DEPARTMENT OF HOMELAND SECURITY 

Office of Inspector General 

Effectiveness of the Federal Trucking 

Industry Security Grant Program 

OIG-08-100 September 2008
 

Office of Inspector General 

U.S. Department of Homeland Security 

Washington, DC 20528 

 September 26, 2008 

Preface 

The Department of Homeland Security (DHS) Office of Inspector General (OIG) was 

established by the Homeland Security Act of 2002 (Public Law 107-296) by amendment 

to the Inspector General Act of 1978. This is one of a series of audit, inspection, and 

special reports prepared as part of our oversight responsibilities to promote economy, 

efficiency, and effectiveness within the department. 

This report addresses the performance, efficiency, and effectiveness of the Federal 

Trucking Industry Security Grant Program, and the need for the program. It makes 

recommendations regarding the future of the program, including options to improve its 

effectiveness and utility and that of motor carrier security. It is based on interviews with 

employees and officials of relevant agencies and institutions, direct observations, and a 

review of applicable documents. 

The recommendations herein have been developed to the best knowledge available to our 

office, and have been discussed in draft with those responsible for implementation. It is 

our hope that this report will result in more effective, efficient, and economical 

operations. We express our appreciation to all of those who contributed to the 

preparation of this report. 

Richard L. Skinner 

Inspector General 
Table of Contents/Abbreviations 

Executive Summary.............................................................................................................1
 

Background..........................................................................................................................2 

Results of Review ................................................................................................................7 

DHS Needs to Re-evaluate the Program’s Enrollment Strategy ......................................8 

Recommendations...........................................................................................................14 

Management Comments and OIG Analysis ...................................................................15 

The Efficiency of ATA’s Program is Difficult to Evaluate............................................15 

Recommendations...........................................................................................................21 

Management Comments and OIG Analysis ...................................................................21 

DHS Can Make the Program More Effective .................................................................22 

Recommendations...........................................................................................................27 

Management Comments and OIG Analysis ...................................................................27 

Recommendations Regarding the Future of the Program and Motor Carrier Security ..28 

Figures 

Figure 1: Highway Watch® Enrollment...........................................................................4 

Figure 2: ATA Industry Advertisement.........................................................................10 

Figure 3: Post-Training Participation Decline Over Time.............................................11 

Figure 4: TSA Funding and Program Oversight............................................................13 

Figure 5: Highway Watch Call Center Safety and Security Incident Reports...............24 

Appendices 

Appendix A: Purpose, Scope, and Methodology..........................................................30 

Appendix B: Management Comments to the Draft Report..........................................33 

Appendix C: Synopsis of Report I Review ..................................................................37
 

Appendix D: Highway Watch Enrollment By Industry Sector ....................................39 

Appendix E: Highway Watch Budget Authorized and Spent......................................40 

Appendix F: Highway Watch Participation By State ..................................................42 

Appendix G: Post-Training Decline in Participation ...................................................43 

Appendix H: Major Contributors to this Report...........................................................44 

Appendix I: Report Distribution .................................................................................45 
 

Table of Contents/Abbreviations 

Abbreviations 

ATA American Trucking Associations 

DHS Department of Homeland Security 

DOT Department of Transportation 

FEMA Federal Emergency Management Agency 

FY Fiscal Year 

G&T Office of Grants and Training 

Highway ISAC Highway Information Sharing and Analysis Center 

ODP Office of Domestic Preparedness 

OIG Office of Inspector General 

SLGCP State and Local Government Coordination and Preparedness 

TSA Transportation Security Administration 

TSNM Transportation Sector Network Management 

TSOC Transportation Security Operations Center 
 

OIG 

Department of Homeland Security 

Office of Inspector General 

Executive Summary 

The Department of Homeland Security administers the Federal 

Trucking Industry Security Grant Program. The intent of the 

program is to enhance homeland security through increased 

vigilance and awareness on highways. As mandated by Congress, 

since FY 2004, the Highway Watch® program trains segments of 

the Nation’s surface transportation community in how to detect 

and report security threats on highways, how to avoid becoming a 

target for terrorist activity, and how to recognize potential highway 

safety hazards. The program emerged from an earlier effort by the 

Department of Transportation which focused on highway safety 

issues. 

This is the second part of a review required by the Implementing 

Recommendations of the 9/11 Commission Act of 2007 (Public 

Law 110-53). This report addresses the performance, efficiency 

and effectiveness of the program and evaluates the need for the 

program. 

Although the American Trucking Associations reached enrollment 

targets of more than 800,000 members, security incident reporting 

has remained steady at less than 200 calls a month. Furthermore, 

the American Trucking Associations incurred costs to acquire the 

assistance of state trucking associations that were not well 

documented. Therefore, we cannot say definitively whether the 

benefits achieved so far have been worth the costs. DHS’ 

inconsistent oversight has also hindered the program. 

However, we support the department’s plans to continue this 

program. Industry experts and representatives maintain that the 

program is needed. We are making six recommendations to help 

DHS be more accountable; develop a sound trucking security 

strategy; spend funds wisely and in a transparent manner; improve 

internal coordination, communication, and administration of the 

grant; and demonstrate effectiveness to become a more viable 

program. TSA and FEMA have concurred with these 

recommendations. 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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Background 

This is the second part of a review required by the Implementing 

Recommendations of the 9/11 Commission Act of 2007 (Public 

Law 110-53). Pursuant to the Act, we analyzed the performance, 

efficiency, and effectiveness of the Federal Trucking Industry 

Security Grant Program, and evaluated the need for the program. 

We also made recommendations regarding the program’s future, 

options to improve its effectiveness and utility, and motor carrier 

security.1 The first report, entitled Administration of the Federal 

Trucking Industry Security Grant Program for FY 2004 and 

FY 2005, was published in October 2007.2 That report addressed 

the grant process and summarized expenditures. 

The Nation’s highway infrastructure includes nearly 4 million 

miles of public roads, 600,000 bridges, and more than 1,050 

highway-related and transit tunnels. In 1998, the American 

Trucking Associations (ATA) established the Highway Watch® 

program to take advantage of the experience and commitment of 

transportation workers to safeguard America’s roadways and 

communities. With funding from the Department of 

Transportation (DOT), Highway Watch® recruited and trained 

transportation workers to recognize and report hazardous 

conditions, vehicle crashes, criminal activity, and other incidents. 

DOT provided the funds to ATA through a cooperative agreement 

to allow for substantial involvement by both the government and 

the recipient.3 

The Highway Watch® Cooperative Agreement 

In August 2003, the Transportation Security Administration (TSA) 

entered into its first agreement with ATA to incorporate security 

issues and expand the program. In this report, we refer to the 

recipient of the cooperative agreements as ATA, and refer to the 

program as Highway Watch®. Because the term Highway Watch® 

was trademarked by ATA and congressional grant authorization 

language referred specifically to the Highway Watch® program 

between 2004 and 2007, TSA awarded ATA $63 million for the 

program. The Consolidated Appropriations Act, 2008 

appropriated an additional $16 million for the Trucking Industry 

Security Grant Program in FY 2008.4 The appropriation language 

1 P. L. 110-53, § 1542 (b) (1–2). 

2 Administration of the Federal Trucking Industry Security Grant Program for FY 2004 and FY 2005, 

(OIG-08-08) 

3 31 U.S.C. § 6305. 

4 P.L. 110-161, Title III, State And Local Programs, 121 STAT. 2062.
 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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did not refer to the trademarked term Highway Watch®, and stated 

that the funding was to be “competitively awarded.”5 Therefore, 

DHS opened the FY 2008 grant program for competitive bid. 

Applicants submitted bids for the FY 2008 grant cycle in March 

2008. DHS did not award the 2008 grant to ATA. The new 

grantee will have a yearly budget of about $5 million. 

Each year, the cooperative agreement between DHS and ATA has 

covered essentially the same four priorities: 1) participant 

identification and recruitment; 2) training; 3) communications; and 

4) information analysis and distribution. Within these priorities the 

cooperative agreement was modified slightly in three areas: 1) in 

2004, after the grant was awarded, the scope of training was 

expanded to include a subcontract with Mississippi State 

University to conduct emergency planning exercises; 2) DHS 

dropped requirements that ATA develop individualized training 

programs for the highway and motor carrier sector professionals, 

and instead enabled other industry sectors to develop training; and 

3) after the 2007 grant was awarded, the scope of information 

analysis and distribution was expanded to include another 

subcontract with Mississippi State University to research the 

trucking industry. 

