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TSA REFORM: EXPLORING INNOVATIONS IN TECHNOLOGY PROCUREMENT TO STIMULATE JOB 

GROWTH 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

TRANSPORTATION SECURITY 

OF THE

COMMITTEE ON HOMELAND SECURITY 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED TWELFTH CONGRESS 

FIRST SESSION 

SEPTEMBER 22, 2011, OCTOBER 13, 2011 and NOVEMBER 3, 2011 

Serial No. 112–46 

Printed for the use of the Committee on Homeland Security 

Available via the World Wide Web: http://www.gpo.gov/fdsys/ 
(II) 

COMMITTEE ON HOMELAND SECURITY 

PETER T. KING, New York, Chairman 

LAMAR SMITH, Texas 

DANIEL E. LUNGREN, California 

MIKE ROGERS, Alabama 

MICHAEL T. MCCAUL, Texas 

GUS M. BILIRAKIS, Florida 

PAUL C. BROUN, Georgia 

CANDICE S. MILLER, Michigan 

TIM WALBERG, Michigan 

CHIP CRAVAACK, Minnesota 

JOE WALSH, Illinois 

PATRICK MEEHAN, Pennsylvania 

BEN QUAYLE, Arizona 

SCOTT RIGELL, Virginia 

BILLY LONG, Missouri 

JEFF DUNCAN, South Carolina 

TOM MARINO, Pennsylvania 

BLAKE FARENTHOLD, Texas 

MO BROOKS, Alabama 

BENNIE G. THOMPSON, Mississippi 

LORETTA SANCHEZ, California 

SHEILA JACKSON LEE, Texas 

HENRY CUELLAR, Texas 

YVETTE D. CLARKE, New York 

LAURA RICHARDSON, California 

DANNY K. DAVIS, Illinois 

BRIAN HIGGINS, New York 

JACKIE SPEIER, California 

CEDRIC L. RICHMOND, Louisiana 

HANSEN CLARKE, Michigan 

WILLIAM R. KEATING, Massachusetts 

KATHLEEN C. HOCHUL, New York 

JANICE HAHN, California 

MICHAEL J. RUSSELL, Staff Director/Chief Counsel 

KERRY ANN WATKINS, Senior Policy Director 

MICHAEL S. TWINCHEK, Chief Clerk 

I. LANIER AVANT, Minority Staff Director 

SUBCOMMITTEE ON TRANSPORTATION SECURITY 

MIKE ROGERS, Alabama, Chairman 

DANIEL E. LUNGREN, California 

TIM WALBERG, Michigan 

CHIP CRAVAACK, Minnesota 

JOE WALSH, Illinois, Vice Chair 

MO BROOKS, Alabama 

PETER T. KING, New York (Ex Officio) 

SHEILA JACKSON LEE, Texas 

DANNY K. DAVIS, Illinois 

JACKIE SPEIER, California 

CEDRIC L. RICHMOND, Louisiana 

BENNIE G. THOMPSON, Mississippi (Ex Officio) 

AMANDA PARIKH, Staff Director 

NATALIE NIXON, Deputy Chief Clerk 

THOMAS MCDANIELS, Minority Subcommittee Director 
(III) 

C O N T E N T S 

Page 

THURSDAY, SEPTEMBER 22, 2011 

STATEMENTS

The Honorable Mike Rogers, a Representative in Congress From the State 

of Alabama, and Chairman, Subcommittee on Transportation Security: 

Oral Statement ..................................................................................................... 1 

Prepared Statement ............................................................................................. 2 

The Honorable Sheila Jackson Lee, a Representative in Congress From the 

State of Texas, and Ranking Member, Subcommittee on Transportation 

Security: 

Prepared Statement ............................................................................................. 31 

The Honorable Bennie G. Thompson, a Representative in Congress From 

the State of Mississippi, and Ranking Member, Committee on Homeland 

Security: 

Oral Statement ..................................................................................................... 3 

Prepared Statement ............................................................................................. 4 

WITNESSES

Ms. Elaine C. Duke, President, Elaine Duke & Associates, LLC: 

Oral Statement ..................................................................................................... 5 

Prepared Statement ............................................................................................. 7 

Mr. Michael P. Jackson, President, Firebreak Partners, LLC: 

Oral Statement ..................................................................................................... 9 

Prepared Statement ............................................................................................. 10 

Mr. Stephen M. Lord, Director, Homeland Security, Government Accountability Office: 

Oral Statement ..................................................................................................... 15 

Prepared Statement ............................................................................................. 17 

THURSDAY, OCTOBER 13, 2011 

STATEMENTS

The Honorable Mike Rogers, a Representative in Congress From the State 

of Alabama, and Chairman, Subcommittee on Transportation Security ......... 41 

The Honorable Sheila Jackson Lee, a Representative in Congress From the 

State of Texas, and Ranking Member, Subcommittee on Transportation 

Security ................................................................................................................. 42 

WITNESSES

Mr. Marc A. Pearl, President and CEO, Homeland Security and Defense 

Business Council: 

Oral Statement ..................................................................................................... 45 

Prepared Statement ............................................................................................. 46 

Mr. Scott Boylan, Vice President and General Counsel, Safran Morpho Detection: 

Oral Statement ..................................................................................................... 51 

Prepared Statement ............................................................................................. 53 
Page

IV 

Mr. Guy Ben-Ari, Deputy Director, Defense-Industrial Initiatives Group Fellow, International Security Program, Center for Strategic and International 

Studies: 

Oral Statement ..................................................................................................... 54 

Prepared Statement ............................................................................................. 56 

THURSDAY, NOVEMBER 3, 2011 

STATEMENT

The Honorable Mike Rogers, a Representative in Congress From the State 

of Alabama, and Chairman, Subcommittee on Transportation Security ......... 71 

WITNESSES

Mr. Nick Nayak, Chief Procurement Officer, U.S. Department of Homeland 

Security: 

Oral Statement ..................................................................................................... 74 

Prepared Statement ............................................................................................. 75 

Mr. Robin E. Kane, Assistant Administrator, Security Technology, Transportation Security Administration: 

Oral Statement ..................................................................................................... 78 

Joint Prepared Statement ................................................................................... 79 

Mr. Paul Benda, Chief LOf Staff, Director, Homeland Security Advanced 

Research Projects Agency, U.S. Department of Homeland Security, Accompanied by Susan Hallowell, Director, Transportation Security Laboratory: 

Oral Statement ..................................................................................................... 85 

Joint Prepared Statement ................................................................................... 79 

Mr. Charles K. Edwards, Acting Inspector General, U.S. Department of 

Homeland Security: 

Oral Statement ..................................................................................................... 87 

Prepared Statement ............................................................................................. 88 

APPENDIX

Questions Submitted by Chairman Mike Rogers for Nick Nayak ....................... 117 

Question Submitted by Ranking Member Sheila Jackson Lee for Nick 

Nayak .................................................................................................................... 117 

Questions Submitted by Chairman Mike Rogers for Robin E. Kane .................. 118 

Questions Submitted by Ranking Member Bennie G. Thompson for Robin 

E. Kane ................................................................................................................. 120 

Questions Submitted by Ranking Member Sheila Jackson Lee for Robin E. 

Kane ...................................................................................................................... 120 

Questions Submitted by Chairman Mike Rogers for Paul Benda ....................... 121 

Question Submitted by Ranking Member Bennie G. Thompson for Paul 

Benda .................................................................................................................... 121 

Question Submitted by Ranking Member Sheila Jackson Lee for Paul 

Benda .................................................................................................................... 122 

Question Submitted by Ranking Member Sheila Jackson Lee for Charles 

K. Edwards ........................................................................................................... 122 
(1) 

TSA REFORM: EXPLORING INNOVATIONS IN 

TECHNOLOGY PROCUREMENT TO STIMULATE JOB GROWTH 

Thursday, September 22, 2011 

U.S. HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON TRANSPORTATION SECURITY, 

COMMITTEE ON HOMELAND SECURITY, 

Washington, DC. 

The subcommittee met, pursuant to call, at 10:01 a.m., in Room 

311, Cannon House Office Building, Hon. Mike Rogers [Chairman 

of the subcommittee] presiding. 

Present: Representatives Rogers, Jackson Lee, Davis, Richmond, 

and Thompson (ex officio). 

Mr. ROGERS. The Committee on Homeland Security Subcommittee on Transportation Security will come to order. The subcommittee is meeting today to examine innovative solutions to 

technology procurement at TSA that could generate cost savings for 

the Federal Government and stimulate job growth in the private 

sector. 

I will recognize myself now for an opening statement. I do want 

to make a point that the Ranking Member, Ms. Jackson Lee, called 

me a little while ago. She is currently giving a speech downtown 

and is going to be a few minutes late. So we will get started and 

she will be here as soon as she can. 

I would like to welcome everybody to our hearing today and 

thank the witnesses for the time they have put into these prepared 

remarks and making themselves available for this hearing. I look 

forward to your comments. 

As part of our oversight of the Transportation Security Administration, one of the things we are looking to do is to encourage good 

ideas that will stimulate job growth in the private sector. Given the 

hundreds of millions of dollars that the agency spends on technology procurement per year, I believe the TSA has ample opportunity to generate any number of private-sector jobs. The Housepassed fiscal year 2012 appropriations bill would provide TSA with 

more than $550 million for explosive detection system procurement 

and maintenance. I would like to see if we can find creative ways 

to reduce that cost over time while still keeping the traveling public safe from acts of terrorism. 

There are lots of good ideas out there, some of which TSA is engaged in already, and other proposals that we are hearing about 

from the private sector. I believe there are a variety of ways that 

we can better tap into and leverage the private sector to provide 
2 

technologies and services. There is a great innovation in the private sector, both among large and small businesses, and we need 

to do everything we can to foster that innovation. This includes 

streamlining and reforming acquisitions mechanisms within TSA 

and it also means finding new opportunities to entice industry, especially through greater transparency on the part of TSA, as to 

what its acquisition roadmap looks like. 

The only way to reap the benefits of many businesses out there 

that have the solutions we need is, to the extent possible, let them 

know what TSA wants and when it wants it. 

The TSA Authorization Act of 2011, just adopted by this subcommittee, is aimed at improving security by streamlining and 

eliminating burdensome regulations that are a barrier to job creation in the transportation industry and encouraging the use of 

technologies developed by the private sector. 

This subcommittee hearing will continue to focus on the wise use 

of taxpayer dollars and job creation by examining TSA’s technology 

procurement practices. I would like to see TSA fully engage the private sector in an open, transparent way for the development and 

purchase of security technologies. I would like to see progress on 

saving taxpayers’ dollars and creating private sector jobs. I believe 

we can achieve this while effectively securing the traveling public 

and the flow of commerce. I look forward to hearing the witnesses’ 

ideas for finding cost efficiencies and stimulating jobs through improved technology procurement at TSA. 

[The statement of Chairman Rogers follows:] 

PREPARED STATEMENT OF CHAIRMAN MIKE ROGERS

SEPTEMBER 22, 2011 

I would like to welcome everyone to this important hearing and thank our witnesses for being here. We look forward to your testimony and greatly appreciate 

your time. 

As part of our oversight of the Transportation Security Administration, one of the 

things we are looking to do is encourage good ideas that will stimulate job growth 

in the private sector. Given the hundreds of millions of dollars that the agency 

spends on technology procurement per year, I believe that TSA presents ample opportunity for generating any number of private-sector jobs. 

The House-passed fiscal year 2012 appropriations bill would provide TSA with more than $550 million for explosives detection system procurement and maintenance. I’d like to see if we can find creative ways to reduce that cost over time, 

while still keeping the traveling public secure from acts of terrorism. 

There are lots of good ideas out there, some of which TSA is engaged in already, 

and other proposals that we are hearing about from the private sector. 

I believe there are a variety of ways that we can better tap into and leverage the 

private sector to provide technologies and services. There is great innovation in the 

private sector, both among large and small businesses, and we need to do everything we can to foster that innovation. 

This includes streamlining and reforming acquisitions mechanisms within TSA. It 

also means finding new opportunities to entice industry, especially through greater 

transparency on the part of TSA as to what its acquisition roadmap looks like. The 

only way to reap the benefits of the many businesses out there that have the solutions we need is—to the extent possible—let them know what TSA wants and when 

it is going to want it. 

The TSA Authorization Act of 2011, just adopted by this subcommittee, is aimed 

at improving security by streamlining and eliminating burdensome regulations that 

are a barrier to job creation in the transportation industry, and encouraging the use 

of technologies developed by the private sector. 

This subcommittee hearing will continue to focus on the wise use of taxpayer dollars and job creation by examining TSA’s technology procurement practices. I would 

like to see TSA fully engage the private sector in an open and transparent way for 
3 

the development and purchase of security technologies. I’d like to see progress on 

saving taxpayer dollars and creating private-sector jobs. I believe we can achieve 

this all while effectively securing the traveling public and the flow of commerce. 

I look forward to hearing the witness’ ideas for finding cost efficiencies and stimulating the growth of jobs through improved technology procurement at TSA. With 

that I yield to the Ranking Member, Ms. Jackson Lee of Texas, for any opening 

statement she may have. 

Mr. ROGERS. With that, I yield to the Ranking Member of the full 

committee, Mr. Thompson from Mississippi. 

Mr. THOMPSON. Thank you very much, Mr. Chairman. I welcome 

our panel of witnesses to the subcommittee hearing today. 

Under the Democratic majority, as you know, we held several 

hearings on the role of the Science and Technology Directorate, 

TSA’s technology vetting and approval process, and the need for 

DHS to align research with its mission. I am pleased that the oversight begun under our watch continues today. As we conduct oversight and continue steps toward reform, let us assure that S&T has 

sufficient funding. As you know, S&T is in line to make a major 

cut to its budget in the fiscal year. Programs would need to be 

scaled back and promising projects may be eliminated. Mr. Chairman, I hope you can work with us to stop these drastic cuts. 

Today’s hearing will evaluate the Department’s process to develop, procure, and deploy innovative technologies. It would have 

been helpful if we had had someone who currently works for the 

Department testify today. But I do look forward to hearing from 

Mr. Jackson and Ms. Duke, former Department employees. While 

they are unlikely to shed light on the current process, I hope they 

can shed light on the process used during their tenure. 

Some experts have said the failure to employ an effective process 

led to the puffer machine fiasco. For those who may not recall, I 

want to take a moment to recount the puffer machine story. The 

Department purchased these high-tech checkpoint screening machines for about $150,000 each. We were told that the machines 

would spray a short puff of air on a passenger. The machine would 

then analyze the debris that fell from the passenger and determine 

whether the passenger had been near explosive material. 

In the lab, the machine seemed to work. The maker promised 

that they would work. So TSA ordered 200 of them. However, in 

the real world, the machines were useless. They did not work. 

There was no way to make them work. After spending nearly $30 

million to buy and maintain the nearly 100 puffer machines deployed, TSA finally retired these machines. At one time, these machines were touted as a high-tech response to aviation security. 

Now, they are sitting in a warehouse and we have wasted $30 million. 

Why did this happen? It happened because the research, development, and testing of the technology was disconnected from the realworld use of the machines. 

We cannot allow another incident of this kind to occur. Every 

dollar we waste on ineffective technology is a dollar that will not 

be spent to secure this Nation. The puffer machine fiasco happened 

while Mr. Jackson and Ms. Duke were at the Department. I look 

forward to hearing from them about how the system that was in 

place then allowed for the procurement of these machines. 
4 

In the last few months, the Obama administration has attempted 

to reform research, development, and procurement practices at 

S&T. I hope that Mr. Jackson and Ms. Duke will share with this 

committee the difficulties they found in their attempts at reform. 

I look forward to hearing from our witnesses. 

I yield back. 

[The statement of Ranking Member Thompson follows:] 

PREPARED STATEMENT OF RANKING MEMBER BENNIE G. THOMPSON

SEPTEMBER 22, 2011 

Under the Democratic Majority, we held several hearings on: 

• the role of the Science and Technology Directorate; • TSA’s technology vetting and approval process; • the need for DHS to align research with its mission; and • examining whether research fulfilled mission-critical needs of the components. 

I am pleased that the oversight begun under our watch continues today. As we 

conduct oversight and consider steps toward reform, let us also assure that S&T has 

sufficient funding to do its job. 

As you know, S&T is in line to take a major cut to its budget in the upcoming 

fiscal year. Programs will need to be scaled back and promising projects may be 

eliminated. Mr. Chairman, I hope you can work with us to stop these drastic cuts. 

Today’s hearing will evaluate the Department’s process to develop, procure, and 

deploy innovative technologies. It would have been helpful to have someone who 

currently works for the Department testify today. 

But I do look forward to hearing from Mr. Jackson and Ms. Duke, former Department employees. While they are unlikely to shed light on the current process, I hope 

they can shed light on the process used during their tenure. 

Some experts have said that the failure to employ an effective process led to the 

‘‘Puffer’’ machine fiasco. 

For those who may not recall, I want to take a moment to recount the Puffer machine story. The Department purchased these high-tech checkpoint screening machines for about $150,000 each. 

We were told that the machine would spray a short puff of air on a passenger. 

The machine would then analyze the debris that fell from the passenger and determine whether the passenger had been near explosive materials. In the lab, the machines seemed to work. The maker promised that they would work. So TSA ordered 

over 200 of them. 

However, in the real world, the machines were useless. They did not work and there was no way to make them work. After spending nearly $30 million to buy and 

maintain the nearly 100 Puffers deployed TSA finally retired the machines. At one 

time, these machines were touted as a high-tech response to aviation security. Now 

they are sitting in a warehouse and we have wasted $30 million. 

Why did this happen? It happened because the research, development, and testing 

of the technology was disconnected from the real-world use of the machine. 

We cannot allow another incident of this kind to occur. Every dollar we waste on 

ineffective technology is a dollar that will not be spent to secure this Nation. The 

Puffer machine fiasco happened while Mr. Jackson and Ms. Duke were at the Department. 

I look forward to hearing from them about how the system that was in place then 

allowed the procurement of these machines. In the last few months, the Obama administration has attempted to reform the research, development, and procurement 

practices at S&T. I hope that Mr. Jackson and Ms. Duke will share with this committee the difficulties they found in their attempts at reform. 

Mr. ROGERS. I thank the Ranking Member. 

We are very pleased today to have a distinguished panel of witnesses before us on this important topic. Elaine Duke is the principal of Elaine Duke and Associates, LLC. She provides acquisition 

and business consulting services to a wide variety of clients. She 

specializes in assisting companies in doing business with the Federal Government. Ms. Duke had 28 years with the Federal Government—she started at age 3—culminating with her Senate confirmation on June 27, 2008, as the Department of Homeland Secu-
5 

rity’s Under Secretary for Management. As the Under Secretary, 

she was responsible for the management of the Department’s $47 

billion budget. We don’t use millions up here, apparently. 

She previously served in several positions within the Department, including Deputy Under Secretary for Management and 

Chief Procurement Officer. Ms. Duke assisted in the stand-up of 

DHS while at the Transportation Security Administration, where 

she served as Deputy Assistant Administrator for Acquisition beginning in August 2002. Ms. Duke spent a great deal of her career 

with the U.S. Navy, and she has held various acquisition positions 

of progressive responsibility. 

During her service with the Federal Government, Ms. Duke received the Presidential Meritorious Rank award, the DHS Secretary’s Medal, and the Transportation Security Administration’s 

Silver Medal for Customer Service, the Department of Army Commanders Award for Public Service, and the U.S. Coast Guard’s Distinguished Public Service. 

Ms. Duke, we are very proud to have you here today. You are 

recognized for your opening statement. 

STATEMENT OF ELAINE C. DUKE, PRESIDENT, ELAINE DUKE & 

ASSOCIATES, LLC 

Ms. DUKE. Good morning, Chairman Rogers and Members of the 

subcommittee. I am pleased to testify before the committee as it explores innovations in technology procurement to stimulate job 

growth. 

Mr. Chairman, I would like to begin by thanking you for your 

leadership over the years as a key member of the Homeland Security Committee. Since I was first standing up acquisition at TSA, 

through my time as the Department of Homeland Security as Chief 

Procurement Officer, and then Under Secretary for Management, 

you and this committee have provided me tremendous support. I 

am truly grateful. 

In this time of high unemployment, coupled with the debt ceiling 

crisis, each one of us must ask what can be done differently to contribute to economic recovery? The questions ‘‘What changes to the 

procurement process might stimulate job growth?’’ and ‘‘How can 

TSA improve efficiency and therefore save taxpayer dollars?’’ are 

important questions, and I thank you for letting me participate in 

this hearing. 

I believe Federal procurement can play a role in stimulating job 

growth in the United States. There are several measures that can 

be taken to ensure DHS, TSA technology, and other acquisition 

programs maximize job growth as they meet mission needs in partnership with industry. The key to making this happen is to get the 

funds that are appropriated to TSA for acquisition programs out 

into awarded contracts to our industry partners quickly effectively 

and efficiency. There are several steps that can be taken to do this. 

First, there must be the appropriate number of acquisition workforce personnel with the appropriate skill set to manage the acquisition programs. Now, more than ever, with flat and declining 

budgets, TSA must ensure that the acquisition workforce is properly positioned to manage its programs. That will ensure a couple 

of key features: First, that the requirement will be adequately de-
6 

fined so industry can prepare proposals and perform effectively. 

Good requirements lead to good competition. 

Second, the request for proposals and resulting contracts can be 

issued quickly and awarded without protest so the work can begin 

promptly and the industry partner can create and sustain jobs. 

Third, is the Government’s requirement will be met at the best 

price, with the appropriated funds not going to unnecessary overhead but to direct work in the related jobs. The acquisition program will deliver what the homeland security mission really needs. 

There are several key initiatives that will help ensure the desired result. One is continuation of the DHS’s acquisition workforce 

and its Acquisition Professional Career Program that provides a 

pipeline of acquisition professionals into the Federal workforce. Another is continued refinement of the functional integration authority over the departmental chiefs of the business lines. A third is the 

balancing of the Federal and acquisition workforce within DHS. 

There must be an appropriate balance of the Federal workforce and 

its industry partners. I don’t believe there is a magic formula of 

percentage and number. The amount of the workforce and control 

is dependent on the size and criticality of the program. 

An agency, regardless of its contractual relationship, must retain 

ownership and responsibility for being a good steward of the taxpayer dollars appropriated to that agency. 

Another important aspect of using procurement to stimulate job 

growth is to ensure there is strong regular communications with 

industry. The Federal Acquisition Regulation provides guidelines 

for market research that allow extensive communications with industry throughout the acquisition process. 

Taking maximum advantage of the communications not only 

makes for a better acquisition program, it helps industry by informing its business decisions. Bid and proposal decisions are critical in industry, and the cost to submit proposals for Federal procurements can be very high. Communications mutually inform so 

both parties—the U.S. Government and industry—can make the 

best, most precise, most efficient business decisions. 

Third, acquisition strategies, budgets, and requirements can 

work together. The current 25-Point Implementation Plan to Reform Federal Information Technology Management, for instance, 

points out that for the technology initiatives, such as cloud computing and shared services to work, there must be strong acquisition management, and more importantly, there must be an alignment between the programs, the acquisition process, and the budget cycle. 

Also, DHS, with TSA, must buy effectively and efficiently. That 

includes a robust strategic sourcing program and working towards 

the joint capabilities that are outlined in DHS’s integrated strategy 

for high-risk management. Improved procurement can benefit and 

help the United States move towards its economic recovery. 

I look forward to discussing this further through your questions. 

Thank you. 

[The prepared statement of Ms. Duke follows:] 
7 

PREPARED STATEMENT OF ELAINE C. DUKE

SEPTEMBER 22, 2011 

Chairman Rogers, Ranking Member Jackson Lee, and Members of the subcommittee, I am pleased to testify before the committee as it explores ‘‘Innovations 

in Technology Procurement to Stimulate Job Growth.’’ Mr. Chairman, I’d like to 

begin by thanking you for your leadership over the years as a key member of the 

Homeland Committee. Since I was first standing up the acquisition function at TSA, 

through my time as Department of Homeland Security’s Chief Procurement Officer 

and then Under Secretary for Management, you provided me tremendous support, 

and I am truly grateful. 

In this time of high unemployment coupled with the debt ceiling crisis, each one 

of us must ask what can be done differently to contribute to economic recovery. The 

questions ‘‘What changes to the procurement process might stimulate job growth?’’ 

and ‘‘How can TSA improve procurement efficiency, and therefore save taxpayer dollars?’’ are important questions and I again thank the committee for calling this 

hearing to explore answers to these critical questions. 

I believe Federal procurement can play a role in stimulating job growth in the 

United States. There are several measures that can be taken to ensure that DHS, 

TSA technology, and other acquisition programs maximize job growth as they meet 

mission needs in partnership with industry. The key is to get the funds that are 

appropriated to TSA for acquisition out into awarded contracts with industry partners quickly, effectively, and efficiently. There are several steps that can be taken 

to do this. 

First, there must be the appropriate number of acquisition workforce personnel, 

with the appropriate skill set, to manage the acquisition programs. Now more than 

ever, facing flat and declining budgets, TSA must ensure that its acquisition workforce is properly positioned to manage its program. That will ensure several key features: 

• The requirement will be adequately defined so industry can prepare proposals 

and perform most effectively. Good requirements lead to good competition. 

• The request for proposals and resulting contracts can be issued and awarded 

quickly and without protest, so work can begin promptly and the industry partner can create and sustain jobs. 

• The Government’s requirement will be met at the best price, with the appropriated funds not going to unnecessary overhead, but to direct work and the related jobs. 

• The acquisition program will deliver what the homeland security mission needs. 

There are several initiatives that will help ensure the desired results are 

achieved. 

• The DHS acquisition Workforce and its Acquisition Professional Career Program is providing a pipeline of new acquisition professionals into the Federal 

workforce. It is designed to provide both formal and on-the-job training and results in a well-qualified Federal acquisition workforce. 

• The functional integration authority of the Departmental chiefs over the component functions must continue to be refined. 

• A balancing of the Federal and contracting workforce within DHS. There must 

be an appropriate balance of Federal workforce and industry partners. There is 

no magic formula of percentage and number. The amount of Federal workforce 

and control is dependent on the size and criticality of a program. An agency, 

regardless of its contractual relationship, must retain the ownership and responsibility for being a good of steward of taxpayer dollars appropriated to that 

agency. Partnering with industry to perform the work is a key aspect of good 

stewardship, but accountability, at its core remains with the Federal agency. 

Critical functions should be performed with Federal employees to the extent required by the agency to maintain control of its mission. Once there are adequate 

Federal employees to control the critical functions (mission and operations), the 

work can be performed by private sector contractors, creating the properly balanced workforce and private industry job stimulation. 

Second, is there must be strong, regular communications with industry. The Federal Acquisition Regulation provides guidelines for market research that allow extensive communications with industry. Taking maximum advantage of the communications not only makes for a better acquisition program, it also helps industry but 

informing its business decisions. Bid and proposal decisions are critical for industry, 

and costs to submit proposals for Federal procurements can be very high. Communications mutually inform so both parties—the U.S. Government and industry—so 

they can make the best, most precise, most efficient business decisions. 
8 

Third, acquisition strategies, budgets, and requirements must work together. The 

25-Point Implementation Plan to Reform Federal Information Technology Management points out that for the technology initiatives, such as cloud computing, shared 

services, data centers to be effective, there must be strong acquisition management, 

the acquisition process must be aligned with the technology cycle, and the budget 

process must be aligned with the technology cycle. Industry will only partner with 

the Federal Government, and create jobs, if the business risk is appropriate. The 

Federal procurement system must, with industry engagement, develop acquisition 

strategies that deliver the technology solution with appropriately manageable financial, performance, and schedule risk. 

Fourth, DHS, with TSA, must buy efficiently and effectively, thus enabling industry to operate efficiently and effectively. There are two facets to this point. The first 

is based around finding commonality in requirements within DHS missions and programs, and defining requirements and filling those requirements in a joint manner. 

DHS’s Integrated Strategy for High Risk Management Implementation and Transformation, discusses the formation of Functional Coordination Offices and a Capabilities & Requirements Council among the key initiatives to increase DHS management integration. This will require a rationalization of requirements that will greatly contribute to effectiveness and efficiency in procurement. The second facet is that 

agencies must continue to use and grow strategic sourcing programs to procure 

goods and services more effectively. Strategic sourcing leverages the buying power 

of TSA, DHS, and the Federal Government. 

