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TSA OVERSIGHT PART IV: IS TSA EFFECTIVELY 

PROCURING, DEPLOYING, AND STORING AVIATION SECURITY EQUIPMENT AND TECHNOLOGY? 

JOINT HEARING 

BEFORE THE

COMMITTEE ON OVERSIGHT 

AND GOVERNMENT REFORM 

AND THE

COMMITTEE ON TRANSPORTATION 

AND INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED TWELFTH CONGRESS 

SECOND SESSION 

MAY 9, 2012 

Printed for the use of the Committees on Oversight and Government Reform 

and Transportation and Infrastructure 

Committee on Oversight and Government Reform 

Serial No. 112–160 

Committee on Transportation and Infrastructure 

Serial No. 112–85 

( 

Available via the World Wide Web: http://www.gpo.gov/congress/house 

http://www.house.gov/reform 

(II) 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM 

DARRELL E. ISSA, California, Chairman 

DAN BURTON, Indiana 

JOHN L. MICA, Florida 

TODD RUSSELL PLATTS, Pennsylvania 

MICHAEL R. TURNER, Ohio 

PATRICK T. MCHENRY, North Carolina 

JIM JORDAN, Ohio 

JASON CHAFFETZ, Utah 

CONNIE MACK, Florida 

TIM WALBERG, Michigan 

JAMES LANKFORD, Oklahoma 

JUSTIN AMASH, Michigan 

ANN MARIE BUERKLE, New York 

PAUL A. GOSAR, Arizona 

RAU ́ L R. LABRADOR, Idaho 

PATRICK MEEHAN, Pennsylvania 

SCOTT DESJARLAIS, Tennessee 

JOE WALSH, Illinois 

TREY GOWDY, South Carolina 

DENNIS A. ROSS, Florida 

FRANK C. GUINTA, New Hampshire 

BLAKE FARENTHOLD, Texas 

MIKE KELLY, Pennsylvania 

ELIJAH E. CUMMINGS, Maryland, Ranking 

Minority Member 

EDOLPHUS TOWNS, New York 

CAROLYN B. MALONEY, New York 

ELEANOR HOLMES NORTON, District of 

Columbia 

DENNIS J. KUCINICH, Ohio 

JOHN F. TIERNEY, Massachusetts 

WM. LACY CLAY, Missouri 

STEPHEN F. LYNCH, Massachusetts 

JIM COOPER, Tennessee 

GERALD E. CONNOLLY, Virginia 

MIKE QUIGLEY, Illinois 

DANNY K. DAVIS, Illinois 

BRUCE L. BRALEY, Iowa 

PETER WELCH, Vermont 

JOHN A. YARMUTH, Kentucky 

CHRISTOPHER S. MURPHY, Connecticut 

JACKIE SPEIER, California 

LAWRENCE J. BRADY, Staff Director 

JOHN D. CUADERES, Deputy Staff Director 

ROBERT BORDEN, General Counsel 

LINDA A. GOOD, Chief Clerk 

DAVID RAPALLO, Minority Staff Director 

(III) 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE 

JOHN L. MICA, Florida, Chairman 

DON YOUNG, Alaska 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee 

FRANK A. LOBIONDO, New Jersey 

GARY G. MILLER, California 

TIMOTHY V. JOHNSON, Illinois 

SAM GRAVES, Missouri 

BILL SHUSTER, Pennsylvania 

SHELLEY MOORE CAPITO, West Virginia 

JEAN SCHMIDT, Ohio 

CANDICE S. MILLER, Michigan 

DUNCAN HUNTER, California 

ANDY HARRIS, Maryland 

ERIC A. ‘‘RICK’’ CRAWFORD, Arkansas 

JAIME HERRERA BEUTLER, Washington 

FRANK C. GUINTA, New Hampshire 

RANDY HULTGREN, Illinois 

LOU BARLETTA, Pennsylvania 

CHIP CRAVAACK, Minnesota 

BLAKE FARENTHOLD, Texas 

LARRY BUCSHON, Indiana 

BILLY LONG, Missouri 

BOB GIBBS, Ohio 

PATRICK MEEHAN, Pennsylvania 

RICHARD L. HANNA, New York 

JEFFREY M. LANDRY, Louisiana 

STEVE SOUTHERLAND II, Florida 

JEFF DENHAM, California 

JAMES LANKFORD, Oklahoma 

REID J. RIBBLE, Wisconsin 

CHARLES J. ‘‘CHUCK’’ FLEISCHMANN, 

Tennessee 

NICK J. RAHALL II, West Virginia 

PETER A. DEFAZIO, Oregon 

JERRY F. COSTELLO, Illinois 

ELEANOR HOLMES NORTON, District of 

Columbia 

JERROLD NADLER, New York 

CORRINE BROWN, Florida 

BOB FILNER, California 

EDDIE BERNICE JOHNSON, Texas 

ELIJAH E. CUMMINGS, Maryland 

LEONARD L. BOSWELL, Iowa 

TIM HOLDEN, Pennsylvania 

RICK LARSEN, Washington 

MICHAEL E. CAPUANO, Massachusetts 

TIMOTHY H. BISHOP, New York 

MICHAEL H. MICHAUD, Maine 

RUSS CARNAHAN, Missouri 

GRACE F. NAPOLITANO, California 

DANIEL LIPINSKI, Illinois 

MAZIE K. HIRONO, Hawaii 

JASON ALTMIRE, Pennsylvania 

TIMOTHY J. WALZ, Minnesota 

HEATH SHULER, North Carolina 

STEVE COHEN, Tennessee 

LAURA RICHARDSON, California 

ALBIO SIRES, New Jersey 

DONNA F. EDWARDS, Maryland 

(V) 

C O N T E N T S 

Page 

Hearing held on March 9, 2012 .............................................................................. 1 

WITNESSES 

Mr. David R. Nicholson, Assistant Administrator for Finance and Administration and Chief Financial Officer, Transportation Security Administration 

Oral statement .................................................................................................. 6 

Written statement ............................................................................................ 9 

Mr. Charles K. Edwards, Acting Inspector General, Department of Homeland 

Security 

Oral statement .................................................................................................. 14 

Written statement ............................................................................................ 16 

Mr. Stephen M. Lord, Director, Homeland Security and Justice Issues, U.S. 

Government Accountability Office 

Oral statement .................................................................................................. 19 

Written statement ............................................................................................ 21 

APPENDIX 

Timeline of Congressional Request and Delay of the On-Site Review of TSA’s 

Transportation Logistics Center Warehouses .................................................... 57 

The Honorable Jason Chaffetz, a Member of Congress from the State of 

Utah, Opening Statement ................................................................................... 58 

(1) 

TSA OVERSIGHT PART IV: IS TSA EFFECTIVELY PROCURING, DEPLOYING, AND 

STORING AVIATION SECURITY EQUIPMENT 

AND TECHNOLOGY? 

Wednesday, May 9, 2012, 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM, 

JOINT WITH THE

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, 

Washington, D.C. 

The committees met, pursuant to call, at 1:09 p.m. in room 2154, 

Rayburn House Office Building, Hon. Darrell Issa [chairman of the 

Committee on Oversight and Government Reform], presiding. 

Present from the Committee on Oversight and Government Reform: Representatives Issa, Cummings, Mica, Chaffetz, Lankford, 

Farenthold, Gowdy, Buerkle, Connolly, Norton, Burton and Guinta. 

Present from the Committee on Transportation and Infrastructure: Representatives Mica, Lankford, Farenthold, Altmire, 

Cummings, Cravaack, Bucshon, Richardson, Norton, DeFazio, 

Guinta and Hultgren. 

Also Present: Representative Blackburn. 

Staff Present: Thomas Alexander, Senior Counsel; Will L. 

Boyington, Majority Staff Assistant; Molly Boyl, Majority Parliamentarian; Sharon Casey, Senior Assistant Clerk; Adam P. Fromm, 

Majority Director of Member Services and Committee Operations; 

Linda Good, Majority Chief Clerk; Christopher Hixon, Majority 

Deputy Chief Counsel, Oversight; Mitchell S. Kominsky, Majority 

Counsel; Mark D. Marin, Majority Director of Oversight; Laura L. 

Rush, Majority Deputy Chief Clerk; Jeff Solsby, Majority Senior 

Communications Advisor; Rebecca Watkins, Majority Press Secretary; Sang H. Yi, Majority Professional Staff Member; Kevin 

Corbin; Minority Deputy Clerk; Ashley Etienne, Minority Director 

of Communications; Jennifer Hoffman, Minority Press Secretary; 

Carla Hultberg, Minority Chief Clerk; Peter Kenny, Minority Counsel; Lucinda Lessley, Minority Policy Director; and Dave Rapallo, 

Minority Staff Director. 

Chairman ISSA. The Committee will come to order. 

At the Oversight Committee, we exist to secure two fundamental 

principles. First, Americans have the right to know that the money 

Washington takes from them is well spent. Second, Americans deserve an efficient and effective government that works for them. 

Our duty on the Oversight and Government Reform Committee 

is to protect these rights. Our solemn responsibility is to hold govVerDate Aug 31 2005 08:38 Aug 10, 2012 Jkt 000000 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 C:\USERS\APRIL~1.KIN\DOCUME~1\75300.TXT APRIL
2 

ernment accountable to taxpayers because taxpayers have a right 

to know what they are getting from the government. 

We work tirelessly in partnership with citizen watchdogs to deliver the facts to the American people and bring genuine reform to 

the Federal bureaucracy. This is our mission, this is what we are 

here for today. 

The way in which TSA has managed aviation security at our Nation’s eight airports raises numerous questions and concerns regarding the stewardship of taxpayer dollars. Although a new organization, you are not so new that you shouldn’t have gotten better 

by now. Too many Americans instead of delivering effective security, believe that TSA has given Americans public long lines and 

policies that hardly make us safer. 

This is not to say that the 65,000 employees, particularly those 

at the front lines who often find people frustrated when they get 

to the head of the line, are to blame. Organizations are not based 

on whether their workers are good or bad, they are based on 

whether, in fact, their leadership is good or bad. 