The Highway Watch® Program 

The four priorities outlined in the cooperative agreements are 

discussed below. In FY 2008, DHS introduced a fifth priority. It 

is a government-wide requirement to develop plans based on 

identified high-risk scenarios and the conduct of a risk assessment 

or hazard analysis. A discussion of each priority follows. 

Participant Identification and Recruitment (Outreach) 

The Highway Watch® outreach program aims to identify and 

recruit surface transportation professionals as volunteers 

nationwide to improve highway and motor carrier safety and 

security. There are approximately 5 million active highway 

professionals. There are an estimated 12 million commercial 

driver’s license holders, 3 million of whom are active drivers. In 

addition, there are several million industry professionals, including 

school bus and motor coach drivers, law enforcement personnel, 

first responders, state and local highway workers, and toll booth 

operators. 

5 P.L. 110-161, Title III, State and Local Programs, Explanatory Statement, page 1081. 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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ATA relied on those entities it represents, namely state trucking 

associations, for outreach at the state level; while it managed 

advertising, industry outreach, and trade show participation at the 

national level. In 2006, ATA also began working with school bus 

associations to recruit their members. The initial cooperative 

agreement between DHS and ATA set a target of 400,000 

Highway Watch® participants. ATA did not meet the goal until 

mid-2006. Today, there are more than 800,000 Highway Watch® 

participants. Appendix D shows the professions and industry 

segments of Highway Watch® members, about half of whom are 

truck and passenger bus drivers. Once ATA reached the initial 

membership goal of 400,000, cooperative agreements specified 

new membership targets of about 100,000 additional members 

each year. Figure 1 shows Highway Watch® enrollment from 2004 

to 2007. 

Figure 1: Highway Watch Enrollment 

Source: Highway Watch® Database 

Between FY 2003 and FY 2007, DHS authorized $25.7 million in 

outreach expenses (see Appendix E). Actual expenditures for 

outreach were $14.9 million, with reimbursement to state trucking 

associations and later to school bus associations accounting for 

$9.4 million. Remaining expenditures included the development 

of a Highway Watch® website, staffing, outreach and travel 

expenses. Within the terms of the cooperative agreements, ATA 

could spend more, or less, than authorized on program activities. 

In addition, ATA’s record of actual expenditures shifts some items 

between the four program areas (see Appendix E). 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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Training 

Initial cooperative agreements stated ATA would develop training 

for most industry sectors, including law enforcement officers, but 

DHS later rescinded these requirements. Highway Watch® offers a 

basic one-hour domain awareness training session to acquaint 

surface transportation professionals with how to identify and report 

safety hazards and suspicious security incidents. ATA later 

modified the the basic one-hour session to address the unique 

needs of the school bus sector, and developed an accelerated 

program for targeted audiences, such as mass transit officers. 

ATA worked with a security consulting firm to develop its initial 

training. The training is offered through various methods. These 

include in-person training led by security experts, in-person 

training led by company safety and security officers who have 

attended a train-the-trainer session, and training in which a 

facilitator shows the Highway Watch® training video and answer 

questions. Training is also accomplished through the distribution 

of a DVD, video or audio cassette, as well as online. 

DHS authorized $12.1 million in training expenses between 

FY 2003 and FY 2007. Actual expenditures for training were 

$13.9 million, with reimbursements to state trucking associations 

and school bus associations accounting for $5 million. Actual 

expenditures exceeded authorized expenditures because ATA 

recharacterized expenditures to state trucking associations as 

divided between outreach and training. Expenditures for 

consulting services accounting for $7.3 million, including a solesource contract for $1.7 million with Mississippi State University 

(MSU) for security exercises, mobilization planning, emergency 

preparedness education, and technology research (see 

Appendix E). 

Communications 

Communications are facilitated by a continuously operating 

communications call center capable of directing non-emergency 

participant incident reports of safety issues to local authorities and 

reports of potential security issues to headquarters Highway 

Watch® staff. DHS initially authorized ten full-time employees to 

handle an anticipated call volume of 1 call per 100 Highway 

Watch® members per year. When that volume of calls did not 

materialize, the call center operators took over administrative tasks 

related to enrollment, such as providing training materials and 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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credentials to participants, answering information requests, and 

entering data on new enrollees. 

In mid-2006, Georgia enacted state legislation that required 

commercial drivers license holders to receive Highway Watch® 

training. Before the law was repealed 18 months later, more than 

100,000 new members enrolled, causing a significant increase in 

call center activity. In mid-2007, ATA and Senture, which 

operates the call center, renegotiated their contract to maintain four 

dedicated full time staff, four part-time, and others trained for 

surge capacity. 

Since 2004, the call center has received or initiated more than 

100,000 calls. These calls relate to membership and technical 

assistance with the Highway Watch® website and online training, 

safety and security incident reports, and followups from incident 

reports. DHS authorized $11.6 million in communications 

expenses between FY 2003 and FY 2007. Actual expenditures 

were $14.1 million, with call center costs accounting for 

$9.9 million, and website and database development accounting for 

$2.8 million. Actual expenditures exceeded authorized 

expenditures because ATA recharacterized most website 

development expenditures as communication, rather than outreach, 

expenditures. 

Information Sharing and Analysis 

The program’s last component is information sharing and analysis. 

The cooperative agreement required ATA to create a Highway 

Information Sharing and Analysis Center (ISAC) dedicated 

exclusively to highway and highway-transport-related security 

needs and issues. The Highway ISAC is unique among the sectorspecific ISACs because it is co-located with TSA’s Transportation 

Security Operations Center (TSOC). The TSOC has a 

communication and coordination function for all transportation 

sectors, serving as the point of contact for government and industry 

security concerns related to rail, trucking, mass transit, maritime, 

pipeline, highway, and aviation. 

Grant funding covers the salaries of the ISAC’s director and two 

ISAC officers, while ATA funds additional staff. At present, the 

director and three analysts work at the ISAC and all possess 

intelligence backgrounds. The ISAC’s primary responsibility is to 

investigate security incident reports that are forwarded by the call 

center. If reports are sufficiently credible and actionable, the ISAC 

forwards them to the TSOC, and to state intelligence and law 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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enforcement information analysis and coordination centers known 

as state fusion centers. The ISAC also distributes alerts and 

lookouts concerning highway and motor carrier security to relevant 

industry and law enforcement sources. In addition, the ISAC’s 

activities include information analysis, responding to information 

requests from state and local law enforcement officers, and 

coordination with other sector-specific ISACs. 

DHS authorized $2.9 million in ISAC expenses between FY 2003 

and FY 2007. Actual expenditures were $1.9 million, with staffing 

accounting for almost $1 million, and subscriptions, information 

management software, and consultants accounting for about 

$0.5 million. 

Planning 

For the 2008 grant cycle, DHS added a fifth requirement to the 

Trucking Industry Security Grant Program that the grant recipient 

develop plans based on identified high-risk scenarios, such as the 

hijacking of a truck or management of incidents involving 

hazardous materials. The grant recipient was also required to 

conduct a risk assessment or hazard analysis for the trucking and 

motor carrier industry. These planning requirements were 

introduced to all DHS security grants to state, local, and industry 

applicants. 

Results of Review 

The Implementing Recommendations of the 9/11 Commission Act 

of 2007 requires the OIG to examine the performance, efficiency, 

and effectiveness of the Federal Trucking Industry Security Grant 

Program and to report its findings to Congress. As required by 

Congress, we assessed the need for the program, and made 

recommendations to improve the effectiveness and utility of the 

program and motor carrier security. 

As a result of frequent shifts in fiscal and programmatic oversight 

among various components, DHS did not evaluate its continued 

use of enrollment as its primary performance measure for the 

Highway Watch® program. ATA met enrollment targets through 

multi-million dollar reimbursements to state trucking associations, 

and sole source subcontracts, and did so at the expense of 

developing cooperative relationships with other highway and 

motor carrier industry organizations. Although there are now more 

than 800,000 Highway Watch® members, active participation in 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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the program has been low, averaging about four to five security 

incident reports a day. 

Increasing awareness on the Nation’s highways through the active 

participation of surface transportation professionals has merit 

given the size and mobility of the trucking industry. However, 

DHS needs to look for ways to improve the effectiveness of the 

program. Congress’ decision to open the Trucking Industry 

Security Grant Program to competitive bidding in FY 2008, 

coupled with more stable DHS oversight, should benefit the 

program. 