Improved procurement not only provides economic benefit to our country in terms 

of effective use of tax dollars and job creation, it also helps ensure screening technologies actually make the traveling public safer. TSA must buy the right things 

at the right time for the right price to meet the homeland security threat, currently 

and as it evolves. The initial stand-up of TSA was focused on Federalizing the airports. As it matures, TSA must find the right mix of technology, people, and systems. A risk-based approach, facilitating freedom of movement of goods and people 

while providing adequate security for evolving threats against homeland security is 

a critical facet of the path forward. The approach must provide security for the 

present, while always anticipating and prepared to evolve to adapt to changes in 

threat and security technology. 

Thank you for the opportunity to participate in your discussions regarding the 

ability of sound procurement to contribute to job growth and economic stability. I 

look forward to your questions. 

Mr. ROGERS. Thank you. Next, we have Michael Jackson, President and founder of Firebreak Partners, LLC, a firm that designs, 

finances, and deploys high-value security technology networks to 

protect airports, seaports, and other critical infrastructure. Mr. 

Jackson has extensive experience in executive positions in both the 

private sector and Federal Government. From early 2005 through 

October, 2007, he was Deputy Secretary of the U.S. Department of 

Homeland Security. In this role, he was the Department’s chief operating officer, with responsibility for managing day-to-day operations in DHS. Mr. Jackson served as Deputy Secretary to the U.S. 

Department of Transportation from May, 2001 to August, 2003. 

His tenure there was particularly focused on DOT’s response to 

9/11 terrorist attacks, including creation of the new Transportation 

Security Administration and the management of the recovery efforts for the Nation’s aviation industry. Mr. Jackson also held positions working for Presidents George H.W. Bush and Ronald 

Reagan. In addition, Mr. Jackson has worked at a number of private technology corporations. He has been a researcher at the 

American Enterprise Institute, and taught political science at the 

University of Georgia and Georgetown University. 

Mr. Jackson, thank you for being here. We look forward to your 

testimony. You are recognized. 
9 

STATEMENT OF MICHAEL P. JACKSON, PRESIDENT, 

FIREBREAK PARTNERS, LLC 

Mr. JACKSON. Good morning, Mr. Chairman. Thank you very 

much for having me here today. Ranking Member Thompson, 

thank you for being with us this morning. I appreciate your presence as well and the opportunity to talk about TSA and the topic 

of this hearing. 

Technology, obviously, is a vital component of TSA’s success and 

its mission. Congress has generously funded billions of dollars in 

technology for this agency over the decade following the attacks of 

9/11. Over that period, TSA has made substantial progress. Yet 

today, simple procurement tools and technologies could deliver 

meaningful budget savings and improved security. Moreover, with 

Congressional approval and with no additional cost to the taxpayers, TSA could also easily increase the number of jobs in America, and do so relatively quickly, particularly with simple affirmation of alternative financing. My written testimony provides additional material about all of these ideas. But I have essentially focused on four points. I would like to today summarize those four 

points by way of introduction. 

First, the first recommendation I would have is to authorize alternative financing and operating lease agreements as proposed to 

TSA by public commercial airport authorities. These transactions 

would leverage private sector capital to acquire and maintain security technology for inline baggage systems, checked baggage inspection, passenger checkpoint screening, and other associated technology needs. 

TSA faces just a formidable array of needs for the technology to 

do its work to get operating efficiencies and to do their screening 

tasks more effectively. 

I would argue or suggest that Congress should consider authorizing TSA—even better, instructing TSA—at least to experiment 

and adopt alternative financing transactions. There are multiple 

ways to structure these types of transactions that would bring capital that could attract literally billions of dollars into this important 

need for airports and TSA. My testimony explains in more detail, 

for example, a proposal from two airports that would have leveraged approximately $198 million in private sector investment to 

support TSA. TSA rejected the proposal a few months ago because 

its staff thought it lacked statutory authority to exercise an appropriate operating lease arrangement with these airport authorities. 

The second recommendation is to privatize DHS’s transportation 

security lab certification testing for explosive detection equipment, 

as has been pioneered by the European Union. The process that 

DHS uses for certification testing for explosive detection needs rethinking, it needs your focus, it needs your attention and examination. The current process is unnecessarily expensive, both for taxpayers and for vendors who use the system. It is excessively timeconsuming and the process for obtaining approvals lacks clarity, 

transparency, the resources, and adequate institutional capacity for 

making this happen more quickly. The E.U. governments have successfully privatized this function. My written testimony explains 

why that should be considered here in the United States. 
10 

The third recommendation I would like to lay on the table is for 

TSA to create a TSA version of an ‘‘X-Prize’’ by replacing at least 

some of TSA’s traditional R&D equipment funding with resultsbased achievement testing awards. Such awards can stimulate 

breakthrough innovations in checkpoint and checked baggage 

screening, and better leverage private investment. 

Pure and simple, we should at least look at some technology incentive investments that reward getting the job done rather than 

making promises for a job to be done. 

The final recommendation is insist that any new core explosive 

detection imaging system—CT, AT, AIT, trace detection, these 

types of tools—that are sold to TSA, after some reasonable date to 

be determined must have presented image data outputs in an open 

source format. In addition, requiring manufacturers to provide sufficient software transparency to allow TSA the option to develop 

modular common-use apps routinely that could help upgrade the 

software. This is a big problem. The GAO has done a good report 

recently on this topic. 

This type of thing is not hard to do. I thought when I was at 

DHS that it was a good idea. I gave a speech for it. It immediately 

met with a resounding reaction from the vendor community. They 

just hated it. It is understandable. But I would just urge you to dig 

into this topic because it is really something that has transformed 

the medical community and can transform TSA operations. 

In conclusion, these four authorizations seem, in a way, disarmingly simple or small-bore things perhaps, but together they offer 

specific systemic procurement reform as regards to TSA technology 

acquisition and promise transformational change for the agency. 

I thank you and look forward to your questions. 

Mr. ROGERS. I thank you. 

[The prepared statement of Mr. Jackson follows:] 

PREPARED STATEMENT OF MICHAEL P. JACKSON

SEPTEMBER 22, 2011 

Good morning Chairman Rogers, Ranking Member Jackson Lee, and distinguished Members of the subcommittee. I appreciate the opportunity to appear before 

you today and to share some thoughts about the Transportation Security Administration (TSA) and the important topic of this hearing. 

Technology is a vital component of TSA’s mission and essential to its success. 

Congress has generously funded billions of dollars in technology for this agency over 

the decade following the attacks of 9/11. The topic of this hearing suggests two introductory, orienting questions: 

• Can further innovations at TSA regarding technology acquisition allow the 

agency to reduce cost while improving security? 

• Can TSA’s technology investments be structured to maximize job creation in 

these difficult economic times? 

The answer to both is clearly yes. Tools to deliver budget reductions and better 

security are readily available. Moreover, with Congressional approval—and with no 

additional cost to taxpayers—TSA could also easily increase the number of jobs in 

America, and do so relatively quickly. 

As a private citizen, I offer four recommendations for Congressional action that 

can significantly advance the objectives being explored by today’s hearing: 

1. Authorize ‘‘alternative financing’’ operating lease agreements as proposed to 

TSA by public commercial airport authorities. These transactions would leverage private sector capital to acquire and maintain security technology for in-line 

baggage systems, checked baggage inspection, passenger checkpoint screening 

and potentially other needs. 
11 

1 Congress and the administration have allocated a great deal of cash to this problem, especially during the last 2 years. Yet the number of priority airports (TSA’s Category X–III targets) 

that are still not fully funded remains large. TSA’s fiscal year 2012 Congressional Budget Justification reports that only 187 of the 286 largest airports (CAT X–III) will have CBIS systems 

completed for the entire airport at the end of fiscal year 2011 (p. A–23). The fiscal year 2011 

Budget Justification predicted that TSA would not reach 100 percent coverage even for the largest airports until 2018 (p. AS–30). Some airports lack capacity to fund projects effectively under 

TSA’s current business model. Those airports are, in many cases, not yet even in the early 

stages of TSA’s project funding queue. Moreover, several of the more expensive projects completed early after 9/11 have failed by a notable margin to meet the minimum throughput standards that TSA set for such systems (∼400 bags per hour) and would need almost wholesale replacement to support even the currently certified medium-capacity EDS machines, let alone the 

higher-capacity EDS machines that could improve performance and further reduce TSA capital 

and operating expenses at those airports. 

2. Privatize the DHS’s Transportation Security Lab certification testing for explosive detection equipment, as has been pioneered in the European Union. 

3. Create TSA’s version of an ‘‘X-Prize’’ by replacing at least some of TSA’s traditional R&D equipment funding with results-based achievement awards. Such 

awards can stimulate breakthrough innovations in checkpoint and checked bag 

screening, and better leverage private investment. 

4. Insist that any new core explosive detection imaging systems (CT, AT, AIT, 

and the like) sold to TSA after a reasonable date certain generate image data 

outputs in an open-source format. Additionally, require manufacturers to provide sufficient software transparency to allow TSA the option to develop modular, common-use aps for routinely upgrading explosive detection algorithms for 

its entire network of detection systems. 

What follows offers a few words about each of these recommendations. My purpose is not to explore any single one in great depth, instead to provide a high-level 

summary that can guide further assessment by the subcommittee, if of interest. 

Alternative Financing Agreements.—TSA faces a formidable array of financial demands to fuel its critical technology needs. The single most expensive category of 

investment has been in-line checked baggage inspection systems. These investments 

clearly improve security and airport operations, diminishing delays, and passenger 

inconvenience. 

With each efficient in-line baggage system, TSA also typically generates meaningful cost savings for its own operation—for its capital budgets, because TSA purchases fewer explosive detection systems (e.g., EDS and trace detection) and for 

operational budgets because TSA achieves greater personnel efficiency, increased 

screening throughput, lower maintenance, fewer consumables and reduced energy 

consumption. These TSA savings often total millions of dollars annually, even at a 

mid-sized airport. 

Although TSA has a large backlog of in-line checked baggage system projects that 

have been funded but not completed, there remains a large backlog of unfunded inline system needs that will require more billions of dollars and many years to eliminate.1 TSA has been chasing this backlog since 2002. In fact, some of the expensive 

projects initially funded by TSA must now regrettably be upgraded to accommodate 

today’s requirements for higher-speed screening technology. 

Aside from in-line baggage system investments, TSA is also juggling numerous 

other formidable capital needs for technology. These include checkpoint equipment 

modernization, exit lane breach control (for which effective technology is available 

to allow reassignment of guards who now stand watch at exit lanes), risk-based 

screening infrastructure, credential validation systems, efficient physical security 

device management (for cameras, video recorders, door locks, etc.), multiplexing of 

threat detection imaging for more efficient and effective review remotely (TSA has 

recently published a Request for Information seeking technologies that can make 

this happen), and more. 

For the next several years, TSA’s capital budgets will face a particular squeeze 

in order to recapitalize its first-generation EDS machines and related technologies, 

which are now reaching the end of anticipated service life. It is simply not practical 

to fund all of TSA’s needs with a business model that continues to ask Congress 

to write such large checks. Yet absent investment, better security, greater efficiency, 

TSA cost reductions and customer service improvements will be deferred. 

Alternative financing can and should play a role in meeting TSA mission needs. 

There are multiple business models that work, and there will be many airports willing to engage with TSA creatively, if allowed. These solutions don’t require complex 

tax code changes or exotic and risky financing structures. They would simply leverage the way airports for decades have done business. 
12 

But to jump-start this common-sense investment, Congress must authorize TSA— 

even better, instruct TSA—at least to experiment in adopting alternative financing 

transactions. By legislatively cutting through one or two project scoring nits that are 

perceived by TSA staff to be impediments, Congress can make it possible for TSA 

to negotiate operating leases for security technology, just as TSA does today with 

regard to leasing office space and obtaining other essential services from airports 

Nation-wide. TSA authorizing legislation would simply recognize affirm the unique 

dependencies that exist between TSA and airport authorities, allowing governmentto-government alternative financing transactions to be funded, especially at today’s 

unprecedented favorable rates. 

Sensible alternative financing can literally attract billions of dollars of investment 

from the private sector. Not 2 or 3 years from now. Now. This approach can facilitate many airport in-line baggage system improvement projects, which can easily be 

completed at lower cost and in less than half the time required to complete an identical project funded with TSA’s existing procurement model. Putting Americans to 

work and supporting TSA’s mission. I’ll give a quick overview of one approach with 

which I have been personally involved. 

In September of last year two airport authorities—supported by Delta Air Lines, 

Southwest Airlines, the Vic Thompson Company (arguably the leading U.S. engineering firm specializing in aviation security project work) and my firm—formally 

proposed two alternative financing lease agreements to TSA. We had others ready 

to follow. These first two transactions together offered an estimated $198 million in 

private-sector investment to design, purchase, and maintain in-line baggage systems, explosive detection equipment, and checkpoint modernization technology. 

As proposed, at each airport, the airport authority would make the screening technology and infrastructure needed by TSA available to the agency through a multiyear services agreement (the proposed term was 8 years). Screening systems currently operated by TSA (or regulated in any way by TSA) would, of course, meet 

all TSA performance standards, relevant equipment certifications and operational 

requirements. 

The two transactions were part of a proposed new pilot program of security investments, which the offerors called the Next Stage Investment (NSI) program. 

NSI does not contemplate any change regarding existing operational roles and obligations at the airport. TSA would, for example, still be responsible for operating 

or overseeing private sector operations regarding checked bag and checkpoint 

screening. By pilot testing an alternative to TSA’s existing buy-own-maintain business model, TSA can gain remarkable advantages, while preserving all of its inherently Governmental discretion and operational control. 

The NSI program is not an ordinary commercial enterprise; rather, it is a government-to-government agreement that leverages private sector skills in support of a 

compelling public interest. NSI can substantially improve aviation security—and do 

so much more quickly, at a lower project cost and more comprehensively than can 

be achieved using TSA’s existing business model for infrastructure investment. The 

offerors are convinced that their alternative financing pilot program provides a compelling value proposition for TSA and the aviation industry. 

NSI would generate well-paying jobs and other near-term economic activity with 

its technology purchases, project design, construction and private sector program 

management. Monthly fees to be paid by TSA under the services agreement would 

not begin until after system acceptance. In other words, NSI transactions would 

truly be quick-start projects. Because TSA does not have to obligate funds up front 

to get an NSI project off the ground, they offer a very efficient way to reduce the 

backlog of TSA project needs without imposing on Congress for large capital budget 

appropriations. A way to pilot test technology innovations of all sorts. 

The offerors can prove that the proposed NSI projects are sound financial investments for TSA—reducing overall project costs, decreasing the number of TSA employees needed for on-going screening operations and reducing overhead costs at 

TSA headquarters. NSI projects can considerably reduce TSA’s dauntingly large 

backlog of near-term technology investment needs. They can smooth investment 

spikes and increase flexibility to pay for what will otherwise be large capital budget 

needs for years ahead. Many of the savings achieved drop straight to TSA’s bottom 

line, generating annual saving each year ahead. 

Such alternative financing tools can help DHS and Congress balance the need to 

reduce Federal budget outlays while meeting DHS mission needs. The NSI and 

other alternative financing approaches proposals therefore raise transactional policy 

issues that are strategically significant for the long-term success of TSA and to DHS 

overall. In sum, the NSI program constitutes a potentially transformational business model for acquisition and maintenance of aviation security technology. 
13 

So what happened with the two proposals? TSA staffers reviewed them and decided that the transactions would have to be scored as a capital lease rather than 

an operating lease, thus making the transaction unworkable. This was based on a 

conservative interpretation of OMB Circular A–11 (Appendix B), one that I would 

invite Members to review. However, a simple legislative waiver allowing TSA to accept proposals for such transactions would, I’m convinced, unlock very considerable 

benefits for TSA. 

2. Privatize the DHS’s equipment certification testing.—The process within DHS 

for providing certification testing for explosive detection systems needs re-thinking. 

Today, the Transportation Security Laboratory (TSL), a part of the DHS Science 

and Technology Directorate, conducts such certification testing for TSA. A legacy 

FAA organization, TSL is home to many highly talented individuals, men and 

women who do work that is essential to DHS’s mission. Certification testing is not 

a task that needs to remain on their plate. 

The current process is unnecessarily expensive, both for the taxpayers and for 

vendors seeking certification of devices. It is excessively time-consuming and the 

process for obtaining approvals lacks clarity, transparency, resources, and an adequate institutional capacity for working more quickly. 

The gauntlet through which equipment manufacturers must navigate is dispersed 

to several different testing locations. Vendors must often guess at the requirements 

for success. If a firm is trying, for example, to get a new EDS machine certified it 

starts with something called certification readiness testing. Later, it ships a prototype machine to TSL’s Atlantic City, New Jersey facility. There it undergoes testing 

with military and commercial explosives. Much of the actual work supporting certification is done by TSL-contracted labor. In addition, the firm has to send another 

prototype to Tyndall Air Force Base in Florida for testing with more exotic and unstable threat materials. Tyndall then sends their data and images up to New Jersey 

for review. If successful, the applicant has to send a prototype machine for integration testing to a facility outside of Washington, DC, and later elsewhere for operational testing in an actual airport environment. 

If you fail at any stage (certification testing is appropriately binary; miss something on the extensive test-list and you fail), you pull out, try to fix the problems 

and ask for a spot in the busy queue to start over. In short, the process is unnecessarily bureaucratic—and a substantial impediment to innovation. I have spoken 

over the last 3 years with numerous successful venture capital investors who fund 

various security start-ups or early stage businesses. Most of them won’t even go 

near any investment that has to end up subjected to this certification process. That’s 

a market-driven recognition that this essential process is too much cloaked in mystery, delay, and excessive cost. In short, too often the process unintentionally 

squelches innovation. 

What would an alternative process look like? First, TSL and TSA would still be 

responsible for formulating and promulgating the performance standards that any 

particular class of equipment (AIT, checked baggage inspection, checkpoint bag inspection, trace detection, etc.) must meet. That is an inherently Governmental task. 

Performance standard-setting should be a collaboration that brings together technologists with TSA and DHS intelligence analysts. It is the military and intelligence 

community that is continuously gathering relevant field information. Getting 

enough clarity to outsource testing will almost certainly make for more rigorous, 

adaptable, and transparent standards. 

Then, DHS would design and conduct a procurement to select one or (ideally) two 

vendors. The winners would receive multi-year charters to establish integrated professional teams qualified to do the testing. There should be greater transparency 

about the performance standards for testing. Like an Underwriters Laboratory does 

in other areas. The National Labs, non-profits such as Battelle or MITRE, some university labs, and various for-profit corporations have the basic program capabilities 

needed. The certification testing would be provided to industry on a fee-for-service 

basis. If the Government likes, DHS could take half of what it currently spends on 

this task and buy down the retail testing cost with a subvention for the testing 

lab(s). Or take part of that cost savings and apply those funds to results-based 

achievement awards (see below). 

With private lab, if a particular machine fails a test, it might not be necessary 

to withdraw altogether and re-schedule. Perhaps the same lab might also become 

a center of expertise that could help both fledgling entrepreneurs and established 

corporations improve the products. That’s not appropriate or possible if DHS is 

doing the testing. It is a given that such labs would be appropriately trained and 

resourced, and routinely audited by DHS. 

In the end, the testing lab would make a recommendation for a certification to 

TSA, which would still own that final decision. 
14 

2 United States Government Accountability Office, Aviation Security: TSA Has Enhanced Its 

Explosive Detection Requirements for Checked Baggage, but Additional Screening Actions Are 

Needed (Washington, July 2011), GAO–11–740. 

This model has been adopted within the European Union (EU) and it works well. 

There are four E.U. labs that provide comparable certification testing in Europe— 

they are located in France, the United Kingdom, Germany, and Holland. The latter 

two are privately-owned facilities. 

Why is this important? Because the threats are real, and we owe it to TSA to put 

in place the best possible package of incentives to spur aggressive innovation by the 

private sector. A more efficient certification process should be part of such an incentive package. 

3. Results-based achievement awards.—Ten years into TSA’s life, it is worth the 

effort for Congress and TSA to engage in a fresh dialogue about how best to structure TSA’s research grant program for new technologies. To date, DHS has devoted 

considerable dollars to various development grants or R&D grants for firms working 

on what seem to be promising avenues of study. These grants kept some struggling 

firms in the hunt. Even still, only some TSA investments proved successful, others 

were duds. 

Alternatively, I’m convinced that a results-oriented award program for winning 

technologies would offer more effective incentives, especially when paired with a 

more transparent and swift certification process. TSA needs the functional equivalent of a permanent X-Prize. This would offer a ring to chase, notoriety to be won, 

and cash to be awarded if you are the first (or perhaps also the second) to obtain 

certification for a breakthrough technology. 

If we had offered such a grant in 2008 or 2009 for an AT machine that accurately 

identified liquid explosives in a carry-on bag, the loathed ‘‘3–1–1 rule’’ might today 

be history. 

These prizes would be meaningful only if they were rewards for taking security 

to a noticeably higher level, not for incremental change. A given prize should be 

large enough to constitute a reward and an incentive. TSA should pay more if the 

private sector delivers results faster. Achieving a TSA-endorsed goal might be worth 

a fixed amount if delivered in, say, 2 years. But perhaps twice as much, if delivered 

in one. I can imagine that a non-profit foundation might be formed with public contributions to support TSA by matching, for example, a given string of awards. 

A prize would perhaps also help to re-align how investors in new technology view 

the homeland security technology market. In essence, this is simply a suggestion to 

look closely at how grant incentives are awarded today, and ask if they might, at 

least in part, be better based also on rewards for performance, not just promises. 

I have no clue what Administrator Pistole’s lawyers or his procurement chief 

would say about whether TSA has the legal authority to do this. But if the specific 

authorization were to come from Congress, this subcommittee would certainly be a 

good place to get the ball rolling. 

4. Open source data, image standards and a TSA app factory.—In an earlier life 

in the public sector, I became convinced that this final recommendation was potentially transformational. So I gave a speech about it one day at a large industry gathering. It quickly evoked a reaction from TSA’s technology vendor community: They 

hated it. 

Members of this subcommittee may get the same reaction. Still, I think it is worth 

insisting on this legislatively, in some way or another. 

What is the basic recommendation? To give TSA the mandate to insist that any 

new core explosive detection imaging equipment (CT, AT, AIT, and the like) sold 

to TSA after a reasonable date certain must compile its image data outputs in an 

open-source format (format to be determined). Moreover, the manufacturers should 

be required to provide such additional software transparency as required to allow 

TSA to develop and deploy modular, common-use apps that would routinely upgrade 

explosive detection algorithms in its equipment. 

In July of this year the Government Accountability Office published an insightful 

report that is germane to this suggestion.2 It explains the extraordinary complexity 

of the job of implementing needed configuration management and software upgrades 

for TSA’s inventory of EDS equipment and other screening devices, such as electronic trace detection. There are at least two big parts to this problem. The first 

is keeping up with what is known about terrorist bomb-making innovations. Of 

course, TSA has the on-going obligation to convert intelligence about those threats 

into equipment performance standards and operational protocols. But the second 

problem is that all of TSA’s explosive detection equipment runs with proprietary 
15 

software, which TSA has virtually no ability to control once it has bought one of 

these long-life tools. 

So if TSA needs a specific software change, they are at the mercy of getting it 

from a welter of original manufacturers. I’d vouch for that community to say there 

is an enormous reservoir of professionalism in the manufacturing community. A 

commonality of interest. But not perfect alignment. TSA is more or less at the 

mercy of each manufacturer of its legacy screening equipment to design and implement system modifications as needed. Of course, TSA is expected to pay for any 

such changes. The changes themselves and the costs are usually not trivial. The 

GAO report shed light on some of the problems regarding this process, both at TSA 

and among the vendors. 

These circumstances are not unlike what existed with owners of cellular phones 

prior to introduction of the iPhone, and later its competition. By making the core 

software that ran these gizmos open-source, Apple empowered individuals with specific interests to write their own apps. When a lot of people wrote apps, those innovations began to cascade, redefining what was possible and therefore what tools 

users could expect. In recent years, the medical community has made a similar, dramatic progress in standardizing software protocols for essential diagnostic and business tools. 

TSA finds itself with identical needs with respect to their imaging technology providers. Changing the status quo would not be easy, but dividends are large. In each 

case, the software component of a given machine is a vendor’s secret sauce. So that 

makes for an untidy stew at TSA. On the other hand, if there were greater openness 

and standardization with software across these systems, that would enable greater 

flexibility and creativity. It would allow TSA to retain an outrageously talented 

team to do configuration management and to support innovation, matching the pace 

of threat changes in the real world. This would take a bit of time and a lot more 

detailed planning, but again, it would offer a transformational responsiveness and 

strengthen homeland security. 

In close, I’d like again to thank the Members of the subcommittee for affording 

me the time to present these four ideas. Taken together, they constitute a cluster 

of tools that could give TSA remarkable new capabilities to spur innovation, acquire 

and utilize technology, and create economic opportunity. 

Mr. ROGERS. Next, we have Steve Lord. He is the GAO executive 

responsible for directing GAO’s numerous engagements on the 

aviation surface transportation issues and regularly discusses these 

issues before Congress and at industry forums. He has recently 

conducted in-depth reviews of TSA’s of passenger checked baggage 

and air cargo screening programs, which led to significant improvements at TSA’s operations. Before his appointment to senior executive service in 2007, he led GAO’s work on a number of key international security, finance, and trade issues. Mr. Lord has received 

numerous GAO awards for meritorious service and outstanding 

achievement. 

Mr. Lord, we appreciate your presence before this committee and 

on the many occasions you have been here, and look forward to 

your testimony. 

You are recognized. 

STATEMENT OF STEPHEN M. LORD, DIRECTOR, HOMELAND 

SECURITY, GOVERNMENT ACCOUNTABILITY OFFICE 

Mr. LORD. Thank you, Mr. Chairman. I am pleased to be here 

today to discuss TSA’s progress and related challenges in not only 

developing but fielding new technology. As you and Representative 

Thompson have indicated, these programs represent billions of dollars in life-cycle costs. This is obviously a very important issue. 

What I would like to do today is summarize some of the key insights gleaned from our recent work in this area related to DHS 

and TSA acquisition. They are in the three following areas: Our 

work has emphasized the importance of, No. 1, developing clear 
16 

program requirements; our work has also demonstrated the importance of testing and conducting oversight of the acquisition process; 

and third, our work also has highlighted the importance of conducting cost/benefit analysis to guide your acquisition and deployment decisions. 

Regarding the first point, requirements, our past work has highlighted the importance of setting clear requirements up front. Otherwise, you have difficulty further in the process in achieving successful outcomes and you run the risk of increasing the costs of 

your programs if it is unclear what you are trying to achieve. For 

example, in June, 2010, we reported that over half of the 15 DHS 

programs we reviewed in detail lacked documented approval of key 

planning, requirement setting, and program baseline documents. 

These are all very important planning steps that you need to conduct up-front to ensure you have good outcomes. 

Regarding TSA, we also found that TSA faced similar challenges 

in identifying and meeting requirements in some programs. For example, in July, a few months ago, we reported that TSA revised it 

is checked baggage explosive detection requirements in January of 

this year, which we view as a good thing to better detect new 

threats. However, while the specific numbers are sensitive security 

information, some of the current machines are configured to detect 

explosives at the 2005 levels while the other machines are configured to detect explosives at the 1998 levels. 

So we recommended, given the disparities between the current 

requirements and the current capabilities, we recommend that TSA 

develop an action plan to better ensure new and deployed equipment meets current requirements. TSA agreed with our recommendation and has begun to take appropriate steps. 

In a recent report, we also recommended that TSA establish a 

better process for communicating with the vendor community, 

these are issues that Mr. Jackson and Ms. Duke previously raised, 

such as through industry days and kickoff meetings. This has been 

a reoccurring issue. We identified similar communication issues in 

our 2009 report. 

Regarding testing, our prior work has identified several challenges which can lead to problems down the road in achieving desired incomes. For example, we recently reported on the role played 

by S&T’s test and evaluation and standards office. This is an important development. TSA stood this office up to ensure proper 

testing at the component level. We found it could do a better job 

in reviewing and approving the testing agents conducting testing 

across DHS. 

Another testing issue we identified is related to our July checked 

baggage screening report. We found TSA was trying to collect explosives test data as the same time as it was procuring new baggage screening machines. This is not to say it couldn’t be done. 