As we look at the Transportation Logistics Center in Dallas, we 

find a flaw that it is easy to poke holes into, but as we look at the 

4,000 out of 65,000 TSA people who are here in Washington making up rules, overseeing logistics and, in fact, making many of the 

mistakes that have been noted in the past by both our Committee 

and the Transportation Committee, we realize there is a problem. 

The problem, for our purposes, will primarily be seen as a failure 

to get organized in Washington. 

Do I believe that TSA could do more with less? Yes. As we look 

at various new technologies that cost hundreds of millions of dollars, and we find them sitting not in the field but in storage. In 

many cases, our audits show, through Chairman Mica and my 

staff, that assets are brought back and languish there for long periods of time until congressional investigators show up. Then after 

weeks of delay and a few more hours delay, they have been swept 

away. 

That is exactly what you cannot do in an America that depends 

on your Inspector General and your Congress to have transparent 

ability to fairly evaluate needs for improvement. 

I served in the military a generation ago. The name Inspector 

General meant a great deal. Often people would have to say, we 

have to get ready for the IG’s inspection. That meant training and 

preparation to pass a test. It did not mean shoving things away, 

hiding them or making up new schedules of what it would be on 

a certain day. 

I remain concerned that since the TSA’s creation in 2001 and as 

its workforce has grown from an initial 16,500 authorized, with 

25,000 as its intended cap, the 65,000 people working for TSA 

today represent too many people for too little protection. Part of 

this is because of the failure to launch effectively new technologies. 

I, for one, was at the center of the dais, was here in 2001. I participated in the vote to create the TSA and I participated in many, 

many votes that spent a great deal of money. Literally, one could 

say we threw money at the problem. It wasn’t Republicans, it 

wasn’t Democrats; it was a nation that was concerned in a postVerDate Aug 31 2005 08:38 Aug 10, 2012 Jkt 000000 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 C:\USERS\APRIL~1.KIN\DOCUME~1\75300.TXT APRIL
3 

9/11 era that we had to act quickly. We were more interested in 

effectiveness than efficiency. 

We are decade later. Today, we are looking at both efficiency and 

effectiveness and we find both lacking at the TSA. The idea that 

you get a good deal by buying more machinery that simply decays 

or becomes obsolete during its presence in Dallas makes no sense. 

Additionally, as a manufacturer, I am well aware that if you want 

to take possession of assets, it is much, much less expensive on 

these large pieces of equipment to take possession at the factory 

and have them drop-shipped when needed. 

Logistically, there were failures; in oversight, there was cover up; 

and in fact, a decade after the creation of TSA, we are here today 

to question whether or not the management is maximizing the 

hard work of the men and women of the TSA for the benefit of the 

American people. That is why we are here today. This is the fourth 

in a series and an unparalleled joint effort by this Committee and 

the Transportation Committee. 

I hope you have answers for the many questions today and I 

hope this will serve as a reminder that in fact we will not give up, 

on the Republican or Democratic side, until TSA delivers a higher 

value for the American people. 

With that, I recognize the Ranking Member for his opening statement. 

Mr. CUMMINGS. Thank you very much, Mr. Chairman. 

Earlier this week, the CIA reportedly thwarted an effort by an 

al Qaeda affiliate in Yemen to blow up an airliner headed to the 

United States using a new version of an underwear bomb. If these 

reports are accurate, they are yet another testament to the superb 

work of our intelligence and military officials in our entire Nation’s 

ongoing vigilance against terrorism. 

This conspiracy also underscores the real threats that are still directed against our Nation. We are engaged in an ongoing battle to 

stay one step ahead of the terrorists. Just because Osama Bin 

Laden has been killed and al Qaeda leadership has been degraded 

does not mean we can rest. 

As today’s hearing highlights, part of our core defense includes 

efforts by TSA to procure and deploy effective security technology 

and equipment in our Nation’s airports. In recent years, however, 

the DHS Inspector General and GAO have documented shortcomings in TSA’s acquisition process in individual procurements. 

In 2006, for example, TSA deployed Explosive Trace Detection 

Portals, commonly known as ‘‘puffers,’’ even though initial tests 

suggested they might not perform in airports as they had in laboratory settings. TSA later ended the program and scraped the machines when they failed to perform adequately in the field. 

Similarly, after the attempted bombing of a Northwest Airlines 

flight on Christmas Day, 2009, another passenger screening technology, the Advanced Imaging Technology, was rapidly deployed. 

GAO raised concerns about the testing and performance of these 

machines before they were deployed. GAO also raised concerns 

about their low usage after they were deployed. 

Finally, last month, GAO reported that TSA’s Checked Baggage 

Screening Program has never had a Department-approved acquisition program baseline. This program, which initiated eight years 

4 

ago, has cost an estimated $49 billion through 2030. According to 

GAO, the program has already experienced cost increases, but the 

absence of an approved baseline makes it difficult to measure those 

increases against specific benchmarks. 

TSA’s procurement challenges are similar to those of other agencies. For example, during my tenure as Chairman of the Subcommittee on the Coast Guard and Maritime Transportation, I convened a series of hearings to examine the Coast Guard’s major procurements, including what was then known as the Deepwater Program. 

Early in this program, the Coast Guard spent millions of dollars 

buying boats that literally did not float. Based on our detailed oversight work, over many months, I offered legislation to ensure that 

specific and detailed statutes would guide Coast Guard procurement in the future. I am proud to say that this legislation eventually became Title IV of the Coast Guard Authorization Act of 2010. 

I believe a similar effort may be warranted here and that we 

should consider applying such statutes to the entire Department of 

Homeland Security. In the meantime, I’m encouraged that the Department has already taken some steps to strengthen its management and oversight, starting with issuing a new acquisition guideline directive. 

This directive requires that each procurement follow a standardized and rigorous process and it is intended to allow progress 

through acquisition phases only after clear and justifiable decisions 

are made at specific milestones. However, no rules will be effective 

unless they are followed. 

DHS awarded 88,000 procurement actions for $13 billion in fiscal 

year 2010. The challenges that TSA has faced with its aviation security systems are a result of the agency not fully complying with 

DHS directives and DHS not insisting on TSA’s compliance. The 

Department and its agencies must be accountable for their expenditures and that process starts by ensuring that the Department and 

its procuring agencies follow their own rules. 

In a time when people are proposing even more extreme measures to address TSA’s challenges, I see a very simple solution. Follow the protocols that have been established. We have come a long 

way and we still have a long way to go, but we now have an acquisition system in place that all DHS components should follow. With 

today’s hearing, I look forward to understanding how and when 

TSA will reach this critical milestone. 

With that, Mr. Chairman, I yield back. 

Chairman ISSA. I thank the Ranking Member. 

We now recognize the Chairman of the Committee on Transportation and Infrastructure, the senior member of the Oversight 

Committee, Mr. Mica, for his opening statement. 

Mr. MICA. Thank you again, Chairman Issa, and also Mr. 

Cummings, for agreeing to co-chair and be part of this oversight 

hearing with the Transportation and Infrastructure Committee, in 

our efforts to make certain that the American public is safe and secure and we have in place the very best security and transportation 

security system possible. 

5 

The subject today is, ‘‘Is the TSA Effectively Procuring, Deploying and Storing Aviation Security Equipment and Technology?’’ To 

that, I have to say absolutely they are not doing that. 

When we assumed the majority last year, we started looking at 

the history of the acquisition of equipment during the past four 

years and what was happening with important security equipment. 

I think each of my colleagues has alluded to the fact that aviation 

in this country is still at risk. 

In the last 48 hours, we have seen that terrorists still are targeting aviation because they know it can destroy our economy. The 

question is, what is our primary agency that is responsible for getting the latest technology, and dealing with technology and spending taxpayer money on technology what are they doing? 

First of all, Mr. Cummings talked about the puffers. I wanted to 

know where are the puffers? I went to Atlantic City and saw the 

puffers. They didn’t work when I went through them. I had some 

trace on me, went through them multiple times and they said, it 

was just a software glitch and it would be resolved. Instead, they 

went forward buying puffers. They bought puffers, they deployed 

puffers at great expense. What happened to the puffers when they 

found they didn’t work? They sat in warehouses. 

We started our investigation last year and they were still sitting 

in warehouses for years at great expense to the taxpayers. When 

we started the investigation, they finally took the puffers, at a cost 

of $600 apiece, correct me if I am wrong, and had the Department 

of Defense destroy them. In the meantime, I want to know how 

much those puffers, sitting there idly in that warehouse, cost the 

taxpayers and how much that fiasco cost us. 

Let us get current here. We had a whistleblower contact us at 

the end of last year and the beginning of this year who said there 

are incredible amounts of equipment sitting in a TSA warehouse 

outside of Dallas, Texas. We started looking into it and of course 

TSA gave us a hard time. Thanks to Mr. Issa, we combined forces. 

We have one staffer who is with OGR, thank you, and also with 

our Committee. We started investigating and sure enough something was rotten in Denmark and Dallas. Denmark is very close to 

Dallas in this case. 

Here we get the whistleblower, we emailed at the beginning of 

February that we wanted to do a site visit to Texas and they put 

us off. They put us off for some time. I want this sequence of time 

line of the requests and delays on the site visit made a part of the 

record. 

Chairman ISSA. That will be made a part of the entire record 

without objection. 

Mr. MICA. In February, we asked to go down there. They put us 

off. Finally, they asked for a delay. Then we found out, our staff 

arrived there February 15, on the 13th through the 15th, TSA was 

moving, we got word, 1,300 pieces of equipment. As our staff is arriving, the equipment is going out the back door to make certain 

congressional investigators don’t see what is there. What there was 

is equipment that had been sitting there for I think over a year, 

some of it very important to the security and safety of the people 

of the United States. 