DHS Needs to Re-evaluate the Program’s Enrollment Strategy 

The Trucking Industry Security Grant Program’s enrollment 

strategy has had far-reaching implications for Highway Watch®, 

because it led to more than $30 million in expenditures related to 

outreach, recruitment and training efforts, but did not encourage 

industry-wide participation, or the development of more or better 

quality incident reporting. Initially, DHS wanted the program to 

involve all highway and motor carrier industry stakeholders and to 

provide appropriate sector-specific training. ATA did not 

implement that plan. Instead, ATA relied primarily on its state 

trucking associations to recruit, train, and enroll members. Its 

training program, while high quality, addresses only basic 

awareness and reporting issues. 

This strategy left many industry organizations, which had the 

capacity to recruit their members or develop more specialized 

training, antagonistic or indifferent toward the program. 

Furthermore, ATA’s enrollment strategy distracted it from 

fostering active participation or communication among Highway 

Watch® members. ATA questioned the use of enrollment as a 

performance measure, but DHS, through the terms of the 

cooperative agreement, continues to use it. 

DHS has enforced extensive reporting requirements for 

expenditures, but has not carried out comparable programmatic 

oversight. Although member incident reports are a key indicator 

of Highway Watch’s® effectiveness, neither ATA nor TSA 

adequately monitors Highway ISAC resolution of call center 

referrals or the volume or quality of security incident reports. DHS 

has spent $63 million on Highway Watch®, but has not evaluated 

the program’s effectiveness or efficiency. 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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ATA’s Enrollment Strategy Left Potential Partners 

Antagonistic Toward the Program and Affected Enrollment 

In the formative years of Highway Watch®, ATA could have 

developed more cooperative coalitions or subcontracts with 

highway and motor carrier industry organizations to establish a 

broad membership base. We interviewed representatives of school 

bus associations, state and local law enforcement and highway 

industry officers, union drivers, passenger bus companies, and 

independent owner operators. With the exception of school bus 

associations, ATA did not collaborate with or offer reimbursement 

to industry organizations to recruit, train, and enroll their members 

into Highway Watch®. Not only did this leave many potential 

Highway Watch® partners antagonistic or indifferent toward the 

program, it also affected enrollment, as these associations have a 

combined membership of more than 1 million. 

The original cooperative agreement was intended to increase 

participant numbers and include all segments of the commercial 

motor carrier and transportation community, and create specialized 

training for individual driver and first responder and law 

enforcement communities. Support for this initial strategy varied 

among DHS components, and ultimately DHS did not hold ATA to 

the terms of the agreement. Thus, ATA continued to channel most 

funding for recruitment to state trucking associations. 

According to the Highway Watch® database, of its 822,962 

members, 676,851, or 82%, were recruited through a state trucking 

association, for which the association received compensation. 

Beginning in 2006, ATA also paid school bus associations to 

recruit members. In total, ATA reimbursed its state trucking 

associations $14.5 million for outreach and training, and 

reimbursed school bus associations $229,000 for outreach and 

training. State trucking associations persuaded some large 

companies to institute a 100% training policy to enroll as many 

drivers as possible. Some state trucking associations signed 

exclusive agreements with companies headquartered in their state 

which ensured they would receive compensation even when 

another state trucking association recruited and trained drivers 

from that company. 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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Figure 2: ATA Industry Advertisement 

Source: ATA 

ATA’s strategy did not foster active participation among Highway 

Watch® members. Among large trucking companies, driver 

turnover may reach 100% a year, meaning that many drivers will 

change employer more than once a year. With high turnover, 

companies were training drivers without the expectation of a longterm commitment to the program. While state trucking 

associations obtained a mailing address to ensure that members 

receive their membership certificate and wallet card, members 

provided a contact telephone number or email address on a 

voluntary basis. Of the 822,962 members, 231,016 (28%) 

provided neither a telephone number nor an email address, 571,323 

provided only a telephone number, and 336,574 provided an email 

address. Members do not receive alerts or updates after they join 

the program, and the website is not routinely updated. Because the 

program did not achieve its FY 2004 membership target of 

400,000 until mid-2006, the limited engagement of those enrolled 

may not have become apparent until several years into the program 

(see Appendix G). 

The effects of involuntary membership are perhaps best illustrated 

by Georgia’s experience. From mid-2006 to January 1, 2008, 

Georgia required mandatory enrollment in Highway Watch® as a 

condition for obtaining a state commercial driver’s license. 

Georgia Highway Watch® members make up about one-fourth of 

the Highway Watch® program’s national enrollment. The number 

of safety and security incidents reported by Georgia members since 

2004 was 645, the highest in the program. However, the 

percentage of enrolled Georgia drivers who called in a safety or 

security incident was among the five lowest participation rates in 

the country (see Appendix F). The number of enrolled drivers may 

not accurately illustrate Highway Watch® members’ commitment 

toward the program. 

Comparing the dates when members are trained and enroll to when 

they make incident calls indicates that participation drops off over 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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time. As shown in Figure 3, members made about 500 incident 

reports within a month after completing training, and an additional 

900 incident reports within four months after receiving training. 

After four months from the date members were trained, the number 

who made incident reports fell each month. More than one-half of 

the members who did make incident reports made them in their 

first year after they received training. 

Figure 3: Post-Training Participation Decline Over Time 

Source: Highway Watch Database 

As shown in Appendix G, this pattern is consistent regardless of 

when Highway Watch® members enrolled and whether they made 

one or multiple incident reports. This pattern may be skewed 

because participants receive a new card and new enrollment date if 

they report a card lost or stolen, and because drivers who transfer 

from one participating employer to another may receive additional 

training. Emphasizing enrollment benefits the program more in the 

short term than in the long term. The cooperative agreement has 

not required refresher training or ongoing outreach, because 

performance was measured by the number of new enrollments 

rather than participation by existing members. 

DHS Needs to Increase its Involvement 

DHS did not hold ATA to the original terms of the agreement 

largely because programmatic responsibility shifted between its 

components several times during the initial years of the program. 

Inconsistent responsibility for programmatic and fiduciary 

oversight hampered DHS’ ability to identify and address 

weaknesses in the program. In certain instances, DHS staff 

identified flaws in the program but under the terms of the 

cooperative agreement lacked authority to address them. Some 

DHS staff believed their limited authority led to unnecessary costs 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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and poor prioritization of resources. Although DHS grant staff 

implemented extensive reporting requirements, they asserted they 

did not have the authority to implement spending controls. In 

addition, program managers saw the program as a congressional 

earmark and were less likely to question costs. 

Each DHS agency in charge of dispersing Highway Watch® funds 

required ATA to provide budget worksheets and justifications, 

monthly and quarterly technical reports, financial status reports, 

independent audits, and evidence of general and administrative 

expenditures. There were also reporting requirements for training 

and recruitment activities, and monthly reports on the activities of 

the state trucking associations, the call center and the Highway 

ISAC. DHS delayed approval of the first Mississippi State 

University subcontract until MSU described in detail what it 

intended to deliver. DHS also required ATA to submit draft 

publications and training and outreach materials for approval, to 

monitor quality. 

Although individuals within DHS components have made a 

concerted effort to coordinate and meet regularly to discuss the 

program, organizational restructuring and shifts in responsibility 

have limited their effectiveness. TSA maintained responsibility for 

the program when it transferred from DOT to DHS, and provided a 

small non-competitive grant to keep the program operating. 

Congress authorized $19 million for Highway Watch® in 2003, but 

DHS did not award the funds until March 2004. In May 2004, 

DHS shifted program responsibility from TSA to the then Office of 

State and Local Government Coordination and Preparedness 

(SLGCP), but TSA retained fiduciary responsibility. SLGCP’s 

Office of Domestic Preparedness (ODP) managed the FY 2004 

grant for $21.7 million and the FY 2005 grant for $4.8 million. 

TSA maintained fiduciary responsibility in FY 2004, but 

transferred that responsibility to SLGCP for FY 2005. 

In October 2005, SLGCP’s ODP was transferred to the 

Preparedness Directorate, and the Office of Grants and Training 

(G&T) assumed fiduciary and program oversight for the FY 2006 

grant award for $4.8 million and the FY 2007 grant award for 

$11.6 million. Finally, in March 2007, DHS transferred G&T 

operations to the Federal Emergency Management Agency’s 

(FEMA’s) Capabilities Division. FEMA assumed fiduciary 

responsibility, while TSA resumed its program oversight role. 

Currently, within TSA, the Transportation Sector Network 

Management (TSNM) Highway and Motor Carrier Division 

provides subject matter expertise. TSNM Integration developed 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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and posted the grant application. A panel of TSA TSNM and 

FEMA officials evaluated the FY 2008 grant proposals. 