This major strategy is a higher risk. We found that this led to some 

delays in the acquisition process. Thus, we recommended that TSA 

collect the needed data before starting the procurement process for 

new machines and upgrades. 

In the earlier report, and as previously referenced by Representative Thompson, we found that TSA deployed explosive trace portals, or puffers, before they demonstrated reliable performance in 
17 

an airport environment. As a result of this setback, TSA has 

agreed and changed their processes to better test new technology 

before deploying it to airports. 

Finally, our prior work has shown that cost/benefit analysis can 

be a useful tool when making acquisition decisions. The good news 

is that in June of this year, in response to these and other reports, 

the Department has reported taking steps to strengthen its investment and acquisition process. But as we reported earlier, it is too 

soon to tell whether this is going to have the desired effect. 

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

any questions you may have. 

[The prepared statement of Mr. Lord follows:] 

PREPARED STATEMENT OF STEPHEN M. LORD

SEPTEMBER 22, 2011 

GAO HIGHLIGHTS

Highlights of GAO–11–957T, a testimony to the Subcommittee on Transportation 

Security, Committee on Homeland Security, House of Representatives. 

Why GAO Did This Study 

Within the Department of Homeland Security (DHS), the Transportation Security 

Administration (TSA) is responsible for developing and acquiring new technologies 

to address homeland security needs. TSA’s acquisition programs represent billions 

of dollars in life-cycle costs and support a wide range of aviation security missions 

and investments including technologies used to screen passengers, checked baggage, 

and air cargo, among others. GAO’s testimony addresses three key challenges identified in past work: (1) Developing technology program requirements, (2) overseeing 

and conducting testing of new technologies, and (3) incorporating information on 

costs and benefits in making technology acquisition decisions. This statement also 

addresses recent DHS efforts to strengthen its investment and acquisition processes. 

This statement is based on reports and testimonies GAO issued from October 2009 

through September 2011 related to TSA’s efforts to manage, test, and deploy various 

technology programs. 

What GAO Recommends 

GAO is not making any new recommendations. In prior work, GAO made recommendations to address challenges related to deploying EDS to meet requirements, overseeing and conducting testing of new technologies, and incorporating information on costs and benefits in making technology acquisition decisions. DHS 

and TSA concurred and described actions underway to address the recommendations. 

HOMELAND SECURITY: DHS AND TSA ACQUISITION AND DEVELOPMENT OF NEW

TECHNOLOGIES

What GAO Found 

GAO’s past work has found that TSA has faced challenges in developing technology program requirements on a systemic and individual basis. Program performance cannot be accurately assessed without valid baseline requirements established 

at the program start. In June 2010, GAO reported that over half of the 15 DHS 

programs (including 3 TSA programs) GAO reviewed awarded contracts to initiate 

acquisition activities without component or Department approval of documents essential to planning acquisitions, setting operational requirements, or establishing 

acquisition program baselines. At the program level, in July 2011, GAO reported 

that in 2010 TSA revised its explosive detection systems (EDS) requirements to better address current threats and plans to implement these requirements in a phased 

approach. However, GAO reported that some number of the EDSs in TSA’s fleet are 

configured to detect explosives at the levels established in the 2005 requirements 

and TSA did not have a plan with time frames needed to deploy EDSs to meet the 

current requirements. 

GAO has also reported DHS and TSA challenges in overseeing and testing new 

technologies. For example, in July 2011, GAO reported that TSA experienced challenges in collecting data on the physical and chemical properties of certain explo-
18 

1See the related products list at the end of this statement. 

sives needed by vendors to develop EDS detection software and needed by TSA before procuring and deploying EDSs to airports. TSA and DHS Science and Technology Directorate have experienced these challenges because of problems associated 

with safely handling and consistently formulating some explosives. The challenges 

related to data collection for certain explosives have resulted in problems carrying 

out the EDS procurement as planned. In addition, in October 2009, GAO reported 

that TSA deployed explosives trace portals, a technology for detecting traces of explosives on passengers at airport checkpoints, in January 2006 even though TSA officials were aware that tests conducted during 2004 and 2005 on earlier models of 

the portals suggested the portals did not demonstrate reliable performance in an 

airport environment. In June 2006, TSA halted deployment of the explosives trace 

portals because of performance problems and high installation costs. 

GAO’s prior work has shown that cost-benefit analyses help Congressional and 

agency decision-makers assess and prioritize resource investments and consider potentially more cost-effective alternatives, and that without this ability, agencies are 

at risk of experiencing cost overruns, missed deadlines, and performance shortfalls. 

GAO has reported that TSA has not consistently included these analyses in its acquisition decisionmaking. 

In June 2011, DHS reported that it is taking steps to strengthen its investment 

and acquisition management processes by implementing a decision-making process 

at critical phases throughout the investment life cycle. The actions DHS reports taking to address the management of its acquisitions and the development of new technologies are positive steps and, if implemented effectively, could help the Department address many of these challenges. 

Chairman Rogers, Ranking Member Jackson Lee, and Members of the subcommittee: I am pleased to be here today to discuss our past work examining the 

Transportation Security Administration’s (TSA) progress and challenges in developing and acquiring new technologies to address homeland security needs. TSA acquisition programs represent billions of dollars in life-cycle costs and support a wide 

range of aviation security missions and investments including technologies used to 

screen passengers, checked baggage, and air cargo, among others. Within the Department of Homeland Security (DHS), the Science and Technology Directorate 

(S&T) has responsibility for coordinating and conducting basic and applied research, 

development, demonstration, testing, and evaluation activities relevant to DHS components, which also have responsibilities for developing, testing, acquiring, and deploying such technologies. For example, TSA is responsible for securing the Nation’s 

transportation systems and, with S&T, researching, developing, and deploying technologies to, for example, screen airline passengers and their property. 

In recent years, we have reported that DHS has experienced challenges in managing its multibillion-dollar acquisition efforts, including implementing technologies 

that did not meet intended requirements and were not appropriately tested and 

evaluated, and has not consistently included completed analyses of costs and benefits before technologies were implemented. 

My testimony today focuses on the key findings of our prior work related to TSA’s 

efforts to acquire and deploy new technologies to address homeland security needs. 

Our past work has identified three key challenges: (1) Developing technology program requirements, (2) overseeing and conducting testing of new technologies, and 

(3) incorporating information on costs and benefits in making technology acquisition 

decisions. This statement will also discuss recent DHS and TSA efforts to strengthen its investment and acquisition processes. 

This statement is based on reports and testimonies we issued from October 2009 

through September 2011 related to TSA’s efforts to manage, test, and deploy various 

technology programs.1 For our past work, we reviewed program schedules, planning 

documents, testing reports, and other acquisition documentation. For some of the 

programs we discuss in this testimony, we conducted site visits to a range of facilities, such as national laboratories, airports, and other locations to observe research, 

development, and testing efforts. We also conducted interviews with DHS component program managers and S&T officials to discuss issues related to individual 

programs. We conducted this work in accordance with generally accepted Government auditing standards. More detailed information on the scope and methodology 

from our previous work can be found within each specific report. 

BACKGROUND

The Aviation and Transportation Security Act (ATSA) established TSA as the 

Federal agency with primary responsibility for securing the Nation’s civil aviation 
19 

2See Pub. L. No. 107–71, 115 Stat. 597 (2001). For purposes of this testimony, ‘‘commercial 

passenger aircraft’’ refers to a U.S.- or foreign-based air carrier operating under TSA-approved 

security programs with regularly scheduled passenger operations to or from a U.S. airport. 3Private-sector screeners under contract to and overseen by TSA, and not TSOs, perform 

screening activities at the 16 airports participating in TSA’s Screening Partnership Program as 

of July 2011. See 49 U.S.C. § 44920. 4TSA designed the Screening Passengers by Observation Techniques program to provide 

BDOs with a means of identifying persons who may pose a potential security risk at TSA-regulated airports by focusing on behaviors and appearances that deviate from an established baseline and that may be indicative of stress, fear, or deception. 5 Advanced Imaging Technology screens passengers for metallic and nonmetallic threats including weapons, explosives, and other objects concealed under layers of clothing. 6The mission need statement outlines the specific functional capabilities required to accomplish DHS’s mission and objectives, along with deficiencies and gaps in these capabilities. 7GAO, Department of Homeland Security: Assessments of Selected Complex Acquisitions, 

GAO–10–588SP (Washington, DC: June 30, 2010). Three of 15 were TSA programs. 

system, which includes the screening of all passenger and property transported from 

and within the United States by commercial passenger aircraft.2 In accordance with 

ATSA, all passengers, their accessible property, and their checked baggage are 

screened pursuant to TSA-established procedures at the 463 airports presently regulated for security by TSA. These procedures generally provide, among other things, 

that passengers pass through security checkpoints where they and their identification documents, and accessible property, are checked by transportation security officers (TSO), other TSA employees, or by private-sector screeners under TSA’s Screening Partnership Program.3 Airport operators, however, also have direct responsibility for implementing TSA security requirements such as those relating to perimeter security and access controls, in accordance with their approved security programs and other TSA direction. 

TSA relies upon multiple layers of security to deter, detect, and disrupt persons 

posing a potential risk to aviation security. These layers include behavior detection 

officers (BDOs), who examine passenger behaviors and appearances to identify passengers who might pose a potential security risk at TSA-regulated airports;4 travel 

document checkers, who examine tickets, passports, and other forms of identification; TSOs responsible for screening passengers and their carry-on baggage at passenger checkpoints, using X-ray equipment, magnetometers, Advanced Imaging 

Technology, and other devices; random employee screening; and checked-baggage 

screening systems.5

DHS’s Science and Technology Directorate (S&T) and TSA have taken actions to 

coordinate and collaborate in their efforts to develop and deploy technologies for 

aviation security. For example, they entered into a 2006 memorandum of understanding for using S&T’s Transportation Security Laboratory, and they established 

the Capstone Integrated Product Team for Explosives Prevention in 2006 to help 

DHS, TSA, and the U.S. Secret Service to, among other things, identify priorities 

for explosives prevention. 

DHS AND TSA HAVE EXPERIENCED CHALLENGES IN DEVELOPING AND MEETING KEY

PERFORMANCE REQUIREMENTS FOR VARIOUS TECHNOLOGIES

Our past work has found that technology program performance cannot be accurately assessed without valid baseline requirements established at the program 

start. Without the development, review, and approval of key acquisition documents, 

such as the mission need statement, agencies are at risk of having poorly defined 

requirements that can negatively affect program performance and contribute to increased costs.6 For example, in June 2010, we reported that over half of the 15 DHS 

programs we reviewed awarded contracts to initiate acquisition activities without 

component or Department approval of documents essential to planning acquisitions, 

setting operational requirements, or establishing acquisition program baselines.7

For example, TSA’s Electronic Baggage Screening Program did not have a Department-approved program baseline or program requirements, but TSA is acquiring 

and deploying next-generation explosive detection technology to replace legacy systems. We made a number of recommendations to help address issues related to 

these procurements as discussed below. DHS has generally agreed with these recommendations and, to varying degrees, has taken actions to address them. 

In addition, our past work has found that TSA faces challenges in identifying and 

meeting program requirements in a number of its programs. For example: 

• In July 2011, we reported that TSA revised its explosive detection system (EDS) 

requirements to better address current threats and plans to implement these 
20 

8GAO, Aviation Security: TSA Has Enhanced Its Explosives Detection Requirements for 

Checked Baggage, but Additional Screening Actions Are Needed, GAO–11–740 (Washington, DC: 

July 11, 2011). 9GAO–11–740. An EDS machine uses computed tomography technology to automatically 

measure the physical characteristics of objects in baggage. The system automatically triggers 

an alarm when objects that exhibit the physical characteristics of explosives are detected. 10GAO, Aviation Security: DHS and TSA Have Researched, Developed, and Begun Deploying 

Passenger Checkpoint Screening Technologies, but Continue to Face Challenges, GAO–10–128 

(Washington, DC: Oct. 7, 2009). 11GAO–11–740. 12GAO, DHS Science and Technology: Additional Steps Needed to Ensure Test and Evaluation 

Requirements Are Met. GAO–11–596. (Washington, DC: June 15, 2011). 

requirements in a phased approach.8 However, we reported that some number 

of the EDSs in TSA’s fleet are configured to detect explosives at the levels established in the 2005 requirements. The remaining EDSs are configured to detect explosives at 1998 levels. When TSA established the 2005 requirements, it 

did not have a plan with the appropriate time frames needed to deploy EDSs 

to meet the requirements. To help ensure that EDSs are operating most effectively, we recommended that TSA develop a plan to deploy and operate EDSs 

to meet the most recent requirements to ensure new and currently deployed 

EDSs are operated at the levels in established requirements.9 DHS concurred 

with our recommendation and has begun taking action to address them; for example, DHS reported that TSA has developed a plan to evaluate its current 

fleet of EDSs to determine the extent to which they comply with these requirements. However, our recommendation is intended to ensure that TSA operate 

all EDSs at airports at the most recent requirements. Until TSA develops a 

plan identifying how it will approach the upgrades for currently deployed 

EDSs—and the plan includes such items as estimated costs and the number of 

machines that can be upgraded—it will be difficult for TSA to provide reasonable assurance that its upgrade approach is feasible or cost-effective. Further, 

while TSA’s efforts are positive steps, it is too early to assess their effect or 

whether they address our recommendation. 

• In October 2009, we reported that TSA passenger screening checkpoint technologies were delayed because TSA had not consistently communicated clear requirements for testing the technologies.10 We recommended that TSA evaluate 

whether current passenger screening procedures should be revised to require 

the use of appropriate screening procedures until TSA determined that existing 

emerging technologies meet their functional requirements in an operational environment. TSA agreed with this recommendation. However, communications 

issues with the business community persist. In July 2011, we reported that vendors for checked-baggage screening technology expressed concerns about the extent to which TSA communicated with the business community about the current EDS procurement.11 TSA agreed with our July 2011 recommendation to establish a process to communicate information regarding TSA’s EDS acquisition 

to EDS vendors in a timely manner and reported taking actions to address it 

such as soliciting more feedback from vendors through kickoff meetings, industry days, and classified discussions of program requirements. 

DHS AND TSA HAVE ENCOUNTERED CHALLENGES IN OVERSEEING AND TESTING NEW

TECHNOLOGIES

Our prior work has also shown that not resolving problems discovered during testing can sometimes lead to costly redesign and rework at a later date. Addressing 

such problems before moving to the acquisition phase can help agencies better manage costs. Specifically: 

• In June 2011 we reported that S&T’s Test & Evaluation and Standards Office, 

responsible for overseeing test and evaluation of DHS’s major acquisition programs, reviewed or approved test and evaluation documents and plans for programs undergoing testing, and conducted independent assessments for the programs that completed operational testing.12 DHS senior-level officials considered the office’s assessments and input in deciding whether programs were 

ready to proceed to the next acquisition phase. However, the office did not consistently document its review and approval of components’ test agents—a Government entity or independent contractor carrying out independent operational 

testing for a major acquisition. In addition, the office did not document its review of other component acquisition documents, such as those establishing programs’ operational requirements. We recommended, among other things, that 
21 

13GAO–11–740 14GAO–10–128. 

S&T develop mechanisms to document its review of component acquisition documentation. DHS concurred and reported actions underway to address them. 

• In July 2011, we reported that TSA experienced challenges in collecting explosives data on the physical and chemical properties of certain explosives needed 

by vendors to develop EDS detection software.13 These data are also needed by 

TSA for testing the machines to determine whether they meet established requirements prior to their procurement and deployment to airports. TSA and 

S&T have experienced these challenges because of problems associated with 

safely handling and consistently formulating some explosives. The challenges 

related to data collection for certain explosives have resulted in problems carrying out the EDS procurement as planned. Specifically, attempting to collect 

data for certain explosives while simultaneously pursuing the EDS procurement 

delayed the EDS acquisition schedule. We recommended that TSA develop a 

plan to ensure that TSA has the explosives data needed for each of the planned 

phases of the 2010 EDS requirements before starting the procurement process 

for new EDSs or upgrades included in each applicable phase. DHS stated that 

TSA modified its strategy for the EDS’s competitive procurement in July 2010 

in response to the challenges in working with the explosives for data collection 

by removing the data collection from the procurement process. While TSA’s plan 

to separate the data collection from the procurement process is a positive step, 

we feel, to fully address our recommendation, a plan is needed to establish a 

process for ensuring that data are available before starting the procurement 

process for new EDSs or upgrades for each applicable phase. 

• In July 2011, we also reported that TSA revised EDS explosives detection requirements in January 2010 to better address current threats and plans to implement these requirements in a phased approach. TSA had previously revised 

the EDS requirements in 2005 though it did not begin operating EDS to meet 

the 2005 requirements until 2009. Further, TSA deployed a number of EDSs 

that had the software necessary to meet the 2005 requirements, but because the 

software was not activated, these EDSs were still detecting explosives at levels 

established before TSA revised the requirements in 2005. TSA officials stated 

that prior to activating the software in these EDSs, they must conduct testing 

to compare the false-alarm rates for machines operating at one level of requirements to those operating at another level of requirements. According to TSA officials, the results of this testing would allow them to determine if additional 

staff are needed at airports to help resolve false alarms once the EDSs are configured to operate at a certain level of requirements. TSA officials told us that 

they plan to perform this testing as a part of the current EDS acquisition. 

• In October 2009, we reported that TSA deployed explosives trace portals, a technology for detecting traces of explosives on passengers at airport checkpoints, 

in January 2006 even though TSA officials were aware that tests conducted 

during 2004 and 2005 on earlier models of the portals suggested the portals did 

not demonstrate reliable performance in an airport environment.14 TSA also 

lacked assurance that the portals would meet functional requirements in airports within estimated costs and the machines were more expensive to install 

and maintain than expected. In June 2006, TSA halted deployment of the explosives trace portals because of performance problems and high installation costs. 

We recommended that to the extent feasible, TSA ensure that tests are completed before deploying checkpoint screening technologies to airports. DHS concurred with the recommendation and has taken action to address it, such as requiring more-recent technologies to complete both laboratory and operational 

tests prior to deployment. For example, TSA officials stated that, unlike the explosive trace portal, operational testing for the Advanced Imaging Technology 

(AIT) was successfully completed late in 2009 before its deployment was fully 

initiated. We are currently evaluating the testing conducted on AIT as part of 

an on-going review. 

TSA HAS NOT CONSISTENTLY INCORPORATED INFORMATION ON COSTS AND BENEFITS IN

MAKING ACQUISITION DECISIONS

According to the National Infrastructure Protection Plan, security strategies 

should be informed by, among other things, a risk assessment that includes threat, 

vulnerability, and consequence assessments, information such as cost-benefit analyses to prioritize investments, and performance measures to assess the extent to 
22 

15DHS, National Infrastructure Protection Plan (Washington, DC: June 2006). In 2009, DHS 

issued an updated plan that replaced the one issued in 2006. 16GAO–10–128. 17GAO–10–484T. 18GAO, High Risk Series: An Update, GAO–11–278 (Washington, DC: February, 2011). 19GAO–10–588SP. 20GAO, GAO Cost Estimating and Assessment Guide: Best Practices for Developing and Managing Capital Program Costs, GAO–09–3SP (Washington, DC: Mar. 2, 2009). 

which a strategy reduces or mitigates the risk of terrorist attacks.15 Our prior work 

has shown that cost-benefit analyses help Congressional and agency decision makers assess and prioritize resource investments and consider potentially more costeffective alternatives, and that without this ability, agencies are at risk of experiencing cost overruns, missed deadlines, and performance shortfalls. For example, we 

have reported that TSA has not consistently included these analyses in its acquisition decision making. Specifically: 

• In October 2009, we reported that TSA had not yet completed a cost-benefit 

analysis to prioritize and fund its technology investments for screening passengers at airport checkpoints.16 One reason that TSA had difficulty developing 

a cost-benefit analysis was that it had not yet developed life-cycle cost estimates 

for its various screening technologies. We reported that this information was 

important because it would help decision makers determine, given the cost of 

various technologies, which technology provided the greatest mitigation of risk 

for the resources that were available. We recommended that TSA develop a 

cost-benefit analysis. TSA agreed with this recommendation and has completed 

a life-cycle cost estimate, but has not yet completed a cost-benefit analysis. 

• In March 2010, we reported that TSA had not conducted a cost-benefit analysis 

to guide the initial AIT deployment strategy.17 Such an analysis would help inform TSA’s judgment about the optimal deployment strategy for the AITs, as 

well as provide information to inform the best path forward, considering all elements of the screening system, for addressing the vulnerability identified by the 

attempted December 25, 2009, terrorist attack. We recommended that TSA conduct a cost-benefit analysis. TSA completed a cost-effectiveness analysis in June 

2011 and provided it to us in August 2011. We are currently evaluating this 

analysis as part of our on-going AIT review. 

DHS HAS EFFORTS UNDERWAY TO STRENGTHEN ACQUISITION AND TECHNOLOGY

DEVELOPMENT

Since DHS’s inception in 2003, we have designated implementing and transforming DHS as high-risk because DHS had to transform 22 agencies—several with 

major management challenges—into one department. This high-risk area includes 

challenges in strengthening DHS’s management functions, including acquisitions; 

the effect of those challenges on DHS’s mission implementation; and challenges in 

integrating management functions within and across the Department and its components. Failure to effectively address DHS’s management and mission risks could 

have serious consequences for U.S. National and economic security.18

In part because of the problems we have highlighted in DHS’s acquisition process, 

implementing and transforming DHS has remained on our high-risk list. DHS currently has several plans and efforts underway to address the high-risk designation 

as well as the more specific challenges related to acquisition, technology development, and program implementation that we have previously identified. 

In June 2011, DHS reported to us that it is taking steps to strengthen its investment and acquisition management processes across the Department by implementing a decision-making process at critical phases throughout the investment life 

cycle.19 For example, DHS reported that it plans to establish a new model for managing Department-wide investments across their life cycles. Under this plan, S&T 

would be involved in each phase of the investment life cycle and participate in new 

councils and boards DHS is planning to create to help ensure that test and evaluation methods are appropriately considered as part of DHS’s overall research and development investment strategies. According to DHS, S&T will help ensure that new 

technologies are properly scoped, developed, and tested before being implemented. 

DHS also reports that it is working with components to improve the quality and 

accuracy of cost estimates and has increased its staff during fiscal year 2011 to develop independent cost estimates, a GAO best practice, to ensure the accuracy and 

credibility of program costs.20 DHS reports that four cost estimates for level 1 pro-
23 

21Level 1 programs are those that have estimated life-cycle costs in excess of $1 billion and 

are reviewed at the Department level. 

grams have been validated to date, but did not explicitly identify whether any of 

the Life Cycle Cost Estimates were for TSA programs.21

The actions DHS reports taking or has underway to address the management of 

its acquisitions and the development of new technologies are positive steps and, if 

implemented effectively, could help the Department address many of these challenges. However, showing demonstrable progress in executing these plans is key. In 

the past, DHS has not effectively implemented its acquisition policies, in part because it lacked the oversight capacity necessary to manage its growing portfolio of 

major acquisition programs. Since DHS has only recently initiated these actions, it 

is too early to fully assess their effect on the challenges that we have identified in 

our past work. Going forward, we believe DHS will need to demonstrate measurable, 

sustainable progress in effectively implementing these actions. 

Chairman Rogers, Ranking Member Jackson Lee, and Members of the subcommittee, this concludes my prepared statement. I would be pleased to respond to 

any questions that you or other Members of the subcommittee may have. 

Mr. ROGERS. I thank you for those comments. I now recognize 

myself for my opening questions. 

Mr. Lord, you are right on the money when you talked about the 

failure to adhere to the 2005 standards that TSA has set. When 

you raised that point in your opening statement, you said that TSA 

acknowledged that was a problem and was working to correct it. 

Why haven’t they corrected it already, and did they have set a time 

line? It is crazy to still be using 1998 standards. How did they get 

by that long without anybody raising this issue? 

Mr. LORD. Well, we were somewhat surprised. When we looked 

at the 2005 standards we found that it took 4 years to start implementing them. So our point was we think it is a positive development. They are constantly updating and refining the standards. 

But we were concerned about the substantial lag between issuing 

the standards and integrating them in the machines. I don’t want 

to oversimplify the complexity of the task. These are very complicated of technology. I am not sure we ever got a really clear response. Some of it was related to TSA’s need to do some additional 

testing to see how the false alarm rates were affected. That could 

conceivably change the number of people you needed in the airport 

to check bags that are kicked aside. 

The good news is they wholeheartedly agree it shouldn’t take 

that long, and they have instituted some changes to improve the 

process. As they will point out, the 1998 standards at the time 

were considered world-class standards. 

Mr. ROGERS. Well, I guess what I am hoping is when you say 

they wholeheartedly agree and are going to address it, have they 

given a time line that they are committed to have implemented 

these recommendations? 

Mr. LORD. I am not sure they have a very specific time line, but 

I am convinced they are taking action to address it. I will have to 

get back to your staff if they have committed to a specific time line. 

Mr. ROGERS. Do you have a time line to go back to revisit the 

issue and see if they have followed through? 

Mr. LORD. Yes. Under our process, any time we conduct a recommendation, we conduct thorough follow-up after our report is 

issued to help close the loop. Obviously, we are just as interested 

as the committee in seeing these important changes in the process 

are made. 
24 

Mr. ROGERS. Great. 

Ms. Duke, you talked about needed alignment changes. Can you 

talk more fully about that? 

Ms. DUKE. The Department operates in the business lines, which 

include the CF, chief information office, chief financial officer, and 

procurement and human capital, security and facilities, under a 

functional integration model, which means that in the operating 

components, the operating components own those business lines. 

However, the chiefs of the Department that report to the Under 

Secretaries for Management have functional authority. 

Over time, the Department has refined those authorities to ensure that—to work towards ensuring that the right controls are in 

place—the oversight, the standardization of policy. That would be 

typical in a department, where a department would exercise over 

its operating components. So I think that is important in continuing to strengthen and refine those functional authorities of the 

business line chiefs to have the Department operate more effectively. 

Mr. ROGERS. You recall when I was Chairman of the Management and Oversight Subcommittee, you had raised the issue of inadequate number of procurement office staff. Do you see that having been remedied since your departure? 

Ms. DUKE. Yes. The number of procurement staff has gotten better. I think what continues to have to work on is the other pieces 

of staffing properly the other types of acquisition professionals, like 

the program managers; test and evaluation is another acquisition 

career field; logistics, cost estimating. These are all other types of 

acquisition professionals that DHS continues to try to build a need 

to get the full answer to running these programs more effectively. 

Mr. ROGERS. Mr. Jackson, you talked about the high cost of certification under the current structure. Why is it so expensive and 

cumbersome right now and how would it be better if we worked in 

a different direction? 

Mr. JACKSON. Right now, it is a fragmented process. You have 

literally to take machines that you want certified, oftentimes they 

have to make multiple machines for the certification process, but 

you have to take them to multiple locations—to Tindall for HME 

analysis and other unstable explosives. For other more traditional 

explosives, that is done in New Jersey at the TSL lab. Then you 

have early testing in a TSA test environment, and in the field you 

have pre-certification work to do as well. 

It is just simply a bureaucratically dispersed and not adequately 

focused program. It is very, very expensive and becomes a checklist 

process. You either pass or fail. If you fail, it is oftentimes, if you 

talk to the people who have been doing this, very unclear to them 

why exactly they failed and what is necessary to get back in the 

game. Oftentimes, there are mistakes made by the people submitting the machines. They are sort of obvious and can be corrected. 

But there is work on both sides that needs to happen. 

The model that has been used in Germany, for example, has 

been very successful in making a more collaborative process while 

focusing the government on the inherently governmental process of 

defining the performance requirements that they want from the 
25 

output, which really goes to this whole question about what are we 

trying to get these machines to do. 

More and better work can be done there. Greater clarity, greater 

transparency. Then have a group of people that can maybe perhaps—have two groups that can compete this process and work it 

more effectively. 

Mr. ROGERS. I thank you. 

I recognize the Ranking Member for any questions he may have. 

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

It has often been said hindsight is 20/20. Ms. Duke, Mr. Jackson, 

you have been here, done that. You have now gone into another 

part of your professional career. I want to get from you what it is 

you tried to do to improve this inside the Department and why we 

didn’t get it done. Do you understand? So that going forward we 

can revisit it from a committee perspective. 

