported that a growing percentage of all DOD requests for clearances 
for industry personnel was at the top secret level. [Footnote 15] This 
increase in the proportion of investigations at the top secret level 
affects workloads and costs because top secret clearances must be 
renewed twice as often as secret clearances (i.e., every 5 years versus 
every 10 years). In August 2006, OPM estimated that approximately 60 
total staff hours are needed for each investigation for an initial top 
secret clearance and 6 total staff hours are needed for the 
investigation to support a secret or confidential clearance. The 
doubling of the frequency along with the increased effort to 
investigate and adjudicate each top secret reinvestigation adds costs 
and workload for the government. [Footnote 16] 

As we noted in February 2008, we are not commenting on the 
appropriateness of the current numbers and levels of clearances; 
instead, we are pointing out that any unnecessary clearance requests 
use government resources that can be utilized for other purposes, such 
as building additional quality into other clearance phases or decreasing
delays in clearance processing. Unless the new system developed by the 
joint reform team includes a sound requirements process, workload and 
costs may be higher than necessary. 

Reform Efforts Provide Some Information on Building Quality into the 
Clearance Process, but Include Limited Details on How Automated 
Processes Will Ensure Quality: 

The joint reform teamï¿½s plan provides some information on building 
quality into the clearance process, but it includes limited details on 
how automated processes will ensure quality. In February 2008, we noted 
that a key factor the government should consider as it develops a 
reformed security process was the incorporation of quality control and 
quality monitoring into the clearance process. The joint reform teamï¿½s 
plan includes references to quality and quality control in a number of 
instances. For example, in a section in which the key features of the 
reformed process are described, the plan states that relevant data 
would be better used for subsequent hiring or clearing decisions, 
reducing duplication of requests, and ensuring consistent quality and
standards. In addition, the joint reform team plan describes new 
automated processes (e.g., electronic adjudication of cases with no 
issues) that it asserts will help ensure consistency and quality in the 
decision-making process. However, at this stage in the joint reform 
teamï¿½s efforts, the plan provides limited details regarding how these 
new processes will ensure quality, and there is no discussion of any 
quality metrics the government would monitor and report to measure the 
performance of a reformed clearance process. While the executive order 
calls for metrics on the implementation of reform goals, it does not 
specifically discuss quality in the investigation and adjudication
processes. As we noted in February 2008, [Footnote 17] it will be 
important for the joint reform team to continue to build quality and 
quality reporting into a reformed clearance process as it develops its 
plans further. 

We have previously noted the governmentï¿½s limited attention to 
reporting on quality measures in the security clearance process. In our 
November 2005 testimony on the previous governmentwide strategic plan 
to improve the clearance process, we noted that the strategic plan 
devoted little attention to monitoring and improving the quality of the
personnel security clearance process, and that limited attention to and 
reporting about quality continues. In addition, when OMB issued its 
February 2007 Report of the Security Clearance Oversight Group 
Consistent with Title III of the Intelligence Reform and Terrorism 
Prevention Act of 2004, it documented quality with a single metric. OMB
stated that overall, less than 1 percent of all completed 
investigations are returned to OPM from the adjudicating agencies for 
quality deficiencies. When OMB issued its February 2008 Report of the 
Security Clearance Oversight Group, it did not discuss the percentage 
of completed investigations that are returned to OPM or the development 
or
existence of any other metric measuring the level of quality in 
security clearance processes or products. We have previously reported 
that it is problematic to equate the quality of investigations with the 
percentage of investigations that are returned by requesting agencies 
due to incomplete case files. For example, in October 1999 and again
in our November 2005 evaluation of the governmentwide strategic plan, 
we stated that the number of investigations returned for rework is not 
by itself a valid indicator of quality because adjudication officials 
said they were reluctant to return incomplete investigations as they 
anticipated this would lead to further delays. [Footnote 18] In our 
September 2006 report, we recommended that regardless of whether this 
metric continues to be used, OMBï¿½s Deputy Director for Management 
should require OPM and DOD to develop and report metrics on 
investigative and adjudicative completeness and other measures of
quality. [Footnote 19] In commenting on our 2006 report, OMBï¿½s Deputy 
Director for Management did not take exception to this recommendation, 
but the joint reform team plan does not describe any new quality 
measures or mention any plans to develop such measures. 

In September 2006, we reported that while eliminating delays in 
clearance processes is an important goal, the government cannot afford 
to achieve that goal at the expense of quality.20 We additionally 
reported that the lack of full reciprocity of clearances is an 
outgrowth of agenciesï¿½ concerns that other agencies may have granted 
clearances based on inadequate investigations and adjudications. An 
interagency working group, the Security Clearance Oversight Steering 
Committee, noted that agencies are reluctant to be accountable for poor 
quality investigations or adjudications conducted by other agencies
or organizations. To achieve fuller reciprocity, clearance-granting 
agencies need to have confidence in the quality of the clearance 
process. Without full documentation of investigative actions, 
information obtained, and adjudicative decisions, agencies could 
continue to require duplicative investigations and adjudications. 

Reform Efforts Emphasize Timeliness, but Do Not Discuss Additional 
Metrics That Could Be Used to Evaluate Clearance Process Performance: 

The joint reform team plan emphasizes timeliness but does not contain a 
discussion of the use of additional metrics that the team and 
stakeholders would use to evaluate the performance of a reformed 
process. In addition, the executive order tasks the Performance 
Accountability Council with establishing annual goals and metrics for 
implementation of the reform effort, but not necessarily for the 
processing of clearance determinations. This order also states that the 
Security Executive Agent may establish guidelines for timeliness in the 
processes related to determining clearance eligibility, but does not 
make that task a requirement. In February 2008, one key factor we 
identified in reforming the security clearance process is the use of 
metrics beyond those measuring timeliness. We noted that by including 
additional metrics, the joint reform team could provide a more complete 
picture of the performance of a reformed clearance process. In our 
November 2005 testimony, we stated that a previous government plan to 
improve the clearance process placed an emphasis on monitoring the 
timeliness of clearances governmentwide, but that plan detailed few of 
the other elements that a comprehensive strategic plan might contain. 
[Footnote 21] A similar emphasis on timeliness appears to be emerging
in the joint reform team plan. In the letter accompanying the plan, 
OMBï¿½s Deputy Director for Management notes that the reforms proposed 
are projected to enable the government to complete initial security 
clearance decisions in 60 days, as called for by IRTPA. 

We have previously recommended a number of additional metrics the 
government could use to evaluate clearance processes and procedures. 
[Footnote 22] As the joint reform team continues to develop its reform 
plans and the Performance Accountability Council establishes its 
progress metrics, they should consider including metrics beyond 
timelines measures to aid regular congressional monitoring of clearance 
process reform. Prior GAO reports as well as inspector general reports 
identify a wide variety of methods and metrics that program evaluators 
have used to examine clearance processes and programs. For example, our 
1999 report [Footnote 23] on security clearance investigations used 
multiple methods to examine numerous issues that included: 

* documentation missing from investigative reports; 

* investigator training (courses, course content, and number of 
trainees); 

* investigatorsï¿½ perceptions about the process; 

* customer perceptions about the investigations; and; 

* internal controls to protect against fraud, waste, abuse, and 
mismanagement. 

We believe that including these and other types of metrics in regular 
monitoring of clearance processes could add value in current and future 
reform efforts as well as supply better information for greater 
congressional oversight. 

Reform Efforts Contain No Funding Requirements Information: 

Neither the joint reform team plan nor the executive order contains 
information about funding requirements, which limits their utility as 
tools for decision makers. The executive order does not require the 
Performance Accountability Council or the Suitability and Security 
Executive Agents to estimate the costs of reforming the security
clearance system across the military, executive branch, and 
intelligence community. In February 2008, we noted that the joint 
reform team should provide the long-term funding requirements to 
implement changes to the security clearance process. However, this 
information was not included in the plan or the executive order. In the 
letter accompanying the plan, OMBï¿½s Deputy Director for Management 
notes that updates will be provided to the President in the coming 
months as additional reforms are validated, cost-benefit analysis is 
completed, and funding made available. 

We believe that not including the long-term funding requirements limits 
the utility of the joint reform teamï¿½s plan as a tool for decision 
makers in both the executive and legislative branches to carry out 
their budgetary development and oversight functions. We noted in our 
February 2008 statement to this committee that without more information 
on funding requirements for the joint reform teamï¿½s proposed process, 
the executive branch is limited in its ability to compare and 
prioritize this proposal for reforming the clearance processes against 
other pressing needs. In addition, as the joint reform team consults 
with Congress on its security clearance reform plans, the absence of 
any funding requirements to implement these reforms limits Congressï¿½s 
ability to fully assess appropriation requests. 