Figure 4: Funding and Program Oversight 

Fiscal Year 

Grant Award 

Grant 

Administration 

Program 

Oversight 

Award 

2003 TSA SLGCP $19,300,000 

2004 TSA SLGCP $21,780,000 

2005 SLGCP SLGCP $4,828,569 

2006 G&T G&T $4,801,500 

2007 G&T G&T $11,640,000 

2008 FEMA TSA TSNM $15,544,000 

Source: DHS Grant Documentation 

In several instances, one DHS component approved funding 

requests when another component had concerns about initiating or 

continuing the program. For example, TSA officials said that they 

had tolerated what they considered excessive spending and skewed 

priorities in the first year of the cooperative agreement, but 

intended to renegotiate terms in the second year. However, 

responsibility for the program was shifted from TSA to SLGCP. 

SLGCP extended the terms of the first year agreement for another 

year. In 2007, FEMA officials had concerns about the second sole 

source subcontract with MSU, in part because they wanted to 

ensure that sufficient funds were available to operate the call center 

and the Highway ISAC. FEMA officials said that while they could 

verify that ATA was spending money for the purpose allocated, 

they did not have enough authority under the terms of the 

cooperative agreement to ensure that the work was accomplished 

efficiently. FEMA could not require competitive bidding on 

subcontracts or use of a survey to determine whether costs of a 

sole-source subcontract were within industry standards. TSA 

TSNM Highway and Motor Carrier Division officials said their 

TSNM Integration unit did not consult them before publishing the 

2008 grant. The terms of the FY 2008 grant were almost identical 

to the FY 2007. 

DHS Should Clarify its Expectations of the Highway ISAC 

The Highway ISAC is complying with reporting requirements, 

including lists of its published alerts and lookouts, and its outreach 

efforts. However, processes related to security incident reports are 

not as well documented. Although there is a consensus that the 

Highway ISAC is a valuable resource, TSA officials responsible 

for motor carrier security, TSOC officials who interact with the 

ISAC, and associations representing highway law enforcement 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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officials were unsure of the scope of the ISAC’s role and 

responsibilities. Improving oversight and clarifying the ISAC’s 

role would enable TSA TSNM and TSOC officials, the grantee’s 

program managers, and the ISAC to develop a common 

understanding of the ISAC’s mandate and performance 

measurements. 

Neither TSA grant officials, the TSOC, nor ATA headquarters 

officials provided direct oversight or supervision of the Highway 

ISAC staff. Although screening driver incident reports is the 

Highway ISAC’s primary mission, we determined that the ISAC 

staff maintained limited and incomplete records on how they 

resolved call center referrals of security incident reports. In 

addition, the Highway ISAC received insufficient direction on the 

scope of information it should include in its alerts and lookouts. 

Most of the industry representatives and DHS subject matter 

experts we interviewed do not support the ISAC’s practice of 

reporting on fugitives, missing children, or other incidents not 

directly related to highway and motor carrier security. 

DHS has not adequately coordinated fiscal and programmatic 

oversight of the grant. Individuals within TSA and FEMA have 

made a concerted effort to coordinate and meet regularly to discuss 

the program, but shifting and split responsibilities have limited 

their effectiveness. 

Recommendations 

We recommend that the Assistant Secretary for Transportation 

Security Administration: 

Recommendation #1: Analyze the effectiveness of Highway 

Watch® enrollment strategies and provide the Office of Inspector 

General a report on how program effectiveness will be measured in 

the FY 2009 grant, and why this measure was chosen. 

We recommend that the Assistant Secretary for Transportation 

Security Administration and the Administrator of the Federal 

Emergency Management Agency: 

Recommendation #2: Revise the FY 2009 grant to reflect DHS’ 

expectations for updating enrollment and participation strategies, 

including changes to membership criteria, training curriculums, 

and outreach requirements. 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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Management Comments and OIG Analysis 

TSA’s Comments to Recommendation #1: 

TSA did not provide formal comments on the draft report. 

However, TSA officials informed us that they concurred with 

Recommendation #1. TSA agreed to provide an action plan within 

90 days of the report’s publication. 

OIG Analysis: We consider the proposed course of action 

responsive to our recommendation. The recommendation is 

resolved and open. 

TSA’s and FEMA’s Comments to Recommendation #2: 

TSA and FEMA concurred with Recommendation #2. TSA agreed 

to provide an action plan within 90 days of the report’s publication. 

FEMA noted that FEMA and TSA program managers would work 

jointly to establish enrollment and participation standards, and 

establish expectations for the program’s new grant recipient. 

FEMA noted that federal managers would monitor the training 

program more closely and anticipate requiring more frequent 

communication and coordination between the grant recipient and 

enrollees. 

OIG Analysis: We consider the proposed course of action 

responsive to our recommendation. The recommendation is 

resolved and open. 

The Efficiency of ATA’s Program is Difficult to Evaluate 

ATA incurred costs to acquire the assistance of state trucking 

associations and those costs were not well documented. 

Specifically, ATA’s reliance on sole-source contracts and 

consultancies, reimbursements to its own state trucking 

associations, untimely reimbursement submission, and its complex 

system for tracking expenditures provided limited information with 

which to assess expenditures. 

Based on congressional language, DHS awarded the trucking 

security grant to ATA without competition. Because the grant was 

a cooperative agreement, ATA needed only to demonstrate that its 

expenditures were reasonable and met the program’s objectives. 

Therefore, we could not determine whether the program has been 

costly, or cost-beneficial, or could have achieved similar results at 

Effectiveness of the Federal Trucking Industry Security Grant Program 

Page 15 
 

 

less cost. ATA provided required justifications for these practices. 

However, the TSA and FEMA officials involved in highway and 

motor carrier security and grant management, as well as many of 

the industry representatives whom we interviewed for this review, 

said they had the impression that ATA was running the program 

inefficiently. 

Neither DHS nor ATA conducted a cost benefit analysis of ATA’s 

expenditures. But by 2006, Highway Watch® began introducing 

management practices that cut costs within the existing program’s 

structure. At the time of our review, with the notable exception of 

costs tied to the performance measures of the cooperative 

agreement, most remaining inefficiencies were administrative. 

Sole-Source Subcontracts Limited Transparency 

Sole-source contracts are not very conducive to cost benefit 

analysis. ATA justified its use of sole-source contracts due to time 

constraints and the need for specialized expertise available only 

from their contractual partners. However, the noncompetitive 

nature of these contracts, and because some were awarded to 

institutions in the states or districts of members of Congress who 

sponsored the Trucking Industry Security Grant Program, created 

the impression that ATA was funding earmarks. They also made it 

difficult for us to assess whether ATA was awarding and 

administering these subcontracts efficiently. 

In the past 5 years, DHS authorized four sole-source subcontracts 

that totaled $22.5 million as well as more than $4 million for 

various consultants and public relations contracts (see Appendix 

E). Actual expenditures for sole-source contracts include: 

$9.8 million to Senture to operate the call center in Kentucky; 

$3.3 million for public relations contracts; $3.3 million for training 

reproduction and distribution services; $2.7 million to Anexinet for 

database and website development; $2.1 million to Total Security 

Services International, Inc., for training; and $1.9 million to 

Mississippi State University for emergency planning exercises and 

research. We could not determine whether these services could 

have been provided at a lower cost or with higher quality. ATA 

met federal requirements for obtaining spending authorizations, 

provided sole-source justifications, and obtained an independent 

financial audit of expenditures. Each of these subcontractors 

provided the services specified. However, the expenditures for the 

call center and for Anexinet’s database and website development 

were miscalculated in the initial cooperative agreement planning 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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document because the volume of member calls and internet traffic 

was considerably less than projected. 

ATA Expended Most Outreach and Training Money On State 

Trucking Associations 

ATA’s state trucking associations were a principal fiscal 

beneficiary of the outreach and training program. ATA reimbursed 

state trucking associations $14.5 million for outreach and training 

for 676,851 of the 842,028 Highway Watch® members, and 

reimbursed school bus associations $229,000 for outreach and 

training for 88,309 members. ATA’s decision to recruit industry 

professionals through its state trucking associations and through 

school bus associations, coupled with an industry perception that 

highway safety and security training cost less than $5 per trainee, 

led many to conclude that ATA’s strategy was inefficient and 

designed to benefit its state trucking associations. ATA did not 

enter into reimbursable agreements with other trucking industry 

organizations and may have missed opportunities to enroll many of 

the one million members of these organizations at equal or less 

cost. 