Ms. DUKE. Yes, Mr. Thompson. What I tried to do in my positions as Chief Procurement Officer and Under Secretary of Management was to build the acquisition system. I think that we made 

good starts. I think the reason we didn’t finish during my tenure 

was because there was so much to do. We were in the right direction. I think the work of Under Secretary Borras is taking the Department further in that direction, but just not the time to do it. 

For instance, the test and evaluation function that you mentioned in your opening statement didn’t exist. So during the tenure 

that I had at the Department, we set up the test and evaluation 

function. Now, the current leadership is working to try to refine 

that to make sure it handles not only developmental testing, which 

is the part of testing that doesn’t meet the specification, but also 

operational testing, which gets to the point of: Does it perform for 

the intended use in the operational environment? 

So I think that we set the building blocks in terms of what needed to happen. The carry-through has to happen to make it fully 

functional. 

I think another point is that when you talk about effectiveness, 

it is the balance of cost, schedule, and performance. I believe that 

in the aftermath of 9/11, there was such an emphasis on schedule—fast, fast, fast—that in the balance of cost, schedule, and performance, there sometimes was an imbalance. And schedule, getting things out quickly, ruled. I think that there is a necessity for 

continued homeland security excellence to balance being nimble 

and quick and being postured in a nimble way to be able to react 

to changes in the terror threat, but also have the stability where 

you are balancing schedule with cost and performance. 

Mr. THOMPSON. Mr. Jackson. 

Mr. JACKSON. Congressman, I think that Elaine is correct in everything that she said, and I would just underscore a couple of 

points. The sense of urgency at the outset of the Department’s formation was substantial and animated by an acute awareness that 

another attack could be upon us each day. So to some degree, it 

was a rush job to build DHS and then to fill it out in a more professional and effective and efficient fashion. That is not an excuse for 

mistakes that we have made in that period, but it does explain that 

the tradeoffs in the sense of trying to build a new organization 
26 

from scratch and to deliver a capable set of assets into the field 

was a very complex set of tradeoffs. 

I think what I am trying to suggest this morning is that if you 

try going forward and focus on things that can have transformational change at the points of failure or the points of opportunity that lay on the field, then that gives you a constructive and 

positive way to look about going ahead. It is important to understand the failures of the past, as I think your opening remarks absolutely make clear. 

Mr. THOMPSON. Thank you. As you know, we have voted in the 

House on a budget. A lot of those items that you have indicated, 

we will have to do within S&T. Those funds have been cut. 

Now you referenced Under Secretary Borras. He basically has offered testimony to us that if he has to lay off 70 percent of the 

management directorate staff, that creates a problem. 

Ms. Duke, you referenced the fact that under your tenure we as 

a Congress plussed-up your ability to hire more people. Do you see 

the reduction in the budget for the Department as creating a potential problem/vulnerability for S&T? 

Ms. DUKE. I believe that if Congress chooses to fund a program, 

that it must fund the people to manage the program. So if the decision is to fund major acquisition programs such as Secure Border 

or any type of program or TSA technology, that it must fund the 

appropriate people to manage that program. It goes back to my 

written statement point of when the money is appropriated to an 

agency or department, it has the fiduciary responsibility to manage 

that money. So I do think that we have to continue to fund the 

Federal employees to manage those programs—the acquisition 

workforce—yes. 

Mr. THOMPSON. So if we create new programs, new pilots, or 

whatever, and not put the resources to operate them, then we put 

those pilots or demonstrations at risk? 

Ms. DUKE. Well, one shouldn’t be surprised if they don’t do as 

well as one had hoped if we don’t fund the people to actually manage the programs, yes. 

Mr. THOMPSON. Thank you. 

I yield back. 

Mr. ROGERS. I thank the gentleman. 

Ms. Duke, in looking at the TSA and the industry, how can we 

get them to partner better? What, in simple lay terms, would be 

the thing that you would suggest first and foremost? 

Ms. DUKE. I think starting communications early is first and 

foremost. Mr. Lord mentioned changing the standards. TSA could 

and should be communicating with industry early on. 

Mr. ROGERS. By ‘‘early on,’’ what do you mean? Give me some 

time lines. 

Ms. DUKE. Before setting the standards. New standards, new 

specifications should not be a surprise to industry. So as it is setting its standards, I recommend that TSA be dialoguing with industry and see what is state-of-the-art? What is possible? What is 

the cost/benefit tradeoff between different standards that will meet 

the terrorist threat? 

Mr. ROGERS. You were with the Navy. Does the DOD do what 

you are talking about in their procurement process? 
27 

Ms. DUKE. I think every Federal agency can do it more effectively. There is, I will call it a systemic fear that if the Federal 

Government talks with industry effectively, that it increases the 

chance of protest. So there is kind of a prejudice to cut off dialogue 

really just at the point where it would be most beneficial to the 

program. So I think that what DHS, DOD needs to do is manage 

that risk and make sure that the communications are fair, meaning 

they don’t just favor a company. So do it maybe in open forums. 

I believe that doing them orally sometimes helps. 

When you get back into the written questions and answers, it 

kind of looks legalistic. So I think there is more opportunity for 

oral forums. I think a lot could be done and still not increase the 

risk of protest. 

Mr. ROGERS. But what you are talking about, I take it, is more 

than just having industry days? 

Ms. DUKE. Yes. I think industry days are very useful, but they 

are too late. They need to stay, but then there needs to be predecessors to industry day. 

Mr. ROGERS. Mr. Jackson, you talked in your opening statement 

about an idea for lease processes. How would that save the Department money? 

Mr. JACKSON. Well, first of all, the proposals that have been laid 

on the table would make these expensive inline baggage system investments and other investments in the technology happen much 

faster. So you save the time, cost of money, and getting them into 

the field more quickly. In addition, frankly, by cutting through 

some of the bureaucratic layers of TSA oversight in a traditional 

grant-based approach to this, you cut out some of the cost to TSA 

of the overhead to paying consultants to stand around and watch 

people to make sure they are doing it right. 

You still have, I think, an urgent necessity to have high standards of performance and very clear objectives about what the performance standards are. For example, in what a machine must do 

and what it must not do; up time, down time. All these types of 

indicators are crucial to having clarity and success in the mission. 

But, frankly, there is just a much more efficient way to put capital 

to work there. 

Also, if you are constrained with resources, as we are today, in 

trying to get done a substantial backlog of work, you have to figure 

out how to find the cash to do that. You can leverage an awful lot 

of money and get that work done up-front without having to obligate the entirety of a project’s cost and hold it in escrow at TSA 

while the work is done. 

So I think with an approach that is very common-sense and uses 

private sector capabilities that are structured through a government-to-government contract—the airport authority with TSA— 

that should be something that we figure out how to work. It is not 

that hard. It is a very transformational way, however, to intrude 

a lot more efficiency and effectiveness, and especially over the next 

couple of years where I think the recapitalization problem is going 

to leach out the funds that would otherwise be used for some of 

this backlog of inline systems, that it is an especially timely thing 

to do, and the cost of capital is at an all-time low, so it is an effective way to do this. 
28 

Mr. ROGERS. Is that process being used by any other governmental entity that you are aware of? 

Mr. JACKSON. Variations of it are. For example, at LAX, using a 

basic grant agreement, Delta had worked with a private sector vendor to essentially build and maintain an in-line system for the terminal that Delta operates out of. Southwest Airlines has done a 

similar thing at multiple different airports. 

So there is experience with this. At Denver, for example, after 

9/11, the airport was very impatient, rightfully so, to get a big EDS 

machine deployment working. So they worked with the manufacturer to do a financing project for that, for which TSA came behind 

and did reimbursements. 

So there is plenty of experience in the private sector of how to 

do these sort of things. There is no one group or way to sign on 

to make it work. There just needs to be some flexibility, in my 

view, to have a very fundamental thing that allows the airport authority to structure and take the risk for an investment that supports themselves, the airlines, and TSA, and then allow TSA simply to buy that as a service from that airport authority. That is a 

dramatic transformation and energizing way to give TSA the tools 

they need to do it without having to come to Congress and beg for 

so many billions of dollars. 

Mr. ROGERS. Great. Thank you. 

The Chairman now recognizes Mr. Davis from Illinois for any 

questions he may have. 

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

Mr. Jackson, I notice in your testimony that you suggested a 

prize for technology. One of the complaints that I have heard from 

vendors, both large and small, is what they consider to be a lack 

of direction and planning from TSA. There is no indication of 

multi-year planning or strategy in its procurement process. How 

would offering a prize really help, and wouldn’t it continue to hold 

TSA to being reactionary or being a reactor as opposed the 

initiator? 

Mr. JACKSON. An excellent question. Let me see if I can try to 

just explain in short compass. 

This is not something that would cover every need or objective 

at TSA, but for some major transformational investments that need 

to happen, where you take not incremental change but substantial 

change, what you are trying to do is go from the existing model, 

which is basically to seed a variety of different firms and hope they 

come out with a successful machine or a successful technology. Instead, to reverse that a little bit and say: Here is a very important 

outcome. 

I give one example, which is, I believe, that it is possible, I know 

that it is possible, with the right focus, to get an AT machine to 

be able to detect liquid explosives in a bag. TSA has gone through 

several years of conversations with the vendor community about 

that. I believe if you made a very simple objective of achieving that 

goal and then put some money behind it, it would induce people 

to invest the time and energy and focus to get there, whereas right 

now it is a very uncertain outcome for the vendor community; if 

you invest in this thing one day and another thing another day, 
29 

whether you are going to be on point for what TSA really most 

needs. 

So that is just a way of trying to get the Government to focus 

on the two or three things that are most transformational for the 

Government, and then the private sector to chase it with a sense 

of urgency and dispatch and innovation. 

Mr. DAVIS. So are you saying that the vendors are more reluctant 

to explore new or different approaches if they don’t have much indication of what the outcome might be in terms of TSA deciding 

that what they have come up with is something that it really wants 

to use? 

Mr. JACKSON. That is true. It relates to the other point I had 

made in the testimony about the complexity and expense and time 

delays associated with the certification process. So if you could 

make that more transparent, more efficient, less costly, then you 

can actually help bring these two ideas together to allow TSA to 

focus their highest priorities in a way that is very clear and to give 

the vendor community a system that they can use to get it certified. 

Mr. DAVIS. Thank you. That leads me to my next question, actually. Mr. Lord, what would you say is the most effective means for 

DHS to assess cost and benefits of new technologies? 

Mr. LORD. In terms of cost, first of all, they already produce lifecycle cost estimates at the component level. What has been lacking 

in the past, as Ms. Duke alluded to, is the need to validate these 

cost estimates. Have an independent office outside of the component validate independently whether these estimates are realistic. 

That is in terms of cost. 

In terms of performance, again, it is an independent oversight 

issue. I think it is always good to have a second set of eyes review 

any estimates or summary of performance that are delivered to 

senior management. 

So, again, it is just an independent oversight function that has 

recently been stood up. We think it is a good thing. It has taken 

years to erect it. So we would obviously have some concerns if that 

was changed significantly. 

Mr. DAVIS. Thank you very much. My time is about to expire, so 

I will just end there. 

Mr. ROGERS. I thank the gentleman. 

Mr. Jackson, in your testimony, you discussed the considerable 

backlog of inline checked baggage system replacement projects. 

Even if Congress writes annual checks to TSA to replace these 

technologies as they age, would we find ourselves during this perpetually as the technologies need to be replaced? In your opinion, 

is this a sustainable way of doing business? Ms. Duke, I would like 

your comments on this as well. 

Mr. JACKSON. I don’t think it is sustainable under the current 

procurement model because we need to address several problems in 

this—how to get more capital into the field faster and more efficiently. That is a big problem. Alternative finance helped address 

that. 

There is a question that I think has come up with several of the 

Members’ questions here this morning about the change and the 

pace of change for managing the software that drives detection in 
30 

these big explosive detection systems both at the checkpoint and 

downstairs with checked baggage. The issue is that our opponents 

in the field are constantly innovating them in the way they package and the types the recipes or formulas they use for explosives. 

It is not just a simple inventory of death tools that are out there 

and once you figure out how to use those, you have got everything 

covered. It is a constantly iterative cat-and-mouse game between 

the bad guys and the Government to figure out how best to use 

your devices. 

The Government puts the standard on the table when they buy 

these things in good faith. As Mr. Lord says, the procurements we 

did after 9/11, we took the state-of-the-art that we could deliver 

and that the manufacturers could come to the table with. But that 

state-of-the-art changes over time and it produces a series of different software operating platforms that have different capabilities 

different from one manufacturer to the next and over time they get 

progressively more complex and more efficient and more effective. 

But the threat changes as well. 

So what you are in is a game of exploring how to do this on a 

continuous basis. That is why the suggestion that I make about 

making the architecture of the software open and transparent is so 

vital because what that would do is give TSA the capability to take 

charge of its destiny in making rapid and iterative changes in the 

software algorithms necessary to make these machines work 

against the current threat level. That way you get a better value 

for the long term for the very substantial investment that you have 

paid for with the machines. 

The medical industry has made phenomenal progress in this 

way. If you just think about what an iPhone did with apps, it is 

the same thing, really. When you make an open architecture for a 

device that is widely used and iteratively changes, you now empower a whole community of smart people to come in and help you 

work on those type of tools. 

What you can do if you had that and you gave a little prize 

money for success on specific things, these four things all link together to say you have to stand back from where we have been and 

really evaluate how to go forward and give TSA the tools they need 

to succeed. Some of these things that I have suggested TSA may 

be less favorable about, and others much more favorable. Some in 

the industry may not like them as much and others they may like 

very much. I am saying that the responsibility of an independent 

analyst and the Congress is to step back and say: How can we put 

together the right tools to make it happen? 

Mr. ROGERS. Ms. Duke. 

Ms. DUKE. Mr. Chairman, when TSA stood up, its focus was on 

Federalizing the airports in a short amount of time. I think from 

the perspective of getting that, it was a huge success. Two challenges that it resulted in that is something that we have to deal 

with now are the reliance on technology, virtually solely, and second are what I call chokepoints in both passenger and baggage 

screening in the process. 

So I think that as TSA moves forward, looking at the layered 

risk-based approach to screening technology is an improvement 

that could be made. We still have to rely on technology. But how 
31 

do we address the risk-based piece of it, and the layer, including 

like the behavioral technology. 

So I think that TSA, working with CBP, because that is something they have done in the past, is a step in the right direction. 

So you have your technology as a base, but then you also have the 

layered approach that deals with these two challenges. One is the 

overreliance on technology and the cost of that, and the second are 

these movement of goods and people chokepoints. 

Mr. ROGERS. Mr. Lord, your thoughts. 

Mr. LORD. I agree with Ms. Duke, it is very important not to lose 

sight of the impact on commerce. You are obviously trying to balance commercial considerations—moving people through airports 

with security needs. I always like to add another consideration, and 

that is privacy. That has recently been discussed extensively in 

Congress and in the press. So within that triangle, you are trying 

to figure out where to put your pin—privacy; security; and throughput, or commerce. So I think that is a constant struggle. 

In terms of the additional financing flexibility Mr. Jackson has 

alluded to, I think that is a very interesting concept. I haven’t seen 

any proposals in writing, but I know the TSA administrator, he has 

already been on record in suggesting there could be some additional flexibility needed in financing so many improvements being 

made at airports. 

In terms of open software issue, I believe I would have to think 

about that. There is obviously some National security considerations involved here. We don’t want our adversaries to know exactly what our requirements are, what our machines are looking 

for. Is there a way to make the process more transparent in terms 

of testing? Probably if TSA was here to probably mention this new 

testing facility they are coming up with, hopefully that will address 

some of Mr. Jackson’s concerns stated today. 

Mr. ROGERS. Excellent. The Chairman now recognizes the Ranking Member Ms. Jackson Lee from Texas. 

Ms. JACKSON LEE. Mr. Chairman, let me thank you for your indulgence. I appreciate the opportunity to briefly give my opening 

remarks and how the Chairman must proceed I would like to raise 

a few questions if I might. 

[The statement of Ranking Member Jackson Lee follows:] 

PREPARED STATEMENT OF RANKING MEMBER SHEILA JACKSON LEE

SEPTEMBER 22, 2011 

TSA and the Science and Technology Directorate at DHS are tasked with the critical mission of delivering technologies that can improve transportation security. I 

cannot overstate the importance of this mission. 

Given the risks to our aviation and mass transit sectors, it is imperative that we 

take a close look at how DHS integrates an effective security technology approach 

into our transportation security programs. 

Last Congress, this subcommittee took the first step in this evaluation. 

I held a hearing exploring the Department’s effectiveness in acquiring and deploying passenger screening technologies and procedures. 

Coordination between the Science and Technology Directorate and the Transportation Security Administration is essential to ensuring that the best technology is 

deployed in a systematic way. 

We cannot address emerging threats with an ad hoc practice and a lack of process. 
32 

To be clear, Mr. Chairman, the Department has come a long way since its establishment but more must be done to ensure an effective research and development 

program that leads to purchases in the real world. 

However, because my colleagues on the other side of the aisle have proposed to 

slash S&T’s budget below the President’s fiscal year 2012 request, I have little hope 

that S&T will be able to fulfill its mission. 

We ask the Department to improve efficiency, delivery, and coordination efforts 

but we want them to do this with inadequate funding. 

Doing more with less is a good campaign slogan, but it does not explain how we 

get the necessary research and development done. 

It doesn’t explain how we keep this Nation safe from emerging threats. 

Mr. Chairman, I know from my discussions with you, that we share the same 

commitment to securing our Nation’s transportation systems. 

Ms. JACKSON LEE. Let me thank the witness for their presence 

here today and I acknowledge some other friends and individuals 

we discussed in the past I am delighted with the Chairman and 

our effort to be part of the securing of the homeland and recognizing the importance of job opportunities through new technology. 

I think this is a very instructive hearing. 

Mr. Chairman, I would encourage that we expand these hearings 

and hear more about the emerging technology. 

In particular, TSA and the science and technology directorate at 

DHS are tasked with the critical mission of delivering technologies 

that can improve transportation security. I cannot overstate the 

importance of this mission, given the risks to our aviation and 

mass transit sectors. It is imperative that we take a close look at 

how DHS integrates an effective security technology approach in 

our transportation security programs. 

If I might anecdotally say, had any of us heard of a shoe bomb 

in 1995? But our terrorist community, if I might use that with 

some tongue-in-cheek, are at the cutting edge of technology. Had 

anyone heard on the Christmas day bomber of the hiding or the 

placing of bomb materials in a strategic location of which it was 

found? They are looking for new ways to do us harm. 

Last Congress, this subcommittee took the first step in this evaluation. I held a hearing exploring the Department’s effectiveness 

and acquiring and deploying passenger screening technologies and 

procedures. Coordination between the science and technology directorate and the Transportation Security Administration is essential 

to ensure that the best technology is deployed in a systemic way. 

We cannot address emerging threats with an ad hoc practice and 

a lack of progress or a lack of process. To be clear, Mr. Chairman, 

the Department has come a long way since its establishment, but 

more must be done to ensure an effective research and development program that leads to purchases in the real world. However, 

because of my colleagues on the other side of the aisle I am concerned about the slash in the S&T’s budget below the President’s 

fiscal year 2012 request. I have some concern that S&T will be able 

to fill its mission. Maybe the Chairman and I can raise this question in a bipartisan manner. I have always said we should not nickel-and-dime our security. We ask the Department to improve efficiency, delivery, and coordination efforts, and I expect that they 

will do so. But I also think that they cannot function with inadequate funding. Doing more with less is a good campaign slogan, 

but it does not explain how we get the necessary research and de-
33 

velopment done. It doesn’t explain how to keep the Nation safe 

from emerging threats. 

Secretary Napolitano is reaching across the Nation on the slogan 

and the effort of ‘‘see something, say something.’’ We are calling 

upon Americans to rise to their higher angels and to be part of securing the homeland. We must do our job and our job is to ensure 

that the resources are there for the right work to be done, to be 

able to approach and face the threats that are constantly emerging. 

Mr. Chairman, I know from my discussions with you that we 

share the same commitment to secure our Nation’s transportation 

systems, and I look forward to doing so. I might add anecdotally 

that I think the Chairman and I were speaking of the new technology and canines, the kinds of canines, how they are bred. That 

is a step that was not in focus or in play, if you will, either before 

9/11 or shortly thereafter. So I believe that our technology is the 

key to the 21st Century and I ask as I proceed with my questions 

that we continue on that pathway. 

Let me proceed with some questions. Ms. Duke, welcome. It is 

good to see you. I know we went down this pathway again, but it 

disturbs me that I would like to pose it again and that is around 

the explosives trace portal known as puffers, costing us $36 million. 

The reason why I use it is because it will be used by others. I know 

that my Ranking Member of the full committee also posed this 

question that it was removed from the airport checkpoints in 6 

months. I think I remember being puffed and seeing how it worked. 

It was an attractive looking and I do not say this with disrespect, 

but toy. It had those kinds of bells and whistles. I can imagine it 

might have been that kind of an attractive sight when someone 

made the determination. 

So the question comes again: What is the level of expertise that 

reviews new technology? What are the bells and whistles that 

should go off? I would like Mr. Lord to comment, $36 million used 

against us at some point in time, it might have had some value, 

but it didn’t function in 6 months. Do we have the right kind of 

expertise that are vetting these particular new projects? 

Ms. DUKE. I think there are two aspects at the beginning and 

end of the process: The first is setting the requirement to meet the 

operational need most effectively. We talked about that a little earlier. The second—— 

Ms. JACKSON LEE. Did we do that in this instance or do we have 

the kind of expertise? I doubt that—— 

Ms. DUKE. I think the Department and TSA continues to build 

it, but it is still a work in progress. I think at the other end of cycle 

is test and evaluation. I mentioned earlier that initially there was 

probably not enough testing in either area. Then we started to improve the developmental testing which deals with how can—do 

these machines meet the specifications. Then near the end of my 

tenure, we started to, more systematically, do more operational 

testing and that is the full picture. Operational testing just doesn’t 

meet the specification, but does it operate for the intended purpose 

in the intended environment? I think this is an area that is building and will really help ensure the puffer scenario doesn’t happen 

in the future. 
34 

Ms. JACKSON LEE. Just quickly, do you know how many staff are 

involved in those layers, operational, developmental? 

Ms. DUKE. At the Department level there are few people in S&T, 

standard and test and evaluation division. There should be test 

and evaluation personnel in each of the major programs but I don’t 

know the numbers. 

Ms. JACKSON LEE. Can you get back to us with a number, it 

would be helpful to me, if you would. Did you hear me? 

Ms. DUKE. Yes. 

Ms. JACKSON LEE. If you would say what your appointees—— 

Ms. DUKE. I will work with the Department, since I am retired 

now, I will work with the Department to get access to that information. 

Ms. JACKSON LEE. I appreciate that. Mr. Lord, do you want to 

comment on how we found ourselves in that manner? Do you have 

the expertise in house? 

Mr. LORD. I think this whole puffer episode underscores the importance of conducting rigorous testing and evaluation. I would just 

like to amplify. I agree with Ms. Duke’s assessment. I would like 

to clarify, there are two types of test and evaluation. There is qualification test and evaluation, that is where you test against the requirements in a controlled laboratory setting. I think that was 

done. But I think where the shortfall occurred is operational test 

and evaluation. That is where you test in a real-world setting. 

What they found with the puffers is when there is dirt in the air, 

high humidity, temperature variations, that it did not perform like 

it did in the carefully controlled laboratory settings. So again, the 

lesson learned is you need to test it in real-world conditions. That 

should be part of your testing scenario. They have changed their 

processes now. That is a requirement for the new technology. So 

hopefully, these types of incidents will be avoided in the future. 

Ms. JACKSON LEE. Do we have the in-house expertise? Do we 

have scientists at the level—— 

Mr. LORD. We not only have more procurement experts, acquisition experts, independent cost estimators. There are more people 

concerned with testing and evaluation. Again, as I stated earlier, 

you need to have that function outside of the component level, you 

need to have an independent function and they stood that up. So 

it is—I mean, they have been strengthening the process over the 

years. It has taken probably—it has taken a long time, but they do 

have the enhanced processes and testing capabilities now, which is 

a good thing. 

Ms. JACKSON LEE. Let me quickly ask—thank you very much, 

Mr. Lord. If I can put on the record that I would like to get the 

numbers of the staff and the levels of positions that they hold. So 

Mr. Chairman, I am not sure Mr. Lord will be able to help us, Ms. 

Duke is retired, and I do appreciate that. 

Let me just pose this question: There is not a moment that we 

are home in our districts that the American people whose tax dollars we are entrusted to who are in business ask us about this complicated process of doing business with the Federal Government. I 

have encouraged the President to talk more about buy America 

from the perspective of the Federal Government that every effort 

is made to buy America. I think if we buy paper clips from a small 
35 

business in the United States, we have just built capacity beyond 

our expectation. 

What steps do you recommend for TSA in order to issue and 

award contracts quickly, at the same time, ensuring competition 

and the proper use of TSA funds in the technology area? What can 

we do? Forgive me if someone has asked that. 

Ms. DUKE. I think that one of the key steps is communicating 

with industry early and openly and that goes back to before the requirements are set, not just a day once the requests for proposals 

was issued, but work with industry early on about what is stateof-the-art, what is the art of the possible and what are the cost and 

schedule tradeoffs for going to the cutting edge technology, versus 

commercially available and the stages in between. So I think that 

is very important. I also think it allows industry to bid more effectively if they know what to anticipate and plan for. 

I think setting clear requirements is No. 1. I know I have worked 

that into every hearing that I have ever testified in, but that is important. Industry has to make a decision whether to propose on a 

contract. Without a good requirement it really is kind of—it really 

is taking on undue business risk. 

A third part, I think, is educating the businesses, especially the 

small businesses and how to do business with the Government, 

programs such as the Small Business Innovative Research Program 

need to continue so that small businesses have the opportunity to 

enter the Federal market in a prime contract function, not just as 

a subcontractor. 

Ms. JACKSON LEE. Let’s probe that because we have had long discussions. I know when you were in the Government you were out 

on the road. We are still hearing from small minority and womenowned businesses. How do we get the mind-set to be more energetic 

on really aggressively looking at small businesses may make their 

application or they are fishing around to really create the atmosphere they could thrive and secure a contract? Is there some pearl 

of wisdom or some action you took that you not just offered to us 

in testimony right now? Some anecdotal story that might give us 

some understanding how to get small businesses involved. 

Ms. DUKE. Well, I think really the key is for the small businesses 

decoding the process, there are a lot of acronyms and stuff that 

seem complicated. I think education is the key. 

I think the recent change to allow set-asides for women-owned 

business is a step in the right direction for that. I encourage 

women-owned businesses to get certified just like there is certification under the 8(a) program, because that allows you to compete 

against your peers, just other small women-owned businesses as 

other small 8(a)s, that is huge, because it is more of a level playing 

field than you competing against a large business. Both the Department and Small Business Administration has to really continue 

that education process. 

The other point if it is a pearl of wisdom, I would say is think 

small; it is always hard to get that first contract, just like it is hard 

to get that first job when you are out of college. So when I am 

coaching small businesses, I say really look for that opportunity 

where you can garner your reputation and get that past performance in Federal Government. I think that is important. 
36 

Ms. JACKSON LEE. Let me just—Mr. Chairman, I am concluding 

in just a moment. Let me make this point on the record, Mr. Chairman, which I hope we can find a way, maybe the committee could 

join in sort of an on-the-Hill summit about this small business 

issue because it impacts all of our constituents. I want the Federal 

Government to put small contracts forward. It is difficult to get 

procurement officer to think of the value of the those small contracts, maybe you can have greater encouragement, if we could, to 

be able to do that. 

Mr. Jackson, from your business perspective, a comment on 

doing business with the Federal Government, particularly on the 

technology lines. 

Mr. JACKSON. Well, I think that TSA has made huge progress in 

trying to figure out structures and mechanisms to work with businesses large and small. So they are in the process of growing, they 

have made substantial changes and progress and there is more to 

do. So there is always more to do. So I think that TSA could do 

more in reaching out to businesses in a systemic way. 

I agree with what Elaine has said for the process. I would also 

add it is equally important once a business has gotten an award 

for a service or technology, it is particularly important to give sustained feedback and input to the company about how they are performing. That is frequently an area that is easy to ignore or forget. 