As we have previously testified, incorporating these four factors will 
be key to reforming the security clearance process. These factors may 
be addressed in the implementation plan that OMB says it will issue in 
December 2008. 

Implementation of Reform Efforts Could Also Benefit from Incorporating
Additional Best Practices GAO Identified for Successful Transformation: 

Moving forward, as reform efforts transition into the implementation 
phase during the remaining months of this calendar year, the joint 
reform team, the Performance Accountability Council and all other 
agencies involved in reform implementation efforts could benefit from 
incorporating additional best practices for agencies to successfully
transform their cultures. This is particularly important since a 
central theme of the 9/11 Commission Report [Footnote 24] was that one 
of the major challenges facing the intelligence community is moving 
from a culture of ï¿½need to knowï¿½ to a culture of ï¿½need to share.ï¿½ These 
additional best practices include, among other things (1) establishing 
a coherent mission and integrating strategic goals to guide the 
transformation, (2) focusing on a key set of principles and priorities 
at the outset of the transformation, (3) setting implementation goals 
and a timeline to build momentum and show progress from day one, and 
(4) establishing a communication strategy to create shared expectations 
and report related progress. Table 1 provides more detail about these 
selected additional key practices and their associated implementation 
steps. 

Table 1: Selected Additional Key Practices and Implementation Steps for 
Mergers and Transformations: 

Practice: Establish a coherent mission and integrated strategic goals to
guide the transformation; 
Implementation Steps: 
* Adopt leading practices for results-oriented strategic planning and 
reporting. 

Practice: Focus on a key set of principles and priorities at the outset 
of the transformation; 
Implementation Steps: 
* Embed core values in every aspect of the organization to reinforce 
the new culture. 

Practice: Set implementation goals and a timeline to build momentum and
show progress from day one; 
Implementation Steps: 
* Make public implementation goals and timeline; 
* Seek and monitor employee attitudes and take appropriate follow-up 
actions; 
* Identify cultural features of merging organizations to increase
understanding of former work environments; 
* Attract and retain key talent; 
* Establish an organizationwide knowledge and skills inventory to
exchange knowledge among merging organizations. 

Practice: Establish a communication strategy to create shared
expectations and report related progress; 
Implementation Steps: 
* Communicate early and often to build trust; 
* Ensure consistency of message; 
* Encourage two-way communication; 
* Provide information to meet specific needs of employees. 

Source: GAO-03-669. 

[End of table] 

Further, IRTPA sets clearance processing timeliness requirements, 
general specifications for an integrated database, and reciprocity 
across the government. Using the best practices to meet IRTPA 
requirements can assist the Performance Accountability Council in the 
development of a coherent mission, guide the transformation, and focus
efforts on key principles and priorities. For example, timeliness is an 
important strategic goal not only because IRTPA establishes phased 
milestones for reducing the time to complete clearances, but also 
because the reform efforts are intended to improve clearance processing 
times. In the first period, from December 2006 to December 2009, the 
act requires agencies to make a determination of eligibility for a 
clearance on at least 80 percent of all personnel security clearance 
applications within 120 days after the date that the application is 
received by an authorized investigative agency, with a maximum of 90 
days allotted for the investigation phase and a maximum of 30 days 
allotted for the adjudication phase. After December 17, 2009, the act 
requires agencies to make a clearance determination on at least 90 
percent of all applications within 60 days of the application receipt 
date, allowing no more than 40 days for the investigation and 20 days 
for the adjudication. To OMBï¿½s credit, it has placed great emphasis on 
meeting IRTPAï¿½s requirements since 2004 and clearance processing times 
are improving; however, an OMB official said that the December 2009 
timeliness goal will be difficult to achieve. As the clearance 
determination process reform is implemented, one of the key 
transformation steps is to keep the implementation goals and timeline 
public, so that those exercising oversight can monitor the achievement 
and achievability of IRTPA timeliness requirements. The linkage of 
steps and timelines to long-term IRTPA requirements may help establish 
a coherent mission to guide the transformation. 

In addition, focusing on a key set of principles and priorities at the 
outset of the transformation can help the joint reform team ensure that 
the core values of the plan are reinforced as the plan is implemented. 
For example, IRTPA requires the directors of OPM and OMB to establish 
an integrated and secure database system for security clearance data 
from all entities conducting investigations and adjudications across the
federal government. The joint reform team is currently conducting 
demonstration projects across the federal government to determine which 
existing information technology system, or integrated set of systems, 
can best support the clearance process across the federal government. 
As these options are explored, it is important to identify the culture 
and operating environment of each agency that will use the data system 
to increase the joint reform teamï¿½s understanding of each agencyï¿½s 
needs. Establishing this integrated database is a complex process that 
would benefit from a timeline with milestones to build momentum and 
show progress toward the implementation of the integrated database 
across multiple agencies. IRTPA also requires reciprocity of clearances 
across federal agencies, meaning that all comparable security clearance
background investigations and determinations completed by an authorized 
investigation and adjudication agency should be accepted by all 
government agencies. Reciprocity would ease the transition of employees 
from one agency to another without having to undergo multiple clearance 
investigations and adjudications for similar clearances. We have 
previously reported that lack of reciprocity can lead to increased 
costs and workload. To demonstrate the importance for reciprocity 
governmentwide, it would be helpful for those leading the reform to 
articulate the compelling reason for accepting other federal agenciesï¿½ 
clearances while continuing the granting of security clearances. 

Furthermore, setting implementation goals and timelines to meet those 
goals up front, and also making them public, can enable those involved 
in reform efforts to demonstrate progressï¿½from day oneï¿½in any 
transformation effort, and also enable them to identify steps still to 
be accomplished. Cultural transformation can take years, and having 
established implementation goals and timelines will be key to 
maintaining momentum for the reform efforts when the administration 
changes in January 2009. The process of establishing goals and 
timelines can also serve to help identify the cultures of all entities
involved in the reform and, in so doing, increase understanding of the 
reform and bring clarity to the interim steps and milestones that need 
to be accomplished in order to achieve success. 

Finally, during all phases of the reform process, it will be important 
for the joint reform team and the Performance Accountability Council to 
establish a solid communication strategy to create shared expectations 
and report progress, and to establish this communication strategy early 
in the process. Given that these reform efforts involve a number of 
agencies across the federal government, a solid communication strategy 
can promote momentum, build trust among affected agencies, and ensure 
consistency of message across agencies. Officials from OMB told us that 
the key elements of the best practices we identified are currently a 
part of the reform efforts, adding that the joint reform team and 
Performance Accountability Council are following these best practices 
as they develop their implementation plan. Any opportunity to make the 
use of these practices transparent could serve to sustain progress in 
the reform efforts, not only over the next few months, but also in the 
coming years. 

We believe that incorporating these best practices is key to the 
implementation of personnel security reform and will also help inform 
the implementation plan that will be issued before the upcoming change 
in administrations. OMB informed us in July 2008 that the Performance 
Accountability Council plans to issue another report in December 2008 
that will provide details about the desired reformed process to be 
implemented, a general implementation and adoption schedule, the fiscal 
and related cost/benefit relationship issues, and an estimate of the 
likely timeliness and quality that will result from the reformed 
automated system. This report would benefit from incorporating these 
best practices and statutory requirements to the extent possible. 

Concluding Observations: 

Our preliminary observations of the current reform effortsï¿½the joint 
reform teamï¿½s plan to develop a new governmentwide end-to-end security 
clearance process and Executive Order 13467 that establishes a 
leadership structureï¿½are that they represent positive steps to address 
past impediments and manage security clearance reform efforts. The 
joint reform team plan includes the input of key stakeholders, 
addresses clearance need validation, and has begun to address some 
aspects of building quality into the clearance system. As the 
implementation of the security clearance reform efforts proceeds, we
believe that the key factors we have previously identified for 
reforming the personnel security clearance process, key practices we 
have identified for guiding transformation, and IRPTA requirements 
could further inform and improve the process. Nonetheless, much remains 
to be done before a new system can be fully implemented. We look 
forward to conducting a more detailed review of these reform efforts as 
requested by the Chairman of the Permanent Select Committee on 
Intelligence of the U.S. House of Representatives and you in your 
capacity as chairwoman of this Subcommittee. In that review, we plan to 
more fully examine the issues presented in this statement and others
as the efforts move forward. 

Madam Chairman and Members of the Subcommittee, this concludes my 
prepared statement. I would be happy to answer any questions you may 
have at this time. 

Contact and Acknowledgments: 

For further information regarding this testimony, please contact me at 
(202) 512-3604 or [email protected]. Contact points for our Offices of 
Congressional Relations and Public Affairs may be found on the last 
page of this statement. Individuals who made key contributions to this 
testimony are David E. Moser, Assistant Director; Renee S. Brown, Sara 
G. Cradic, James P. Klein, Ron La Due Lake, and Gregory Marchand. 