Our analysis of reimbursement fees showed that ATA sought to 

address inefficiencies or improve incentives within the existing 

program. Initially, ATA paid state trucking associations for time 

and materials, but many associations believed the reporting 

requirements were too cumbersome, and eventually switched to a 

system whereby they received $4,000 a month for overhead, $500 

a month for DHS reporting requirements, and a sliding perenrollment fee that rose as they met or exceeded target goals. 

During these phases, administrative overhead alone cost more than 

$2.5 million a year in reimbursements to state trucking 

associations. 

In 2007, ATA introduced a third reimbursement structure that paid 

state trucking associations the following fees: 

•	 $16 for each enrollment for which the association 

completed data entry on the new member; 

•	 $14 for each enrollment for which the call center completed 

data entry; and 

•	 $3 for each enrollment in which the member completed the 

training and data entry online. 

Contracts with school bus associations, which were introduced in 

2006, paid $3 per trainee and overhead expenses. 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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Program’s Administrative Costs Were Difficult to Evaluate 

While ATA appeared to be allocating funding as required by the 

cooperative agreement and authorized budgets submitted to DHS, 

ATA’s budget codes to track spending were difficult to evaluate. 

We were not able to examine each line item to verify expenditures. 

DHS program administrators also struggled to understand and 

control costs. 

ATA’s spreadsheets contained line items that did not correspond 

with budgets it presented to DHS, while line items on the DHS 

budget were not itemized using the same categories on the 

spreadsheet. For example, the call center is one of several 

expenditures under “research,” while payments to state trucking 

associations were broken down under six separate categories 

unrelated to the DHS grant authorization line items. In addition, 

with its subcontractors and state trucking associations, ATA was 

paying fixed prices for services and did not control or review their 

expenditures. At our request, ATA provided spreadsheets 

documenting categories of expenditures that corresponded to its 

budget requests to DHS, but this process was labor-intensive 

because ATA had not been tracking its expenditures by program 

priorities. 

ATA’s largest administrative costs were for salary, including the 

staff, fringe benefits and overhead as listed in Appendix E, at 

$7 million, and general and administrative costs (listed as G&A in 

Appendix E), at $10.9 million. Although ATA initially estimated 

general and administrative costs at 10.8% of its total costs, it raised 

rates to 22.1% in 2006 and 23.9% in 2007, and in 2008, TSA 

retroactively raised the 2004 rate to 24.3%. Initial rate calculations 

were based on a volume of membership applications and incident 

reports that was never realized. The FY 2006 and FY 2007 rates 

were determined by a third party at DHS’ request, while the 

readjustment of the 2004 rates was based on TSA’s review of 

incurred expenses. 

ATA did not submit its expenditures regularly. As a result, both 

grant administration staff and we had difficulty matching 

expenditures with authorized activities. ATA used to provide 

copies of receipts to DHS grant administrators. In 2007, DHS 

introduced an agency-wide automated draw down system thereby 

eliminating the need to collect receipts. This paperless 

reimbursement system is more efficient, although less transparent. 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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In our first review of the program, we reported the amount and 

percentage of expenses dedicated to general and administrative 

costs, but did not identify what these expenses covered. During 

fieldwork for this review, we noted in meetings on the program’s 

budget, contracts, database, and website that ATA dedicated 

extensive personnel resources to its Highway Watch® program that 

would be appropriately billed as general and administrative costs. 

However, our initial report outlining the high percentage of the 

budget dedicated to general and administrative costs, and the need 

for more details on what these costs covered, contributed to a 

perception in the industry and Congress that the program was 

operating inefficiently. 

The language in congressional authorizations limited DHS’ 

discretion to choose the grant recipient and set program priorities, 

and DHS grant administrators struggled to control costs. For 

example, several TSA and SLGCP officials questioned the need 

for the initial 2004 MSU sole source subcontract to provide 

emergency preparedness exercises. At the time, Highway Watch® 

was behind schedule on training and enrollment, and the program’s 

core mission was still being established. 

However, Congress directed that a portion of the program funds be 

made available for emergency planning and exercises, so DHS 

authorized funding for those purposes.6 While officials believe 

that Congress’ intentions restricted their ability to question costs, 

the transfer of the program from TSA to SLGCP and then the 

bifurcation of programmatic and fiscal oversight between TSA and 

FEMA were also contributing factors. 

ATA Took Steps to Control Some Costs 

Among current and former Highway Watch® officials, opinions 

about ATA’s strategy and practices varied. Some believed that 

while ATA had not fully anticipated some of the difficulties it 

encountered, Highway Watch® was the first program of its kind 

and start-up costs were inherent in establishing a new model for 

government-private sector cooperation. Some officials described 

reliance on sole-source contracts as a pragmatic approach during 

the start-up phase, while others saw the sole-source contracts as 

overly expensive or unnecessary quid pro quos for congressional 

support for the program. Some former officials said that ATA’s 

decision to work through its state trucking associations damaged 

the program’s credibility and outreach opportunities to continue to 

6

 S. Rep. No. 108-280, at 56 (2004). 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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expand the program in the highway industry. Some Highway 

Watch® officials said that frequent DHS restructuring made it 

difficult for DHS or ATA to re-evaluate the terms of the original 

cooperative agreement, and of particular importance, to re-evaluate 

enrollment numbers as a primary measure of the program’s 

success. 

The former director of Highway Watch® took several steps to 

reduce sole-source and subcontract expenditures. For example, he 

directed that ATA contract for a web-based database and online 

training program which, while costly to develop, made Highway 

Watch® more efficient. ATA was able to renegotiate its 

agreements with state trucking associations because it no longer 

needed to reimburse the associations for reporting requirements 

automated with the database. In addition, ATA cut monthly 

overhead expenditures by paying a flat rate for each enrollee. At 

the current rate of $16 per enrollee, several state trucking 

associations dropped out of the program, indicating that the fee 

was at or below their costs. 

The former director of Highway Watch® worked closely with the 

call center to reduce staff from ten to four full time staff and 

expanded operators’ duties accordingly. Call center staff 

reductions were possible in part because Georgia repealed a 

requirement that all commercial drivers obtain Highway Watch® 

training, which reduced enrollment volume and corresponding 

administrative costs. Several DHS officials said that some ATA 

staff brought to their attention concerns about subcontracts that 

ATA staff themselves perceived as unnecessary. 

Administrative Inefficiencies in Enrollment Process 

About one-half of the Highway Watch® enrollments came from 

forms completed by hand and mailed to the call center. Call center 

operators estimate that between 10% and 20% of these enrollments 

are duplicates, most likely from truck drivers who have changed 

employers. The form does not require enrollees to specify whether 

they are already Highway Watch® members, and the data entry 

process does not allow operators to recognize a duplicate enrollee 

until all of the information on the form has been entered. In 

addition, because the database can operate slowly or inconsistently, 

and can drop entered data without warning, operators are 

resubmitting data. Operators said the system’s unreliability is 

particularly frustrating when they are on an incident call and must 

re-enter extensive notes on the incident. Finally, ATA’s database 

is not configured to provide the Highway ISAC with a direct 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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download of incident reports. Call center operators are emailing 

information to the ISAC, which stores it in unlinked Microsoft 

Word and Excel documents, losing much of the analytical potential 

of the database. 

Despite call center staff frustration with the inconvenience of lost 

data and productivity, there has been little incentive for ATA to 

address these issues because funding and staffing for the program 

have been high and volume of incident reports relatively low. 

While addressing these administrative inefficiencies may improve 

productivity and reduce costs, they are not as important as the need 

to re-evaluate the program’s enrollment strategy. 

Recommendations 

We recommend that the Administrator of the Federal Emergency 

Management Agency: 

Recommendation #3: As part of its fiscal oversight 

responsibilities for the grant program, FEMA should verify that all 

reported expenditures are adequately supported and made 

according to the grant agreement. 

We recommend that the Assistant Secretary for the Transportation 

Security Administration and the Administrator of the Federal 

Emergency Management Agency: 

Recommendation #4: Amend the cooperative agreement to 

address database inefficiencies and build interoperable capabilities 

for the Highway ISAC. 

Management Comments and OIG Analysis 

FEMA’s Comments to Recommendation #3: 

In its response, FEMA stated that it “supports this recommendation 

and will request a financial audit from the IG for compliance with 

this recommendation within 60 days of release of this report.” 

OIG Analysis: We reworded the original recommendation that 

FEMA audit these funds to say should FEMA review reported 

expenditures. We will resolve and close this recommendation 

when we receive confirmation that FEMA has completed its 

review. This recommendation is unresolved and open. 