So if you are producing a piece of technology and it gets out into 

the field and it is not doing certain things that the users would like 

or it is doing them particularly well, those are things that need 

constant feedback. It has to start with the beginning of an idea of 

a need and continue all the way through the operational life. 

Ms. JACKSON LEE. If I might interrupt you, do you know the 

functional coordination officers and capabilities requirement council 

that DHS is proposing? Does that ring a bell? 

Mr. JACKSON. I do not, ma’am. 

Ms. DUKE. Ms. Duke knows about it. Why does the Federal Government have—Chairman, do you know about the functional coordination offices and capabilities and requirement council? 

Mr. ROGERS. First time I have heard it. 

Ms. JACKSON LEE. Ms. Duke, will you tell us that be worth—Mr. 

Jackson, I didn’t mean to interrupt you. I just thought you may be 

aware of it. 

Ms. DUKE. Mr. Lord may want to comment, but that is part of 

DHS’s answer to the GAO integrated high-risk plan. What that 

seeks to do is define commonality in capabilities and mission requirements across DHS and eventually buy more effectively. So if 

TSA, CVP Coast Guard have a similar mission requirement, how 

can you rationalize the requirements and then buy them more effectively? 

Ms. JACKSON LEE. Is it proposed, or is it in place yet? 

Ms. DUKE. It is part of the report that went to GAO and they 

are in the process of putting it together. I believe Mr. Lord could 

verify that. 

Mr. LORD. That is correct. 

Ms. JACKSON LEE. Thank you. I will finish with this question Ms. 

Duke. Thank you, Mr. Lord, and I do not take issue with the language as long as I understand it, but it is pretty long title here. 
37 

I noted that it is to become more efficient with the buying process 

when there is overlap. 

Let me just ask this question, Ms. Duke. In your testimony, you 

emphasize a need for an appropriate acquisition workforce in your 

review or your knowledge of the proposed House budget, which I 

will just say cuts quite a bit. Does the proposed House budget impact DHS’s effort to ensure accountability and a acquisition workforce adequate to stimulate economic growth and innovative solutions in Homeland Security technologies? 

Ms. DUKE. I have not looked at the current proposed budget, but 

I can say this: One is that the acquisition workforce has to stay in 

proportion to the program dollars. So if the cut in the acquisition 

workforce is more than the program dollars, that is going to be to 

the detriment of the spending of the money. It will make it harder 

for the acquisition workforce to get the requirement out there and 

get under contract to allow job growth and industry. I learned in 

industry, that oftentimes they have a percentage so that as they 

look at program or direct dollars, they anticipate a percentage increase and the need for people like acquisition workforce, human 

resources, and I think that is important in ensuring that the taxpayers dollars are spent. 

Ms. JACKSON LEE. Thank you very much for your indulgence, Mr. 

Chairman. To the witnesses, let me thank you very much for what 

I think is a major component to securing the homeland, but at the 

same time, the Department of Homeland Security gives a very, 

very important opportunity for the genius of America, the new inventors, the new technology that can both secure us, but generate 

the next level of inventiveness and jobs. With that, Mr. Chairman, 

I thank you for this hearing and I yield back. 

Mr. ROGERS. I thank the gentlelady. 

Mr. Lord, in your opinion, is it fair to say that in the procurement process TSA over the last 10 years, we have largely been reacting to the last terrorist attempt rather than looking forward to 

new technologies and new threats? 

Mr. LORD. That is—hmm. I would have to say in terms of their 

requirement-setting process, they are trying to anticipate new 

threats. That is why in January of this year they broadened and 

deepened, I can’t give any specifics, it is sensitive information, but 

they have made an attempt to keep abreast of latest developments. 

You know, it is Government bureaucracy, sometimes it probably 

takes a little longer than you would anticipate, but they are making an attempt. In terms—— 

Mr. ROGERS. Do they have formal practice, exercises is what I 

am getting at. When I played football a long, long time ago, we 

would have what we call skull sessions, that was all about brainstorming. I am wondering does TSA have formal meetings or functions where they just sit around and think in cooperation with the 

private sector, what are our threats? How can we deal with them? 

Are you aware of anything like that, any exercises? 

Mr. LORD. They set up this process with S&T, it is called integrated product team IPT capstone process where they try to harmonize and discuss what are the threats and requirements, what 

are the detection issues we should be aware of. I know they made 

at least some effort. Also, they do reach out, Ms. Duke mentioned 
38 

the industry days, they conduct classified briefings. They have discussions with industry: Is it enough? I don’t know how you would 

measure that, but they do have mechanisms in place. What we 

found in our prior work is vendor still considered an issue, it is difficult to evaluate, because the vendors, you are not sure what the 

basis of the complaint is, but they have been very vocal with us. 

I think it is something TSA needs to continue to work on. Obviously they are trying, but could further efforts be made? Absolutely. 

Mr. ROGERS. Mr. Jackson, your thoughts? 

Mr. JACKSON. I think TSA absolutely does look in the rear-view 

mirror, and they must do that, because once you have a known 

threat, you have no excuse not to try to cover that threat in an effective way. My experience in the Government showed that we 

spent however a substantial amount of time, a really focused effort 

to try to anticipate changes in this. So the TSA administrator begins his or her day with an intelligence briefing from the intelligence community that sucks up all this sort of information about 

current plots, techniques, tools, devices, modes of attack, and it has 

home at DHS headquarters, intelligence shop, it has an intelligence 

shop home at TSA. This is how you begin your day if you were in 

a job like my old one, I would start 7:00 a.m. with those type of 

briefings. 

Then each of the operating components, most all the operating 

components have real field work, CDP, Coast Guard, TSA, Secret 

Service have that focus. Then there is a systemic search for what 

you can do to make a cost-effective investment for a dollar to try 

to cover the known threats and the unknown threats. For example, 

when Kip Hawley became TSA administrator, we had a very sustained and focused conversation around how can I spend a certain 

amount of money and achieve the maximum extra benefit for detection. I had some of these conversations with you at the time. We 

thought getting more dogs and behavior recognition into the field 

as fast as we could in a disciplined way, were the two most efficient 

ways to take on a bunch of unknown problems, but which fell into 

that categories that we knew we could work through with those 

tools. So my experience is you have to do both, TSA does both. It 

is a hard job to try to crystal ball the means of attack in the future. 

It can always be improved, that process can always be improved, 

I assume, but they work at it. 

Mr. ROGERS. Ms. Duke, your thoughts. 

Ms. DUKE. One of the recommendations I would have is that one 

difference between Department of Defense and Department of 

Homeland Security is the budgeting and programming process. 

Even though both have an annual budget. Within Homeland Security it tends really, even though you submit a 5-year budget, it is 

really nearly 100 percent annual. Where in Defense even though 

most of their appropriations are annual also there is really a 5-year 

plan. They really look at the 5-year budget. I think that TSA has 

to look back, as Mr. Jackson said, and also, has to look forward. 

But really, looking at the 5-year budget as a plan, subject to the 

annual adjustments that are necessary, but really looking at that 

comprehensively, because the years do feed on each other, I think 

would help TSA look more perspectively and plan better. I think 
39 

it would also help industry because then they can anticipate if 

there is a reasonable assurance that they can predict the out years, 

I think it would help them use some of their—as you know every 

industry partner major has the IRAD funds, internal research and 

development. It would help them use that more effectively if they 

knew what they could reasonably anticipate in the budget out 

years. 

Mr. ROGERS. Excellent. Mr. Lord, you had something you wanted 

to say? 

Mr. LORD. Yes, I wanted to add one thing to my prior remarks. 

On the Department-wide basis, the Department has an office of 

risk management and analysis, they go through the scenario testing, what, looking at different scenarios, how the terrorists could 

hit us next. It is really interesting, they literally model hundreds 

of scenarios. They try to get at the unknown unknowns, as former 

Secretary of Defense Rumsfeld once labeled it, the so-called Black 

Swan, what should we be worried about that we can’t even vision. 

Sort of futuristic, I think that office does good work and that is an 

important part of their program. 

Mr. ROGERS. I am glad you offered that. The Chairman now will 

recognize Mr. Richmond, if he has any questions. 

Mr. RICHMOND. I will just ask one and it is to Mr. Lord. I know 

GAO has done extensive work on TSA and looking at their workforce. I guess my specific question would be looking at the high 

turnover and attrition there, and its impacts on fewer training opportunities, especially based on the fact the checkpoints are understaffed and workers are not allowed to take time off for training. 

What type of impact does that have on the training on the deployment of checkpoint technology? 

Mr. LORD. Um, all due respect, sir, we never looked at that question specifically. What we did look at was turnover at the higher 

level, the SES level. We found that turnover typically goes up after 

a new administrator comes on board and levels out. Over time, it 

had gone down. It wasn’t out of line with the rest of the Department, so I can’t answer that specifically as relates to the transportation security officers, but the only work we have done was at a 

much higher level on that. 

Mr. RICHMOND. Thank you. I yield back. 

Mr. ROGERS. I thank the gentlemen. I thank the witnesses. This 

has been very helpful. This hearing is the first in a series of three. 

We wanted to get folks who could to have kind of a rearview mirror 

perspective and get their thought from the 20/20, ‘‘you are out of 

the Government looking back in’’ perspective. Our next panel hearing will be with private sector folks who have had struggles in 

working with the Department, what they think we can do to improve the procurement process. Then we will have a third and final 

hearing where we have DHS folks come in who are doing it now. 

They will have the benefit of your testimony and comments here 

today as well as the private sector folks, and hopefully well get 

something productive out of it. I do appreciate all of you. I want 

to remind the witnesses that there may be some additional questions from Members who couldn’t be here. So we will hold it open 

for 10 days, if you could respond to those, I would appreciate it. 
40 

Again this is very helpful. Thank you for being here, this hearing 

is adjourned. 

[Whereupon, at 11:25 a.m., the subcommittee was adjourned.] 
(41) 

TSA REFORM: EXPLORING INNOVATIONS IN 

TECHNOLOGY PROCUREMENT TO STIMULATE JOB GROWTH, PART II 

Thursday, October 13, 2011 

U.S. HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON TRANSPORTATION SECURITY, 

COMMITTEE ON HOMELAND SECURITY, 

Washington, DC. 

The subcommittee met, pursuant to call, at 2:15 p.m., in Room 

311, Cannon House Office Building, Hon. Mike Rogers [Chairman 

of the subcommittee] presiding. 

Present: Representatives Rogers, Jackson Lee, and Richmond. 

Mr. ROGERS. The Homeland Security Subcommittee on Transportation will come to order. The subcommittee is meeting today to 

continue to examine innovative solutions to technology procurement at TSA that could generate cost savings for the Federal Government and stimulate job growth within the private sector. 

I want to thank our witnesses for being here. I know it is a consuming effort, but I appreciate them making the time to participate 

in what I believe is going to be a very timely hearing. We look forward to your thoughts on how TSA can continue to improve its 

working relationship with the private sector. 

Our job on this subcommittee is to ensure that TSA has the resources and capabilities needed to secure commerce and the traveling public. Through that oversight, we have a great opportunity 

to examine the ways to solve some of our Nation’s other challenges, 

the most pressing of which right now is high unemployment. This 

subcommittee held the first installment of this series of hearings 

just a few weeks ago. In that hearing we heard from former DHS 

officials and the GAO on ways in which TSA can do a better job 

communicating with the private sector and ways TSA and DHS 

might reform their procurement processes. 

Some of the ideas we heard included things like providing the 

private sector with a much better roadmap so they can work to 

meet TSA’s needs in a less reactionary sort of way than what we 

are seeing now. 

It is clear that we need to look at ways to streamline and reform 

acquisitions mechanisms within TSA and the Department more 

broadly. Chairman King’s authorization bill, of which I am an original cosponsor, gets at some of these reforms in matters like strategic sourcing and enhanced requirement settings. 

I can’t overemphasize the need for well-thought-out requirements. Both the Science and Technology Directorate and the oper-
42 

ational components of TSA must be part of the process. The Capabilities and Requirements Council that DHS is standing up once 

again, after having disbanded it, should go a long way toward that 

end. 

We have heard recommendations of a third-party certification for 

alternative financing for strategic sourcing and for revising the 

clearance process. I am pleased to see these ideas in the dialogue 

that these hearings generated around the issue. We must examine 

all options for finding new opportunities to engage industry. 

What I would like to hear from all of you are viable options for 

changing how things are done at TSA that will build innovative capacity in your world. You know better than anybody what you need 

to promote progress in your challenging but critical fields and create job opportunities. 

I want to do all I can to foster that innovation of which I know 

the private sector is incredibly capable, so I look forward to hearing 

your thoughts on finding cost efficiencies and creating jobs through 

improved technology procurement at TSA. I encourage you all to 

return next month when we invite the Department to testify on 

that same issue. 

With that, I yield to my Ranking Member, my good friend from 

Texas, Ms. Jackson Lee, for any opening statement she may have. 

Ms. JACKSON LEE. I think this series of hearings are both important and relevant in light of the fact of our full understanding that 

security is holistic, and it requires a seamless interaction between 

the S&T of the Department of Homeland Security and the importance of the private sector. 

I have interest of the private sector’s collaboration. I don’t have 

interest in the private sector’s dominance. But I do think it is important that S&T becomes more focused, that it is not a hobby 

shop, that it is intertwined with the framework of our present conditions. I always say this. I think the Chairman has heard me say 

this, that terrorism is becoming franchised. We use the term ‘‘lone 

wolf.’’ I prefer using ‘‘individual actor’’ and we don’t know who that 

actor may be. 

So it is not a laughing matter or a matter that draws humor, but 

it requires a sense of balance and a sense of understanding that 

all the principals are important in the effort of securing the homeland. 

So as I indicated I know from our discussions that the Chairman 

and myself share the same commitment to securing our Nation’s 

transportation system. Understand that today’s hearing is the second hearing in this series, and I look forward to receiving testimony from today’s witnesses and hope that the third hearing, 

which will contain Government witnesses, will provide insight on 

the practices of this administration. 

Today we will hear from members of the business community. I 

want to first welcome Mr. Guy Ben-Ari, deputy director of the Defense-Industrial Initiatives Group at the Center for Strategic and 

International Studies. It is an important think tank, and I thank 

you for being here today. 

At the September hearing, we heard from former Homeland Security officials. They testified about the need for greater cooperation between business and Government in developing contract re-
43 

quirements for major research projects. The 9/11 Commission was 

a very, very thorough review, I believe, in the immediacy of the 

tragedy. But they produced a readable document. All of these elements are part of preparedness, part of putting on our armor, and 

it is imperative that we continue going to the next generation of 

technology that gets us more than one step ahead of the terrorists 

but many steps ahead of the terrorists. 

While this is an interesting thought, as you know, the Federal 

Acquisition Regulations have strict rules about the depth and 

breadth of permissible discussions between Government and industry prior to the announcement of a contracting opportunity. 

I think the last hearing also made it clear that this administration has given some thought and taken some action on how TSA 

and S&T can improve their collaboration. We can put in a framework where the security issues are answered and the dialogue can 

continue. 

We in Congress need to support and encourage efforts to assure 

that Government is more efficient and generally meets the needs 

of its customers and the American taxpayer. Unfortunately, the 

current budgetary atmosphere makes a strong and robust research 

and development agenda unlikely, though I would like to push the 

envelope to say that we should not nickel-and-dime the Nation’s security. 

TSA and the Science and Technology Director at DHS are tasked 

with the critical mission of developing, evaluating, and delivering 

technologies to improve transportation security. Their job is to increase public safety. Given the risk to our aviation and mass transit sectors, DHS must be able to integrate effective security technology into our transportation security programs. However, new solutions, old problems, seldom come without cost. 

Mr. Chairman, at this point we must ask: What costs are we 

willing to pay? We should not be afraid to spend dollars if we save 

lives. 

Let me put in an additional note. Some of the greatest research 

comes from start-ups and small businesses. I don’t want to see the 

intricate and difficult procurement process that is tied to S&T and 

the Department of Homeland Security keep away those genius 

ideas that may be the next level of securing the homeland. I hope 

the witnesses will comment on the need for that kind of view in 

order to keep with the next generation of technology. 

I will just make one point. Every time there was a terrorist act 

post-9/11, from the anthrax to the shoe bomber to the underwear 

bomber, unfortunately these were low-tech, but everybody in the 

United States I would imagine had never heard of it. Low-tech, 

never heard of it. What is next? We have got to be ahead of that 

kind of action. So we should not be afraid to spend dollars however 

because my colleagues on the other side of the aisle have from the 

leadership decided to slash the Department’s budget below fiscal 

year 2012. I am not hopeful of moving forward. 

So I am hoping to convince a few of my colleagues that research 

and development under the S&T is extremely important. I hope 

this testimony will help the Chairman work with me on that idea 

and that premise, and that we can ensure that we do not stop the 
44 

collaboration between the private sector, the effectively secured collaboration between the private sector. 

With that, Mr. Chairman, might I just offer, as I indicated to you 

that I have a duplicate or an overlapping hearing of which I am 

offering amendments to legislation. If the witnesses perceive that 

I am departing, I am hoping to return to this very important hearing, and I have asked the Chairman for his indulgence, and he has 

been kind enough to indulge me. 

Thank you very much, Mr. Chairman, I yield back. 

Mr. ROGERS. I thank the gentlelady. 

I am tickled to have such a fine panel here. I appreciate all of 

you. 

We have Mark Pearl who has served as the president and CEO 

of Security and Defense Business Council since March 2008. Prior 

to joining the Council, Mr. Pearl was principal and chairman of IT 

Policy Solutions, which he founded to counsel private sector organizations in meeting their public policy challenges. He concurrently 

served as executive director of the Consumer Electronics Retailers 

Association. Mr. Pearl had previously been a partner in the international law firm of Shaw Pittman and led their e-commerce policy 

practice; served as general counsel and senior vice president to the 

ITAA, now Take America, and was chief of staff and legislative 

counsel to U.S. Representative Dan Glickman when the former 

chairman chaired the House Intelligence Committee. 

We also have Scott Boylan, who is vice president and general 

counsel of Morpho Trust USA, where he overseas legal and Governmental relations functions. Mr. Boylan joined Morpho in April 2005 

where he served as vice president of Government Relations and 

general counsel. Prior to joining Morpho Detection, Mr. Boylan was 

senior advisor to the Secretary of Homeland Security and part of 

the team that established DHS. Immediately prior to his time at 

DHS, Mr. Boylan served at the Treasury Department and the Department of Justice in international law enforcement roles. We are 

pleased to have Mr. Boylan here and appreciate his testimony before the committee on numerous occasions. 

We also have Guy Ben-Ari, deputy director and fellow of the Defense Industrial Initiatives Group at the Center for Strategic and 

International Studies, where he studies the links among innovation 

industry, military capabilities, and defense policy. Prior to joining 

the CSIS, Mr. Ben-Ari was research associate at George Washington University, Center for International Science and Technology 

Policy, where he worked on National research and development 

policies and network-centric capabilities. 

From 2000 to 2002 he managed collaborative research and development programs for Gilat Satellite Networks Limited, an Israeli 

high-tech company in the field of satellite and communications, and 

from 1995 to 2000 he was technology analyst for the Israeli Government. He also consulted for European Commission and the 

World Bank in innovation policy and project evaluation. 

We are thrilled to have all of you here and look forward to your 

opening statements before we go into questions. 

Mr. Pearl, we will start with you. 
45 

STATEMENT OF MARC A. PEARL, PRESIDENT AND CEO, 

HOMELAND SECURITY AND DEFENSE BUSINESS COUNCIL 

Mr. PEARL. Mr. Chairman, thank you for giving the Homeland 

Security and Defense Business Council an opportunity to testify before you today to discuss the important issues involving technology 

procurement at the TSA, particularly related to innovation and job 

growth in the private sector. The Council, as you well know, serves 

as the collective voice of the Nation’s leading homeland security solution providers whose major goal is to facilitate transparent, substantive dialogue between industry and Government on critical 

homeland security issues. 

Our written testimony focuses on providing the subcommittee 

with industry’s perspective on how TSA in particular, and the Department of Homeland Security as a whole, can work more effectively with the private sector to improve technology acquisition and 

procurement process, as well as stimulate job growth. 

While my written testimony goes into obviously much more 

issues and more detail, I would like to use my time to highlight a 

few issues that we raise. 

Everyone understands that the full acquisition life-cycle process 

is very complex and requires effective and efficient strategies, processes, and procedures. It requires strong organization, capable of 

determining if what is needed technologically is technologically feasible and economically reasonable, with strong understanding of 

any unintended consequences. Those are three important questions 

that have to go into the whole life-cycle process. 

The DHS Acquisition Management Directive, 102–01, updated in 

January of last year, provides a foundation of policies and procedures to support acquisition management at the agency. The issue, 

however, is whether the programs that result from these policies 

actually operate and function as intended and in a manner that is 

transparent to all parties. 

Government and industry share the same goal: To provide for the 

technology and capabilities needed by TSA for mission success 

through processes that are transparent, accountable, coordinated, 

timely, cost-effective, and policies that encourage competition, innovation, and investment in the homeland security marketplace. 

No one, particularly in these tough economic times, wants to see 

nor can afford to have their time, money, and resources wasted. Reform alone, however, at TSA will not solve the current challenges 

with technology acquisition. A truly successful processing system 

will require that component parts of DHS stop operating in silos 

and become more harmonized. While much progress has been made 

since its creation, DHS across all platforms, within all of its components, must work to achieve the development of a common operating picture that facilitates communication, collaboration, coordination, and cooperation in a triangulated fashion between and 

among operations; in this case, at TSA, R&D, and the procurement 

process. 

Here are a few ways in which we belive that shared goal can be 

achieved: 

First, develop a long-term acquisition strategy along with adequate and predictable funding. Particularly given the current economic environment, companies cannot waste time and money on 
46 

speculative technologies that they believe TSA might want to incorporate into security in the transportation arena. Industry needs 

greater insights and predictability into TSA’s long-range acquisition and procurement plans. The information the private sector 

currently receives comes much too late in the process and is not detailed enough to enable it to redirect R&D investments to align 

with TSA’s goals. 

Second, develop procedures that encourage and allow an early 

and on-going dialogue with industry. DHS and TSA must facilitate 

early substantive engagement with the private sector in an open 

and transparent manner, long before an RFP or an RFI is initiated, 

that will encourage industry input to help define and calibrate 

technological requirements to match objective and achieve mission 

goals. The more complex the procurement, the more critical the 

need is for an open information exchange. 

Such conversations between and among the interested parties 

sufficiently in advance of any specific procurement would not be 

tied to an upcoming project or program or contract, but would enable the Government to gather the information needed to help 

shape the desired outcome and define requirements long before a 

contract is initiated. 

Third, technology testing requirements should be standardized. 

Technology testing and certification requirements need to be more 

transparent, realistic, consistent, and not cloaked in mystery. The 

process should rely on a clearly-defined series of lab, field, and 

operational tests under an open schedule to encourage technology 

companies to invest in new research, with more assurance that its 

investment will receive vetting and possible acquisition by TSA. 

In conclusion, let me say: A harmonized acquisition process within DHS that encourages and utilizes early engagement and ongoing communication with industry will drive innovation and investment towards technologies needed for mission success. This 

process does not pick winners. Rather, it provides a foundation for 

competition at the very high level. The Council believes the actions 

I have outlined here as well as in my written testimony will go a 

long way to ensuring that TSA will be able to acquire the most effective and cost-efficient technology. 

On behalf of the Council, I appreciate the opportunity to provide 

this collective perspective of industry on these important issues before the subcommittee. 

I will answer any questions that you deem fit to ask. 

[The statement of Mr. Pearl follows:] 

PREPARED STATEMENT OF MARC A. PEARL

OCTOBER 13, 2011 

Chairman Rogers, Ranking Member Lee, and distinguished Members of the subcommittee, I thank you for giving the Homeland Security & Defense Business Council an opportunity to appear before you today to discuss the important issues involved with technology procurement at the Transportation Security Administration 

(TSA), particularly as they relate to innovation and job growth in the private sector. 

I am Marc Pearl, President and CEO of the Council, a non-partisan, non-profit 

organization of the leading homeland security solution providers. The purpose of the 

Council is to facilitate two-way substantive dialogue between the private sector and 

Government on critical homeland security issues and to ensure that the private sector’s perspectives, innovation, expertise, and capabilities are integrated into our Nation’s security. 
47 

Collectively, our members employ more than 3 million Americans in all 50 States 

and provide expertise in technology development and integration, facility and networks design and construction, human capital, financial management, and program 

management. In particular, many of our member companies specialize in the technologies and services needed and used by TSA. 

The Council’s testimony today will focus on providing the subcommittee with industry’s perspective on how TSA, in particular, and the Department of Homeland 

Security (DHS), as a whole, can work more effectively with the private sector to improve the technology acquisition and procurement process and stimulate job growth. 

As recognized in the September 2011 Government Accountability Office Report on 

‘‘DHS and TSA Acquisition and Development of New Technologies,’’ TSA acquisition 

programs represent billions of dollars in life-cycle costs and support a wide range 

of aviation security missions and investments including technologies used to screen 

passengers, checked baggage, and air cargo. These technologies make up a significant part of TSA’s annual budget and play a critical role in its ability to accomplish 

its mission. 

The full acquisition life-cycle process is quite complex and requires effective and 

efficient strategies, processes, and procedures, and a strong organization capable of 

determining if what is needed is technologically feasible, economically reasonable, 

and will not result in unintended consequences. The life-cycle process begins with 

identifying a capability need; analyzing and selecting the means to provide that capability; obtaining the capability through the appropriate types of acquisitions; and 

producing, deploying, and supporting the capability through its useful life until disposal. If any infrastructure component is deficient, the entire process is at risk for 

failure. 

The DHS Acquisition Management Directive 102–01, updated in January 2010, 

provides the overall policy and procedures to support acquisition management at the 

agency. While it offers a strong indication that acquisition management processes 

are in various stages of development, it is critical that the programs resulting from 

these policies actually operate and function as intended and in a manner that is 

transparent to all parties. 

Government and industry share the same goal: To achieve the capabilities needed 

by TSA for mission success through processes that are transparent, accountable, coordinated, timely, cost-effective, and policies that encourage competition, innovation, 

and investment in the homeland security marketplace. No one, particularly in tough 

economic times, wants to see, nor can afford, to have time, money, and resources 

wasted. 

Reform solely at TSA, however, will not solve the current challenges with technology acquisition. A truly successful process and system will require that component parts of DHS stop operating in silos. DHS—across all of its platforms, within 

all of its components—must work to achieve the development of a common operating 

picture that facilitates communication, collaboration, coordination, and cooperation 

in a triangulated fashion between and among operations at TSA, the research and 

development (R&D) process, and the procurement process. To achieve the shared 

goal, the Council strongly recommends the development of the following: 

(1) A long-term acquisition strategy, multi-year budgets and deployment plans, 

and adequate and predictable funding; 

(2) Open, transparent, and coordinated processes, practices, and procedures that 

facilitate early and on-going dialogue with the private sector and well-defined 

technology performance and testing requirements; and 

(3) A strong organization that can coordinate both the R&D and procurement 

processes and has a workforce capable of planning and executing that process. 

If the entire acquisition process is harmonized (and perhaps even ‘‘standardized’’) 

within DHS, and includes earlier and continuous engagement and communication 

with industry throughout the process, we can drive innovation and investment towards the technologies needed for mission success. This process does not pick winners; rather, it provides a foundation for competition at the very highest level. The 

Council believes these actions will go a long way in ensuring that TSA (as well as 

other components within DHS) can acquire the best, most effective, and cost-efficient technologies (as well as services and products). 

1.DEVELOPMENT OF A MID- TO LONG-TERM STRATEGIC ACQUISITION PLAN, MULTI-YEAR

BUDGETS, AND ADEQUATE AND PREDICTABLE FUNDING

The private sector serves an important role in developing, testing, and providing 

the technologies that TSA needs to operationalize its mission. Industry, however, 

does not have limitless resources to devote to technology development in a void. Par-
48 

ticularly in the current economic environment, the private sector cannot waste time 

and money on building speculative technologies that they believe TSA ‘‘might’’ want 

to incorporate into aviation security. Industry wants to develop and deliver the technologies that TSA needs now and long into the future. To accomplish this, the homeland security industry must have greater insight and predictability into TSA’s longrange acquisition and procurement plans. It currently only receives high-level, nearterm technology plans in the form of an annual Congressional budget justification. 