[End of section] 

Highlights of previous reports: 

Personnel Clearances: 

Key Factors for Reforming the Security Clearance Process: 

Statement of Brenda S. Farrell: 
Defense Capabilities and Management: 

GAO-08-776T: 

GAO Highlights: 

Highlights of GAO-08-776T, a testimony before the Subcommittee on 
Oversight of Government Management, the Federal Workforce, and the 
District of Columbia, Committee on Homeland Security and Governmental 
Affairs, U.S. Senate. 

Why GAO Did This Study: 

Since 1974, GAO has examined personnel security clearance processes and 
acquired a historical view of key factors to consider in reform 
efforts. GAO placed the Department of Defenseï¿½s (DOD) personnel 
security clearance program, which represents 80 percent of federal 
government clearances, on its high-risk list in 2005 due to long-
standing problems. These problems include incomplete investigative 
reports from the Office of Personnel Management (OPM), the agency 
primarily responsible for providing clearance investigation services; 
the granting of some clearances by DOD adjudicators even when required 
data were missing from the investigative reports used to make such 
determinations; and delays in completing clearance processing. Delays 
can lead to a heightened risk of disclosure of classified information, 
additional costs and delays in completing related contracts, and 
problems retaining qualified personnel. DOD has reported on these 
continuing delays. However, there has been recent high-level 
governmentwide attention to improving the process, including 
establishing a team to develop a reformed federal government security 
clearance process. 

This statement addresses four key factors that should be considered in 
personnel security clearance reforms. This statement draws on GAOï¿½s 
past work, which included reviews of clearance-related documents and 
interviews of senior officials at DOD and OPM. 

What GAO Found: 

Efforts to reform personnel security clearance processes should 
consider, among other things, the following four key factors: (1) a 
strong requirements-determination process, (2) quality in all clearance 
processes, (3) metrics to provide a fuller picture of clearance 
processes, and (4) long-term funding requirements of security clearance 
reform. In February 2008, GAO noted that a sound requirements process 
is important because requesting a clearance for a position in which it 
will not be needed, or in which a lower-level clearance would be 
sufficient, will increase both costs and investigative workload 
unnecessarily. For example, the cost of obtaining and maintaining a top 
secret clearance for 10 years is approximately 30 times greater than 
the cost of obtaining and maintaining a secret clearance for the same 
period. Also, changing a positionï¿½s clearance level from secret to top 
secret increases the investigative workload for that position about 20-
fold. 

Building quality throughout the clearance process could promote 
positive outcomes, including more reciprocity governmentwide. However, 
agencies have paid little attention to this factor despite GAOï¿½s 2006 
recommendation to place more emphasis on quality. For example, the 
Office of Management and Budgetï¿½s (OMB) February 2007 report on 
security clearances documented quality with a single metric in only one 
of the six phases of the process. Further, OMB did not discuss the 
development or existence of any metric measuring the level of quality 
in security clearance processes or products in its February 2008 
report. Concerns about the quality of investigative and adjudicative 
work underlie the continued reluctance of agencies to accept clearances 
issued by other agencies; thus, government resources may be used to 
conduct duplicative investigations and adjudications. 

Federal agenciesï¿½ efforts to monitor clearance processes emphasize 
timeliness, but additional metrics should be developed to provide a 
fuller picture of the performance of the clearance process. GAO has 
highlighted a variety of metrics in its reports (e.g., completeness of 
investigative reports, staffï¿½s and customersï¿½ perceptions of the 
process, and the adequacy of internal controls), all of which could add 
value in monitoring clearance processes. The emphasis on timeliness is 
due in part to the Intelligence Reform and Terrorism Prevention Act of 
2004 which provides guidelines for the speed of completing clearances 
and requires annual reporting of that information to Congress. 

Providing Congress with the long-term funding requirements to implement 
changes to security clearance processes could enable more-informed 
congressional oversight. Reform efforts should identify long-term 
funding requirements to implement proposed changes, so that decision 
makers can compare and prioritize alternate reform proposals in times 
of fiscal constraints. The absence of long-term funding requirements to 
implement reforms would limit decision makersï¿½ï¿½in the executive and 
legislative branchesï¿½ability to carry out their budgetary development 
and oversight functions. 

To view the full product, click on [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-08-776T]. For more information, 
contact Brenda S. Farrell at (202) 512-3604 or [email protected]. 

[End of highlight] 

DOD Personnel Clearances: 

DOD Faces Multiple Challenges in Its Efforts to Improve Clearance 
Processes for Industry Personnel: 

Statement of Jack E. Edwards, Acting Director: 

Defense Capabilities and Management: 

GAO-08-470T: 

GAO Highlights: 

Highlights of GAO-08-470T, a testimony before the Subcommittee on 
Readiness, Committee on Armed Services, House of Representatives. 

Why GAO Did This Study: 

The Department of Defense (DOD) maintains approximately 2.5 million 
security clearances on servicemembers, federal DOD civilian employees, 
industry personnel for DOD and 23 other federal agencies, and employees 
in the legislative branch. Delays in determining eligibility for a 
clearance can heighten the risk that classified information will be 
disclosed to unauthorized sources, increase contract costs, and pose 
problems in attracting and retaining qualified personnel. In this 
statement, GAO addresses: (1) the status of DODï¿½s efforts to improve 
its projections of the numbers of clearances needed for industry 
personnel, and (2) other long-standing challenges that have a negative 
effect on the efficiency and effectiveness of DODï¿½s personnel security 
clearance program for industry personnel. This statement is based on a 
report GAO is issuing today (GAO-08-350) and other prior work, which 
included reviews of clearance-related documents and interviews of 
senior officials at DOD and the Office of Personnel Management (OPM). 

What GAO Found: 

DOD has had a long-standing challenge in accurately projecting the 
number of clearance investigations that will be required in the future 
for industry personnel. The Office of Management and Budget (OMB) 
developed criteria for these projections in November 2005. It 
established a governmentwide goal for agencies to refine their 
projections of the number of clearance investigations that will be 
required in any given year to be within 5 percent of the number of 
actual requests for investigation. At a May 2006 congressional hearing, 
an OPM Assistant Director stated that DOD had exceeded its 
departmentwide projection by 59 percent for the first half of fiscal 
year 2006. The negative effects of such inaccurate projections include 
impediments to workload planning and funding. GAO noted the problem 
with the accuracy of DODï¿½s projections in its February 2004 report and 
recommended that DOD improve its projections for industry personnel. In 
the report it is issuing today, GAO noted that DOD has initiated 
changes to improve its estimates of future investigation needs and is 
conducting research that may change these methods further. For example, 
in 2006, DOD took steps to increase the response rate of its annual 
survey used as a basis for determining its projections. In 2007, it 
changed its methods for analyzing data that informs its projections. 
However, DOD has not yet demonstrated the effectiveness of these 
changes. 

DOD must address additional long-standing challenges or issues in order 
to improve the efficiency and accuracy of its personnel security 
clearance program for industry personnel. First, continuing delays in 
determining clearance eligibility can result in increased costs and 
risk to national security. For example, when new employeesï¿½ clearances 
are delayed, it affects their abilities to perform their duties fully 
since they do not have access to classified material. Second, DOD and 
the rest of the federal government provide limited information to one 
another on how they individually ensure the quality of clearance 
products and procedures, which affects reciprocity of clearances. 
Reciprocity occurs when one government agency fully accepts a security 
clearance granted by another government agency. GAOï¿½s September 2006 
report noted that agencies may not reciprocally recognize clearances 
granted by other agencies because of concerns that other agencies may 
have granted clearances based on inadequate investigations and 
adjudications. Third, in DODï¿½s August 2007 report to Congress, it 
provided less than 2 years of funding-requirements information, which 
limits congressional awareness of future year requirements for this 
program. Fourth, DOD does not have a comprehensive DOD-specific plan to 
address delays in its clearance program. While there is a 
governmentwide effort to reform the clearance process, it is projected 
not to be operational until beyond December 2008. 

What GAO Recommends: 

GAO made recommendations to address DODï¿½s security clearance 
challenges. For example, in the report we are issuing today, GAO 
recommended that DOD provide Congress with information on funding and 
quality in clearance processes. DOD concurred and indicated it would 
provide that information in its 2009 report to Congress. 

To view the full product, click on [hyperlink, http://www.GAO-08-470T]. 
For more information, contact Jack Edwards at (202) 512-8246 or 
[email protected], or Brenda Farrell at (202) 512-3604 or 
[email protected]. 

[End of highlight] 

Personnel Clearances: 

Key Factors to Consider in Efforts to Reform Security Clearance 
Processes: 

Statement of Brenda S. Farrell: 
Director, Defense Capabilities and Management: 

GAO-08-352T: 

GAO Highlights: 

Highlights of GAO-08-352T, a testimony before the Subcommittee on 
Intelligence Community Management, Permanent Select Committee on 
Intelligence, House of Representatives. 