6 

We have the equipment sitting there and we find out the equipment was bought for certain purposes, very good purposes. Some 

of that dealt with screening baggage and liquids. I won’t get into 

all the details and was supposed to have certain performance 

standards. Then we find out the equipment is there and TSA can’t 

deploy the equipment. 

These are pictures of this equipment. Here the country is at risk, 

the United States is under threat and highly technical equipment 

that is purchased, they don’t know how to operate it and they are 

storing it at great public expense. It is sitting in these warehouses, 

5,700 pieces of equipment were sitting there. 

I think this is outrageous. We are depending on this agency to 

protect us, not to be storing equipment, buying it, not meeting the 

specifications, not able to operate the equipment. We will hear 

some from our witnesses today in more detail about this outrage. 

I thank you for holding this hearing. We need to get to the bottom of why TSA is dancing this Committee, our joint committees, 

around and not providing taxpayers with good return for their dollars and security for the traveling public. 

I yield back. 

Chairman ISSA. I thank the Chairman. 

I understand the chairman of the subcommittee will be submitting his for the record. 

Without objection, all members will have seven days to submit 

opening statements and related material for the record. 

At this time, I would like to recognize our distinguished panel of 

witnesses. Mr. David R. Nicholson is Assistant Administrator for 

Finance and Administration and Chief Financial Officer at the 

Transportation Safety Administration. Mr. Charles K. Edwards, a 

very important returning witness, is Acting Inspector General at 

the Department of Homeland Security. Mr. Stephen M. Lord is Director of Homeland Security and Justice Issues at the U.S. Government Accountability Office, a part of this branch of government. 

Pursuant to Committee rules, all witnesses must be sworn. 

Please rise to take the oath. 

Do you solemnly swear or affirm that the testimony you are 

about to give will be the truth, the whole truth, and nothing but 

the truth? 

[Witnesses respond in the affirmative.] 

Chairman ISSA. Let the record indicate that all witnesses answered in the affirmative. 

In order to have time for discussion and knowing that in about 

20 or 25 minutes, we will have our first round of votes, I would ask 

that you try to summarize your statements to the five minutes. 

Your entire opening statements will be placed in the record. 

With that, I recognize Mr. Nicholson for five minutes. 

WITNESSES STATEMENTS 

STATEMENT OF DAVID R. NICHOLSON 

Mr. NICHOLSON. Good afternoon, Chairman Issa, Chairman Mica, 

Ranking Member Cummings and distinguished members of the 

committees. Thank you for the opportunity to testify today. 

7 

As intended in the Aviation Transportation Security Act, TSA remains vigilant in ensuring the security of people and commerce 

flowing through our transportation networks. The nature of our 

counter-terrorism work has driven changes. TSA employs riskbased, intelligence-driven operations to prevent terrorist attacks 

and to reduce the vulnerability of the Nation’s transportation system to terrorism, and provide the most effective security in the 

most efficient manner. 

We continue to revolve our security approach by examining procedures and technologies we use and how screening is conducted. 

To date, TSA conducts security operations at about 450 airports divided into six regions, 26 Federal air marshal field offices, we have 

a 7 by 24 national operations center and two vetting centers with 

credentialing enrollment centers throughout the country. 

We have a systems integration facility and a logistics facility, a 

Federal air marshal training center and our headquarters is located in Arlington, Virginia. We have over 15,000 pieces of checkpoint and baggage screening equipment at our airports. Our 37 

Viper teams provide a deployable capability ready to respond to intelligence and provide the capability for protecting or restoring 

transportation security. 

In our international programs, we have 29 TSARs in 19 countries 

covering 100 international governments. We also have 920 canine 

teams and law enforcement agreements with 300 local law enforcement authorities. 

To meet our transportation security responsibilities requires 

flexibility and involving our personnel capabilities, processes and 

employment of technology to screen about 1.7 million passengers 

and their property each day. 

You have heard about our risk-based security initiatives like TSA 

PreCheck which has screened over 1 million passengers, and new 

procedures for screening children and people over 75. 

To meet our security requirements, TSA must be able to rapidly 

deploy technology in response to changing threat information or 

have equipment ready to deploy when airport facilities are changed 

to accommodate the equipment. Approximately 85 percent of our 

screening equipment is being used in the field and 15 percent is 

in warehouse either for deployment, redeployment or scheduled for 

disposal. 

After security equipment successfully clears a multifaceted testing regime, TSA fulfills several requirements prior to its use in an 

airport setting. These requirements include developing estimates of 

how much equipment is needed and building a schedule for deploying individual pieces of equipment at airports around the country. 

Coupled with the manufacturing schedules and companies that 

produce our equipment, TSA typically procures equipment ahead of 

scheduled deployments so that it is immediately available when the 

airport is ready to receive it. Preparedness includes facilities preparation and a trained workforce at the appropriate staffing level. 

To store transportation security equipment prior to deployment, 

redeployment or disposal, TSA leases three warehouses in Texas. 

Nearly 80 percent of the screening equipment procured by TSA has 

been stored in warehouses for less than a year. The reported gross 

value of our security equipment in the warehouse, as of March 31 

8 

is approximately $155 million or 5 percent of the value of all of our 

security equipment. 

In the past two years, by working directly with warehouse owners and awarding warehouse operations contracts to a service-disabled veteran-owned small business, we have reduced our cost to 

$3.1 million annually or 2 percent of the value of the equipment 

just located in the warehouse. 

In a report published in November 2009, the DHS Inspector General reviewed TSA’s management of the Logistics Center. TSA 

worked closely with the IG to quickly implement the three recommendations made in the report. As a result, these recommendations have been closed. Since this report closed, TSA has continued 

to build on those recommendations to streamline our equipment deployment, storage and disposal. As a result of these efforts, TSA is 

planning to close one of the three warehouses within the next year. 

Thank you for the opportunity to appear before you today and I 

am happy to answer any of your questions. 

[Prepared statement of Mr. Nicholson follows:] 

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Chairman ISSA. Thank you. 

Mr. Edwards. 

STATEMENT OF CHARLES K. EDWARDS 

Mr. EDWARDS. Good afternoon, Chairman Issa, Chairman Mica, 

Ranking Member Cummings, and distinguished members of the 

committees. Thank you for the opportunity to testify today on the 

Transportation Security Administration’s procurement, deployment 

and storage of airport security-related equipment. 

My testimony today will focus on our November 2009 audit report titled ‘‘Management of Transportation Security Administration’s Logistics Center,’’ which evaluated the efficiency and effectiveness of TSA’s deployment, redeployment and disposal of transportation security-related equipment. 

Our audit concluded that because TSA did not have formal guidance and procedures to ensure periodic review and proper classification of inventory, it was unable to efficiently deploy, redeploy 

and dispose of transportation security equipment through its Logistics Center. As a result, the agency had potentially lost equipment 

utility and did not have accurate accounting of its inventory. 

We learned that the equipment was sent to a warehouse, assigned a condition code and never reviewed again to ensure its utility. TSA’s systems did not include an accurate inventory of items 

available for use; did not allow TSA management to make informed 

deployment; redeployment and disposal decisions, and did not ensure TSA disposed of equipment that was no longer needed. We 

recommended TSA periodically review its inventory to make sure 

equipment is correctly classified. 

We also found that TSA did not always deploy new equipment 

efficiently or resolve deployment delays. In some instances, new 

equipment was stored for years before TSA personnel designated 

an airport to receive it. For example, eight explosive detection systems units, worth about $7 million, were stored for two years. 

At the time of our audit, airports had been identified to receive 

seven of the units. Additionally, 345 EDT units, worth about $10.6 

million, had been stored for one to two years or longer. The equipment deployment had been delayed because until that time, TSA 

did not have written transition plans for the units. 

We recommended that TSA develop, implement and monitor procedures for the efficient deployment, redeployment and disposal of 

all transportation security-related equipment through its Logistics 

Center. 

Our audit also revealed TSA was not redeploying equipment effectively. TSA did not assess the condition of used equipment in a 

timely manner to determine whether to redeploy or dispose of 

units. For example, as of January 2009, used equipment, including 

conveyors worth about $4 million, had been stored at the Logistics 

Center for one to two years or longer. 

Finally, TSA did not efficiently dispose of excess equipment because the agency did not have consistent guidance for disposal. Although TSA began developing a disposal plan in May 2005, the 

first actual disposal did not take place until late 2008. The delay 

was due to difficulty in establishing an agreement with a governVerDate Aug 31 2005 08:38 Aug 10, 2012 Jkt 000000 PO 00000 Frm 00020 Fmt 6633 Sfmt 6633 C:\USERS\APRIL~1.KIN\DOCUME~1\75300.TXT APRIL
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ment entity that could properly destroy sensitive national security 

equipment and review hazardous material disposal requirements. 

The space required to store the growing inventory of new, used 

and excess equipment contributed to TSA’s decision in fiscal year 

2009 to lease an additional warehouse at a cost of $2 million. We 

recommended the agency develop a recurring process to redeploy or 

dispose of any excess equipment at the Logistics Center. 

TSA concurred with all three of our audit recommendations and 

has taken corrective action in all three. We have closed the recommendations as implemented. 

In conclusion, the Office of Inspector General remains committed 

to identifying issues and making recommendations to assist TSA in 

carrying out its mission effectively and efficiently. 

Messrs. Chairmen, this concludes my prepared statement. Thank 

you for the opportunity to testify and I welcome any questions from 

you or the members of the Committee. 

[Prepared statement of Mr. Edwards follows:] 

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Chairman ISSA. Thank you, Mr. Edwards. 

Mr. Lord. 

STATEMENT OF STEPHEN M. LORD 

Mr. LORD. Good afternoon, Chairman Issa, Chairman Mica, Representative Cummings, and other distinguished members of the 

committees. I am pleased to be here today to discuss DHS and 

TSA’s broader efforts to develop and field new screening technologies. 

This is an important issue as these technologies represent billions of dollars in life cycle costs and are an integral part of TSA’s 

layered approach to aviation security. Today, I would like to highlight some of the key insights gleaned from our prior work. I summarize those as three. 