This information comes too late and is not detailed enough to enable industry to 

redirect R&D investments to align with TSA’s goals. Development and testing typically requires several years before a security technology is ready for implementation 

and deployment. 

The Council strongly believes that TSA must strive to develop a mid- to long-term 

strategic acquisition plan and consider the possibility of multi-year budget plans. A 

strategic acquisition plan would provide all interested companies with an insightful 

blueprint for Government’s future needs, and give them the necessary time to align 

and focus financial and personnel resources towards addressing the highest-priority 

needs. While no doubt difficult to do under the current budget approval process, 

Congress and the Department could work together more closely to develop multiyear budget plans, or at least a credible forecast of future budget activities at the 

time of an annual budget justification. This would provide all interested parties, including and particularly industry, with a level of certainty needed to make multimillion dollar technology investments and hiring decisions. 

TSA could also improve transparency in the acquisition planning process by sharing, through appropriate channels, the relevant findings, from the Transportation 

Sector Security Risk Assessment. Sharing long-term technology acquisition and deployment plans, including a prioritized, risk-based, multi-year list of required capabilities and intended deployment plans would help industry provide more timely and 

cost-effective solutions. New technology development is hindered when industry is 

uncertain as to whether DHS will undertake testing, much less purchase newer, 

higher-performing systems. 

In conjunction with budget forecasts, it is also critical that TSA have confidence 

that it will receive adequate funding to address evolving threats. Enhanced budget 

planning and communication of budget requirements will result in taxpayer savings 

and increase industry’s ability to understand whether business risk justifies future 

job creation. Any and all assistance that Congress can provide in guiding the development of a mid- to long-term strategic acquisition plan, multi-year budget plans, 

or ensuring adequate funding for TSA would go a long way in providing the foundation for all interested parties to achieve mission success. 

2. DEVELOPMENT OF OPEN, TRANSPARENT, AND COORDINATED PROCESSES, PRACTICES, 

AND PROCEDURES THAT FACILITATE WELL-DEFINED TECHNOLOGY AND TESTING REQUIREMENTS

A. Engaging the Private Sector Long Before the Procurement Process Begins Will Result in Well-Defined Technology Performance Requirements and Better Results 

The private sector wants to develop and provide the capabilities that TSA (and 

the entire Department) needs to achieve mission success. To accomplish this, it is 

incumbent upon Government to provide industry with well-defined technology and 

testing requirements. If the technical performance needs and testing requirements 

for technologies are not clear to industry, it increases the potential for an increased 

or lost cost of development, longer time before deployment, duplication of effort, and 

a resulting product or technology that fails to meet TSA’s expectations and operational needs. Well-defined requirements also help motivate industry and are critical to promoting competition. 

Defining mission needs in a clear and concise fashion is not a job that Government can or should do alone. DHS and TSA must develop coordinated processes, 

procedures, policies, and practices that facilitate early, substantive engagement with 

the private sector in an open, transparent, and predictable manner long before a Request for Proposal (RFP) is initiated. Industry input is essential to help define and 

calibrate technical requirements to match mission objectives and achieve mission 

goals. The more complex the procurement, the more critical the need for an open 

information exchange. Transparency in this process is also necessary to ensure that 

no one feels that a particular technology is being highlighted or unfairly selected. 

If all participants understand and adhere to ‘‘rules of engagement,’’ that are both 

predictable and consistent, we can optimize the input and exchange between Government and industry. 

The members of the Council strongly support DHS engaging the private sector by 

conducting more conversations or discussions surrounding general needs and con-
49 

ceptual frameworks that are NOT tied to any upcoming or projected program or contract. Whether called ‘‘Industry Days’’ or something else, such interactions between 

and among the interested parties sufficiently in advance of any specific procurement 

will enable Government to gather the information needed to help shape the desired 

outcome, define requirements, identify what is economically reasonable and technologically feasible, and allow all interested parties to explore any unintended consequences before a contract is initiated. 

Contracting professionals in Government often have a limited understanding of 

what industry is (or may not be) capable of providing, and limited exposure with 

the skills, business practices, and experiences of potentially valuable companies. By 

engaging with the private sector long before the procurement process begins, DHS 

personnel, for example, can conduct more effective market research and gain a 

greater understanding of existing and emerging technologies, including Commercial 

Off The Shelf (COTS) products, which may offer significant opportunities for reduced development time, faster insertion of new technology, lower life-cycle costs, 

and an overall substantial cost savings to Government. This type of engagement 

with industry would allow Government to understand the business practices supported by the commercial item, learn the appropriate industry terminology and concepts associated with the desired service or equipment, identify potential contractors 

that provide the item, and determine the correct scope of the requirements that best 

fit the existing vendor base. 

The Council has been in on-going discussions over the past year with representatives from the Science and Technology (S&T) and the Management Directorates to 

begin to address some of these needs and issues to further the goal of transparency 

and how best to achieve mission success. We have raised the idea, for example, of 

creating a Government-industry advisory council that could coordinate an open dialogue on specific topics that could bring about a greater understanding between the 

two sectors, such as having industry days earlier in the process. A jointly-led advisory council could conduct work sessions to share perspectives on the timing, manner, and substance of communications, and the best ways to conduct industry days 

so that both sectors receive mutual benefit. We are currently exploring options for 

how to facilitate such an important and potentially effective activity. 

Industry is also encouraged to see the Government issuing more Requests for Information (RFIs) on the FedBizOpps website, and hopes this trend continues in the 

future. This is another manner for the Government to conduct market research to 

identify what kind of products or service solutions are commercially available. It 

asks industry to offer solutions for agency requirements or objectives; and facilitates 

the collection of information about companies with the appropriate capabilities, 

products, experience, and expertise. Through this interactive tool, Government and 

industry can have a continuous two-way dialogue that results in requirements that 

are greatly improved from when the RFI was first issued. 

We must stress that the exchange of information with industry cannot stop at the 

issuance of a RFP, it must continue throughout the entire procurement process, particularly when information previously provided has changed. DHS should continue 

to use and further develop acquisition websites that provide information for specific 

identified procurements, definitions of terminology and milestones, and regular updates to time schedules, future needs, and other previously provided information. 

B. Standardize Technology Testing Requirements and Speed Up the Process for Certification by Using a Clearly-Defined Series of Lab, Field, and Operational Tests 

That Can Be Provided by Third Parties 

The process by which DHS tests technology is not standardized. TSA uses a series 

of lab, operational, and field tests to validate some equipment but not all equipment. 

Other components, like Customs and Border Protection, rely on a single demonstration test every 5 years to evaluate inspection equipment. The lack of consistency and 

continuity creates a great deal of unpredictability and inefficiency, which can cause 

delays in deploying the most up-to-date, qualified technology in a cost-effective manner. 

DHS must do more to communicate with industry to ensure that technology testing and certification requirements are realistic, consistent, and not cloaked in mystery. It must develop a process that relies on a clearly-defined series of lab, field, 

and operational tests on a rolling schedule to allow for the testing and validation 

of new technologies. An open schedule will encourage technology companies to invest in new research with more assurance that its investment will receive vetting 

and possible acquisition by DHS. 

The current process for testing and certifying new technologies is often confusing, 

cumbersome, and can result in wasted time, money, and resources. DHS needs to 

provide industry with greater transparency into the process and should also con-
50 

sider alternative arrangements, such as paying a third party to test and certify the 

technologies based on standards established by the Government. This is something 

that has been successfully done in the United Kingdom. The use of National labs, 

non-profits, or for-profit corporations for this process could greatly speed up the deployment of technology to TSA. 

3. DEVELOPMENT OF A STRONG ORGANIZATION THAT HAS A COORDINATED ACQUISITION

PROCESS AND A WORKFORCE CAPABLE OF PLANNING AND EXECUTING THE PROCESS

A. Development of a Coordinated Acquisition Process That Links Operations, R&D 

Efforts, and the Procurement Process 

DHS needs a stronger, more coordinated acquisition process that moves away 

from the current stove-piped environment and can harmonize and link operational 

considerations with R&D efforts and procurements. While much progress has been 

made since its creation, DHS still has more work to do in ensuring collaboration, 

coordination, and communication across the agency. 

The Council believes that it is critical to implement an acquisition process that 

facilitates effective engagement between and among DHS’ components and with the 

private sector. There are at least 11 unique procurement and R&D processes occurring across the agency. Large components run their own processes in different ways 

and many times inconsistently. This can result in duplicative efforts. 

Current R&D efforts are spread not only among different component organizations within DHS but also across Federal agencies. The S&T Directorate is highly 

dependent on other Federal agencies to achieve its mission. There does not appear 

to be a clear strategy for how to do it effectively and in collaboration with the Department of Defense, the Department of Energy, NIST, and other scientific organizations. This lack of collaboration may result in duplicative efforts and unleveraged 

technologies. To increase the likelihood of success, Congress should determine 

whether the S&T Directorate needs greater authority to perhaps direct the Government-wide R&D agenda, rather than having to compete against numerous organizations inside and outside of DHS. 

With more communication within and among Federal agencies, DHS has the opportunity to effectively link efforts and identify potential technologies that it could 

leverage in support of other missions. The development of a standardized and coordinated DHS-wide acquisition process and the use of the same communication 

tools would not only enhance efficiency, but would provide needed transparency so 

that end-users, acquisition and operations officials, and industry can work together. 

If we can improve coordination of these programs and processes throughout the Department, it will contribute to a strong organization and we will get better results 

with procurements at TSA. 

B. Ensure a Workforce Capable of Planning and Executing the Acquisition Process 

by Increasing the Quantity and Quality of Public Sector Contracting Personnel 

We urge Congress to recognize and help address the shortage of acquisition and 

procurement staff across the Department. DHS needs the ability to increase the 

number of procurement officers with expertise in technology, engineering, and management to accomplish the complex operational aspects of oversight and review. 

Contracting officers must be accessible, interactive, and open to sharing concerns 

and approaches for various aspects of a particular procurement. They must also 

value and understand input and substantive dialogue with the private sector both 

pre- and post-award. Such an exchange is particularly valuable at a time when procurements have become more complex. To accomplish these goals, Congress should 

support programs that further the development, training, and retention of acquisition professionals. This could be accomplished, in part, by ensuring continued funding for the acquisition ‘‘intern’’ program. 

The Council has also long advocated, for example, that DHS develop an exchange 

program with the private sector to improve the management abilities and the technical and professional competencies of its employees. A professional exchange program would offer DHS direct insight into the philosophy, procedures, and practices 

of industry. It would provide public sector professionals with an opportunity to examine industry policies and processes, as well as learn first-hand how industry addresses both R&D and contracting and procurement issues. This would allow DHS 

to interpret the needs of the Department in industry terms. By studying the best 

practices of the industry, Government professionals are able to bring new knowledge, understanding, and empathy back into the Department to improve its processes. The process would also benefit industry, which would gain a better understanding of the unique perspective and experience of the DHS professional. Obtaining such direct insight and experience is currently unavailable in DHS. There are 
51 

a few programs that bring private sector experts into Government, but none, as far 

as we know, that encourage or permit public sector employees to be temporarily detailed into the private sector to gain the knowledge and/or perspective that would 

help them better understand the multiple factors that go into the relationships between R&D, procurements, and operations. 

CONCLUSION

As I stated in my introduction, we all share the same goal: To achieve the most 

successful outcome for all stakeholders through a process that is transparent, accountable, predictable, timely, cost-effective, and that encourages competition, innovation, and investment in the homeland security marketplace. Today’s acquisition 

process and specifically the procurement process need to be more flexible, inclusive, 

and dynamic to change. The Council and its members have worked closely and successfully to nurture a substantive relationship with the Management and S&T Directorates in particular to discuss how we can best develop a dialogue that identifies 

a successful process that could lead to even more effective and efficient innovative 

solutions to protect our country. But even amidst the establishment of these relationships, the business sector, as a whole continues to struggle to comprehend the 

long-term strategic needs and goals of TSA. This has made our long-term investments toward new and innovative technologies that might become effective solutions, challenging at best. 

We respectfully ask Congress and this vital and interested subcommittee to consider the following recommendations, provide guidance and continued oversight, and 

help facilitate the dialogue necessary between industry and Government to improve 

the process and outcome for all stakeholders: 

(1) Development of a long-term acquisition strategy, multi-year budget plans, 

and predictable and adequate funding for TSA; 

(2) Development of open, transparent, and coordinated processes, practices, and 

procedures that facilitate well-defined technology and testing requirements; and 

(3) Development of a strong organization with a standardized and coordinated 

acquisition process and a workforce capable of planning and executing the process. 

While TSA in particular and the Department as a whole are still evolving, this 

is not about ‘‘reinventing the wheel,’’ but rather identifying and encouraging the 

many best practices and lessons learned available from other Federal agencies that 

have decades of experience with acquisitions. 

On behalf of the Homeland Security & Defense Business Council, I appreciate the 

opportunity to provide the collective perspectives of industry on the important issues 

before the subcommittee. The Council is willing to provide or facilitate any support, 

expertise, and input you need to ensure that we can all work together to achieve 

mission success. 

Mr. ROGERS. Mr. Boylan, you are recognized. 

STATEMENT OF SCOTT BOYLAN, VICE PRESIDENT AND 

GENERAL COUNSEL, SAFRAN MORPHO DETECTION 

Mr. BOYLAN. Morpho has three companies that supply to TSA: 

Morpho Trust, which I am an employee of; Morpho Detection, 

which is a leading provider of explosive detection to TSA; and 

Morpho Track, which is a leading provider of automated fingerprint 

systems that the FBI uses and they are used in various applications at TSA as well. 

We are also a leader in identity technologies that are used in the 

TWIC program and a number of other programs. So TSA is a very 

important customer of ours. 

Just a footnote. Morpho, a commonality that crossed our businesses is algorithms, algorithms that enable us to make decisions 

in the security context. Morpho is a type of algorithms mathematics and that is why we have that name. I heard that question 

in your voice, Mr. Chairman. 

I have three points to make. 
52 

One, the first is engagement. I echo Mr. Pearl’s comments. Preengagement with industry, discussing the possibilities and the limitations and the fundamentals of what technology can and cannot 

do, is very important for TSA and especially for TSA policymakers. 

When I was at the Department, I have to say we were a bit remiss 

in understanding these capabilities. I think not just the technology 

people, but also the policymakers need to know not at a micro 

level, but at a certain baseline, what technology can and cannot do. 

That enables you to make good policy decisions. 

Constructing a way to engage with TSA, industry and TSA, is 

something I think is necessary because in my experience with folks 

at TSA, they want to engage, they want to talk, they do talk. But 

they also have a certain hesitation because it is not really clear 

what bright-line engagement rules are for them. I think clarifying 

that for the employees could go a long way to making that interaction more fruitful. 

Second is phased implementation of technology as opposed to 

here is what we want the technology to do, a long laundry list, and 

trying to deploy that. What happens is you have years of experimentation before you get a deployment, as opposed to deploying the 

basics and improving from that baseline. 

We have a very clear example of this from the very beginning of 

TSA. We have been providing TSA explosive detection equipment 

that scans bags since the creation of TSA, and the initial deployment of that technology met a baseline that wouldn’t get certified 

today. Many of those machines that were deployed at the beginning, I have to say Reagan Airport is one of them, you can see our 

machines there, they are the early version, those machines have 

the capabilities that are required today because they have been updated in place. 

So there is the capability of deploying machines, deploying technologies at a baseline, and raising that if you plan for it. That system, it was planned for. So I recommend that that is something 

that TSA look into for most of their deployments. 

Finally, a recommendation in the international field and international standards. In the European Union, for example, E.U. 

Commission passed a regulation that was to go into effect next 

year that basically required the adoption of the American-style system of screening baggages by deployment computer tomography, 

CT machines that we use here in the United States at level one 

as the first instance of screening. Industry airports in the European Union have pushed back on that because of the expense, and 

it has been pushed out to 2014. 

TSA has largely been uninvolved, not engaged in this discussion. 

That is an area where we could really have a big impact on jobs 

and the economy, because right now the CT industry, all of the certified equipment around the world, is made here in the United 

States. That is an opportunity that we have for our economy here 

to grow vis-a ́-vis TSA. 

Thank you for your time. I am happy to answer any questions. 

[The statement of Mr. Boylan follows:] 
53 

PREPARED STATEMENT OF SCOTT BOYLAN

OCTOBER 13, 2011 

Chairman Rogers, Ranking Member Jackson Lee, and Members of the subcommittee: Thank you for holding today’s hearing on TSA procurement and how 

TSA’s technology procurement can stimulate economic growth. My name is Scott 

Boylan and I am Vice President and General Counsel of MorphoTrust USA Inc., a 

subsidiary of the Safran Group, the largest biometrics company in the world. I was 

most recently the Vice President and General Counsel of Morpho Detection, Inc. 

(‘‘MDI’’), the second of three Morpho security companies that provide security technologies related to detection and/or identification to TSA, the Department of Homeland Security (‘‘DHS’’) and U.S. Government more broadly. 

MorphTrust has more than 1,000 employees in the United States and is 

headquartered in Massachusetts. We offer a comprehensive set of products and solutions for protecting and securing personal identities and assets—leveraging the industry’s most advanced multi-modal biometric platform for finger, face, and iris recognition, document authentication, secure driver’s licenses and identification cards, 

and passports. MorphoTrust is a global leader in providing Secure Identity Management solutions across Government and commercial markets. 

MDI has more than 560 U.S.-based employees with factories in California and 

Massachusetts. We are a leading supplier of explosives and narcotics detection technology world-wide. Our technologies support Government, military, transportation, 

first responder, critical infrastructure, and other high-risk organizations. We integrate computed tomography (CT), Raman Spectroscopy, trace (ITMS technology), Xray and X-ray Diffraction (XRD) technologies into solutions that deliver detection results quickly with a high degree of accuracy, while ensuring efficient security operations. MDI has been a supplier to TSA since its creation. 

MorphoTrak has more than 541 employees in the United States with major facilities in New York, California, and Washington State. We provide biometric and identity management solutions to a broad array of markets in the United States including law enforcement, border control, identity cards, civil identification, and facility/ 

IT security. We are a leading innovator in large fingerprint. MorphoTrak has provided biometric identification solutions in the United States for over 35 years and 

provides State-wide biometric identification systems in 28 States plus the District 

of Columbia. Our products are used by more than 300 city, county, and State government agencies across the United States. 

INDUSTRY GOVERNMENT PARTNERSHIP: ADVISORY COMMITTEES

A continuous challenge doing business with TSA is the lack of visibility into its 

future acquisition plans. The Chairman has recognized that this is a challenge for 

industry and has encouraged TSA in previous hearings to be more open and communicative with private-sector partners. We believe that a formal mechanism, such as 

an advisory panel consisting of industry and technology stakeholders, would be an 

excellent vehicle for exchanging information for both industry and TSA. TSA should 

set goals for industry and work with industry to create high, interoperable standards. 

Having visibility into future TSA procurement plans gives key guidance to industry in making employment, manufacturing, and inventory decisions. TSA would also 

benefit by reduced costs associated with its technology suppliers being able to more 

efficiently purchase inputs for their products with better planning and more efficient 

procurement of parts. Transparency will also allow for stabilization of manufacturing operations and avoid employment disruptions that many in the industry have 

seen. 

The Morpho companies spend millions on research and development of security 

technologies. This effort can be more efficiently targeted when TSA’s future plans, 

strategy, and vision are known. For example, a Morpho company recently was 

awarded a TSA contract for traveler document authentication. We were willing to 

dedicate significant resources and investments to develop this technology for TSA, 

without a guaranteed return, because when TSA issued requirements we then knew 

what TSA wanted. This is the scenario we need to recreate going forward. We believe that this will become the standard practice as TSA continues to improve and 

invest in its procurement system. 

PHASED ACQUISITIONS

TSA should use phased acquisitions when moving into new and developing technology areas. Initial procurements should focus on basic requirements and follow- 
54 

up procurements should push for increased performance and options. An example 

of this is EDS standards that started with a high threshold and have continually 

gotten more difficult to achieve in subsequent procurements. This has allowed for 

the initial broad deployment of baggage screening equipment immediately after 

9/11 and contributed to a constant improvement in detection capabilities up to 

today. 

ADVOCATING FOR STRONGER INTERNATIONAL AVIATION SECURITY STANDARDS=HIGHER

U.S. JOBS AND SECURITY

TSA is in a unique position to influence the security standards used around the 

globe. Our company provides security technology around the world, much of which 

is made in the United States and shipped overseas. We see in numerous international procurement solicitations that the standard required by airports and governments around the world is the TSA technology standard—especially explosive detection standards. TSA or E.U. certification is often required before a manufacturer 

can bid on a contract. We have seen this in many countries with emerging security 

standards that do not have the resources to conduct their own testing. 

We have also witnessed TSA’s reluctance to strongly advocate for their superior 

standards in international markets. A key example is the European Union where 

the Commission has adopted standards for checked baggage screening that would 

require in the future deployment of computed tomography machines at the first 

level of screening. This is effectively the system used by TSA in the United States 

today. The E.U. standards currently permit X-ray technology to scan checked bags, 

but TSA and the European Union have both recognized that X-ray technology has 

challenges screening for certain threats that CT technology does not. Despite the 

regulation change and the recognition of a security concern, there has been strong 

resistance to deploying CT technology at level one in Europe by European stakeholders who would have to invest in the technology. TSA has largely stayed out of 

this debate. But this is where they have the opportunity to both increase the level 

of explosive detection capability in a region that is a key to U.S. aviation security 

and open a potentially huge market to what is predominately a U.S. industry. Adoption of CT at level one in the European Union would create a market for CT in Europe that would be larger than in the United States. All of the currently certified 

CT technology in the world is manufactured in the United States. 

Once this standard becomes a U.S. and E.U. standard it will likely become a de 

facto global standard that increases aviation security around the globe—and jobs 

and economic activity in the United States. 

Thank you. 

I will be happy to answer any of your questions. 

Mr. ROGERS. Thank you. 

Mr. Ben-Ari, you are recognized. 

STATEMENT OF GUY BEN-ARI, DEPUTY DIRECTOR, DEFENSEINDUSTRIAL INITIATIVES GROUP FELLOW, INTERNATIONAL 

SECURITY PROGRAM, CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES 

Mr. BEN-ARI. Thank you, Mr. Chairman. Thank you for the opportunity to come before the subcommittee on this important issue. 

I would like to provide a few overall DHS trends based on a report that was recently published. We use publicly available data to 

look at contract spending at the Federal level for various departments and agencies, and the data I will be presenting is from a recent report on Department of Homeland Security with a little of 

the more drilled-down into the TSA data. 

Overall, the numbers for DHS are pretty steady in terms of contract spending. In the period we looked at from 2004 to 2010, contract spending stood at about $13 billion to $14 billion a year, 

every year. This is a good thing for internal planning and budgeting purposes. DHS internally knows that it has a steady stream 

of contract dollars that it can then award to the private sector. The 
55 

private sector has a clear signal from the DHS customer that there 

is a steady contracting dollar amount that it can plan against. 

About 70 percent of contract spending by DHS is spent on service 

contracts. The rest almost entirely is spent on products as we will 

talk about in a minute, relatively small portion spent on R&D contracts, research and development contracts. In fact, research and 

development contract spending fell from around $700 million spent 

in 2004 to about $400 million spent last fiscal year, fiscal year 

2010. Those $400 million amounted to about 3 percent of total DHS 

contract spending that year. 

Our report also looks at—sorry. One more word on research and 

development before I move on, because I think this is an important 

topic for this subcommittee and this hearing. 

About one-third of DHS contract spending on research and development is actually spent on research and development management and support contracts. So it is important to make that distinction because these are contracts that do not buy for the Department of Homeland Security actual research and development. They 

are instead supporting facilities, laboratories, test equipment and 

so forth, and when counting overall R&D dollars, it skews the data 

a little bit if you include that, what in DHS is a significant amount 

is R&D spending. 

In terms of how DHS has competed its contracts and how well 

the industrial base has responded to that competition, a large majority—about 75 percent of DHS contracts are awarded competitively—are competed. About half of them receive more than multiple offers from the industry side. 

The way that the Department of Homeland Security has spread 

out those contracts to industry has also been relatively spread out 

in terms of the distribution to small, medium, and large companies. 

In DHS, large companies receive about 40 percent of the contract 

with small- and medium-sized companies receiving about 30 percent each. This, compared to other Government departments is a 

very, very diversified spread of the contract dollars. 

Specifically for TSA, we ran similar data, and for the most part 

the trends for overall DHS contract spending are reflected in TSA’s 

contract spending. That is to say, there is a relatively steady 

amount year over year at about $2 billion dollars a year. About 

three-quarters of that goes on services, and about $500 million goes 

on products. A much smaller share in TSA goes to R&D, and that 

is down significantly, from around $380 million in 2004 to almost 

$6 million in 2010. Even there, of those $6 million, about one-third 

is R&D management and support of contracts I referred to earlier. 

In terms of competition and the industrial base, the picture is 

slightly different for TSA than from DHS overall. Only about half 

of the contracts that TSA awards are competed and receive multiple offers. The share of those contracts that goes to the large companies in the industrial base is much larger as well. In 2004 it was 

56 percent, with about 21–23 percent awarded to small- and medium-sized companies respectively. 

Just two quick points. I know I am short on time. 

Two quick points in conclusion. The first is that our report, as 

most of our other reports, in this case was not intended to answer 

specific questions or address a specific trouble or issue. It was 
56 

purely data-driven. We felt there was a lack of good data on the 

Department and on its components, and our aim here was to put 

forward that data, and we are happy to cut this data any other way 

as is necessary for the betterment of the analysis and the planning 

that goes on in DHS and in Congress. 

The second comment is that specifically on R&D again, the importance of making that distinction between R&D overall and then 

the components of research and development, specifically that component of management and support research and development contracts which do not directly contribute to the R&D effort. 

Thank you very much. I look forward to your questions. 

[The statement of Mr. Ben-Ari follows:] 

PREPARED STATEMENT OF GUY BEN-ARI

OCTOBER 13, 2011 

Chairman Rogers, Ranking Member Jackson Lee, and Members of the subcommittee, I appreciate the opportunity to appear before you this afternoon as part 

of this distinguished panel to offer my views on contracting trends in the Department of Homeland Security and the Transportation Security Administration. I 

would note that my statement draws on research undertaken at the Center for Strategic and International Studies (CSIS) but that the statements and conclusions are 

my own and do not necessarily represent the views of CSIS. 

The Defense Industrial Initiatives Group (DIIG) at CSIS recently undertook a 

study on contracting trends in the Department of Homeland Security (DHS) between 2004 and 2010. Although DHS was enacted by law in 2002 and created as 

a separate entity in 2003, our analysis begins with the year 2004 as it was the first 

full fiscal year of DHS operations. We used the Federal Procurement Data System 

(FPDS) as our primary source of data. All dollar amounts in the report and in this 

testimony are obligated dollars as reported in FPDS and are in 2010 constant dollars. 

In this testimony I plan to first provide an overall view of DHS contract spending 

on products, services, and research and development (R&D), then present data for 

the Transportation Security Administration (TSA), and conclude with final comments. 

OVERALL DHS CONTRACTING

DHS has kept its overall contract spending levels steady at around $13–$14 billion per year since 2005 (with the exception of Katrina response in 2006). Responses 

to unexpected events such as natural disasters and attempted terrorist attacks have 

largely been funded by other outlays, including personnel accounts and grants to 

State and local governments. 

This stability in contract spending enables DHS managers to conduct long-term 

planning and programming with the knowledge that, barring unexpected developments, they can accurately predict the funding levels in future years. A steady 

budget over several years also sends a clear signal to industry that, overall, there 

is stability and continuity in DHS spending that is contracted to the private sector. 

However, the fact that there has been no growth in contract spending also means 

that there is currently very little cushion in this category as the Department moves 

into a period of budget cuts and greater fiscal austerity. 

The majority of DHS contracts—60 percent to 75 percent each year—are awarded 

for services. Within services, the majority of contract dollars—worth $27 billion for 

the period 2004 to 2010—were spent on professional, administrative, and management services (PAMS). The second- and third-largest service categories, by value, 

were facility-related services (including construction) and information and communication technologies (ICT), at $16 and $14 billion, respectively. Total DHS spending 

on services for the years 2004–2010 increased by 85 percent, much more than it did 

for products. Between 2007 and 2010, annual spending on services stabilized at 

around $10 billion. 