Why GAO Did This Study: 

In 2004, Congress passed the Intelligence Reform and Terrorism 
Prevention Act to reform security clearance processes. Much of GAOï¿½s 
experience in evaluating personnel security clearance processes over 
the decades has consisted of examining the Department of Defenseï¿½s 
(DOD) program, which maintains about 2.5 million clearances on 
servicemembers, DOD civilian employees, legislative branch employees, 
and industry personnel working for DOD and 23 other federal agencies. 
Long-standing delays in processing applicationsï¿½and other problems in 
DODï¿½s clearance programï¿½led GAO to designate it a high-risk area in 
2005. GAO also has documented clearance-related problems in other 
agencies. 

For this hearing, GAO was asked to identify key factors that could be 
applied in personnel security clearance reform efforts. To identify key 
factors, GAO drew upon its past reports and institutional knowledge. 
For those reports, GAO reviewed laws, executive orders, policies, 
reports, and other documentation related to the security clearance 
process; examined samples of cases of personnel granted top secret 
eligibility; compared documentation in those sampled cases against 
federal standards; and interviewed a range of cognizant government 
officials. 

What GAO Found: 

Current and future efforts to reform personnel security clearance 
processes should consider, among other things, the following four key 
factors: determining whether clearances are required for positions, 
incorporating quality control steps throughout the clearance processes, 
establishing metrics for assessing all aspects of clearance processes, 
and providing Congress with the long-term funding requirements of 
security clearance reform. Requesting a clearance for a position in 
which it will not be needed, or in which a lower-level clearance would 
be sufficient, will increase both costs and investigative workload 
unnecessarily. For example, changing the clearance needed for a 
position from a secret to top secret increases the investigative 
workload for that position about 20-fold and uses 10 times as many 
investigative staff hours. 

Emphasis on quality in clearance processes could promote positive 
outcomes, including more reciprocity among agencies in accepting each 
othersï¿½ clearances. Building quality throughout clearance processes is 
important, but government agencies have paid little attention to 
quality, despite GAOï¿½s repeated suggestions to place more emphasis on 
quality. Even though GAO identified the governmentï¿½s primary metric for 
assessing qualityï¿½the percentage of investigative reports returned for 
insufficiency during the adjudicative phaseï¿½as inadequate by itself in 
1999, the Office of Management and Budget and the Office of Personnel 
Management continue to use that metric. Concerns about the quality of 
investigative and adjudicative work underlie the continued reluctance 
of agencies to accept clearances issued by other agencies; as a result, 
government resources are used to conduct duplicative investigations and 
adjudications. 

Many efforts to monitor clearance processes emphasize measuring 
timeliness, but additional metrics could provide a fuller picture of 
clearance processes. The emphasis on timeliness is due in part to 
recent legislation that provides specific guidelines regarding the 
speed with which clearances should be completed and requires annual 
reporting of that information to Congress. GAO has highlighted a 
variety of metrics in its reports (e.g., completeness of investigative 
and adjudicative reports, staffï¿½s and customersï¿½ perceptions of the 
processes, and the adequacy of internal controls), all of which could 
add value in monitoring clearance processes and provide better 
information to allow improved oversight by Congress and the Executive 
Branch. 

Another factor to consider in reform efforts is providing Congress with 
the long-term funding requirements to implement changes to security 
clearance processes. DODï¿½s August 2007 congressionally mandated report 
on industry clearances identified its immediate funding needs but did 
not include information on the funding requirements for fiscal year 
2009 and beyond. The inclusion of less than 2 future years of budgeting 
data in the DOD report limits Congressï¿½s ability to carry out its long-
term oversight and appropriations functions pertaining to industry 
personnel security clearances. 

To view the full product, click on [hyperlink, http://www.GAO-08-352T]. 
For more information, contact Brenda S. Farrell at (202) 512-3604 or 
[email protected]. 

[End of highlight] 

DOD Personnel Clearances: 

Delays and Inadequate Documentation Found for Industry Personnel: 

Statement of Derek B. Stewart, Director:
Defense Capabilities and Management: 

GAO-07-842T: 

GAO Highlights: 

Highlights of GAO-07-842T, a testimony before the Subcommittee on 
Oversight of Government Management, the Federal Workforce, and the 
District of Columbia, Committee on Homeland Security and Governmental 
Affairs, U.S. Senate 

Why GAO Did This Study: 

Individuals working for the private industry are playing a larger role 
in national security work conducted by Department of Defense (DOD) and 
other federal agencies. As of May 2006, industry personnel held about 
34 percent of DOD-maintained personnel security clearances. The damage 
that the unauthorized disclosure of classified information can cause to 
national security necessitates the prompt and careful consideration of 
who is granted a security clearance. Long-standing delays in 
determining clearance eligibility and other challenges led GAO to 
designate the DOD personnel security clearance program as a high-risk 
area in January 2005 and again in GAOï¿½s January 2007 update of the high-
risk areas. In February 2005, DOD transferred its security clearance 
investigations functions to the Office of Personnel Management (OPM) 
and now obtains almost all of its clearance investigations from OPM. 
The Office of Management and Budget (OMB) is responsible for effective 
implementation of policy relating to determinations of eligibility for 
access to classified information. 

This testimony addresses the timeliness of the process and completeness 
of documentation used to determine eligibility of industry personnel 
for top secret clearances in January and February 2006. This statement 
relies primarily on GAOï¿½s September 2006 report (GAO-06-1070). 

What GAO Found: 

GAOï¿½s analysis of timeliness data showed that industry personnel 
contracted to work for the federal government waited more than 1 year 
on average to receive top secret clearances, longer than OMB- and OPM-
produced statistics would suggest. GAOï¿½s analysis of 2,259 cases in its 
population showed the process took an average of 446 days for initial 
clearances and 545 days for clearance updates. While the government 
plan has a goal for the application-submission phase of the process to 
take 14 days or less, it took an average of 111 days. In addition, 
GAOï¿½s analyses showed that OPM used an average of 286 days to complete 
initial investigations for top secret clearances, well in excess of the 
180-day goal specified in the plan that OMB and others developed for 
improving the clearance process. Finally, the average time for 
adjudication (determination of clearance eligibility) was 39 days, 
compared to the 30-day requirement that began in December 2006. An 
inexperienced investigative workforce, not fully using technology, and 
other causes underlie these delays. Delays may increase costs for 
contracts and risks to national security. In addition, statistics that 
OMB and OPM report to Congress on the timeliness of the clearance 
process do not portray the full length of time it takes many applicants 
to receive a clearance. GAO found several issues with the statistics, 
including limited information on reinvestigations for clearance 
updating and failure to measure the total time it took to complete the 
various phases of the clearance process. Not fully accounting for all 
the time used in the process hinders congressional oversight of the 
efforts to address the delays. 

OPM provided incomplete investigative reports to DOD, and DOD personnel 
who review the reports to determine a personï¿½s eligibility to hold a 
clearance (adjudicators) granted eligibility for industry personnel 
whose investigative reports contained unresolved issues, such as 
unexplained affluence and potential foreign influence. In its review of 
50 investigative reports for initial clearances, GAO found that that 
almost all (47 of 50) cases were missing documentation required by 
federal investigative standards. Moreover, federal standards indicate 
expansion of investigations may be necessary to resolve issues, but GAO 
found at least one unresolved issue in 27 of the reports. GAO also 
found that the DOD adjudicators granted top secret clearance 
eligibility for all 27 industry personnel whose investigative reports 
contained unresolved issues without requesting additional information 
or documenting in the adjudicative report that the information was 
missing. In its November 2005 assessment of the government plan for 
improving the clearance process, GAO raised concerns about the limited 
attention devoted to assessing quality in the clearance process, but 
the plan has not been revised to address the shortcomings GAO 
identified. The use of incomplete investigations and adjudications in 
granting top secret clearance eligibility increases the risk of 
unauthorized disclosure of classified information. Also, it could 
negatively affect efforts to promote reciprocity (an agencyï¿½s 
acceptance of a clearance issued by another agency) being developed by 
an interagency working group headed by OMBï¿½s Deputy Director. 

[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-07-842T]. 

To view the full product, click on the link above. For more 
information, contact Derek B. Stewart on (202)512-5559 or 
[email protected]. 

[End of highlight] 

Highlights: High-Risk Series: Department of Defense Personnel Security 
Clearance Program: 

GAO Highlights: 

For additional information about this high-risk area, contact Derek B. 
Stewart at (202) 512-5559 or [email protected]. 