Effectiveness of the Federal Trucking Industry Security Grant Program 

Page 21 
 

 

 

TSA’s and FEMA’s Comments to Recommendation #4: 

TSA did not provide formal comments on the draft report. 

However, TSA informed us that it concurred with the 

recommendation, and agreed to provide an action plan within 90 

days of the report’s publication. FEMA also concurred with the 

recommendation, stating that it would request that the new grantee 

create a database that could serve the information-sharing needs of 

the ISAC and the information analysis and collection needs of both 

TSA’s TSOC staff and the ISAC. 

OIG Analysis: We consider the proposed course of action 

responsive to our recommendation. The recommendation is 

resolved and open. 

DHS Can Make the Program More Effective 

The program has contributed to highway safety and security. It has 

addressed safety concerns, helped apprehend criminals, and 

reported potential security threats to federal agencies for 

investigation. However, absent a significant attack or disruption of 

an attack, it is hard to separate effective deterrence from the 

absence of a real security threat. Therefore, gauging the 

effectiveness of the grant program to date is difficult. The 

situation in the highway and motor carrier sector makes an 

evaluation of security programs even more difficult. Most roads 

are publicly accessible, most vehicles are privately owned, and 

when compared to the aviation sector, regulated security measures 

and reporting requirements are more limited. Moreover, DHS’ 

goals for the program, creating additional layers of security, 

increasing vigilance of transportation workers, and aligning sector 

resources with high priority transportation security risks are not 

easily quantifiable.7 

Areas of the program that represent key indicators of its success 

have produced mixed results. First, the cooperative agreement’s 

strategy of focusing on enrollment numbers yielded neither active 

participation nor industry-wide support. ATA did not develop 

cooperative working relationships within the industry, limiting 

membership opportunities and distribution channels for alerts and 

lookouts. 

7 Transportation Sector Security Plan, Highway Infrastructure and Motor Carrier Modal Annex, 

Transportation Sector Goals and Objectives, Transportation Security Administration, pages 17and 18. 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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Second, on average, members report only four to five security 

incidents a day, a frequency that has remained constant even as 

membership has grown to more than 800,000. The benefit of 

training members before enrolling them is difficult to determine. 

Incident reports from non-members are of comparable quality to 

those made by trained members, and trained members do not 

consistently follow guidance. DHS should assess how it will train 

program participants in the future. 

Third, the ISAC has not developed into a clearinghouse for surface 

transportation-related incidents. Non-members are more likely to 

call 911 or state authorities, and as previously mentioned, the 

ISAC is not coordinating its activities closely with the TSOC. The 

ISAC should aim to provide the greatest amount of support 

possible to the TSOC. While these conditions limit the 

effectiveness of Highway Watch®, they do not completely negate 

the program’s contributions to homeland security. TSA TSNM 

will resume program oversight in the 2008 grant cycle, and its 

primary focus should be to make the program more effective. 

The Highway Watch® Training Strategy Has Produced Mixed 

Results 

ATA did not reach out to all potential Highway Watch® 

participants, and hence was not perceived well by industry. 

Industry organizations reacted to ATA’s focus on recruiting and 

training through state trucking associations by not actively 

encouraging their members to join Highway Watch®. Instead, 

representatives of many industry organizations said that their 

members were far more likely to call 911 or designated state safety 

and security authorities than the call center. 

Unlike ATA’s state trucking associations, which represent the 

owners of large trucking companies, other organizations in the 

sector represent the owner-operators, law enforcement officers, 

construction workers and toll booth operators who work on the 

highways. Endorsement by these organizations might have 

brought a broader membership to Highway Watch®. Although 

Highway Watch® is open to anyone in the sector, DHS’ reliance on 

one entity to reach out to all segments of the ground transportation 

industry may have limited opportunities. 

Limited outreach also diminished the effectiveness of informationsharing strategies. The ISAC did not distribute its alerts and 

lookouts to Highway Watch® members unless a member 

specifically requested to be on the distribution list. Instead, the 

Effectiveness of the Federal Trucking Industry Security Grant Program 

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Highway ISAC distributed its materials to a limited list of key 

industry organizations and relied on them for distribution. 

Some former Highway Watch® officials were critical of the alerts 

the ISAC distributed, saying the material placed undue emphasis 

on the ATA Highway Watch® brand, and that the subject matter, 

such as stolen trucks, represented the interests of ATA as much as 

national security. Several representatives from the industry said 

they had not seen many alerts or lookouts. Several others said that 

they did not forward some of the alerts and lookouts because they 

were clearly related to common crime, or unsuitable for a national 

audience. Although these are legitimate concerns, the underlying 

issue is that DHS needs to take a leadership role and better define 

the mission and scope of the ISAC. 

As outlined above, Highway Watch® members have not reported 

many incidents. From the program’s inception to March 2008, the 

call center has received 10,493 incident calls, of which 5,343 or 

51% were security related. The remaining 5,150 calls dealt with 

safety issues. As shown in Figure 5, after the program’s first year, 

and with the exception of anniversaries of September 11, 2001, 

total security calls have remained fairly constant at between 100 

and 200 calls a month. 

Figure 5: Call Center Safety and Security Incident Reports 

0 

50 

100 

150 

200 

250 

300 

350 

400 

Jun04 Sep04 Dec04 Mar05 Jun05 Sep05 Dec05 Mar06 Jun06 Sep06 Dec06 Mar07 Jun07 Sep07 Dec07 

Date Reported 

Number of Calls 

Security Safety Other Incident Calls Total Incident Calls 

Source: ATA Monthly Activity Reports To DHS 

The reporting rate has stayed largely constant even while 

membership grew from less than 100,000 to more than 800,000. 

Only 5,439 Highway Watch® members have called in a safety or 

security incident. Nonmembers have made 2,170 incident reports. 

Effectiveness of the Federal Trucking Industry Security Grant Program 

Page 24 
 

Remaining reports were made by members who called more than 

once. There were 1,047 members who made multiple calls, 15 of 

whom made more than 20 calls. The routine nature of many of 

these reports—such as reckless drivers, accidents, vehicles parked 

near infrastructure or in unusual places—suggests that many 

drivers who observe similar incidents are not using the call center. 

ATA’s strategy limited participation by other industry 

professionals such as owner-operators, state and local law 

enforcement and highway workers, and toll booth operators. ATA 

may have also limited participation by not systematically 

collecting contact information and maintaining communication 

with enrolled members. 

Requiring Highway Watch® members to receive training before 

they enroll is logical, but that training does not ensure members 

submit quality reports. In fact, the quality of members’ safety and 

security incident reports has varied. The call center director stated 

that as a matter of policy it accepts incident reports from anyone, 

and follows the same procedures for forwarding calls. 

We reviewed incident reports made by Highway Watch® members 

and non-members, listened to recordings of calls, and interviewed 

call center operators. Nonmembers who made security incident 

reports willingly provided their contact information to forward to 

the ISAC. The types of incidents reported and the quality of 

information provided was comparable to those made by enrolled 

members. While nonmembers made good reports without 

completing the training, it should be noted that most of these 

nonmembers were industry professionals, and most obtained the 

call center number from a member or the program’s website. 

Conversely, Highway Watch® members routinely disregarded 

basic tenets of their training. They are trained to call 911 first for 

an emergency, but call center operators must tell some callers to 

hang up and call 911. The training warns against confronting a 

subject, but some members did make contact, and even represented 

themselves as having some authority because they were Highway 

Watch® members. Many calls contained too few specific details to 

be actionable. 

The training stresses the importance of focusing on unusual 

behaviors and activities, not ethnicity. It also stresses that 

members should watch for both potential domestic terrorists—such 

as the Oklahoma City bombers—and foreign terrorists. In spite of 

this guidance, a substantial portion of incident reports involved 

Effectiveness of the Federal Trucking Industry Security Grant Program 

Page 25 
 

behaviors or activities that would not otherwise be considered 

suspicious, but appear to have been reported because they involved 

individuals the caller perceived to be Middle Eastern or Muslim. 

In some cases the reports contained questionable descriptions; 

members likely confused Sikhs with Muslims, and several 

described their subject as either Middle Eastern or Hispanic. 

Callers whose reports suggested to call center operators or ISAC 

officers that they were emotionally disturbed were sufficiently 

common that the ISAC had a coding category for such calls. 

Given the low volume of incident reports, the cost of processing 

such calls is negligible, and they are easily screened at the ISAC. 