DHS SPENDING ON R&D

DHS spending on R&D contracts dropped, from $675 million in 2004 (when it was 

8 percent of contract spending) to some $400 million in 2010 (when it was 3 percent 
57 

of contract spending). In comparison, the Department of Defense in 2010 spent 11 

percent of its contract dollars on R&D (not including classified R&D, which, if included, would significantly raise the R&D share). Note that as per the norm in all 

CSIS/DIIG research, R&D management and support contracts, though classified as 

R&D contracts in FPDS, are counted as service contracts and not R&D contracts. 

This leads me to an important point on DHS R&D contract spending. From 2004 to 2010, a total of $4.4 billion was spent on actual R&D contracts and $1.7 billion 

was spent on R&D ‘‘management and support’’ contracts, i.e. contracts for the operation and maintenance of research laboratories and equipment. In other words, almost 30 percent of DHS dollars spent on R&D contracts between 2004 and 2010 was 

not spent actual R&D and should be excluded from R&D data for the purpose of 

assessing R&D funding. 

COMPETITION AND CONTRACTOR BASE

In 2010, nearly half of DHS contracts were openly competed and received multiple 

offers, up from 38 percent in 2004. In parallel, contracts that were not competed 

have been on the decline at a rate of 18 percent per year, on average, to a share 

of 13 percent of total contract dollars. 

DHS has been spreading its contracts to a wider contractor base. In 2010, the top 

20 DHS contractors accounted for 34 percent of total contract spending, compared 

to 43 percent in 2005. DHS contracts with a significant number of commercial companies (primarily in the IT domain) in addition to the traditional defense and security contractors. 

DHS has been consistently contracting with small and medium-sized companies. 

In the past 3 years, about 40 percent of contract dollars have gone to large companies (those with annual revenue of $3 billion or more), 30 percent have gone to medium-sized companies, and 30 percent have gone to small companies. By comparison, the Department of Defense in 2010 spent 56 percent of its contract dollars on 

large companies, 30 percent on medium-sized companies, and 18 percent on small 

companies. 

TSA

Contract spending levels at TSA have been relatively steady from 2004–2010, with about $2 billion spent each year. Of that amount, some $500 million are spent 

each year on product contracts (baggage screening technology, advanced imaging 

technology, etc.), some $1.5 billion are spent on service contracts (screeners, maintenance of products procured, etc.). R&D contract spending at TSA dropped dramatically, from $381 million in 2004 to $3.8 million in 2010. This drop is in part explained by a reclassification earlier 

this year of some $170 million from R&D management and support contracts to 

services contracts. In addition, TSA spent $1.8 million in 2010 on R&D management 

and support services, 32 percent of its total R&D contract spending. 

Some 55 percent of TSA contracts were competed and received multiple offers, a 

share similar to that of DHS as a whole. The share of uncompeted contracts dropped 

from 38 percent in 2004 to 33 percent in 2010 yet remains higher than the DHSwide share of 18 percent uncompeted. Regarding the industrial base supporting TSA, 56 percent ($1.1 billion) of TSA’s contract dollars were awarded to large companies, 21 percent ($410 million) were 

contracted to small companies, and 23 percent ($450 million) went to medium-sized 

companies. Furthermore, the top 20 TSA contractors in 2010 accounted for 42 percent of contract dollars obligated, compared to 45 percent in 2004. Of the top 20 in 

2004, 14 remained on the list in 2010. 

CONCLUSION

Mr. Chairman and Congresswoman Jackson Lee, distinguished Members of the 

subcommittee, I would like to close with two comments. 

First, our research on DHS contract trends was not intended to answer a specific 

question or address a particular problem. Rather, it was intended to present the 

facts as they arise from publicly available data. Given that, we found that DHS contract spending was overall stable over time, with a majority of contracts openly competed and awarded across a broad industrial base that includes companies of varying competencies and size. TSA exhibited similar trends in budget stability and 

share of competed contracts, but has been awarding contracts to a less diverse industrial base. 

Second, our findings raise several important questions that the data are unable 

to answer. With regard to R&D, the issue of how we can measure the outcomes of 

actual R&D contract spending deserves greater attention. A first step would be to 
58 

separate R&D management and support services from actual R&D contracts. More 

importantly, measuring any kind of R&D spending is an input metric that says 

nothing about R&D productivity and innovation, which are the issues we are really 

interested in. For a better understanding of these issues, new analysis is needed 

that assesses TSA’s success in delivering new capabilities to better undertake its 

missions. 

With that, I conclude my remarks and look forward to your questions. 

Mr. ROGERS. Thank you. 

I will start off with the questions. 

I was struck by that number when you said it dropped to $6 million. To what do you attribute that? 

Mr. BEN-ARI. So there are two factors in play here. The first one 

is that as other sectors in the Department of Homeland Security 

grew, namely service and products, something had to give. That 

something in the past 7 years was research and development. The 

numbers are down for—Department-wide, they are particularly 

starved in TSA’s case. 

The second reason is that in recent years, there has been a reclassification of the contract dollars awarded away from the research and development classification towards professional services 

classification. 

So it is not that less work was undertaken. In some of the cases, 

it was just undertaken under a different type of contract classification. 

Mr. ROGERS. Mr. Boylan, you made reference to the concern that 

some folks in DHS have with talking with the private sector. To 

your knowledge, there are no policies that guide them as to the extent to which they can interact with the private sector without getting in trouble? 

Mr. BOYLAN. It depends on the context. Within the contracting 

context, absolutely. Under the FAR, there are clear guidelines, 

from my perspective. 

What I was talking about is the pre-acquisition process, the understanding of the possibilities and the limitations of the possibilities. In that context, we have not had very good conversations as 

of late. At the policy level is what I am talking about. At the technology level, we have these questions. But I think it is important 

for policy people and people who are deciding policy to understand 

what technology can do and cannot do. 

Mr. ROGERS. So you would like to see the Department establish 

some guidelines so that format could be established? 

Mr. BOYLAN. I know there has been a recommendation to creating an advisory board that would have that type of capability. 

Mr. ROGERS. Does the DOD do that now? Do they have that kind 

of format set up? 

Mr. BOYLAN. Yes. 

Mr. ROGERS. That has been one of my goals is to see the Department emulate more of what DOD does, because they have been 

around so long and they have kind of stepped on all of the rakes 

and they know what not to do. But we are seeing DHS has not 

been pursuing that course of action. Because I do want to see what 

you are talking about. I want to see an on-going dialogue about the 

challenges that the Department is facing with the private sector, 

to see what is possible, and do it very early before you start developing the RFPs. To my knowledge, none of that—and I hear regu-
59 

larly about how frustrated the private sector is about trying to just 

talk with somebody. 

But Mr. Pearl, what would be the thing that you would most 

want to see them do as far as new guidelines? Is it that early dialogue? 

Mr. PEARL. Mr. Chairman, we have begun a process with some 

of the folks below the kind of HQ level, with some of the Under 

Secretaries. The Council is facilitating dialogue, for example, with 

the Under Secretary of S&T, with Dr. O’Toole. We have begun a 

dialogue with the Under Secretary of Management, Rafael Borris, 

the idea being in his team, the idea being is that the management 

component part over which the Under Secretary is responsible for, 

he does have on-going oversight authority to even rein in some of 

the procurement issues, and I think there are like 10 or 11 different procurement acquisition kind of different silos going on, but 

he does have a certain amount of oversight. 

However Dr. O’Toole has not been given those kinds of tools and 

does not have that oversight. So if the administrator of TSA or the 

administrator of any of CBP or any of the component parts, wishes 

to do their own R&D, they can do it without any semblance of necessarily communication. So we have been working with them on 

how we can have those dialogues. 

They call them industry days. The fact is that that language basically says, we have developed an RFI and RFP, we know what 

the contract is going to be, and we will call in industry and we will 

basically read you the Federal Register report. What our discussions have been, and we have gotten a little bit further than we 

have in the past, because it all depends on general counsel accepting it, it all depends on ethics, those kinds of things, that if we can 

have those discussions in conceptual framework, along the lines of 

what Mr. Boylan and I were discussing, long before, to figure out— 

because nobody, whether it is in the public sector or in the private 

sector, can expend R&D resources anymore for what we think TSA 

in this case might want. That is part of the discussion. 

We have begun to move that ball, that needle, a little bit, and 

we are trying to get through the clearance. One of the things is the 

possibility of forming an industry-Government council outside of 

the normal kind of structure that would be kind of co-chaired by 

public sector and private sector, facilitated by organizations like 

the Council and other organizations that would be part of it so that 

we can get all of the players and interested players around the 

table. 

Mr. ROGERS. You may not know the answer, but does the DOD 

have some process—you mentioned a while ago that they have 

these preliminary discussions. What do they call it? It is not industry days. How do they format it? 

Mr. BOYLAN. They have industry days that are interactive. What 

the criticism of DHS has been quite recently is that they come in 

and read and they don’t discuss with the people that attend. It is 

a different atmosphere at DOD. 

Mr. PEARL. I don’t think that this is something that should be 

either DOD- or DHS-model component. In many respects, DHS is 

a law enforcement agency in some respects, not a kind of National 

security agency. I think that the CIO who came in from the IRS 
60 

has certain plans in terms of technology, and I think that Mr. 

Squires has been trying to push that kind of model. 

So I think that the lessons learned interagency, not just looking 

at the DOD model, but looking at how things across the board, 

whether it is in Veterans or Education or Interior, how does the 

process and how does the discussion about acquiring technologies 

in this case—what do you go through? There should be lessons 

learned both up-side and down-side, and those would go to the 

three questions I stated. 

Is it even economically reasonable in this environment, is it technologically feasible? We don’t want things that can’t be done. What 

are the unintended consequences? Those are the three things that 

we think should be asked across the board all the time. 

Mr. ROGERS. We have passed the subcommittee mark on the TSA 

reauthorizatioin. We are about to bring it to full committee next 

month. Is there something in the authorization bill that would be 

necessary or helpful, in your view, on this matter that you would 

like to see us include at full committee mark? That is for any one 

of you. 

Mr. PEARL. Just briefly, I would like to see the Congress take a 

more encouraging supportive role. It doesn’t always have to be the 

passage of law that says this is the law that you have to follow. 

I think that the nature of—and certainly our written testimony 

went to that—that Congress has an important role to encourage 

this kind of dialogue; to encourage exactly what the two of us have 

been saying, to come out of an authorization, not out of an appropriations approach; to come out of authorization that says we give 

a sense of acceptance and support for that kind of approach. That 

would help everybody and all of the parties get in the room, and 

I think if they heard that kind of bully-pulpit statement from the 

Congress, that should be part of it. We have submitted suggestions 

for that kind of approach to the staff director and to the folks on 

the Committee. 

Mr. ROGERS. Mr. Boylan. 

Mr. BOYLAN. I agree. We didn’t coordinate our testimony before 

this, Mr. Chairman. I think providing that guidance and high-level 

cover, to the career-level employees especially, that will give them 

comfort in engaging with us and together hopefully we can achieve 

some good things. 

Mr. BEN-ARI. Just one point. I completely agree on this topic of 

Government-industry coordination dialogue. I would just like to 

emphasize the point that internal dialogue discussions are not less 

important, and there are efficiencies to be gained. From a better 

dialogue across the various DHS components, especially when it 

comes to research and development, especially when it comes to acquisition, there are enterprise-wide or mission-wide elements that 

cut across programs and components. If those programs and components came together to put together a common requirement, common standard, and a common acquisition program, I think there 

are efficiencies there for the Department. 

Mr. ROGERS. In response to one of the things I think that Mr. 

Boylan brought up. We did have a full committee mark this morning on the authorization. There was an accepted amendment by 

Mr. Duncan to DHS that requires future-year investments. It pro-
61 

vides that the private sector—it will provide the private sector with 

budget projections so you will see some investment predictabiltiy 

going forward, which I think will be helpful. 

Mr. Richmond is recognized for any questions he may have. 

Mr. RICHMOND. To start with, when you talked about the industry days, and just from someone who is not familiar with how industry gets their ideas and new technology over to the right people 

in DHS or TSA, walk me through a company who either did their 

own research or came up with their own technology. How do you 

get an audience with TSA or DHS to inform them of that technology if you don’t have technology showcases and things like that? 

Mr. BOYLAN. I guess I am the company guy, so I get to answer 

that. 

I have seen varying approaches. One thing that our technology 

department does is they will write an unsolicited white paper: Basically, here are some capabilities we have come across; are you interested? Sometimes that begins a dialogue. 

Sometimes it is a discussion around a current technology that is 

being procured by TSA where we have seen improvements of various sorts, or capabilities that could be added or developed into that 

technology, and you can have those discussions as well. 

Industry days, like I said, one of the criticisms is that usually it 

is TSA laying out a PowerPoint of what they want and what they 

expect. Then what has happened in the past is then industry comes 

in and often, unfortunately, this comes in through a bid protest 

that your requirement has a problem of a number of sorts. I can 

think of a few procurements that have been dragged out for multiple years because of this. If you would have had the engagement 

at the beginning, a lot of that could have been avoided. 

Mr. RICHMOND. To that solution, you recommend an advisory 

council, is that one of your ideas to navigate through that? 

Mr. BOYLAN. One of our suggestions is to have an advisory council where these types of discussions could take place. 

Mr. PEARL. It is important, I would add, that individual companies early on in the process, from 2001 to 2005—you know, I am 

picking numbers—we are trying to knock on the door of the components of the directorate to say we have got the greatest, latest 

product, technology, or whatever. It wasn’t necessarily tied to what 

was being asked for, it was tied to what they had developed and 

what they had determined to be the need. Pre-oil spill or whatever. 

I think that the context was the Department kept saying no, that 

is not our priority right now. That is not what we want to do. 

So what we are trying to do is develop a dialogue where we 

would understand in the long run, and what Mr. Duncan in terms 

of multi-year funding should also be multi-year policy, you know, 

to make sure of what long-term strategies are. What are we looking 

for around the curve? At which point Government and industry together can discuss conceptually what is it that Government is 

going to need to maintain a high level of security. 

I think that the problem has been that focus has been on contract rather than on capabilities. It is on the checking of the box 

rather than the nature of what we are trying to achieve in mission. 

I think that if the two sides could get together to say this is what 

our mission, this is what our goal, this is what we want to achieve, 
62 

what can industry bring capability-wise to meet that mission, then 

we will work out the contracts down the road. We will work out 

what the procurements are. We will allow in this kind of format 

of a council all of the interested parties in the room, not just one 

who happened to knock loudest or shout louder. We want a fair 

process and that is exactly what we are trying to call for. 

Mr. RICHMOND. I guess this question would probably go to Mr. 

Ben-Ari, which is: In your opinion, what are some of the most surprising key findings regarding the DHS and S&T contracting? 

Mr. BEN-ARI. I think it would have to be the fact that so much 

is actually spent on service contracts that are not directly contributing to the research and development mission. Again comparing, 

for example, the Department of Defense, a different animal, with 

a $75 billion annual R&D budget, but for that budget they spend 

about $1.5 billion on what is classified as management and support, R&D management and support contracts. That is about 4 percent. In DHS that is 30 percent. There is something strange about 

this picture. I am not an expert on TSA’s S&T funding and contract 

spending. That is true at the DHS level as well. Something here 

is strange. 

Part of it again might be just that certain contracts were incorrectly classified as R&D contracts as opposed to service contracts. 

But that in and of itself is troubling, because all of these years you 

were counting these contracts as R&D contracts and thought 

that—and possibly expected certain output from that R&D spending that never could have materialized because it was going into 

something else entirely. 

Mr. RICHMOND. Mr. Chairman, I yield back. 

Mr. ROGERS. I thank the gentleman. 

Mr. Boylan, from your time at TSA, can you give me some examples of things where they partnered effectively in this process, and 

some projects? 

Mr. BOYLAN. I was at DHS, not TSA, Mr. Chairman. 

Mr. ROGERS. I am sorry. Frankly, I am more interested in DHS 

as a whole than I am just one particular segment. 

Mr. BOYLAN. The one I know most about is explosive detection, 

and with explosive detection you have something that is very important. You have requirements that are really clear, and those requirements are that you need to be able to detect a specific number 

of substances and you need to detect an amount at a certain level, 

and that drives development. The technology in that area has developed over the last 10 years tremendously, because there were 

targets for development by R&D within companies funded by DHS 

and funded by international governments as well. 

Mr. ROGERS. So there was some interaction, then, before they put 

an RFP out in that situation? 

Mr. BOYLAN. Yes. When I was first at the Department we would 

often have, as Mr. Pearl described, we would have people come in 

with the latest gadget and widget. You know, it was constant. It 

kind of reminded me of the Civil War days of the Federal Government at that point. I often wondered why am I sitting in this discussion, because I don’t know what these people are talking about. 

That was the lesson that I learned in a policy position basically, 

that I needed to get a little more in-depth in what the science was, 
63 

because I was making decisions that impacted this and I needed 

to know. 

Mr. ROGERS. In your experience, we heard Mr. Ben-Ari talk 

about the percentage of DHS contracts to go to big companies, 40 

percent; 30 percent for medium, and 30 percent for small. In your 

experience, do smaller companies and medium-sized companies 

have a greater challenge in trying to penetrate into the Department, or really not? Is it just as difficult for a big company as it 

is for a small one? I would open that up to any of you. 

Mr. BOYLAN. I don’t have data on this. But we interact with 

smaller companies all the time. Often companies are coming to us 

for support because we fall into a category of a bigger company. I 

hear lots of different stories and different experiences from different companies. But I do hear a constant theme of the difficulty 

of getting heard from smaller companies. 

Mr. ROGERS. Is it because they don’t understand the process or 

what? 

Mr. BOYLAN. That is part of it. I would have to say for my company it is easier to engage, because we are providing technology 

and servicing it every day. So that is a different position to be in. 

But we do have companies developing the newest, latest, greatest 

widget, and it is the common theme that they have difficulty getting heard. That goes back to the industry days and the advisory 

groups providing that opportunity for new technology that may 

come from anywhere to be heard. 

Mr. ROGERS. What about you, Mr. Pearl? 

Mr. PEARL. We have a number of small businesses that are in 

the space, and over the course of the last 10 or 12 years, long before even 9/11, I was working with small businesses that were trying to in essence be heard, as Mr. Boylan is talking about. Sometimes it is part that they don’t understand the process. Sometimes 

it is that they have a more limited R&D budget for themselves in 

terms of they have an idea and they want to sell it and they are 

trying to find out what they want to do, and the larger companies 

in the past have been able to invest in R&D, and that one can fail 

and this one can work and whatnot. 

The nature of what happens sometimes is that when the technology or whatever, in the case of a widget, a product, or a service, 

is identified in a small business way and can get in essence some 

traction. Sometimes the best way to do it is for them to align themselves with some of the larger companies, and they become in essence partners because that company hasn’t developed it. They either are taken over, or they become subs or whatever. 

There are opportunities. The problem that my small companies 

are saying to us is the following: That in this environment, without 

a long-range strategic plan, they can’t afford to waste any extra 

time and money in developing—even if they have a patent, even if 

they know what the best technology is going to be, they need to be 

able to get their foothold in. That goes to the international sphere 

as well. 

One of the things that we have been having discussions about is 

how do you take lessons learned in places like Israel or Great Britain or Spain or Germany or India—which is not a microcosm of 

itself, it is a macrocosm—but how you take those lessons learned 
64 

and apply it? We have been encouraging greater communication between cut nation-states, that it is not just about the U.S. technology solution. We are going to be in a global environment. 

So communication, coordination, collaboration, all of the ‘‘-ations’’ 

that I mentioned in my testimony, are exactly what we are trying 

to encourage not just between private sector and public sector, but 

between local and Federal, between the Federal Government and 

nation-states, between the different Federal agencies. We think 

that this Congress should be in the business of encouraging that 

kind of dialogue, that kind of communication, because we think 

that if you allow that, you plant a few seeds, there will be a lot 

of fruit borne. 

Mr. ROGERS. Thank you. The gentlelady from Texas. 

Ms. JACKSON LEE. Thank you, Mr. Chairman. I would like to acknowledge Mr. Richmond. I know he had an opportunity to ask 

questions and he was not here when I indicated that I had a markup as we speak, so I thank him for his indulgence as well. 

Mr. Ben-Ari, I am going to go over something that I know has 

been asked. I sort of have connections into the room and I know 

what questions may have been raised. But I want to explore this 

with you because I think this is a key cornerstone to what my 

opening statement was. 

It is about the management of R&D contract dollars by DHS. It 

is noted that they spent a significant amount. The Defense Department spent roughly $43.4 billion on R&D and $1.7 billion was 

spent on R&D management and support contracts. What does management and support actually mean, and is there a reason why 

DHS is spending more contract dollars on management and support of R&D than R&D? 

Remember, in my opening statement I said we need to be light 

years, many steps, ahead of individuals with shoe bombs and underwear bombs. I am very concerned about top-heavy management 

if you are not in the weeds of research. So I would appreciate your 

commentary on that, and if you can add to the fact that most Government agencies and departments in the Federal Government rely 

on investment in R&D for improving their functional capabilities. 

DHS’s functional capabilities is securing the homeland at all levels 

from aviation to border to intelligence gathering, if you will. But 

according to your report, when looking at DHS contract spending, 

R&D claimed less than 10 percent. Less than 10 percent. 

Now, DOD is between 11 and 14 percent. I would argue that 

DHS needs to be higher because we are not a military, that we buy 

heavy equipment and we are using dollars for that, as much as we 

are trying to thwart terrorist acts. We are trying to be ahead of 

them, we are trying to be preventative. Prevention sometimes 

comes from human resources, but it also comes from technology. 

So based on your research, is there any particular reason why 

DHS R&D spending, particularly last year’s spending, is particularly lower than other parts of the Federal Government? If you can 

give us your overview on that question. 

Mr. BEN-ARI. Sure. Thank you for that question. Starting with 

the issues of research and development management and support 

contracts, these are contracts that are awarded not for actual research and development activity, but in support of facilities and 
65 

equipment that are used for research and development activities. 

So these are contracts to support and operate laboratories, test 

ranges, test equipment, and so forth. The reason that distinction is 

important is that these dollars do not contribute directly to any 

specific R&D outcome. 

So when measuring R&D—and I think it is important to also remember that R&D as is an input metric. You know how much you 

are putting in. You don’t know how much you are getting out. It 

doesn’t tell you necessarily what the outcome is of that money that 

you spent. 

But even when you are measuring an input metric, it is important to measure correctly. If you are counting research and development managing support as research and development, you are 

skewing the number. 

Ms. JACKSON LEE. That is my point. I thank you for the explanation. But I understood that is what it is. That is my quarrel, is 

why is it so high and why is my actual R&D on DHS, which would 

benefit from R&D, more so because we don’t produce heavy armor, 

why is it? Why do we have this imbalance with DHS? 

Mr. BEN-ARI. From what the data can tell, and I hesitate to go 

beyond that, but from what the data can tell, part of the reason 

for the high levels of spending on management and support of R&D 

is because certain contracts were misclassified or classified in error 

as management and support contracts. They were really contracts 

for other types of professional services. When that error was 

caught, the R&D management and support contracts were reclassified into the new category. 

Ms. JACKSON LEE. So are you saying that DHS is investing adequately in pure R&D? 

Mr. BEN-ARI. I didn’t say that. I said that when what we thought 

we were counting as research and development dollars, specifically 

research and development and management and support contract 

dollars, we were wrong; and these contracts were actually—are 

now, hopefully, correctly reclassified as different types of contract. 

In terms of spending levels on R&D overall, I think there is no 

magic number here or magic percentage: X amount of DHS dollars 

must be spent on research and development. 

I think that comparison with DOD is a good one. I mean, it is 

a Department that does depend on technological advantage on the 

battlefield, in the same way that DHS depends on a technology advantage. 

Ms. JACKSON LEE. Do you think we can improve the investment 

in straight R&D in DHS? 

Mr. BEN-ARI. There is room for improvement if the mission calls 

for it. I would look at DHS’ requirements today and in the future, 

and base research and development decisions on those requirements. If technologies exist today that meet today’s requirements 

and requirements that we foresee for the next 5 years, then R&D 

spending levels are probably adequate. If, on the other hand, the 

expectation is, as you pointed out, for different types of threats 

which we are not even aware of today, then maybe the spending 

levels need to accommodate that to encompass a broader range of 

capabilities and a broader range of technology solutions to address 

those future threats. 
66 

Ms. JACKSON LEE. Mission is important. You do want to have 

your research and development connected to mission. 

Let me ask Mr. Pearl and Mr. Boylan three questions, if I might, 

together. One is TSA is engaged in reorganization. I am not sure 

if it is publicly known. But do you believe it is key to attach mission to reorganization? You know, you can move the chairs around 

on a deck and one of them may fall overboard. So the question is: 

Is mission and reorganization important? 

Because I think I heard you mentioning something about confusion to small businesses, and when you say that to me, small- and 

minority- and women-owned businesses are my passion, because I 

believe they are the job creators of America, and I indicated to you 

new starts and many others start out being small businesses. 

So should reorganization be tied to mission? Would that be more 

helpful for the outsider to know even where to go? Is it harmful 

when you cut resources, such as acquisition resources, such as 

R&D resources, for an agency like TSA? How can we improve the 

informational or close the informational gap of information when it 

comes to procurement for small- and minority- and women-owned 

businesses? How can we fix that problem, which is a problem overall in Federal agencies, period? But how can we in particular fix 

it to an agency like DHS, which truly benefits from R&D? 

Mr. Pearl, have you got the three? 

Mr. PEARL. I got the three. Let me start with the third one. That 

was extensively discussed before, when you were gone. I am hoping 

you will get that, as part of that and certainly in our written testimony, that there needs to be strong, substantive dialogue and communication, coordination, collaboration, long before an RFP, that 

everyone can take part in in a transparent and fair way. That allows small business, large business, to be in the room, to be able 

to share their expertise and their capabilities. Because before you 

get to mission—and this goes to your first question—before you get 

to mission, you have to know what it is that—or in the context of 

that, what the capabilities are in the context of do you want just 

Star Wars, do you want just, you know, science fiction, or are 

there—is there a technological feasibility that either a small business or a large business can bring to the table? So from that standpoint, the information gap can be filled when there are these kinds 

of long-before-the-contract discussions. 

With regard to the R&D cuts, there is no question but that it is 

not just TSA. What I think that all of us were talking about is not 

just the TSA budget when it comes to R&D; that it comes to the 

whole nature of research and development and looking ahead of the 

curve for DHS as a whole, and that we need better coordination 

and harmonization—dare I say standardization—so that there can 

be interoperability, so there can be many companies that are part 

of a long-range process when it comes to R&D. 

It is not just R&D at DHS. I know that the folks at S&T work 

with DOE, work with NSA, work with DOD, work with DOJ and 

the FBI on a regular basis as their R&D communication. We need 

to encourage that, not only within Government, but in the public 

labs. We need to talk about it in terms of the private labs that are 

going on. There needs to just be better coordination and commu-
67 

nication. I think that if you do that, all three of your questions are 

answered sufficiently. 

Ms. JACKSON LEE. Did you answer the questions about cutting 

resources being harmful to the process, resources on acquisition? 

Mr. PEARL. Well, the nature—it is transparent to say that the 

private sector is worried there is going to be a cut and therefore 

there isn’t going to be sufficient funds for their operation. We are 

not talking about dollars, we are talking about dialogue. If in fact 

the mission is identified and capabilities are there, then whatever 

Congress decides is going to be appropriated to that mission, then 

we in the industry are going to be able to respond. 

So I am not going to take a position and the organization is not 

going to take a position on whether there should be X amount of 

dollars or Y amount of dollars. We just need to have a smarter 

landscape, a smarter environment in Homeland Security across the 

board. 

Ms. JACKSON LEE. Thank you. 

Mr. Boylan. 

Mr. BOYLAN. On the mission question, in our experience it would 

be useful to break down some of the silos between operations and 

technology, for instance. Technology at TSA is our customer. That 

is primarily who we operate with. But then when the technology 

gets deployed, operations is the one that lives with it and has requirements that may be a little different, because they are interacting with the airports and the airlines and their requirements. 

So the two don’t necessarily always meet, in our experience. 

So if there is a reorganization going on, which I have heard 

inklings of but no details about, I would encourage that the mission 

be a unified mission, and that would go a long way to, at least 

helping us in our mission, to help provide the technology that helps 

secure. 