Why Area Is High Risk: 

The Department of Defense (DOD) is responsible for about 2.5 million 
security clearances issued to servicemembers, DOD civilians, and 
industry personnel who work on contracts for DOD and 23 other federal 
agencies. The clearances give workers access to information, the 
unauthorized disclosure of which could, in some cases, cause 
exceptionally grave damage. 

Long-standing delays in determining clearance eligibility and other 
challenges led GAO to designate DODï¿½s personnel security clearance 
program as a high-risk area in January 2005. DOD transferred its 
security clearance investigations functions to the Office of Personnel 
Management (OPM) in February 2005 and now obtains almost all of its 
clearance investigations from OPM, which conducts about 90 percent of 
all federal clearance investigations. Executive Order 13381 assigned 
the Office of Management and Budget (OMB) responsibility for effective 
implementation of policy relating to determinations of eligibility for 
access to classified information. 

What GAO Found: 

Problems continue with DODï¿½s clearance program even though OMB, OPM, 
and DOD took positive steps to monitor some GAO-identified concerns. 
For example, their November 2005 plan outlined many timeliness 
measures, but included only two measures of quality, both of which were 
deficient. DODï¿½s consistently inaccurate projections of clearance 
requests have impeded workload planning and funding. Although OMB set a 
government goal of projected cases and actual requests being within 5 
percent of one another, OPM reported that DOD exceeded its projected 
number by 59 percent for the first half of fiscal year 2006. In 
addition, GAO reviewed 50 OPM-produced investigative reports and found 
documentation missing from 47. Despite the missing information, which 
in most cases pertained to residences, employment, and education, DOD 
adjudicators granted clearance eligibility but did not request missing 
investigative information or fully document unresolved issues in 27 of 
the 50 reviewed reports. Incomplete investigative or adjudicative 
reports could undermine OMBï¿½s efforts to achieve clearance reciprocity 
(an agency accepting a clearance awarded by another agency). OPM has 
reported that it is using new personnel and procedures to improve the 
quality of its investigative reports. 

Furthermore, clearances continue to take longer than the time 
prescribed in government goals. This occurred in the application-
submission, investigation, and adjudication (determining clearance 
eligibility) phases of the clearance process, despite positive steps 
that include additional congressional and OMB oversight, DODï¿½s growing 
use of OPMï¿½s electronic application-submission system, and OPM 
obtaining more investigators. For example, GAO found that the 
application-submission phase averaged 111 days for industry personnel 
seeking initial top secret clearances, but the government goal is 14 
days. Multiple reviews of applications and manually entering data from 
paper forms are two reasons for the delays. OPM stated that paper 
submissions take on average 14 days longer than electronic submissions. 
For August 2006, OPM reported that 54 percent of DOD applications were 
submitted using OPMï¿½s electronic submission system. In the 
investigation phase, GAO found that it took an average of 286 days for 
initial clearancesï¿½compared with the goal of 180 daysï¿½and 419 days for 
clearance updates for the 2,259 industry personnel who were granted 
clearance eligibility in January and February 2006. Although OPM 
increased its workforce, it faces many impediments to improving 
investigation timeliness, including the backlog of requests for 
investigations and difficulty obtaining national, state, and local 
records. The average time for adjudication was 39 days for industry 
personnel, compared with a mandate that starts in December 2006 
requiring that 80 percent of adjudications be completed in 30 days. DOD 
adjudicators have, however, noted that current procedures to measure 
adjudication timeliness include 2-3 weeks for OPM to print and ship its 
investigative reports, rather than delivering them electronically. 
Delays in determining initial clearance eligibility can increase the 
cost of performing classified work, and delays in updating clearances 
may increase the risk of national security breaches. 

What Remains to Be Done: 

To improve its security clearance program, DOD needs to take actions 
that include (1) improving the accuracy of its projected need for 
clearances, (2) working with OMB and OPM to fully measure and report 
all of the time required to determine clearance eligibility, (3) 
partnering with OPM to improve the timeliness and completeness of 
clearance-application submissions and investigative reports, and (4) 
implementing procedures to eliminate documentation problems. 

[End of highlight] 

DOD Personnel Clearances: 

Additional OMB Actions Are Needed to Improve the Security Clearance 
Process: 

GAO-06-1070: 

GAO Highlights: 

Highlights of GAO-06-1070, a report to congressional requesters 

Why GAO Did This Study: 

The damage that unauthorized disclosure of classified information can 
cause to national security necessitates the prompt and careful 
consideration of who is granted a security clearance. However, long-
standing delays and other problems with DODï¿½s clearance program led GAO 
to designate it a high-risk area in January 2005. DOD transferred its 
investigations functions to the Office of Personnel Management (OPM) in 
February 2005. The Office of Management and Budgetï¿½s (OMB) Deputy 
Director for Management is coordinating governmentwide efforts to 
improve the clearance process. You asked GAO to examine the clearance 
process for industry personnel. This report addresses the timeliness of 
the process and completeness of documentation used to determine the 
eligibility of industry personnel for top secret clearances. To assess 
timeliness, GAO examined 2,259 cases of personnel granted top secret 
eligibility in January and February 2006. For the completeness review, 
GAO compared documentation in 50 randomly sampled initial clearances 
against federal standards. 

What GAO Found: 

GAOï¿½s analysis of timeliness data showed that industry personnel 
contracted to work for the federal government waited more than one year 
on average to receive top secret clearances, longer than OPM-produced 
statistics would suggest. GAOï¿½s analysis of 2,259 cases in its 
population showed the process took an average of 446 days for initial 
clearances and 545 days for clearance updates. While OMB has a goal for 
the application-submission phase of the process to take 14 days or 
less, it took an average of 111 days. In addition, GAOï¿½s analyses 
showed that OPM used an average of 286 days to complete initial 
investigations for top secret clearances, well in excess of the 180-day 
goal specified in the plan that OMB and others developed for improving 
the clearance process. Finally, the average time for adjudication 
(determination of clearance eligibility) was 39 days, compared to the 
30-day requirement that starts in December 2006. An inexperienced 
investigative workforce, not fully using technology, and other causes 
underlie these delays. Delays may increase costs for contracts and 
risks to national security. In addition, statistics from OPM, the 
agency with day-to-day responsibility for tracking investigations and 
adjudications, underrepresent the time used in the process. For 
example, the measurement of time does not start immediately upon the 
applicantï¿½s submission of a request for clearance. Not fully accounting 
for all the time used in the process hinders congressional oversight of 
the efforts to address the delays. 

OPM provided incomplete investigative reports to DOD, and DOD personnel 
who review the reports to determine a personï¿½s eligibility to hold a 
clearance (adjudicators) granted eligibility for industry personnel 
whose investigative reports contained unresolved issues, such as 
unexplained affluence and potential foreign influence. In its review of 
50 investigative reports for initial clearances, GAO found that that 
almost all (47 of 50) cases were missing documentation required by 
federal investigative standards. At least half of the reports did not 
contain the required documentation in three investigative areas: 
residence, employment, or education. Moreover, federal standards 
indicate expansion of investigations may be necessary to resolve 
issues, but GAO found at least one unresolved issue in 27 of the 
reports. We also found that the DOD adjudicators granted top secret 
clearance eligibility for all 27 industry personnel whose investigative 
reports contained unresolved issues without requesting additional 
information or documenting that the information was missing in the 
adjudicative report. In its November 2005 assessment of the government 
plan for improving the clearance process, GAO raised concerns about the 
limited attention devoted to assessing quality in the clearance 
process, but the plan has not been revised to address the shortcomings 
GAO identified. The use of incomplete investigations and adjudications 
in granting top secret clearance eligibility increases the risk of 
unauthorized disclosure of classified information. Also, it could 
negatively affect efforts to promote reciprocity (an agencyï¿½s 
acceptance of a clearance issued by another agency) being developed by 
an interagency working group headed by OMBï¿½s Deputy Director. 

What GAO Recommends: 

To improve the timeliness and completeness of investigations and 
adjudications, GAO is making several recommendations to OMB. OMB did 
not take exception to any of GAOï¿½s recommendations. OMB, DOD, and OPM 
each provided agency comments. 

[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-06-1070]. 

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact Derek B. Stewart at (202) 
512-5559 or [email protected]. 

[End of highlight] 

DOD Personnel Clearances: 

New Concerns Slow Processing of Clearances for Industry Personnel: 

Statement of Derek B. Stewart: 
Director: 
Defense Capabilities and Management: 

GAO-06-748T: 

GAO Highlights: 

Highlights of GAO-06-748T a testimony before the Subcommittee on 
Oversight of Government Management, the Federal Workforce, and the 
District of Columbia, Committee on Homeland Security and Governmental 
Affairs, U.S. Senate. 