However, the prevalence of overly general and inappropriate calls 

suggests that the 1-hour training members receive before 

enrollment may need to be extended or reinforced to improve the 

overall quality of incident reports. 

The Highway ISAC Can Provide Better Support to the TSOC 

Given the modest volume of calls to the call center, it is unlikely 

that Highway Watch® incident reports represent a large proportion 

of all highway-related security incident reports. Officials from 

organizations that represent drivers, state governments, and state 

and highway law enforcement officers said that most of their 

members would report incidents to entities other than Highway 

Watch®. TSOC staff confirmed that they routinely hear of 

incidents through the state fusion centers, and they view the 

Highway ISAC as just one of many sources of information on 

highway and motor carrier security. 

For the ISAC to be effective, it should work closely with, and 

provide support to, the TSOC. TSA should clarify the ISAC’s role 

at the TSOC, and improve oversight. Closer oversight of the 

ISAC’s activities is needed because the ISAC is not placing a high 

priority on supporting the TSOC. Given that half of the Highway 

ISAC’s staff is funded by the grant program, and half by the ATA, 

providing such support is a reasonable expectation. 

Current and former TSOC officials stated that they welcomed the 

ISAC’s presence at the TSOC and their relationships with the 

current and former ISAC directors have been good. TSOC surface 

transportation officials stressed that the presence of any additional 

staff dedicated to highway and motor carrier security was valuable. 

However, current and former TSOC officials had relatively limited 

information about the volume of security incident referrals the 

ISAC received, and the existence of the Highway Watch® 

Effectiveness of the Federal Trucking Industry Security Grant Program 

Page 26 
 

 

database, or the resources and professional relationships developed 

by the ISAC staff. 

TSOC officers did not believe that they had the authority to specify 

how the ISAC provided them information. For example, one 

TSOC official said while he preferred that the ISAC forward each 

incident call as its credibility was determined, the ISAC was 

holding information while it analyzed calls. One TSOC officer 

said that the information would be more valuable if the ISAC 

followed the TSOC’s reporting standards rather than its own. 

While TSOC officers routinely passed on information and asked 

ISAC staff whether they have received similar reports, TSOC staff 

said they thought their own industry and law enforcement contacts 

were in some instances better than those developed by the ISAC. 

It is not likely that current working relationships would deter or 

delay investigation of an important security incident, but the ISAC 

could work more effectively and leverage limited surface 

transportation resources if it sought more direction from the TSOC. 

Recommendations 

We recommend that the Assistant Secretary for Transportation 

Security Administration: 

Recommendation #5: Amend the FY 2009 cooperative 

agreement to enable the TSOC to establish program priorities with 

the Highway ISAC, and to obtain incident reports which conform 

to TSOC reporting standards. 

Recommendation #6: Amend the FY 2009 cooperative 

agreement to require the Highway ISAC to track and report the 

disposition of security referrals it receives from the call center. 

Management Comments and OIG Analysis 

TSA’s Comments to Recommendation #5: 

TSA did not provide formal comments on the draft report. 

However, TSA informed us that it concurred with the 

recommendation, and agreed to provide an action plan within 90 

days of the report’s publication. 

Effectiveness of the Federal Trucking Industry Security Grant Program 

Page 27 
 

 

OIG Analysis: We consider the proposed course of action 

responsive to our recommendation. The recommendation is 

resolved and open. 

TSA’s and FEMA’s Comments to Recommendation #6: 

TSA did not provide formal comments on the draft report. 

However, TSA informed us that it concurred with the 

recommendation, and agreed to provide an action plan within 90 

days of the report’s publication. FEMA also responded to 

Recommendation #6. FEMA agreed that there are substantial 

benefits in tracking and reporting security referrals, and would 

require the new grantee to develop and implement a tracking and 

reporting tool for the ISAC. 

OIG Analysis: We consider the proposed course of action 

responsive to our recommendation. The recommendation is 

resolved and open. 

Recommendations Regarding the Future of the Program and 

Motor Carrier Security 

There is a need for the Highway Watch® program. Professional 

truck and passenger bus drivers are an unusual constituency in that 

they may travel considerable distances and may not be familiar 

with their location or contact information for state authorities when 

they observe a nonemergency incident. 

The Highway Watch® program is a good concept. The call 

center’s staff is well trained and skilled at eliciting information 

about the individual’s location and the details of the reported 

incident. They follow up promptly with local authorities and 

drivers on safety incidents, and transfer security incidents 

immediately to the ISAC. The Highway ISAC performs an 

important function of vetting member security incident reports to 

save time for TSOC officers and state fusion centers. With better 

recordkeeping and a stronger focus on assisting the TSOC, the 

ISAC has the potential to boost TSOC capability. While many 

TSA and FEMA officials, representatives of highway and motor 

carrier associations and organizations, and even former ATA 

employees were critical of how the Highway Watch® program was 

executed, few questioned the value of the concept. 

Moreover, initiatives Highway Watch® took to address some 

programmatic inefficiencies, the recommendations we make in this 

Effectiveness of the Federal Trucking Industry Security Grant Program 

Page 28 
 

 

report, and open competition for the 2008 Federal Trucking 

Industry Security Grant all offer opportunities to improve the 

program. Of these factors, the recent FY 2008 solicitation and 

competition provided the government with the opportunity to 

select the candidate with the best ideas for executing the program. 

In addition, returning programmatic oversight to the TSA TSNM 

Highway and Motor Carrier Division will stabilize the program 

and return authority to subject matter experts. 

Effectiveness of the Federal Trucking Industry Security Grant Program 

Page 29 
 

Appendix A 

Purpose, Scope, and Methodology 

The Implementing Recommendations of the 9/11 Commission Act 

of 2007 required that we initiate a two-part review of the Federal 

Trucking Industry Security Grant Program.8 The first part was 

completed and published in October 2007, Administration of the 

Federal Trucking Industry Security Grant Program for FY 2004 

and FY 2005 [OIG-08-08]. The purpose of our second review was 

to: 

(1) Analyze the performance, efficiency, and effectiveness 

of the Federal Trucking Industry Security Grant Program, 

and the need for the program using all years of available 

data; and 

(2) Make recommendations regarding the future of the 

program, including options to improve the effectiveness 

and utility of the program and motor carrier security. 

We reviewed DHS administration of the trucking industry security 

grant program from FY 2003 to FY 2007. We began fieldwork for 

this report in February 2008. We interviewed more than 50 

individuals involved in the highway and motor carrier industry and in 

transportation safety and security. These interviews included 

representatives from TSA’s Office of Transportation Sector Network 

Management Highway and Motor Carrier Division and Integration, 

TSA’s TSOC, and representatives of FEMA’s Capabilities Division. 

Additionally, we interviewed DHS officials who had previously been 

responsible for programmatic and financial oversight of the Highway 

Watch® program. 

We interviewed current and former employees of the American 

Trucking Associations who worked on the Highway Watch® 

program, including current and former vice presidents, General 

Counsels, Highway ISAC directors, program managers, and financial, 

contracting, administrative, and information technology experts. We 

also interviewed subcontractors who worked with Highway Watch®, 

including representatives of the call center, Mississippi State 

University, and Total Security Services International, Inc. We visited 

the call center, in London, Kentucky, as well as the Highway ISAC 

and TSOC co-located in Herndon, Virginia. 

We interviewed representatives of highway and motor carrier industry 

associations and organizations, including the: American Association 

of Motor Vehicle Administrators; American Association of State 

Highway and Transportation Officials; American Bus Association; 

8

 Pub. L. 110-53 § 1542 

Effectiveness of the Federal Trucking Industry Security Grant Program 

Page 30 
Appendix A 

Purpose, Scope, and Methodology 

American Federation of Labor and Congress of Industrial 

Organizations (AFL-CIO) United Transportation Union; Commercial 

Vehicle Safety Alliance; International Bridge, Tunnel and Turnpike 

Association; International Brotherhood of Teamsters; National 

Association of Truck Stop Operators; National School Transportation 

Association; Owner-Operator Independent Drivers Association; and 

the United Motorcoach Association. 