First is the importance of defining clear program requirements. 

Secondly is overseeing and testing new technologies. Thirdly is developing reliable and accurate acquisition program baselines to 

help gauge progress as an acquisition unfolds. 

Regarding requirements, our past work has highlighted the importance of setting clear requirements at the program’s start. Otherwise, you run the risk of having poor program outcomes further 

down the path or increased costs. For example, in June 2010, we 

reported that over half of the 15 DHS programs reviewed initiated 

acquisition activities without required approval of key requirements or planning documents. Obviously, this issue is broader than 

TSA alone. 

We also found that TSA has faced challenges related to the requirements setting process. For example, we found that TSA did 

not fully follow acquisition policies when acquiring advanced imaging technology or body scanners which resulted in DHS approving 

the scanners for deployment without full knowledge of their capabilities. 

We also reported that TSA revised requirements for its check 

baggage screening systems in 2005 and again in 2010 without a 

clear plan that will ensure the machines were capable of meeting 

the requirements. TSA did agree with our recommendations to address these issues and has begun taking action to address them. 

Regarding my second point, the importance of testing, our prior 

work has identified several challenges related to testing which can 

lead to problems down the road in the acquisition process. For example, in January, we reported that TSA began deploying AIT machines before it received formal approval for how it would test the 

machines. 

Specifically, DHS approved AIT deployment in September 2009 

but did not approve the very important Testing and Evaluation 

Master Plan, or TEMP, until January 2010, after the decision had 

already been made to deploy the machine. 

We also identified some testing issues in our report on TSA’s 

baggage screening system. We found that TSA was trying to collect 

explosive data at the same time it was procuring new machines, 

not to say it couldn’t be done but it was a high risk strategy which 

led to some delays in the acquisition process. Thus, we recommended that TSA collect the needed data first before starting 

the procurement process for new machines. 

20 

Our prior work has also highlighted the importance of establishing reliable program baselines, schedules and cost estimates. 

For example, as was alluded to earlier, we found that TSA’s Electronic Baggage Screening Program has not had a departmental approved acquisition program baseline since the inception of the program more than eight years ago. This is for one of DHS’ largest acquisition programs. 

TSA reports that it hopes to submit an approved version in time 

for the next ARB meeting in July 2012. Just for the record, they 

have made two prior attempts, so it is not that they are not trying 

but the baseline submitted didn’t meet departmental level requirements. 

In response to our AIT report, TSA also agreed to develop an AIT 

roadmap or schedule to help decision makers gauge TSA’s progress 

in meeting new performance requirements. We think that is an important part of the process as well. 

In response to these and other challenges we have identified, not 

only at TSA but other components, DHS has taken some additional 

steps to strengthen the Department’s acquisition processes. For example, they have established a new Office of Program Accountability and Risk Management, PARM. This office will reportedly 

work with DHS leadership to assess the health of major acquisitions and investments and provide new tools to increase the information flows between the Department and the various components. 

In closing, our past work has highlighted the importance of adhering to DHS acquisition processes to achieve better outcomes, 

transparency and accountability. Doing so will help ensure taxpayer funds are used wisely. 

Mr. Chairman, this concludes my statement. I look forward to 

your questions. 

[Prepared statement of Mr. Lord follows:] 

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Chairman ISSA. Thank you, Mr. Lord. 

I now ask unanimous consent that my colleague from Tennessee, 

Mrs. Blackburn, be allowed to participate in today’s hearing. Without objection, so ordered. 

I will now recognize myself for five minutes. 

Mr. Nicholson, are you concerned with the fact that TSA’s Office 

of Legislative Affairs may have provided inaccurate, incomplete 

and potentially misleading information to Congress? 

Mr. NICHOLSON. No, sir. 

Chairman ISSA. You are not concerned? 

Mr. NICHOLSON. No, sir. 

Chairman ISSA. If you learned that in fact, TSA’s Office of Legislative Affairs provided inaccurate, incomplete or potentially misleading information to Congress concerning financial management 

at TSA, what would you recommend that the Administrator do? 

Mr. NICHOLSON. If I learned that someone purposely provided incorrect information, then I think the Administrator should hold 

those people accountable under our professional responsibility program. 

Chairman ISSA. Then I propose to you my staff was given documents which were not accurate as to the day they were given, but 

in fact, were a projection of what you would shove out the backdoor 

in the days before they came in. I would propose to you that we 

have the ability to criminally refer that, criminally refer that as 

lying to Congress. 

Now, will you look at what was in the warehouse, investigate, 

and I know that the IG would be happy to help you, what was in 

the warehouse as of the day the information was given and in fact, 

as we were delayed going in, that material was being taken out so 

that on the day our people went in, it would match it but did not 

fairly and accurately relate to the amount of material that was 

there subject to our inspection and our fact finding. 

Mr. NICHOLSON. Sir, we would be happy to look at those time 

lines and when the meeting was scheduled, how it was scheduled, 

what the inventory consisted of, what the dates were and what the 

nuances. 

Chairman ISSA. Do you believe that not giving an inventory of 

what was in the warehouse on the day it was given but what was 

going to be there after over 1,000 pieces were removed is misleading Congress? 

Mr. NICHOLSON. I don’t believe that happened. 

Chairman ISSA. It did happen. Your IG is shaking his head. I 

want you to understand, Congress was mislead, our staff was deliberately given a document that as they delayed an ordinary appearance, by the way, not one in which we were going to count but simply an ordinary appearance, they were given a document that deliberately was lower than the amount that was there on the day 

it was given and in fact, stuff was being shoved out. 

People were brought in at I believe 5:00 a.m. so they could get 

it out before our people came in. That is something we believe we 

can make a case for. Will you agree here today to take action and 

tell us what is going to be done about it while we consider whether 

it rises to the act of a criminal deception of Congress? 

Mr. NICHOLSON. We will be happy to look into this. 

40 

Chairman ISSA. I appreciate that. 

By the way, Mr. Lord, as you were going through the additional 

group being layered on to create communication between an already bloated group, I could only think of a GSA conference in Las 

Vegas that perhaps adding additional layers would beg additional 

conferences. 

Mr. Nicholson, I am going to stay with you a little bit. You gave 

us a lot of figures and I appreciate that but let me just ask you 

the basic question. Do you think that by buying and storing equipment well in advance, you are minimizing the cost to the American 

taxpayer or your procurement procedures need to be tightened, 

more or less a yes or no there? 

Mr. NICHOLSON. I think there is always room for improvement 

in our procedures. I think we have taken many steps over the last 

few years and I think we have a good employment plan and implementing..... 

Chairman ISSA. Can we have the picture of the office stuff? If you 

could put up the picture of the office supplies? Do you recognize 

that type of equipment? 

Mr. NICHOLSON. From what I can see, it looks like tables and 

perhaps some terminals. 

Chairman ISSA. I am going to pose a question to you, a very simple one. What idiot thought that moving that kind of equipment 

back and forth around the Country made any sense? Are you aware 

that the GSA and other organizations already exist to take that 

kind of equipment off your hands? It doesn’t appear to be sensitive, 

it doesn’t in any way, shape or form justify moving it from San 

Diego or somewhere like there to Dallas. 

I might suggest you start with that. It might be a small amount 

of money but the basic concept that you are going to use a central 

warehouse for office supplies flies in the face of an established General Services Administration system that disposes of every Congressman on the dais’ excesses when we have it and that you at 

least limit those 700,000 feet to unique and sensitive material. 

Mr. Lord, I have just one more question with my remaining time. 

The GAO previously reported that it was unclear whether the advanced imaging system would have discovered explosives similar to 

those used by the Christmas Day bomber. Just yesterday, Secretary Janet Napolitano said there is a high likelihood that advanced imaging technology would have detected the new, sophisticated underwear bomb attempted to be used in the recent plot in 

Yemen. Do you agree that there is a high likelihood that advanced 

imaging would have caught the new bomb? 

Mr. LORD. That is a very interesting question. I would have great 

difficulty answering that in open session, sir. We have done a classified report. We can provide information related to that question. 

I would be happy to brief you in closed session. 

Chairman ISSA. We will take that and I am going to predict that 

it will be no, they couldn’t, but the actual answer will remain classified. 

With that, I recognize the Ranking Member for his questions. 

Mr. CUMMINGS. Thank you very much, Mr. Chairman. 

Mr. Edwards, I have always been very sensitive in this Committee, or any committee, when criminal activity is alleged. The 

41 

Chairman is rightful to be upset about this situation and I am very 

upset about it, but he said something I just want to make sure we 

clear up. He said you were shaking your head and you were shaking your head. Do you remember when he said that just a minute 

ago and it implied that you were in disagreement with Mr. Nicholson. It was at a very critical moment. He was asking about criminal activity. I was just wondering, why were you shaking your 

head? I have to hear you because this is important. 

Mr. EDWARDS. I am just listening to the question, sir. 

Mr. CUMMINGS. You were in disagreement or what? I want to understand because the implication was that you were not believing 

what he was saying. That was the implication. 

Mr. EDWARDS. No, I am just listening to the question, sir. 

Mr. CUMMINGS. You need to watch your head then. 

Effective and efficient oversight of Federal acquisitions is a critical task for this Committee and Congress. It is a long term task 

and requires diligent review of each stage of what can an extremely 

complex process. One of the most crucial steps in any procurement 

should be the establishment of the acquisition program baseline. 

According to DHS’ own acquisition manual, this is essentially the 

contract between the Department and the procuring agency against 

which future performance will be measured. 

Mr. Lord has written in his testimony that program performance 

cannot be accurately assessed without valid baseline requirements 

established at the program start. I completely agree with that, Mr. 

Lord. 

The Coast Guard acquisition legislation I offered prohibits the 

Coast Guard from beginning to obtain assets under Level 1 and 

Level 2 acquisitions until the Coast Guard provides several things 

to Congress. These include key performance parameters for acquisitions, a detailed schedule and program baseline and acquisition 

unit costs. 