Why GAO Did This Study: 

The Department of Defense (DOD) is responsible for about 2 million 
active personnel security clearances. About one-third of the clearances 
are for industry personnel working on contracts for DOD and more than 
20 other executive agencies. Delays in determining eligibility for a 
clearance can heighten the risk that classified information will be 
disclosed to unauthorized sources and increase contract costs and 
problems attracting and retaining qualified personnel. Long-standing 
delays in completing hundreds of thousands of clearance requests and 
numerous impediments that hinder DODï¿½s ability to accurately estimate 
and eliminate its clearance backlog led GAO to declare DODï¿½s personnel 
security clearance program a high-risk area in January 2005. 

This testimony presents GAOï¿½s (1) preliminary observations from its 
ongoing review of the timeliness and completeness of clearances, (2) 
concerns about the upcoming expiration of an executive order that has 
resulted in high level commitment to improving the governmentwide 
clearance process, and (3) views on factors underlying DODï¿½s decision 
to stop accepting clearance requests for industry personnel. 

What GAO Found: 

GAOï¿½s ongoing review of the timeliness and completeness of security 
clearance processes for industry personnel has provided three 
preliminary observations. First, communication problems between DOD and 
the Office of Personnel Management (OPM) may be limiting governmentwide 
efforts to improve the personnel security clearance process. Second, 
OPM faces performance problems due to the inexperience of its domestic 
investigative workforce, and it is still in the process of developing a 
foreign presence to investigate leads overseas. Third, some DOD 
adjudication facilities have stopped accepting closed pending 
casesï¿½that is, investigations formerly forwarded to DOD adjudicators 
from OPMï¿½even though some required investigative information was not 
included. 

In addition, the expiration of Executive Order 13381 could slow 
improvements in the security clearance processes governmentwide, as 
well as for DOD in particular. The executive order, which among other 
things delegated responsibility for improving the clearance process to 
the Office of Management and Budget (OMB), is set to expire on July 1, 
2006. GAO has been encouraged by the high level of commitment that OMB 
has demonstrated in the development of a plan to address clearance-
related problems. Because there has been no indication that the 
executive order will be extended, GAO is concerned about whether the 
progress that has resulted from OMBï¿½s high-level management involvement 
will continue. Issues such as OPMï¿½s need to establish an overseas 
presence are discussed as potential reasons why OPM may not be in a 
position to assume an additional high-level commitment if OMB does not 
continue in its current role. 

Finally, inaccurate projections of clearance requests and funding 
constraints are delaying the processing of security clearance requests 
for industry personnel. DOD stopped processing new applications for 
clearance investigations for industry personnel on April 28, 2006. DOD 
attributed its actions, in part, to an overwhelming volume of requests 
for industry personnel security investigations. DODï¿½s long-standing 
inability to accurately project its security clearance workload makes 
it difficult to determine clearance-related budgets and staffing 
requirements. The funding constraints that also underlie the stoppage 
are related to the transfer of DODï¿½s personnel security investigations 
functions to OPM. DOD has questioned some of the costs being charged by 
OPM and has asked OMB to mediate the DOD-OPM dispute. Information from 
the two agencies indicates that OMB has directed the agencies to 
continue to work together to resolve the matter. According to officials 
in the DOD and OPM inspector general offices, they are investigating 
the billing dispute and expect to report on the results of their 
investigations this summer. 

[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-06-748T]. 

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact Derek B. Stewart at 
(202) 512-5559 or [email protected]. 

[End of highlight] 

DOD Personnel Clearances: 

Government Plan Addresses Some Long-standing Problems with DOD's 
Program, But Concerns Remain: 

Statement of Derek B. Stewart, Director: 

Defense Capabilities and Management: 

GAO-06-233T: 

GAO Highlights: 

Highlights of GAO-06-233T, a testimony before the Subcommittee on 
Oversight of Government Management, the Federal Workforce, and the 
District of Columbia, Committee on Homeland Security and Governmental 
Affairs, U.S. Senate: 

Why GAO Did This Study: 

Unauthorized disclosure of classified information can cause up to 
exceptionally grave damage to national security. The Department of 
Defense (DOD) is responsible for about 2 million personnel with 
clearances that allow them access to classified information. While most 
of these clearances are for servicemembers and DODï¿½s employees and 
contractors, DOD is also responsible for contractorsï¿½ clearances for 
more than 20 other agencies, as well as for congressional staff. Due to 
long-standing problems with DODï¿½s clearance program, GAO designated it 
a high-risk area in January 2005. In February 2005, when DOD 
transferred its personnel security investigative functions to the 
Office of Personnel Management (OPM), the average wait for a top secret 
clearance governmentwide was over 1 year. In June 2005, Executive Order 
13381 gave the Office of Management and Budget (OMB) authority to 
retain or assign to any executive agency any process relating to 
determinations of eligibility for access to classified information. OPM 
is assisting OMB with the development of the plan. 

GAO was asked to assess the government plan. This testimony will 
provide GAOï¿½s preliminary review of how well the government plan (1) 
adheres to the standards of comprehensive strategic planning and (2) 
addresses the timeliness and quality of the security clearance process. 
Finally, GAO will discuss the actions required to remove DODï¿½s program 
from GAOï¿½s high-risk list. 

What GAO Found: 

We are encouraged by the level of commitment demonstrated by OMB in 
overseeing the preparation of the government plan for addressing 
problems in the personnel security clearance process. The plan 
represents an important step toward addressing some long-standing 
concerns GAO has raised in this area. It includes some elements that a 
comprehensive strategic plan should contain, such as metrics that will 
be used to monitor the timeliness of the security clearance process 
governmentwide. However, the plan provides few details on other 
features that GAO looks for in a comprehensive strategic plan. For 
example, in some cases, the plan does not provide details on discrete 
actions the government would take or their projected completion dates. 
In addition, the plan does not always include details on the resources 
required to accomplish the planï¿½s objectives. Finally, the plan does 
not describe potential risks or mitigation plans to address potential 
risks. 

Although the government plan establishes metrics to address the 
timeliness of the security clearance process, they focus on some phases 
of the process more than others. Specifically, the plan identifies a 
wide variety of metrics for monitoring the timeliness of security 
clearance investigations, but it does little to address timeliness in 
the adjudication phase of the process. The government plan also 
provides quarterly goals for different types of investigations. 
However, the plan does not identify baseline measures or interim goals 
for average adjudication processing time. 

Although it explicitly acknowledges that agencies have concerns about 
the quality of investigations and adjudications, the government plan 
devotes little attention to monitoring and improving the quality of the 
personnel security clearance process. The planï¿½s primary metric for 
measuring the quality of investigationsï¿½the percentage of 
investigations returned by requesting agencies due to incomplete case 
filesï¿½is not, by itself, a valid indicator of the quality of 
investigative work. Other or additional statistics, such as the number 
of counterintelligence leads generated from security clearance 
investigations, may be needed. The government plan did not identify a 
metric for assessing the quality of adjudications, although GAO and 
other agencies have identified actions that would facilitate monitoring 
and improvement of the quality of this portion of the personnel 
security clearance process. 

DOD must correct previously identified problems before its personnel 
security clearance program can be removed from the high-risk list. 
Before removing DODï¿½s personnel security clearance program from the 
high-risk list, GAO will examine whether OMB, OPM, and DOD have 
satisfied certain criteria, including the establishment of leadership 
support, sufficient resources to resolve the risk, and a corrective 
action plan. GAOï¿½s criteria also include the presence of a program to 
monitor and independently validate the effectiveness and sustainability 
of any corrective actions and the agencyï¿½s ability to demonstrate the 
implementation of corrective measures. 

[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-06-233T]. 

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact Derek B. Stewart at (202) 
512-5559 or [email protected]. 

[End of highlight] 

DOD Personnel Clearances: 

Some Progress Has Been Made but Hurdles Remain to Overcome the 
Challenges That Led to GAO's High-Risk Designation: 

Statement of Derek B. Stewart, Director, Defense Capabilities and 
Management: 

GAO-05-842T: 

GAO Highlights: 

Highlights of GAO-05-842T, a testimony before the Subcommittee on 
Oversight of Government Management, the Federal Workforce, and the 
District of Columbia, Committee on Homeland Security and Governmental 
Affairs, U.S. Senate: 

Why GAO Did This Study: 

Threats to national security--such as the September 11, 2001, terrorist 
attacks and high-profile espionage cases--underscore the need for 
timely, high-quality determinations of who is eligible for a personnel 
security clearance which allows an individual to access classified 
information. 

The Department of Defense (DOD) needs an effective and efficient 
clearance program because it is responsible for about 2 million active 
clearances and provides clearances to more than 20 other executive 
agencies as well as the legislative branch. Despite these imperatives, 
DOD has for more than a decade experienced delays in completing 
hundreds of thousands of clearance requests and impediments to 
accurately estimating and eliminating its clearance backlog. In January 
2005, GAO designated DOD's personnel security clearance program as a 
high-risk area. In February 2005, DOD transferred its personnel 
security investigative functions and about 1,800 positions to the 
Office of Personnel Management (OPM), after 2 years of negotiation 
between the agencies. 