We requested and reviewed documentation and data from TSA, 

FEMA, and ATA including: 

•	 Laws and regulations relevant to highway and motor carrier 

security and federal authorities and responsibilities; 

•	 TSA’s Highway Infrastructure and Motor Carrier Modal 

Annex to the Transportation Sector Specific Plan; 

•	 Memorandums and organizational charts documenting 

reorganizations and personnel changes within TSA and 

FEMA related to the Highway Watch® grant; 

•	 Materials related to the cooperative agreements between 

DHS and ATA, including grant kits, investment 

justifications, and signed agreements; 

•	 Documentation on the Highway Watch® program, 

including the Highway ISAC, such as standard operating 

procedures, policy, guidance, monthly and quarterly 

activity reports, and lists and samples of alerts and lookouts 

distributed by the ISAC; 

•	 Training materials used in the Highway Watch® program, 

including the Highway Watch® and School Bus Watch 

training materials, teacher’s manuals, train-the-trainer 

materials, and course evaluations; 

•	 Documentation on ATA subcontracts, including 

subcontracts with Mississippi State University, the call 

center, Total Security Services International, Inc., and 

Anexinet, with statements of work and preliminary 

budgets; 

•	 ATA’s reimbursement agreements with state trucking 

associations and bus associations; 

•	 Budget and financial documents related to Highway 

Watch®, including ATA budget requests, reimbursement 

documentation, internal ATA budget spreadsheets, and 

independent financial audit reports; and 

•	 Copies of the Highway Watch® databases for membership, 

state trucking association reimbursements, and incident 

reports. 

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Appendix A 

Purpose, Scope, and Methodology 

This review was conducted under the authority of the Inspector 

General Act of 1978, as amended, and according to the Quality 

Standards for Inspections, issued by the President’s Council of 

Integrity and Efficiency. 

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Appendix B 

Management Comments to the Draft Report 

We provided TSA and FEMA with a draft of this report for review 

and comment. TSA concurred with the relevant recommendations 

and stated that it would provide an action plan to implement each 

relevant recommendation within 90 days of publication of this 

report. FEMA concurred with the relevant recommendations and 

stated that it would initiate a financial audit within 60 days of the 

publication of this report. TSA did not submit a formal letter of 

response. FEMA’s response is provided below. 

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Appendix B 

Management Comments to the Draft Report 

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Appendix B 

Management Comments to the Draft Report 

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Appendix B 

Management Comments to the Draft Report 

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Appendix C 

Synopsis of Report I 

After the September 11, 2001, terrorist attacks, Congress 

encouraged the addition of a security component to the Highway 

Watch® training program.9

 In March 2003, ATA submitted a 

proposal to the Transportation Security Administration seeking an 

additional $100,000 so that Highway Watch® could serve more 

states and support highway communications during a national 

emergency. TSA did not envision that the project would require 

substantial TSA involvement and the funds were awarded through 

a noncompetitive grant on August 1, 2003. This helped ATA 

sustain the Highway Watch® program during its redesign and 

expansion. 

A week later, TSA announced the application period for $19.7 

million in FY 2003 program funds. TSA planned to make the 

award competitive, across four program priorities: 

•	 Outreach 

o	 Participant Identification 

o	 Recruitment; 

•	 Training; 

•	 Call Center Operations; and 

•	 Information Sharing and Analysis. 

Fourteen companies, including ATA, applied. 

Before TSA announced the award decision, ATA asserted that 

TSA could not call the program “Highway Watch®” because ATA 

registered the term as a service mark in March 2002. ATA further 

contended that Congress specifically earmarked the trucking 

industry security grant funds to the “existing joint industry– 

government Highway Watch® program.”10 On January 16, 2004, 

TSA sent a letter to each of the applicants stating that in the best 

interests of the government, it was canceling the announcement. 

The first administrative review of the Federal Trucking Industry 

Security Grant Program established that: 

•	 After having published a competitive announcement for $19.7 

million in FY 2003 grant funds, on January 16, 2004, TSA 

cancelled the announcement “in the best interests of the 

government” and entered into a cooperative agreement with 

ATA in March 2004 using the 2003 funds to expand the 

9 S. Rep. No. 107-224, at 84 (2002). 

10 H.R. Rep. No. 108-76, at 82 (2003) (Conf. Rep.).
 

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Appendix C 

Synopsis of Report I 

program nationwide and to increase its capability to report 

security-related incidents. 

•	 By FY 2004, ATA had received $41 million in program 

funding and expanded the agreement’s scope of work at no cost 

to the government to include mobilization planning exercises 

(by MSU) and other tasks. 

•	 In May 2004, DHS split program management responsibilities 

for Highway Watch® between TSA and SLGCP based on an 

unsigned memorandum of agreement. 

•	 Most program monitoring requirements for FY 2003 and FY 

2004 were established by the FY 2003 cooperative agreement. 

They essentially required ATA to submit periodic technical 

progress and financial status reports as well as to report 

quarterly to TSA on its training and recruitment activities, 

coordination and relationship-building, the Highway Watch® 

call center, and the Highway ISAC. 

•	 The TSA program manager was required to provide guidance 

and support to increase the effectiveness and efficiency of 

Highway Watch® and to integrate it with broader governmental 

objectives. 

•	 TSA planned to hire a third party to perform an independent 

evaluation of the Highway Watch® program and set aside 

$300,000 for that purpose. In March 2005 (FY 2005), SLGCP 

decided to postpone the independent program evaluation until 

Highway Watch® was a more vigorous program. SLGCP 

drafted a plan to use its own staff to perform the evaluation, 

rather than an independent third party as planned by TSA. 

•	 ATA did not meet the FY 2004 target of training 400,000 

highway professionals until June 2006 (FY 2007). 

•	 ATA submitted its final technical completion report in March 

2007. 

•	 At $5 million, the FY 2005 DHS Appropriations Act (Public 

Law 108-334) provided significantly less funding than the FY 

2004 act. Eligibility for funding was limited to ATA to support 

and expand the existing Highway Watch® program. ATA 

began expending the FY 2005 funds in September 2006 and 

exhausted the majority of the funds in December 2006. 

•	 The first report did not contain any recommendations. 

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Appendix D 

Highway Watch Enrollment By Industry Sector 

Source: Highway Watch database 

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Appendix E 

Highway Watch Budget Authorized and Spent 

ATA Budget Authorized By DHS 

 Source: ATA Budget Submissions 

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Appendix E 

Highway Watch Budget Authorized and Spent 

ATA Budget Spent 

Source: ATA Expenditures 

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Appendix F 

Highway Watch Participation By State 

Source: United States Census Bureau (Column 1); Highway Watch Database 

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Appendix G 

Post-Training Decline in Participation 

Post-Training Participation at 6 / 12 / 18 Months 

Incident Reports Made Within: 

6 months 12 months 18 months 

Calls By Date Enrolled 

Date Enrolled Number Enrolled 

2004-2005 2124 40% 64% 78% 

2006 3035 47% 76% 95% 

2007-2008 3109 78% n/a n/a 

2004-2008 8268 46% 70% 85% 

Calls By Frequency 

Callers Making Multiple Calls 1047 39% 64% 79% 

Callers Making One Call 4392 51% 75% 89% 

Total Members 

Who Called 5439 46% 70% 85% 

Source: Highway Watch Database 

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Appendix H 

Major Contributors 

William McCarron, Chief Inspector 

Lorraine Eide, Senior Inspector 

Jonathan Davis-Olo, Inspector 

Melissa Keaster, Inspector 

Kirsten Murray, Inspector 

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Appendix I 

Report Distribution 

Department of Homeland Security 

Secretary 

Deputy Secretary 

Chief of Staff 

Deputy Chief of Staff 

General Counsel 

Executive Secretary 

Director, GAO/OIG Liaison Office 

Assistant Secretary for Office of Policy 

Assistant Secretary for Office of Public Affairs 

Assistant Secretary for Office of Legislative Affairs 

FEMA Audit Liaison 

TSA Audit Liaison 

Office of Management and Budget 

Chief, Homeland Security Branch 

DHS OIG Budget Examiner 

Congress 

Congressional Oversight and Appropriations Committees, as 

appropriate 

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Additional Information and Copies 

To obtain additional copies of this report, call the Office of Inspector General 

(OIG) at (202) 254-4199, fax your request to (202) 254-4305, or visit the OIG web 

site at www.dhs.gov/oig. 

OIG Hotline 

To report alleged fraud, waste, abuse or mismanagement, or any other kind of 

criminal or noncriminal misconduct relative to department programs or 

operations: 

• Call our Hotline at 1-800-323-8603; 

• Fax the complaint directly to us at (202) 254-4292; 

• Email us at DHSOIGHOTLINE@dhs.gov; or 

•	 Write to us at: 

DHS Office of Inspector General 

MAIL STOP 2600, 

Attention: Office of Investigations - Hotline, 

245 Murray Drive, SW, Building 410, 

Washington, DC 20528. 

The OIG seeks to protect the identity of each writer and caller.