Mr. Nicholson, it is my understanding TSA currently has seven 

Level 1 acquisition programs. How many of these have Department-approved acquisition program baselines? 

Mr. NICHOLSON. Sir, I believe on the acquisition program baselines, I believe the Department has approved one and we have 

scheduled others. 

Mr. CUMMINGS. Shouldn’t you have those things already? 

Mr. NICHOLSON. Yes, sir. 

Mr. CUMMINGS. Why don’t you? 

Mr. NICHOLSON. The Department’s program to come in to have 

the ARBs, to establish and approve those ARBs happened well 

after the start of most of our programs. Within the agency, we did 

hold our own ARBs. We established them and I think it is proper 

to refresh those and have them done and affirmed or modified by 

the Department as part of their process. 

Mr. CUMMINGS. I understand some of your Level 1 programs 

have TSA-approved acquisition baselines but they have lacked 

DHS-approved baselines for more than seven years. That is seven 

years of spending without an approved acquisition plan. That is 

more than four years of spending since DHS issued its new acquisition management directive in 2008. 

42 

I know that each program is unique and many predate the 2008 

acquisition directive, but why do so many TSA Level 1 acquisitions 

lack Department-approved program baselines? 

Mr. NICHOLSON. We just need to get in the queue and get those 

approved by the Department under the new process. 

Mr. CUMMINGS. That is not good enough. That is good enough. 

We have to do better than that. What steps are being taken to ensure the Department reviews and approves baselines for these programs? 

Mr. NICHOLSON. We have scheduled meetings with them, we 

have provided the documentation to them and they review those as 

part of our input into the programs and analysis that the new Office of PARM has set up to perform. 

Mr. CUMMINGS. Mr. Lord, I understand the GAO is currently reviewing all of TSA’s Level 1 acquisition programs. Can you explain 

why TSA has so many Level 1 procurements that have lacked program baselines and what steps TSA is taking to ensure that the 

baselines can be approved by the Department because it sounds 

like this is one of them I blame you, you blame me and nobody gets 

it done. 

Mr. LORD. I think you need to look at two levels. The Department level, it is a shared responsibility and DHS needs to take 

ownership of some of the requirements. It is not sufficient to simply issue a new framework; you have to monitor component adherence to it and take additional steps to ensure the necessary meetings, paperwork and discussions take place. 

I am concerned about that because again, the acquisition program baseline is the key document that outlines what the program 

is going to cost, when it is going to be fielded and what technical 

performance it is going to deliver. If you don’t have that up front, 

how are you going to gauge progress over the length of the program. 

Mr. CUMMINGS. Mr. Lord, what specific steps does DHS need to 

take to ensure its component agencies comply fully with its acquisition directives and by what date will this be accomplished? Can 

you tell us that? 

Mr. LORD. I think, first of all, to their credit they have implemented some new guidance, clarified some of the existing rules. We 

found there was some confusion at the TSA level about what the 

actual requirements were because the requirements changed. I 

think they have clarified that. They have given new training, they 

are hiring more acquisition professionals, so it is a difficult nut to 

crack but hopefully, over the longer term, they will be more successful. Again, that is a key deficiency, not having a departmentalapproved acquisition program baseline. 

For your Level 1, just so everybody knows, those are your major programs. That is when the life cycle costs exceed $1 billion. 

Mr. CUMMINGS. Thank you, Mr. Chairman. 

Chairman ISSA. Thank you. 

We now recognize the Chairman of the Transportation Committee, Mr. Mica, for his questions. 

Mr. MICA. Mr. Nicholson, have you seen this report that we published November 16 that was the 10th anniversary of the passage 

of the TSA legislation? 

43 

Mr. NICHOLSON. Yes, sir. 

Mr. MICA. You have seen it? 

Mr. NICHOLSON. Yes, sir. 

Mr. MICA. Are you one of the people that said publishing this report was a disservice to TSA? 

Mr. NICHOLSON. I have not heard that said. 

Mr. MICA. Your communications folks, when Mr. Issa and I produced this report, said this is a disservice to TSA. I remember very 

clearly and I wrote the Administrator back and I thought it was 

a disservice for him to ignore what we had outlined. 

In that report, we went through TSA’s failing to develop and deploy effective technology. Back then, Mr. Issa, we said TSA warehouses are at near capacity, we were correct there, containing almost 2,800 pieces of screening equipment. Little did we know there 

were 5,700 pieces of screening equipment sitting there that again 

you delayed and actually diverted our investigators from going 

down there, moving the stuff out in the middle of the night before 

they arrived after delaying them. 

You need to go back and look at this report because it is not 

meant to demean TSA, but to better define the mission to look at 

the gaps. We think we did a fairly thorough job. We will continue 

to take each part of this, Mr. Issa and I, apart and we will send 

our investigators down until we somehow make some sense out of 

this agency. 

When you are procuring billions of dollars worth of equipment, 

it is sitting in warehouses, some of it for over a year. Listen to this. 

First of all, the Committee investigators discovered 85 percent of 

the transportation security equipment currently warehoused there 

has been stored for longer than six months; 35 percent of the 

equipment had been stored for more than a year. 

First, there was a 2008. Here is advanced imaging technology sitting in that center since August 4, 2008. The next page is explosive 

detection system. I don’t know exactly which one it was but people 

within the last 48 hours are trying to take our lights out and advanced explosive detection system equipment has been sitting there 

since December 12, 2010. Are you aware of this, sir? 

Mr. NICHOLSON. I am not aware of this. 

Mr. MICA. You are not aware of this? Well, somebody needs to 

get aware. This is hundreds of millions. The advanced imaging 

technology was a half a billion dollar acquisition of which they 

bought equipment, for which we still don’t have people that are 

trained, we don’t operate it. 

Yesterday I was briefed in a closed door briefing on the performance, of looking at specifically, and this was scheduled before all of 

this came out. We have had the General Accounting Office test the 

system and Mr. Issa and I will continue to do it, but we have seen 

the failure. Somebody needs to see the failures both in acquiring 

equipment, deploying equipment and making sure equipment is not 

sitting in a warehouse idle when people are trying to take our 

lights out. 

Don’t you think that is a reasonable request, sir, that we have 

you act and make certain that this equipment, one is four years, 

the other is two years, that it is properly deployed or something is 

done with it? The puffers, we stopped paying for the rental after 

44 

years of having it in those warehouses. It would still be sitting 

there if we hadn’t done something about it. 

Mr. NICHOLSON. Sir, I can tell you as I started to say, the EDS, 

I am not sure which unit that would be and what type. The EDS 

would be for electronic baggage. The AIT picture, given the date, 

would have to be a pilot unit from a program that we had several 

years ago because we didn’t make our purchase of AIT to deploy 

in the primary screening area until much later in time after 2008 

following the events of Christmas Day, 2009. 

Mr. MICA. Again, the procurement process is a disaster. We just 

heard we are buying things we haven’t properly vetted. I do not 

think any of the advanced imaging technology was properly vetted, 

in fact, I know it wasn’t vetted. I know we could have bought the 

stick equipment with the image that wasn’t offensive. Now you are 

going back and vetting and testing the stick equipment rather than 

the invasive equipment that you deployed. 

We have an agency in which we had no Administrator for over 

a year and an agency that has turned out to be more dysfunctional 

than anyone would have anticipated. Somebody has to get control 

of this. With 65,000 employees, nearly $8 billion in expenditures, 

14,000 administrative staff, it has reached critical mass. The taxpayers are not going to put up with it anymore. 

I yield back. 

Chairman ISSA. I thank the gentleman. 

I ask unanimous consent I be able to ask one quick question to 

follow up on the Ranking Member. Without objection. 

Mr. Edwards, as Inspector General, if it was done, deliberately 

moving equipment out and changing what was actually in the 

warehouse, essentially rigging something for an IG inspection, if 

this was the military Inspector General, you take all your excess 

equipment, you run it somewhere so you can fit a certain requirement, isn’t that normally something for which there is disciplinary 

action if an IG discovers that essentially things have been moved 

out in anticipation of an IG’s inspection or anyone’s inspection? 

Mr. EDWARDS. If an allegation or if something is brought to our 

attention and it is perceived to be in that nature, then we would 

definitely do an administrative investigation and refer it to management for appropriate action. 

Chairman ISSA. Thank you. I appreciate your indulgence. 

We now go to the gentleman from Virginia, Mr. Connolly, for five 

minutes. 

Mr. CONNOLLY. Mr. Chairman, before my clock begins, may I just 

inquire of you? 

Chairman ISSA. Of course. 

Mr. CONNOLLY. Was this panel sworn in? 

Chairman ISSA. Yes, they were. 

Mr. CONNOLLY. I thank the Chair. 

Mr. Nicholson, you are under oath. In response to the Chairman’s question, did I understand you to deny any and all awareness of the fact that equipment may have been moved in the warehouses in question in order to conceal information from congressional staff or Congress itself? 

Mr. NICHOLSON. Sir, you understood me to say that I have no information that that was done. 

45 

Mr. CONNOLLY. Are you aware of the fact it was done? 

Mr. NICHOLSON. I don’t believe it was done. 

Mr. CONNOLLY. Your position is? 

Mr. NICHOLSON. My position is that we have disposals that happen at our warehouse in the three to five month range each year. 

Those disposals take place and the email traffic I think will be part 

of the record will show that this disposal schedule was started in 

the first quarter of fiscal year 2011. There were several back and 

forths scheduled for it. The disposal was scheduled to take place 

the 13th through the 17th of February and the disposal took place 

as it was scheduled. It was scheduled and it was attempted to be 

scheduled several months before. 

Mr. CONNOLLY. Congressional staff happened to be visiting the 

facility and it was coincident with that scheduled moving out of 

equipment, is that correct? 

Mr. NICHOLSON. Yes, sir. I think the letter we received from the 

Committee that was signed on the 6th of February suggested dates 

of 14 or 15 February and the response we gave was 15 February 

would be fine. 

Mr. CONNOLLY. Mr. Edwards, nothing came to your attention in 

the IG’s office with respect to this matter? 