This testimony provides an update on the challenges that led to GAO's 
high-risk designation. It identifies both the positive steps that have 
been taken to address previously identified challenges and some of the 
remaining hurdles. GAO will continue to monitor this area. 

What GAO Found: 

While DOD has taken steps to address the problems that led to 
designating its clearance program as high risk, continuing challenges 
are found in each of the three stages of DOD's personnel security 
clearance process. Figure 1 describes the process. 

Figure 1: DOD's Process for Determining Clearance Eligibility: 

[See PDF for image] 

Preinvestigation stage: 

After determining that a position requires the employee to have access 
to classified information, the requesting organization submits an 
individual's personnel security questionnaire to OPM. 

Investigation stage: 

OPM or one of its contractors conducts a background investigation and 
forwards a report to one of DOD's adjudication facilities. 

Adjudication stage: 

Based on information in the investigative report, an adjudicator 
determines eligibility for access to classified information, and 
forwards this determination to the requesting organization. 

Source: DOD. 

[End of figure] 

Preinvestigation: To address previously identified problems in 
projecting clearance workload, DOD is identifying the military and 
civilian positions that require clearances. Identifying clearance 
requirements for contractor personnel is still in the planning phase. 
Another problem is the efficient submission of investigation requests. 
In the 2 years since DOD and OPM announced the transfer of DOD's 
investigative functions and personnel to OPM, the two agencies did not 
ensure the seamless submission of DOD requests to OPM. DOD is 
developing software to remedy this problem. 

Investigation: Delays in completing investigations are continuing. For 
February 2005, OPM--which now supplies an estimated 90 percent of the 
government's clearance investigations--reported that over 185,000 of 
its clearance investigations had exceeded timeliness goals. OPM's 
effort to add investigative staff is a positive step, but adding 
thousands of staff could result in continued timeliness problems and 
quality concerns as the staff gain experience. OPM's workload should 
decrease because of two recent initiatives: (1) eliminating a few of 
the investigative requirements for some reinvestigations of personnel 
updating their clearances and (2) requiring the acceptance of 
clearances and access granted to personnel moving from one agency to 
another. 

Adjudication: In the past, DOD had difficulty monitoring who had been 
adjudicated for clearances and when the clearances needed to be 
renewed. While the Joint Personnel Adjudication System has combined 
databases from DOD's 10 adjudicative facilities to enhance monitoring, 
wider consolidation of government databases may be required. The 
Director of OPM will need to integrate all federal agencies into a 
single governmentwide database in order to meet a requirement 
established in a recent law. As of September 30, 2003, DOD had a 
backlog of roughly 90,000 adjudications. 

What GAO Recommends: 

[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-05-842T]. 

To view the full product, click on the link above. For more 
information, contact Derek B. Stewart at (202) 512-5559 or 
[email protected]. 

[End of highlight] 

Intelligence Reform: 

Human Capital Considerations Critical to 9/11 Commission's Proposed 
Reforms: 

J. Christoper Mihm, Managing Director: 
Strategic Issues: 

GAO Highlights: 

Highlights of GAO-04-1084T, a testimony to Subcommittee on Oversight of 
Government Management, the Federal Workforce, and the District of 
Columbia, Committee on Governmental Affairs 

Why GAO Did This Study: 

GAO has performed extensive work and gained experience on government 
transformation and the critical role that human capital management can 
play in driving this change. Valuable lessons from these efforts could 
help guide the proposed reforms in the intelligence community 
envisioned by the 9/11 Commission. 

At the request of this subcommittee, this statement focuses on (1) the 
lessons GAO has learned from successful mergers and organizational 
transformations; particularly the need for committed and sustained 
leadership and the role of performance management systems in these 
changes; (2) human capital flexibilities that can be used as essential 
tools to help achieve these reforms; (3) how the Federal Bureau of 
Investigation (FBI) is using these lessons and human capital 
flexibilities to transform to meet its evolving mission in the post 
9/11 environment, and (4) GAOï¿½s findings to date on the factors that 
must be considered in the approach to the governmentï¿½s security 
clearance process, as a means to accelerate the process for national 
security appointments. 

What GAO Found: 

Recognizing that people are the critical element in transformation 
initiatives is key to a successful transformation of the intelligence 
community and related homeland security organizations. GAOï¿½s work in 
successful mergers and transformations shows that incorporating 
strategic human capital management approaches will help sustain any 
reforms in the intelligence community. Successful major change 
management initiatives in large public and private sector organizations 
can often take at least 5 to 7 years to create the accountability 
needed to ensure this success. As a result, committed and sustained 
leadership is indispensable to making lasting changes in the 
intelligence community. Accordingly, the Congress may want to consider 
lengthening the terms served by the directors of the intelligence 
agencies, similar to the FBI Directorï¿½s 10-year term. One of the major 
challenges facing the intelligence community is moving from a culture 
of a ï¿½need to knowï¿½ to a ï¿½need to shareï¿½ intelligence information. The 
experience of leading organizations suggests that performance 
management systemsï¿½that define, align, and integrate institutional, 
unit, and individual performance with organizational outcomesï¿½can 
provide incentives and accountability for sharing information to help 
facilitate this shift. 

Significant changes have been underway in the last 3 years regarding 
how the federal workforce is managed. The Congress passed legislation 
providing certain governmentwide human capital flexibilities, such as 
direct hire authority. While many federal agencies have received human 
capital flexibilities, others may be both needed and appropriate for 
intelligence agencies, such as providing these agencies with the 
authority to hire a limited number of term-appointed positions on a 
noncompetitive basis. 

Human capital challenges are especially significant for the 
intelligence organizations, such as the FBI, that are undergoing a 
fundamental transformation in the aftermath of September 11, 2001. For 
the last 3 years, we have been using the lessons learned from 
successful transformations to monitor the FBIï¿½s progress as it 
transforms itself from its traditional crime enforcement mission to 
its post 9/11 homeland security prioritiesï¿½counterterrorism, 
counterintelligence and cyber crimes. For example, the FBI has 
undertaken a variety of human capital related initiatives, including 
major changes in realigning, retraining, and hiring special agents and 
analysts with critical skills to address its top priorities. 

The 9/11 Commission recommended that a single federal security 
clearance agency should be created to accelerate the governmentï¿½s 
security clearance process. Several factors must be considered in 
determining the approach to this process. The large number of requests 
for security clearances for service members, government employees, and 
others taxes a process that already is experiencing backlogs and 
delays. Existing impedimentsï¿½such as the lack of a governmentwide 
database of clearance information, a large clearance workload, and too 
few investigatorsï¿½hinder efforts to provide timely, high-quality 
clearance determinations. 

[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-04-1084T]. 

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact J. Christopher Mihm 
(202) 512-6806 or [email protected]. 

[End of highlight] 

[End of section] 

Related GAO Products: 

Personnel Clearances: Key Factors for Reforming the Security Clearance 
Process. [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-08-776T]. 
Washington, D.C.: May 22, 2008. 

Employee Security: Implementation of Identification Cards and DOD's 
Personnel Security Clearance Program Need Improvement. [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-08-551T]. Washington, D.C.: April 
9, 2008. 

DOD Personnel Clearances: Questions for the Record Related to the 
Quality and Timeliness of Clearances. [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-08-580R]. Washington, D.C.: March 
25. 2008. 

Intelligence Reform: GAO Can Assist the Congress and the Intelligence 
Community on Management Reform Initiatives. [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-08-413T]. Washington, D.C.: 
February 29, 2008. 

Personnel Clearances: Key Factors to Consider in Efforts to Reform 
Security Clearance Processes. [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO-08-352T]. Washington, D.C.: February 27, 2008. 

DOD Personnel Clearances: Improved Annual Reporting Would Enable More 
Informed Congressional Oversight. [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO-08-350]. Washington, D.C.: February 13, 2008. 

Homeland Security: Federal Efforts Are Helping to Alleviate Some 
Challenges Encountered by State and Local Information Fusion Centers. 
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-08-350]. Washington, 
D.C.: October 30, 2007. 

Defense Business Transformation: A Full-time Chief Management Officer 
with a Term Appointment Is Needed at DOD to Maintain Continuity of 
Effort and Achieve Sustainable Success. [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-08-132T]. Washington, D.C.: 
October 16, 2007. 

DOD Personnel Clearances: Delays and Inadequate Documentation Found For 
Industry Personnel. [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-
07-842T]. Washington, D.C.: May 17, 2007. 

Maritime Security: Observations on Selected Aspects of the SAFE Port 
Act. [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-07-754T]. 
Washington, D.C.: April 26, 2007. 

High-Risk Series: An Update, [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO-07-310]. Washington, D.C.: January 2007. 