Mr. EDWARDS. No, sir, nothing came to us. 

Mr. CONNOLLY. So this is news to you? 

Mr. EDWARDS. Yes, sir. 

Mr. CONNOLLY. Thank you. 

Mr. Nicholson, at our previous hearing on TSA, we cited the 

abysmal record of turnover at TSA and one of the reasons attributed to it was, the Partnership for Public Service’s Best Places to 

Work Survey, which surveys 241 Federal agencies and entities, 

TSA ranked 232nd out of 241. Mr. Chairman, maybe we should 

hold hearings on the other nine some day to find out just how bad 

things can get. 

Chairman ISSA. What does it take to get to the very bottom. 

Mr. CONNOLLY. Exactly, what does it take. 

To what do you attribute such incredible turnover because one 

looks at working conditions, one looks at management, one looks at 

compensation. Part two of my question is, and I would like Mr. 

Lord to comment on this as well, we can’t, especially in light of the 

recent announcement of yet another permutation on a terrorist attempt to take on an airplane, we know we can’t simply rely on 

technology. We need trained eyes and trained minds to recognize 

something looks funny and true judgment needs to be exercised in 

order to protect the public on occasion. 

I am deeply concerned, as I know you must be, that given the 

turnover and the low morale, that has to impinge on that key set 

of skills we need deployed on behalf of American security. 

Mr. NICHOLSON. Sir, I can give you a couple of comments on that 

with respect to our transportation security officer workforce. I don’t 

have the exact numbers but I seem to recall it is somewhere above 

60 percent of our people have served over 5 years in the agency, 

so we have good retention of a core group of people. 

The attrition rate that we have today I think is about 7 percent, 

so there is marked change in attrition over the years. The surveys 

do show some of the things that you mentioned with respect to 

46 

where TSOS started but we do know the year before TSA stood up, 

the industry was recording over 100 percent turnover so they hired 

essentially two people for the same job every year, so we have 

made significant progress in that. 

We do get overwhelming positive responses in the nature of the 

work and dedicated to the mission. I think the focus of our people 

on the front line to your point are people focused on security and 

protecting the American public. I think the surveys have borne 

that out at least in the minds of our transportation security officers. 

Mr. CONNOLLY. Mr. Lord? 

Mr. LORD. I just want to point out we have ongoing work looking 

at DHS morale issues. I would argue that it is an issue that cuts 

across the entire department. I don’t have any unique insights offers today because our work is not completed, but in general, TSA 

has a difficult task. They are screening 1.7 million passengers per 

day. Some passengers are in a hurry, some are grumpy. It is a 

challenge in some cases. 

Mr. CONNOLLY. Conceding it is a challenge, Mr. Lord, but the 

question is, given relatively low morale by any measurement and 

historic high turnover, although improvements have been made, is 

there reason to believe, from your professional perspective, that 

that could impinge on the ability of the agency through its personnel to sort of stay attuned to the human factor as opposed to 

relying machines to catch it? 

Mr. LORD. I think you need a dedicated and alert workforce given 

the issues you are dealing with but again, I am not sure what the 

root causes are and we have a team looking at that. It is not being 

led by me, I should add. It is being led by another GAO executive. 

Mr. CONNOLLY. Thank you, Madam Chairman. 

Ms. BUERKLE. [Presiding] I thank the gentleman. 

The Chair now yields five minutes to Mr. Chaffetz from Utah. 

Mr. CHAFFETZ. Thank you. 

Mr. Nicholson, the current inventory TSA has is somewhere between $185 million and $200 million, is that correct? 

Mr. NICHOLSON. The inventory in the warehouse as of the March 31 was about $155 million. It has dropped as of the end of April. 

I don’t have the exact figure. 

Mr. CHAFFETZ. The inventory sheet that you gave the United 

States Congress, why did that not account for things that were in 

the disposal process? 

Mr. NICHOLSON. I am not sure, I haven’t seen the sheet, so I am 

not sure. 

Mr. CHAFFETZ. You are the CFO, you are having a hearing about 

this topic and you are telling me you haven’t seen the inventory 

sheet? 

Mr. NICHOLSON. No, sir. I don’t normally look at the inventory 

sheets for our warehouse on a month to month basis. 

Mr. CHAFFETZ. Who would look at that? You are the CFO of TSA 

and we are talking about hundreds of millions of dollars. You don’t 

look at that? 

Mr. NICHOLSON. The person who oversees the warehouse has the 

inventory sheet. I get a monthly printout as part of our financial 

statement. 

47 

Mr. CHAFFETZ. Maybe we are getting to the heart of the problem 

and with thousands administrators along the way, we would expect 

somebody at your level and certainly if we are having a hearing 

about this, we would expect the TSA to provide that type of person. 

Let me ask you another question. How many bomb sniffing dogs 

do you have in the inventory, in the warehouse, how many extra 

ones do you have? 

Mr. NICHOLSON. We have no canines in the warehouse, sir. 

Mr. CHAFFETZ. You have spent hundreds of millions of dollars on 

whole body imaging machines that cost about $175,000 apiece. 

Dogs, fully trained, are about $30,000. How many of these whole 

body imaging machines have you been requested to provide to either the White House, Iraq or Afghanistan? 

Mr. NICHOLSON. Sir, first I would like to say the amount of 

money we spend for technology for all of the AITs, including the 

200 that we just purchased about two weeks ago, is about $159 

million. 

Mr. CHAFFETZ. This most recent purchase was how many dollars? 

Mr. NICHOLSON. $30 million. 

Mr. CHAFFETZ. $30 million, and you still have some in inventory 

and we don’t know that they necessarily work. 

Let me ask you, if we were to take an improvised explosive device and strap it to your groin area and you didn’t want it to be 

detected, would you much rather walk by a bomb sniffing German 

Shepherd or through a whole body imaging machine? 

Mr. NICHOLSON. I would not want to walk past either, especially 

if the canine team was properly certified. 

Mr. CHAFFETZ. I find it fascinating that only the TSA seems enthralled with these machines. I go visit the White House, I have 

been to Iraq, I have been to Afghanistan and I have never seen a 

whole body imaging machine in some of the places we need the 

highest level of security but I do routinely see dogs, bomb sniffing 

dogs. When we have the State of the Union, arguably one of the 

most secure events this Nation has, they don’t bring in whole body 

imaging machines, they bring in dogs. 

What frustrates me about the TSA is that we know, based on 

what we have done at the Pentagon, when they stood up JIED, 

joint improvised explosive device, we put a General in charge of it, 

they spent $19 billion figuring out to find these improvised explosive devices and their conclusion was, the single best way to find 

a bomb is through a dog, a bomb sniffing dog. 

This TSA and this Administration continues to deny the opportunity to secure these airports to the fullest extent that they can 

by purchasing these machines that we have questions about whether or not they even work. The threat from terrorism is real. We are 

not messing around. People want to kill us and people are going 

to die if we continue to play games, put hundreds of millions of dollars in equipment in warehouses not to be used, we don’t even 

know what that inventory is, and we refuse to invest in dogs and 

canines that are mobile. They can detect things from everything 

from the parking lot right up to the gate and on the airplane themselves. 

48 

It is what the Israelis do, it is what the Pentagon does, it is what 

the White House does. It is what we do in the United States Congress. Yet, only the TSA decides that whole body imaging machines 

are better and then we stick hundreds of million dollars of them 

in the warehouse. People are going to die if we continue to make 

these asinine decisions. 

It is so frustrating to see what is happening and then to basically 

get a document that is totally inaccurate presented to the United 

States Congress to try to cover this up while we have thousands 

of administrators out there, we shouldn’t be investing in more administration and opening a new office so we can communicate better. Go get the dogs. That is how we are going to secure these airplanes and thwart these terrorists that want to try to kill us. 

I yield back. 

Ms. BUERKLE. I thank the gentleman. 

The Chair will not recognize the gentleman from Oregon, Mr. 

DeFazio. 

Mr. DEFAZIO. Thank you. 

I have just one question about the newly acquired, automated 

AIT. What are you doing about the false alarm problem? 

Mr. NICHOLSON. We are looking at the false alarm problem to 

make sure it fits within our standards. Right now it does fit within 

our standards. What we are concerned as we make the improvements to the technology. 

Mr. DEFAZIO. I wonder what that standard is. What percent of 

false alarms do you allow? I conducted a little experiment just for 

fun. I wore identical clothes through San Diego last Friday and Eugene, Oregon on Monday, absolutely identical, I took the underwear home and washed it, so nothing changed. 

I went through the remote operator body scanner in San Diego 

and since I know what not to wear, no problem, go right through. 

In Eugene, for the fourth week in a row, brand new technology, I 

have to get patted down, identical clothing. Then I stood there and 

watched and of the next 15 people who went through that machine, 

12 had to be patted down. Doesn’t that seem like a pretty high 

false alarm rate because they were all false alarms? 

Mr. NICHOLSON. Sir, I would have to check into that. I don’t 

know the exact answer to your question. 

Mr. DEFAZIO. Okay. I did talk to the regional administrator and 

he admits that they have a little problem with the software. There 

is new software being developed because it can’t deal with clothing. 

If you are wearing pants that are little heavier than normal, like 

jeans, alarm; wearing socks and pants, alarm because he has socks 

and pants on and wearing a collar, alarm. 

Because we are so uptight in this country that we couldn’t look 

at the fuzzy, black and white images of bodies and have something 

that perhaps is more effective and false alarms less, we have now 

gone to this dumb downed machine or hastily acquired machine 

which apparently, at least from my observations, false alarms a 

tremendous amount of the time. 

Basically, I believe if you get a lot of false alarms, after a while, 

it is like this thing false alarms all the time, then I think the 

screeners are going to lose their attentiveness to find a real threat. 

49 

Mr. NICHOLSON. I hope that your experience is not shared and 

I would be happy to take that up and look into it. 