DOD Personnel Clearances: Additional OMB Actions Are Needed To Improve 
The Security Clearance Process, [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO-06-1070]. Washington, D.C.: September 2006. 

Managing Sensitive Information: DOD Can More Effectively Reduce the 
Risk of Classification Errors, [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO-06-706]. Washington, D.C.: June 30, 2006. 

DOD Personnel Clearances: Questions and Answers for the Record 
Following the Second in a Series of Hearings on Fixing the Security 
Clearance Process. [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-06-
693R]. Washington, D.C.: June 14, 2006. 

DOD Personnel Clearances: New Concerns Slow Processing of Clearances 
for Industry Personnel. [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO-06-748T]. Washington, D.C.: May 17, 2006. 

DOD Personnel Clearances: Funding Challenges and Other Impediments Slow
Clearances for Industry Personnel. [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO-06-747T]. Washington, D.C.: May 17, 2006. 

Questions for the Record Related to DODï¿½s Personnel Security Clearance 
Program and the Government Plan for Improving the Clearance Process. 
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-06-323R]. Washington, 
D.C.: January 17, 2006. 

DOD Personnel Clearances: Government Plan Addresses Some Long-standing 
Problems with DODï¿½s Program, But Concerns Remain. [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-06-233T]. Washington, D.C.: 
November 9, 2005. 

Defense Management: Better Review Needed of Program Protection Issues 
Associated with Manufacturing Presidential Helicopters. [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-06-71SU]. Washington, D.C.: 
November 4, 2005. 

Questions for the Record Related to DODï¿½s Personnel Security Clearance 
Program. [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-05-988R]. 
Washington, D.C.: August 19, 2005. 

Industrial Security: DOD Cannot Ensure Its Oversight of Contractors 
under Foreign Influence Is Sufficient. [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-05-681]. Washington, D.C.: July 
15, 2005. 

DOD Personnel Clearances: Some Progress Has Been Made but Hurdles 
Remain to Overcome the Challenges That Led to GAO's High-Risk 
Designation. [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-05-
842T]. Washington, D.C.: June 28, 2005. 

DODï¿½s High-Risk Areas: Successful Business Transformation Requires 
Sound Strategic Planning and Sustained Leadership. [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-05-520T]. Washington, D.C.: April 
13, 2005. 

High-Risk Series: An Update. [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO-05-207]. Washington, D.C.: January 2005. 

Intelligence Reform: Human Capital Considerations Critical to 9/11 
Commissionï¿½s Proposed Reforms. [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO-04-1084T]. Washington, D.C.: September 14, 2004. 

DOD Personnel Clearances: Additional Steps Can Be Taken to Reduce 
Backlogs and Delays in Determining Security Clearance Eligibility for 
Industry Personnel. [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-
04-632]. Washington, D.C.: May 26, 2004. 

DOD Personnel Clearances: Preliminary Observations Related to Backlogs 
and Delays in Determining Security Clearance Eligibility for Industry 
Personnel. [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-04-202T]. 
Washington, D.C.: May 6, 2004. 

Industrial Security: DOD Cannot Provide Adequate Assurances That Its 
Oversight Ensures the Protection of Classified Information. [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-04-332]. Washington, D.C.: March 
3, 2004. 

DOD Personnel Clearances: DOD Needs to Overcome Impediments to 
Eliminating Backlog and Determining Its Size. [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-04-344]. Washington, D.C.: 
February 9, 2004. 

Results-Oriented Cultures: Implementation Steps to Assist Mergers and 
Organizational Transformations. [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO-03-669]. Washington, D.C.: July 2, 2003. 

[End of section] 

Footnotes: 

[1] See Highlights pages from select GAO products and list of related 
GAO Products at the end of this statement. 

[2] GAO, High-Risk Series: An Update, [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-05-207] (Washington, D.C.: 
January 2005). 

[3] GAO, Personnel Clearances: Key Factors to Consider in Efforts to 
Reform Security Clearance Processes, [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO-08-352T] (Washington, D.C.: Feb. 27, 2008). 

[4] GAO, High-Risk Series: An Update, [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-07-310] (Washington, D.C.: 
January 2007). 

[5] [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-08-352T]. 

[6] Pub. L. No. 108-458 ï¿½ 3001 (2004). 

[7] GAO, Results Oriented Cultures: Implementation Steps to Assist 
Mergers and Organizational Transformations, [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-03-669]. (Washington, D.C.: July 
2, 2003). 

[8] The White House, Implementation of Executive Order 12968, 
Memorandum (Washington, D.C.: Mar. 24, 1997). This memorandum approves 
the adjudication guidelines, temporary eligibility standards, and
investigative standards required by Executive Order 12968, Access to 
Classified Information (Aug. 2, 1995), as amended. 

[9] 5 C.F.R. ï¿½ 1312.4 (2007). 

[10] Executive Order 13381 was revoked on June 30, 2008, by Executive 
Order 13467, which established OMBï¿½s Deputy Director for Management as 
the Chair of the Performance Accountability Council. 

[11] Since June 2007, the goal of the joint reform team expanded to 
include the elimination of duplicative steps in the investigations for 
security clearances and suitability determinations for federal 
employment. In addition, OPM is also now a member of the joint reform 
team. 

[12] GAO, DOD Personnel Clearances: Improved Annual Reporting Would 
Enable More Informed Congressional Oversight. [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-08-350]. (Washington, D.C.: Feb. 
13, 2008). 

[13] The Suitability Executive Agent is responsible for developing 
consistent policies and timely investigations and adjudications 
relating to determinations of suitability, of whether a person is 
suitable or is not suitable for employment in covered positions in the 
federal government or a specific federal agency. The Security Executive 
Agent is responsible for the oversight of investigations and 
determinations of eligibility for access to classified information. 

[14] [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-08-352T]. 

[15] GAO, DOD Personnel Clearances: DOD Needs to Overcome Impediments 
to Eliminating Backlog and Determining Its Size, [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-04-344] (Washington, D.C.: Feb. 
9, 2004). 

[16] The cost of awarding and maintaining a top secret clearance for 10 
years is approximately 30 times greater than the cost of awarding and 
maintaining a secret clearance for the same period. For fiscal year
2008, OPMï¿½s standard billing rate is $3,711 for an investigation for an 
initial top secret clearance; $2,509 for an investigation to renew a 
top secret clearance, and $202 for an investigation for a secret 
clearance. An individual getting a top secret clearance for the first 
time and keeping the clearance for 10 years would cost the government a 
total of $6,202 in current year dollars ($3,711 for the initial 
investigation and $2,509 for the reinvestigation after the first 5 
years). In contrast, an individual receiving a secret clearance and
maintaining it for 10 years would result in a total cost to the 
government of $202 ($202 for the initial clearance that is good for 10 
years). The investigative workload is also affected by the scope of 
coverage in the various types of investigations. Much of the 
information for a secret clearance is gathered through electronic 
files. The investigation for a top secret clearance; however, requires 
the information needed for the secret clearance as well as additional 
data gathered through time-consuming tasks such as interviews with the 
subject of the investigation request, references in the workplace, and 
neighbors. Since (1) the average investigative report for a top secret 
clearance takes about 10 times as many investigative staff hours as the 
average investigative report for a secret clearance, and (2) the top 
secret clearance must be renewed twice as often as the secret, the 
investigative workload increases about 20-fold. Additionally, the 
adjudicative workload increases about 4-fold. In 2007, DOD officials 
estimated that it took about twice as long to review an investigative 
report for a top secret clearance, which would need to be done twice as
often as for a secret clearance. 

[17] [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-08-352T]. 

[18] GAO, DOD Personnel: Inadequate Personnel Security Investigations 
Pose National Security Risks, [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO/NSIAD-00-12] (Washington, D.C.: Oct. 27, 1999); and GAO, 
DOD Personnel Clearances: Government Plan Addresses Some Long-standing 
Problems with DODï¿½s Program, but Concerns Remain, [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-06-233T] (Washington, D.C.: Nov. 
9, 2005). 

[19] GAO, DOD Personnel Clearances: Additional OMB Actions Are Needed 
to Improve the Security Clearance Process, [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-06-1070] (Washington, D.C.: Sept. 
28, 2006). 

[20] [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-06-1070]. 

[21] [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-06-233T]. 

[22] [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-08-352T]. 

[23] GAO, DOD Personnel: Inadequate Personnel Security Investigations 
Pose National Security Risks, [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO/NSIAD-00-12] (Washington, D.C.: Oct. 27, 1999). 

[24] The National Commission on Terrorist Attacks Upon the United 
States, The 9/11 Commission Report: Final Report of the National 
Commission on Terrorist Attacks Upon the United States, Government
Printing Office (Washington, D.C.: July 22, 2004). 

[End of section] 

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