Mr. DEFAZIO. I am told that it does have a problem and they are 

developing new software, but the question would be why did we deploy them and we are using them as standalones with this problem. My observation is you are actually requiring more personnel 

because you have so many false alarms as opposed to we are saving, we don’t have to have a remote operator anymore. It seems to 

me an acquisition problem. We should have had people wearing different thicknesses of clothing testing these things and had some 

sort of parameter on how many false alarms we should tolerate. 

On the inventory, there is the Advanced Technology AT2s, 472 

of them. Does every airport in America now have AT2s for carryon bags? 

Mr. NICHOLSON. No, sir, they don’t. I am not sure of the date of 

the inventory, I don’t have the report available. 

Mr. DEFAZIO. I am just looking at the report the Republicans 

provide, but if there were 472 sitting there, basically this is pretty 

much a simple replacement, doesn’t require much reconfiguration 

of the airport, they are a much better technology, have faster 

throughput and are more accurate. We really shouldn’t have 472 

of them sitting in inventory, should we? 

Mr. NICHOLSON. I think we have 157 in inventory and about 23 

of those are in our safety stocks. At least 23 will remain in inventory unless we have a problem. We have had a deployment plan we 

set out. The deployment plan called for us to continue to outfit the 

entire nation by the end of this fiscal year. We are about three 

months ahead of that plan and will deploy AIT by July of this year. 

Mr. DEFAZIO. Then on the EDSs, 54 according to this inventory, 

these would be baggage screening EDSs. Why would we have 54? 

Mr. NICHOLSON. It could be a variety of reasons. It could be because some are safety stock, a small number of those will be safety 

stock. Another reason is we are doing facilities modification at 

some airports to put in inline systems. That facilities work normally takes about a year depending upon the size of the project. 

We buy the stock to put in so that when the facilities work is 

ready, we can deploy the units and make the system complete. 

Mr. DEFAZIO. Right, but we have airports that don’t have any 

EDS, we have 54 in stock and we keep a large number in stock so 

that when someone finishes their inline system sometime in the 

next 12 months, we will have machines there to go. 

What happened to just in time delivery? Why couldn’t we just 

have the machines delivered to that airport when their new inline 

system is complete? 

Mr. NICHOLSON. That is what we try to do, sir. We use six regional managers and that is the job they try to serve to work with 

the airports to have those ready and available and sequence them 

in for the installation. It is the same approach we take for the 

checkpoint technology. 

Mr. DEFAZIO. Finally, when you go to an inline system and you 

have the standalone units, what do you do with those standalone 

units? 

Mr. NICHOLSON. The standalone units, depending upon what 

happens, you retire some of those. If you have standalone units and 

50 

they are replaced by the inline system, which is often the case, 

those get eliminated. 

Mr. DEFAZIO. Eliminated? What if you have airports that don’t 

have any EDS, why wouldn’t you take a still functioning machine 

and move it there? 

Mr. NICHOLSON. Yes, sir, that is exactly what we do. 

Mr. DEFAZIO. Thank you. 

Mr. LANKFORD. [Presiding] I yield five minutes to myself. 

Let me pick up on what Mr. DeFazio was just talking about, Mr. 

Nicholson. Just in time delivery, I know very few businesses in my 

district that don’t do just in time delivery and they will also order 

it, purchase it and then it is delivered from the factory. Are these 

pieces of equipment inspected and calibrated after they arrive at 

the airport? 

Mr. NICHOLSON. Yes, sir. There are a couple of things on that. 

Depending on the technology, there is a different inspection regime. 

For example, the EDS we were just talking about, the AT and AIT, 

there is normally an inspection that takes place at the factory before we go. It is called factory acceptance test and then we do a site 

acceptance test. 

Mr. LANKFORD. Are you also inspecting when it comes to the 

warehouse? 

Mr. NICHOLSON. When it comes back to the warehouse. 

Mr. LANKFORD. I am saying when it leaves the factory, it is inspected before it leaves the factory. When it gets to the warehouse, 

is it inspected again? 

Mr. NICHOLSON. No, not until the site acceptance. The manufacturer has the warranty on that. They pick it up for the site acceptance. 

Mr. LANKFORD. Is there a reason that it can’t be just delivered 

from the factory to the airport when it is ready, when it is time? 

Mr. NICHOLSON. In our earlier discussion on AIT, to make sure 

we have the record straight on AIT, the inventory level of the warehouse for AIT that we have I think is two right now. 

Mr. LANKFORD. We are talking about probably pieces of equipment, some that have been there six to nine months or a year and 

you are saying the airport is getting ready in the next year so you 

know when it is coming? 

Mr. NICHOLSON. Right. 

Mr. LANKFORD. Obviously there is a long lead up time, there is 

plenty of time to contact the manufacturer and say one of these 

nine months from now dropped and ready to go. You take the nine 

months preparing the airport and then it is delivered out? 

Mr. LANKFORD. Right. The other situation you will have with 

equipment that we buy for the airport is if you take a look at our 

explosive trace detection equipment, for example, we have 8,000 

units. Those are split between checked baggage resolution and 

carry-on baggage resolution. The life expectancy of those units or 

the service life, if you will, is about seven years. You are replacing 

almost 1,000 or more every year. 

Mr. LANKFORD. Is that seven years from the time it hits your 

warehouse or the time it hits the airport? 

51 

Mr. NICHOLSON. Seven years from the time it hits the airport. If 

we are going to buy those, we wouldn’t buy them in small lots. We 

usually buy them to get an economic quantity. 

Mr. LANKFORD. I understand. It is typical manufacturing procurement. You may buy it in multiple if it is part of your agreement and hold them at the factory. You know you are going to need 

18, they have them, they manufacture them, hold them there and 

ship them out just in time. That is a typical agreement. 

Mr. NICHOLSON. It depends upon how we structure our agreement with manufacturers. 

Mr. LANKFORD. Let me make a couple comments. I have met 

some great people who work for TSA. I have no criticism of some 

of the folks there but it is an incredibly chaotic environment that 

you walk through, yelling, lots of long lines and not long lines because of efficiency, it is yelling because somebody is yelling bag 

check over here and it takes four or five minutes for someone to 

wander over and check it. Then you have bag check over there multiple times and hollering back and forth and you see this frustrated 

group of passengers there. 

I also see policies that are implemented that even the TSA workers themselves don’t understand why they have to do this and it 

is especially frustrating to me when they interact with constituents, senior adult ladies with a knee replacement that are getting 

pat downs on that are absolutely humiliating to them in the process. 

I know we have had some discussion on what to do with children 

and now people over 75, but this humiliating process of going 

through the pat downs seems to be very unique to what is happening in our airports. Can we document a single moment that a 

putdown has discovered a threat? 

Mr. NICHOLSON. I think the answer to that is yes, sir. I don’t 

have the specifics. I know we find weapons sometimes through pat 

downs. We find several prohibited items that we find through pat 

downs. We find several items that are concealed on people that 

may or may not be the instrument of terrorism but they are the 

instrument of something that is illicit. 

Mr. LANKFORD. Not just find something, not just a bottle of 

shampoo or something. Mr. Lord, you look like you were leaning 

forward. Do you have a response to that as well? 

Mr. LORD. No, I don’t. I am sorry to suggest I did. 

Mr. NICHOLSON. For example, we found people with tens of credit 

cards and false IDs taped to their bodies. We find folks with tens 

of thousands of dollars taped to their body and attempted to be 

concealed on their body. We find weapons that are strapped to a 

body. 

Mr. LANKFORD. You are talking about in a patdown? 

Mr. NICHOLSON. Sometimes in a patdown or in resolution if it 

shows up as an anomaly during technology screening. 

Mr. LANKFORD. The issue comes back to what I mentioned before, the senior adult lady with a knee replacement that if they 

come to the Capital and it sets off the metal detector, we have a 

wand. If you come to the airport, she is going to get patted down 

and that is not a lot of fun for anyone. 

52 

I have had multiple times, Mr. DeFazio talked about it before, 

of being patted down as I go through security. But it is humiliating 

for a senior adult to go through that. I know people I have talked 

with who say they have just stopped flying. This is beyond just a 

safety issue, this is a commercial enterprise and free movement of 

people around the United States. 

There is a unique balance that has to be abided where some of 

this equipment helps us in that, as Mr. Chaffetz mentioned before 

dogs can help us with that, but in moments that we can get things 

out of the warehouse and into placement and go through a process 

where we are not having to humiliate people as they go through, 

we need to strive to achieve that. 

Mr. NICHOLSON. You said it very close to how our Administrator 

presents it. That is exactly what we are trying to do. We are trying 

to take a risk-based approach to this and modify our procedures 

and phase those in. 

Mr. LANKFORD. Obviously, I fly often as well and I watch the procedures changing consistently over time. There seems to be this 

constant experiment that is going. It is a constant sense of frustration that is also happening in the process as well. 

We are approaching a time for votes. It is getting very close to 

the time it is going to end. I would like to put us in recess for a 

moment until these votes conclude and call us back in session after 

that. 

With that, we will recess until after votes are concluded. 

[Recess.] 

Chairman ISSA. [Presiding] The Hearing will reconvene. 

Mr. CRAVAACK. Thank you, Mr. Chairman. 

I would like to thank you, Chairman Mica and Ranking Member 

Cummings for having what I consider a pretty important meeting 

and trying to have the most efficient government as possible. 

Mr. Edwards, it is good seeing you again, sir. 

I would like to thank all the witnesses for coming here today. I 

know it has been a tough day and I appreciate you coming. The 

bottom line is we are trying to get an efficient government as best 

we can. 

One of the things we are all concerned with is right now the national debt ticked up over $15.7 trillion today. It was $15.6 trillion 

for a couple weeks and it is rapidly increasing. We are just trying 

to bring down government costs and spending. 

One of the proposals I have actually submitted, and you can go 

to the website and take a look, but it addresses this issue and making sure some of the baggage screening devices we have had, we 

have over 600, I believe, and we have to get rid of them, move 

them on and hopefully get some kind of reimbursement out of it 

at the same time. 

Under my proposal, the Federal Government could save about 

$20 million in storage costs. That is pretty significant. Any proceeds in selling the excess equipment could be used in savings. We 

are trying on our part to make it as efficient as possible. 

In the investigations into some of the things we are trying to cut, 

the Committee investigators discovered that 85 percent of major 

transportation security equipment currently warehoused are stored 

for longer than six months and 35 percent of the equipment has 

53 

been stored for more than one year. One piece of equipment has 

been stored for more than six years and that is 60 percent of its 

total useful life. 

Mr. Nicholson, I know you have been involved in a lot of this but why is $184 million worth of screening equipment with an annual 

leasing cost of more than $3.5 million in the warehouse in Dallas? 

Can you tell us why that is? 

Mr. NICHOLSON. Yes, sir. The inventory varies a little bit as I 

mentioned. It sounds like that inventory might have been a January-February time frame, 155 and we are under 150 now, I think 

in inventory. From the perspective of 95 percent of the value of our 

security equipment is in the field and in the airports, at the same 

time I mentioned in my statement that 85 percent of the equipment is out in the airports and 15 at the warehouses. 

What that tells me when I look at my monthly reports that I get 

on the status of the inventory are that we do have our most expensive, which we generally think of as our most impacting technology, 

is operationally deployed. It still is a lot of material. The combined 

warehouses are a little over 400,000 square feet, so they are big 

warehouses but when you put it in the context of what percent of 

the total equipment value is in that warehouse, and consider that 

is our only transportation security equipment warehouse operation. 

I think that gives context to the operation. 

Mr. CRAVAACK. I am assuming that you do have a plan to dispose 

of this equipment? 

Mr. NICHOLSON. Yes, sir, we do. Our next disposal is scheduled 

for early June or late May. I think we are at about 1,000 pieces 

of equipment already and there will be more that will be coming 

up to that point. Each year as part of our financial audit, we have 

two wall to wall inventories, so we capture and reconcile all the inventory in that. 

In the past few years, because of several of the concerns the IG 

had as part of doing that, they would accompany and observe the 

inventory. One we did in the June timeframe, and one we did just 

before the close of the fiscal year, usually the last week in September, last two weeks in September. 

Because of the progress that we have made in reconciling, identifying, coding, addressing all those things that are found wrong, this 

year TSA will do its June inventory by itself and we will be joined 

in the September timeframe by the IG for the final inventory. That 

is largely the result of last year when we did the sample size for 

the value of the inventory at the time, we had 100 percent success 

in identifying every piece of equipment, its condition code and 

where it was in the warehouse. 

Mr. CRAVAACK. I have 14 seconds left, so with that, I will yield 

back. 

Chairman ISSA. Thank you. 

I guess I will recognize myself for a second round. I apologize 

that voting tends to have this effect. 

Mr. Nicholson, what do you say to the fact that you buy more 

pieces of equipment than you have identified locations for? In other 

words, you make purchases of equipment, commitments to purchase and take delivery prior to figuring out what airports they 

would or could go for and when asked, the answer we got was it 

54 

was a good buy, we made a larger buy because we get a better 

price. Is that a sound way to do planning? 

Mr. NICHOLSON. I think it depends upon the piece of equipment 

as far as the specific location. I say that because each year as part 

of the appropriations process we provide a list of all the projects 

we are going to do and all the equipment. Before we execute any 

of the monies or purchases on that equipment, we have to identify 

numbers units and the projects they would go to. 

Chairman ISSA. Let me follow up then. If I hear you right, what 

you are saying is the appropriations process drives bad purchasing 

systems because you buy based on what you can justify in appropriations, more or less? 

Mr. NICHOLSON. No, sir, that is not so. 

Chairman ISSA. Why did the appropriations process work there 

at all? 

Mr. NICHOLSON. I think the appropriations process has worked 

in that case. 

Chairman ISSA. But you bought more than you identified a use 

for, you bought more than you needed and in some cases, the stuff 

never actually went to the field before it became obsolete, so what 

caused that to happen? 

Mr. NICHOLSON. I think in some cases, there were advancements 

in some technology. In the question that I previously answered, we 

would get to things like explosive trace detection equipment. There 

are several thousand pieces of that equipment that serve our baggage screening process as well as the passenger carry-on baggage 

process. 

We don’t always know the exact locations and we won’t buy with 

a specific location for each piece of equipment, but we do have a 

forecast of when the service life of that equipment would reach its 

completion, so we would buy a quantity for that and later determine which airport gets those specific pieces of equipment. 

Chairman ISSA. Mr. Edwards, when you did your investigation, 

did you find these were reasonable assessments of excess volume 

or in fact in some cases, long after they arrived, even two years 

after they had not identified where they would go? 

Mr. EDWARDS. We started the audit mainly because the plant, 

property and equipment, material weakness was reported in the 

2008 financial statement. We looked back at 2010 and 2011 and 

those material weaknesses still existed. First, you need to have a 

transition plan and you have a procedural policy. You have to have 

that and then you go back and see if it is actually working. 

For new equipment, you need to have a strategy and a deployment plan for that and then for redeployment, if you are taking 

some from an airport can that be used at a smaller airport and how 

often you are going to review that. There should be a limit on how 

long something stays in storage. Those things need to be taken into 

consideration. 

Chairman ISSA. I appreciate that. 

Mr. Lord, you haven’t been asked nearly enough questions and 

this one may be a little bit outside of your preparation. Because we 

know we count on the GAO to get answers for questions that somebody on a panel doesn’t yet have, as we reviewed in preparation 

for today’s hearing, we discovered kind of an anomaly. 

55 

Some of the money, of course, for TSA comes from regular appropriations, some comes from fees. When they purchase excess equipment and then dispose of it, but dispose of it in many cases to 

other ‘‘agencies,’’ are we leaving if you will a back door of excess 

purchases that are slightly out of date, new technologies when they 

end up not being destroyed because they are ‘‘out of service,’’ but 

rather, passed on to other governments, do we create essentially a 

back door appropriation if some of that money comes from user 

fees? By the way, are we wasting user fees by allowing excess purchasing? 

Mr. LORD. That is a very difficult question that I am not prepared to answer. 

Chairman ISSA. That is why we give them to GAO. 

Mr. LORD. If I understand your question correctly, you are asking 

whether that poses any anti-deficiency act issue where you are 

spending in excess of your appropriation. I would have to look at 

that. It is clear they are disposing of equipment and perhaps receiving revenue, so the question becomes is that consistent with 

relevant appropriation law. I am not prepared to answer that today 

but it is a great question. 

Chairman ISSA. Mr. Edwards, we recently had a Cabinet officer 

who gave a grade to himself in this Committee, so I will ask not 

the individual but you as the most direct overseer, if you had to 

give for logistics management and control TSA a grade 2008 and 

today, what grades would you give them for each of those reporting 

periods? 

Mr. EDWARDS. TSA has made some improvements, but there is 

still a lot of work left. 

Chairman ISSA. D to a C minus? 

Mr. EDWARDS. Somewhere in that range. 

Chairman ISSA. I want to thank you for your patience here today. 

Mr. Edwards, I will tell you that our staff does intend to follow up 

with the details of their visit, time lines and at least a synopsis of 

what employees at the plant told them that led us to believe that 

in fact it was not an ordinary disposal, that people were brought 

in early specifically to get it out and that our people were delayed 

so that the number on the previously given inventory would come 

much closer to the number that was going to be present but certainly not the number at the time they had. We would appreciate 

your following up to get the facts because we want to be accurate. 

Mr. EDWARDS. Yes, sir, absolutely. As soon as I get the information. 

Chairman ISSA. If you want a second round, go ahead. The gentleman is recognized. 

Mr. CRAVAACK. Mr. Lord, I was going to ask you in regard to 

some of the history like the puffers that didn’t work. What can we 

do to make sure that we don’t have that type of problem again in 

regard to their redesign? Some of the equipment that we have now, 

making sure it does what we need it to do, things like that. Could 

you elaborate on that? 

Mr. LORD. These are some of the same issues I discussed in my 

written statement. I think it is really important to clearly define 

your requirements up front, what you actually need and not only 

get agreement within the component but at the higher level within 

56 

the department and the acquisition group that is responsible for 

overseeing everything. 

Even though DHS has done a good job in updating the requirements and issuing new rules, you also want DHS to be aggressive 

in conducting oversight and making sure people follow the rules so 

to speak. At the department level, you need that to occur. 

At the component level, as some of the examples suggest in my 

testimony today, you need the components, TSA, other groups within the department to provide timely information to the people trying to conduct oversight. Since there has been a breakdown in the 

process, you need good flows of information up, you need good flows 

down, you need clear roles, you need someone responsible for conducting oversight and enforcing the rules. 

It is a very complicated process. That is probably the simplest 

way I could explain it. 

Mr. CRAVAACK. Complicated but important, making sure we efficiently use the taxpayer dollars which I know you are vigilant of. 

Has the TSA developed a plan for identifying how to approach 

the upgrades from currently deployed explosive detection systems? 

Mr. LORD. For the EDS, that was a recommendation we made in 

our July 2011 report. We were concerned about that. They not only 

have this large fleet of machines on the floor, so to speak, but they 

are buying new machines. We didn’t see a clear plan for ensuring 

not only the new stuff but the old machines were going to be capable of meeting the new requirements. 

During the process, they also enhanced their explosive detection 

requirements which poses a very complex problem but we think 

they need to conduct better planning to ensure they will meet those 

requirements. 

Mr. CRAVAACK. The TSA does have a plan? 

Mr. LORD. We are currently conducting follow up on that report. 

They agreed with our recommendation, they are moving out smartly to develop such a plan, but we haven’t signed off on it yet. 

Mr. CRAVAACK. Thank you very much. I appreciate the information today. 

I yield back. Thank you. 

Chairman ISSA. I thank the gentleman. 

I want to thank all of you for your attendance and participation 

today. 

We stand adjourned. 

[Whereupon, at 3:06 p.m., the committees were adjourned.] 

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