Ms. JACKSON LEE. Two quick questions, Mr. Chairman, to Mr. 

Ben-Ari and I will be finished. 

Mr. Ben-Ari, do you think a mentorship program would be helpful to small businesses? 

Mr. BEN-ARI. It couldn’t hurt. I think they have been successful 

in the past in other agencies, in other departments, and I think 

there is always room for improvement. 

I would just point out again this data point of 30 percent of DHS 

contract awards going to small companies. That is much higher 

than both the Small Business Administration’s minimum requirements and most other Government departments. So I agree there 

is always room for improvement, and a mentor program is one. 

Ms. JACKSON LEE. Is it important to have the adequate resources 

for R&D, adequate financial resources for R&D? 

Mr. BEN-ARI. I think research and development, funding research and development to meet future requirements is very important. But those requirements have to be established, ideally, together with industry—that is part of the dialogue that I think was 

referred to earlier—and with the end-user. The people in the field 

undertaking the operation need to be part of this discussion as 

well. 

Ms. JACKSON LEE. But they can’t be part of the discussions. The 

question is: Does the United States need to invest adequate re-
68 

sources for R&D from the Government perspective to protect the 

homeland? Is that an important investment? 

Mr. BEN-ARI. It is an important investment. 

Ms. JACKSON LEE. And not worthy of being looked at lightly or 

being subject to random cuts? 

Mr. BEN-ARI. Absolutely. We are putting future capabilities at 

risk if we do not have this process in place to look at future requirements and fund the capabilities to meet those requirements 

adequately today. 

Ms. JACKSON LEE. Mr. Chairman, I thank you for your indulgence. Thank you to the witnesses as well. 

Mr. ROGERS. I thank the gentlelady. 

I just wanted to ask one more thing. Currently TSA is engaged 

in a pilot program to allow third-party explosive detection canine 

teams to be certified by TSA. If implemented, TSA would then be 

leveraging the private sector to provide the service that until now 

has been the purview of the Federal teams. 

Are there other areas in which the private sector could be certified to provide services, that right now are only being handled by 

Federal employees, that you would like to see? Are you aware of 

any? Mr. Pearl, you mentioned certification in your opening statement, and that is one of the reasons I asked that. 

Mr. PEARL. There is no question, and it goes to the R&D question 

as well. The certification and designation—both Mr. Boylan and I 

were testifying earlier in the summer before the committee on the 

SAFETY Act, the law that already exists that allows DHS to give 

certification and designation to technologies that are antiterrorist 

technologies. That hasn’t been fully marketed and fully publicized. 

That nature of how the Government can in essence give a sense of 

recognition to technologies that provide that is one way. 

I would not limit the whole R&D argument to just the Federal 

Government’s role. I think the public labs, the academia, and in 

the private sector has R&D investment that they are ready to do 

as well. 

So the nature of the industry, the third party in terms of designation and standardization, is something that we are definitely 

interested in and the specifics we can look at more—we can get 

back to you on other ways that have worked in the past. 

Mr. ROGERS. Well, I am definitely going to follow up on your recommendations earlier about making sure we include in our authorization bill next month language to encourage the Department to 

have these early—early conversations with the private sector in 

some sort of a format that is practical. 

But one thing that I am thinking about, I am about to start a 

Transportation Security Caucus here in the Congress. We have a 

lot of members not on the Homeland Security Committee that are 

interested in this topic. So to facilitate communication with them, 

I am going to be starting that. 

Is there a way that you think such a caucus of Members could 

bring about more of this dialogue, or really does it have to just 

come through the Department with the private sector? 

Mr. BOYLAN. I think that Members all have constituent airports 

and other transportation constituents who really would like to have 
69 

their voices heard, in my experience, and I think that would be a 

valuable input for all of us, technology and Government. 

Mr. ROGERS. Okay. Do you have more questions? 

Ms. JACKSON LEE. If the gentleman would yield, I would hope 

that as well, we might add a very strong component on small and 

MWBEs. Even though I hear the 30 percent, I think there are new 

companies that don’t know the system, way beyond the Beltway, 

that I would like to see having an opportunity to work for the Federal Government. Let’s get them from Utah and Alabama, Mississippi, Michigan, Illinois. I know that there may be some. But 

that is where the gap of information is. 

If you are not buzzing around the area, which is the crowd that 

understands Federal contracting, you are not going to get too many 

beyond the Beltway who understand this process. I think they may 

have very worthy ideas, and I would like to make sure they get the 

opportunity to present their ideas to help the American people and 

secure the homeland. 

Thank you. I yield back. 

Mr. ROGERS. I thank the gentlelady. I thank the witnesses. You 

have been very helpful. I would ask that there may be some written questions from Members who couldn’t make it that they would 

want to submit to you, and I would ask you to respond to those 

within 10 days. After that we will close it out. 

With that, this committee is adjourned. 

[Whereupon, at 3:31 p.m., the subcommittee was adjourned.] 

(71) 

TSA REFORM: EXPLORING INNOVATIONS IN 

TECHNOLOGY PROCUREMENT TO STIMULATE JOB GROWTH, PART III 

Thursday, November 3, 2011 

U.S. HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON TRANSPORTATION SECURITY, 

COMMITTEE ON HOMELAND SECURITY, 

Washington, DC. 

The subcommittee met, pursuant to call, at 2:02 p.m., in Room 

311, Cannon House Office Building, Hon. Mike Rogers [Chairman 

of the subcommittee] presiding. 

Present: Representatives Rogers, Cravaack, Turner, Jackson Lee, 

and Davis. 

Mr. ROGERS. The Committee on Homeland Security, Subcommittee on Transportation Security will come to order. 

The subcommittee is meeting today to continue to examine innovative solutions to technology procurement at TSA that could generate cost savings for the Federal Government and stimulate job 

growth in the private sector. 

I want to thank all of our witnesses for being here to participate 

in what I believe is going to be a very fruitful and timely hearing. 

I am pleased to see the spectrum of offices that are participating 

in aviation technology, development, and procurement that are represented at the table. 

Leading up to this hearing we have had testimony from former 

DHS officials, the GAO, and industry representatives on how we 

can optimize the relationship between TSA and the private sector. 

They all expressed both success stories and challenges that TSA 

faces in finding the best ways to achieve this collaboration that is 

so important to developing the right technologies for risk-based 

screening. 

We now invite DHS, TSA, and the Science and Technology Directorate and the DHS Office of Inspector General to speak on what 

they perceive to be successes, challenges, and needed changes to 

foster innovation and meet our security needs as effectively as possible. 

One of TSA’s stated aviation security goals is to develop enhanced technologies and capabilities to enable risk-based and intelligence-driven screening processes. I want to emphasize how important this goal is and what an opportunity it represents for providing both security and jobs. The question is: How can we work 

together to ensure that TSA is getting the technologies it needs to 
72 

secure the traveling public and commerce, while promoting innovation and, therefore, job growth in the private sector? 

I know that Dr. Nayak in his capacity as Chief Procurement Officer has stated that one of his strategic objectives is to establish 

quality communication between industry and DHS. I look forward 

to hearing from him on how the initiatives within his offices are 

making that happen. 

I would also like to hear how acquisitions are being standardized 

across the Department so that vendors working with multiple components can do so with a level of predictability that they say is currently lacking. 

From Mr. Kane and Mr. Benda, I trust you will address the joint 

strategy you have undertaken to ensure that you have a workable 

plan for aviation technology investment. I know the existing plan 

looks out 2 years ahead, but I would love to see this extended further, say to 4 or 5 years, because I believe this is what industry 

needs to help achieve the mission successfully. I also think that 

TSA has the opportunity to be more of a leader in setting international standards for screening technology which would increase 

the market space for many U.S. companies. 

Finally, I look forward to Mr. Edwards’ finding from the Inspector General’s Office, which has produced some very useful reports 

on how acquisition of detection equipment can be consolidated 

across the Department. We know from our prior hearings that 

more use of strategic sources, better industry days, reestablishment 

of the Joint Requirements Council, and transparency with industry 

on the 5-year outlook are some of the key areas we must strengthen. 

I look forward to hearing the perspective of all the witnesses on 

these and other matters where we can work together to find solutions. Industry has ideas, and I want to ensure that TSA and DHS 

are listening to them. Then I want to turn those ideas into solutions. 

We have posed the question: What are the available options for 

adjusting how things are done at TSA that will foster more innovative capacity in the technology sector? Now we need to establish 

answers and implement the needed changes. 

We have an obligation to examine the ways to solve some of our 

Nation’s most pressing challenges, of which high unemployment 

tops the list right now. We must leave no stone unturned in finding 

ways to reverse that trend and support all sectors of the economy, 

including technology innovation, which has long been one of America’s greatest strengths. 

With that, I typically would yield right now to Ms. Jackson Lee, 

but, as I told the panelists a minute ago, she is in Judiciary with 

an amendment of her own and can’t leave, so we are going to pass 

that and go straight to the witnesses for their testimony. 

Nick Nayak is the Chief Procurement Officer at the Department 

of Homeland Security. Prior to coming to DHS, Mr. Nayak served 

as Deputy Director for Internal Revenue Service Procurement. Before rising to Deputy Director for IRS Procurement, Mr. Nayak 

served in several high-impact leadership positions, including Director of Strategic Acquisition Initiatives, Deputy Director of the Office of Information Technology Acquisition, Assistant to the Direc-
73 

tor of Information Technology Program Management, Project Executive for the IRS Commissioner’s Readiness Project, and Director 

of the Treasury Acquisition Institute. 

Robin Kane became Assistant Administrator for Security Technology at TSA in June 2009 after serving in an acting role since 

December 2008. As Assistant Administrator, Mr. Kane oversees the 

implementation and development of security technologies across 

multiple modes of transportation. He is responsible for development, test and evaluation, acquisition and deployment, and the 

maintenance of all TSA security technologies and systems. Mr. 

Kane joined TSA in 2005 as a branch chief within TSA’s Office of 

Budget and Performance. Prior to TSA, Mr. Kane spent 20 years 

in the Coast Guard. 

Paul Benda joined the Department of Homeland Security Science 

and Technology Directorate in January 2010. He serves as the 

Under Secretary’s Chief of Staff and Director of the Homeland Security Advanced Research Projects Agency. 

Can’t you find anything else to do? You don’t have much on your 

plate. 

Prior to joining DHS, Mr. Benda was Director of the Project Integration Office at the Department of Defense where he oversaw the 

design, implementation, testing, and commissioning of all security 

systems in the Pentagon reservation. Earlier, Mr. Benda served as 

the Pentagon’s Chemical, Biological, Radiological, Nuclear, and Explosives Director; and in civilian service he was a program manager at DOD’s Defense Advanced Research Projects Agency. 

Accompanying Mr. Benda in the audience today is Dr. Susan 

Hallowell, Director of the Transportation Security Laboratory. The 

TSL is a Federal laboratory of the DHS Science and Technology Directorate that is dedicated to finding and testing solutions to detect 

and deter weapons and explosive threats to transportation. Prior to 

being named as Director, Dr. Hallowell managed and executed research and development for explosives detection for DHS under 

TSA. 

Dr. Hallowell has worked for DHS and the Federal Aviation Administration for 20 years in the areas of explosive detection, research, and development and is an expert in the area of trace detection of explosives. Prior to working for the FAA, she worked as 

a research chemist for the U.S. Army in the area of detection and 

protection against chemical warfare agents. 

On behalf of the committee, I would like to thank Dr. Hallowell 

for her decades of service and her efforts at Transportation Security Laboratory that are vital to the security of transportation systems around the country. 

Charles Edwards assumed the position of Acting Inspector General for the Department of Homeland Security in February 2011, 

where he previously served as Deputy Inspector General for the 

Department. Mr. Edwards has over 20 years’ experience in the 

Federal Government, where he has held leadership positions at the 

Transportation Security Administration, the United States Postal 

Service, and the USPS Office of Inspector General. 

We have got a great panel here, and this is an area I care very 

much about. We can make some great changes. I hope that the witnesses here have had a chance to look at what came from our pre-
74 

vious two hearings with Michael Jackson and Elaine Duke from 

their perspective in the rearview mirror and then the industry 

panel we had. I know they are all anxious to hear what you have 

to say. 

We will start with Dr. Nayak. You are recognized for 5 minutes 

to summarize your opening statement. 

STATEMENT OF NICK NAYAK, CHIEF PROCUREMENT OFFICER, 

U.S. DEPARTMENT OF HOMELAND SECURITY 

Mr. NAYAK. Thank you, Mr. Chairman. 

Chairman Rogers, Ranking Member Jackson Lee, and Members 

of the subcommittee, I am pleased to testify before you today. 

As DHS Chief Procurement Officer, I am responsible for oversight and policy related to DHS’ annual procurement of approximately $14 billion in goods and service. My background includes 

growing up in family-operated small businesses, working in the private sector for small and large businesses bidding on defense contracts, and more than 20 years of public service dedicated to building the Federal acquisition workforce and driving procurement initiatives to save taxpayer dollars. 

Since arriving at DHS a little more than a year ago, I established 

four priorities that I am using to improve DHS procurement: Quality contracting, quality people, quality program support, and the 

one priority that I added beyond my predecessors, quality interaction with industry and Government communication. Supporting 

each of my priorities are a number of initiatives that move DHS 

procurement forward in getting good deals for the taxpayer. 

In the area of quality contracting, DHS has achieved substantial 

success in spending money more efficiently through our Strategic 

Sourcing Program. The Department leads the Federal Government 

in coordinated procurements and has been recognized by the Office 

of Management and Budget, the General Services Administration, 

and the Partnership for Public Service because of our results. In 

fiscal year 2010, DHS saved over $347 million using strategically 

sourced contracts. 

In addition to savings, the Strategic Sourcing Program also focuses on maximizing the Department’s use of small businesses and 

small disadvantaged business. Small business received approximately 36 percent of the total dollars that were strategically 

sourced in fiscal year 2010, far exceeding the Government-wide 

goal of 23 percent. We intend to expand the use of this valuable 

procurement tool in fiscal year 2012. 

In the area of quality communication with industry, I recently 

issued a Department-wide vendor communication plan. This publicly posted plan begins with a personal commitment from each 

head of contracting activity to enhance component engagement for 

all procurements. Requirements of the plan will result in an increased number of RFIs, draft RFBs, new and improved industry 

days related to specific procurements, a revamped on-line procurement forecast system supported by component procurement liaisons 

to answer inquiries from all in industry, a new and improved annual DHS industry day, and attendance at over 100 small business 

outreach events, including 10 small business vendor outreach sessions that include one-on-one appointments. 
75 

In addition to my plan, we are investigating the possibility of a 

transparent industry advisory council and dialogue forum separate 

and apart from individual procurements. It must be open to all. We 

are contemplating reversing industry days, where industry comes 

in and they are invited to discuss their capabilities with us. I believe, given time for this plan to take hold, we are going to be a 

leader in communication with industry. 

In the areas of quality people and program support, the Department is committed to recruiting, developing, and retaining a worldclass acquisition workforce. Through aggressive recruitment and 

retention strategies, the DHS contracting workforce has increased 

from 603 in fiscal year 2004 to more than 1,400 professionals who 

processed over 90,000 contracting actions and obligated $14 billion 

in fiscal year 2010 and in 2011. 

However, the Department’s rate of hiring contracting and programming support professionals has historically lagged well behind 

our needs. Our primary mechanism to correct this problem is our 

Acquisition Professional Career Program. This is a 3-year program 

that provides participants with acquisition training experience 

through intensive training and on-the-job experience. 

Further, DHS has made significant progress in approving its existing workforce through training and certification for multiple acquisition career fields. A well-trained acquisition workforce can engage industry and apply flexible procurement strategies because 

they know more and they have better experience. Most importantly, a better workforce yields real savings to the taxpayer by a 

getting better business deal. 

DHS is committed to continuing to improve the acquisition process by enhancing our workforce, by partnering with industry, and 

incorporating best practices such as strategic sourcing. This approach supports the Department’s frontline operations while ensuring effective oversight and efficient use of taxpayer resources. 

Thank you for the opportunity to participate today. I look forward to questions. 

[The statement of Mr. Nayak follows:] 

PREPARED STATEMENT OF NICK NAYAK

NOVEMBER 3, 2011 

Chairman Rogers, Ranking Member Jackson Lee and Members of the subcommittee, I am pleased to testify before you today. As the Chief Procurement Officer since October 2010 at the Department of Homeland Security (DHS), I am responsible for oversight and policy related to DHS’s annual procurement of approximately $14 billion in goods and services. DHS continues to improve its purchases 

across the Department first and foremost through the Strategic Sourcing Program. 

We are also expanding communication with large and small businesses to ensure 

we procure the right items at the right prices. The DHS acquisition workforce uses 

these tools to spend taxpayer resources efficiently and effectively. Today, I am 

happy to provide you an update on our continued success with strategic sourcing, 

our expansion of vendor communication and the status of our acquisition workforce. 

QUALITY CONTRACTING—STRATEGIC SOURCING

DHS has achieved substantial success in spending money more efficiently through 

our Strategic Sourcing Program. The Department leads the Federal Government in 

coordinated procurements and has been recognized by the Office of Management 

and Budget, the General Services Administration, and the Partnership for Public 

Service because of our results. In fiscal year 2010, DHS saved over $347 million 
76 

using strategic sourcing contracts. These savings come from initiatives that span 

across eight commodity families including: 

• Industrial Products & Services 

• Information Technology & Telecommunications 

• Professional & Office Area Support Services 

• Security 

• Facilities & Construction 

• Office Management & Miscellaneous Products 

• Travel & Lodging 

• Logistics Operations & Package Delivery Services 

The Department realized these significant savings by choosing the Strategic 

Sourcing Program for approximately $2.6 billion of its requirements. This savings 

represents approximately 18 percent of the $14 billion spent on contracts at the Department in fiscal year 2010. 

In addition to savings, the Strategic Sourcing Program also focuses on maximizing 

the Department’s use of small and socio-economic disadvantaged companies. Small 

businesses received approximately 36 percent of the total contract dollars that were 

strategically sourced in fiscal year 2010, far exceeding the Government-wide small 

business overall contracting goal of 23 percent. In fiscal year 2011, DHS awarded 

13 new strategic sourcing initiatives. We look forward to continuing to expand this 

valuable procurement tool in fiscal year 2012. 

The Strategic Sourcing Program has achieved success, in part, by facilitating collaboration between industry and Government. The Program undertakes comprehensive market research and examines buying trends across the Department. Based on 

industry standards and knowledge of the marketplace, DHS refines the requirement 

and creates the procurement strategy. When we have used this collaboration as part 

of the Strategic Sourcing Program, DHS has achieved robust competitions and significant cost savings. 

DHS’s Wireless Devices procurement is one example of the Strategic Sourcing 

Program listening to industry and responding accordingly. In this case, we learned 

that the telecommunications carriers did not have the existing capability to provide 

the program with management reports. The procurement team decided to eliminate 

the reporting requirements from the carrier agreements and developed a separate 

procurement for the enterprise-wide reporting services. This modification allowed 

the telecommunication carriers to reduce the prices on the devices which DHS believes will result in a net savings that can be reported when the purchase is complete. 

Another example of collaboration that resulted in strategic sourcing savings was 

the purchase of enterprise software licenses. This procurement was one of several 

initiatives implemented as part of Secretary Napolitano’s Efficiency Review to leverage the purchasing power of the entire Department. Multiple commercial and Government sources for software licenses were evaluated, allowing the Government to 

develop a strategy for purchasing an Enterprise Licenses Agreement (ELA) that resulted in $40 million in savings during fiscal year 2010 due to lower prices and 

streamlined the procurement process. 

QUALITY INDUSTRY-GOVERNMENT COMMUNICATIONS

The Department is committed to promoting enhanced vendor engagement in the 

acquisition process. Building on the success of the Strategic Sourcing Program, I 

have included vendor communications as a cornerstone of my Strategic Plan. My 

publicly posted Vendor Communication Plan begins with a personal commitment 

from each Head of the Contracting Activity (HCA) to enhance Component engagement with industry, allowing industry to see how DHS will work to improve dialogue. The signed pledges have already resulted in increased communication with 

industry prior to and during source selection. 

In addition to holding executives accountable for increased communication, the 

Department also includes many other features in its Plan to strengthen vendor communication. For example, my office hosts a DHS Industry Day every year. Last 

year’s event was attended by approximately 1,000 industry representatives and 

2,000 participants via webcast. The event includes panels from each Component 

moderated by the appropriate HCA that provide program- and acquisition-specific 

information on the Components’ planned major acquisitions. The Industry Day also 

facilitates discussion among companies and connects industry with the responsible 

Government representatives. 

Additionally, the Department conducts or attends over 100 small business outreach events each year. Vendor Outreach Sessions, conducted ten times a year by 

the Department’s Office of Small and Disadvantaged Business Utilization (OSDBU), 
77 

provide small businesses pre-scheduled one-on-one appointments with a DHS small 

business specialist. These sessions provide small businesses with an opportunity to 

discuss their capabilities and learn of potential procurement opportunities. Notices 

of upcoming Vendor Outreach Sessions are posted to the Small Business Central 

Event Listing on FedBizOpps, as well as on the DHS public website to maximize 

participation. These efforts have contributed to the awarding of approximately 30 

percent of all DHS contracts to small businesses from 2007 through 2011, and outpacing all other large Federal agencies in achieving all of the Federal small business 

goals each year. These small businesses are making a significant contribution to 

DHS’s mission. 

As an example, in fiscal year 2011 DHS awarded a $2 million contract to Astrophysics, Inc., a small business located in California, for a new technology or technological ideas for screening air cargo assembled into pallets, sometimes called ‘‘skids’’. 

Currently, in certain circumstances, pallets must be broken down before screening, 

which costs more and takes more time. Astrophysics Inc. is creating a system that 

will increase efficiency by scanning a full complement of medium- and high-density 

air cargo across a wide range of commodities (e.g., apparel, produce, seafood/meats, 

flowers, electronics, machine parts, printed material, and miscellaneous durable 

goods). Once operational, the system will reduce TSA’s costs, reduce the time for 

screening, and enhance the security of air cargo. DHS values the contributions of 

its small business partners and recognizes that they are essential to accomplishing 

our mission. 

Finally, to assist large and small vendors, DHS publishes an acquisition forecast 

available on DHS’s website through the new Acquisition Planning Forecast System. 

This new forecasting tool was implemented in response to industry, and will respond to industry concerns and provide an effective mechanism for industry to connect directly with those who may be interested in their technology. 

QUALITY PEOPLE

Effective industry engagement and good procurements require a trained and fullystaffed acquisition workforce. Through aggressive recruitment and retention strategies, DHS’s contracting workforce has increased from 603 in fiscal year 2004 to 

more than 1,400 professionals who processed over 90,000 transactions, and obligated 

$14 billion in fiscal year 2010. However, the Department’s rate of hiring contracting 

professionals has historically lagged well behind the Department’s needs. Our primary mechanism to correct this problem is our Acquisition Professional Career Program (APCP). This 3-year program provides participants with acquisition training 

and experience through intensive training and on-the-job experience. DHS’s future 

procurement improvements depend on continuing to grow its acquisition workforce 

through the APCP. 

Further, DHS has made significant progress in improving its existing workforce 

through training and certification for multiple acquisition career fields. All DHS 

contracting professionals receive appropriate training and experience commensurate 

with their responsibilities and certification requirements. As reported in our March 

2011 update to our acquisition human capital plan, we continue to increase the 

training and experience of our program managers so they have the tools they need 

to successfully manage their assigned procurements. 

Our commitment to an improved professional workforce leads to an acquisition 

process that is more effective and efficient. A well-trained acquisition workforce can 

engage industry and apply flexible procurement strategies because they know more 

and have better experience. Most importantly, a better workforce yields real savings 

to the taxpayer by getting a better business deal. In order to continue to expand 

communication with industry and deepen our procurement capability, DHS must 

continue to invest in our acquisition workforce. Our APCP program will continue 

to provide new energetic talent throughout DHS’s Components. Our centralized 

training of all acquisition fields must be maintained so that all involved in the procurement process have the knowledge and tools they need to effectively engage industry and ensure DHS buys what it needs at a reasonable price. 

CONCLUSION

DHS is committed to continuing to improve our acquisition process by enhancing 

its acquisition workforce and by partnering with industry and incorporating best 

practices from across the Department to efficiently procure common goods and services through the Strategic Sourcing Program. This approach supports the Department’s front-line operations while ensuring effective oversight and efficient use of 

taxpayer resources. 
78 

Thank you for the opportunity to participate in your discussions regarding the 

specific DHS procurement practices. I look forward to your questions. 

Mr. ROGERS. Mr. Kane. 

STATEMENT OF ROBIN E. KANE, ASSISTANT ADMINISTRATOR, 

SECURITY TECHNOLOGY, TRANSPORTATION SECURITY ADMINISTRATION 

Mr. KANE. Good afternoon, Chairman Rogers, Ranking Member 

Jackson Lee, and distinguished Members of the subcommittee. 

Thank you for the opportunity to testify today regarding the ways 

we are advancing security through innovation of new and improving technologies. 

TSA procures and deploys the detection equipment used to 

screen over 1.5 million passengers a day in the Nation’s airports, 

as well as their carry-on and checked baggage. In addition, we test 

and approve technologies for use in screening air cargo and in 

other transportation modes. 

We work closely with the DHS Science and Technology Directorate as well as the private sector, including National labs, Federally-funded research and development corporations, and universities. A specific result of our collaboration was the joint development and publishing of the aviation security technology research 

and development strategy in March 2011. It contained an R&D 

roadmap to keep our efforts closely aligned. 

Since early 2010, TSA has also had a broad agency announcement soliciting input on transportation security innovative concepts. The BAA solicits proposals for research projects which offer 

potential for advancement and improvement of TSA security operations, technologies, processes, human factors, and capabilities. To 

date, TSA has received over 100 proposals and made four awards 

under the BAA. Those discussions and engagements facilitate developing the requirements to address evolving threats to aviation 

and structure TSA’s acquisition programs. 

TSA continues to advance security by investing in innovative 

technologies, improving efficiencies, and pursuing equipment standardization initiatives. Examples include advanced imaging technology, or AIT, which helps transportation security officers screen 

passengers for metallic and non-metallic explosives as well as other 

anomalies. TSA is currently upgrading many of these machines 

with automated target recognition software, providing the same 

high level of detection, while enhancing privacy protection by replacing passenger-specific images with a generic outline of a person 

that is identical for all passengers. 

Early next year, TSA will field test an identification and boarding pass scanning system which quickly screens passengers for 

fraudulent IDs and boarding passes. If proven successful, this technology could replace the current ‘‘lights and loupes’’ manual method of authentication. 

TSA is also upgrading current X-ray systems, deploying nextgeneration systems to screen carry-on luggage at the security 

checkpoint. Next-generation units feature enhanced explosive detection capabilities that detect a wider range of threats. 

Bottled liquid scanner systems are used to detect potential liquid 

or gel threats, while differentiating between liquid explosives and 
79 

common, benign liquids, such as baby formula or insulin. Next-generation systems detect a wider range of explosive materials and use 

light waves to screen sealed containers for explosive liquids. These 

units have been deployed to 230 airports. 

Over the next 5 years, a large number of TSA’s explosive detection systems will reach the end of their useful life and replacing 

these aging units is a top priority. TSA intends to recapitalize them 

with more capable machines with greater detection capability 

through an on-going procurement. 

TSA is also using technology in innovative configurations. This 

past October we began testing TSA PreCheck, a voluntary passenger pre-screening initiative with an actual known traveler population at four U.S. airports, placing more focus on pre-screening individuals who volunteer information about themselves prior to flying. Because we know more about these passengers, TSA PreCheck 

travelers may divest fewer items, which could include leaving on 

their shoes and jacket. 

Of course, TSA will continue to incorporate random and unpredictable security measures throughout the security process. At no 

point is any traveler guaranteed expedited screening. 

Initial feedback from TSA PreCheck passengers has been favorable. TSOs are receiving very positive comments and the two partner airlines have successfully demonstrated the required technical 

capabilities. 

All of these efforts benefit from partnerships within DHS and 

with industry. TSA will continue to strengthen those relationships 

and processes to deliver the best technology and capabilities to provide effective security. 

Chairman Rogers, Ranking Member Jackson Lee, I thank you for 

the opportunity to appear today, and I look forward to answering 

your questions. 

[The joint prepared statement of Mr. Kane and Mr. Benda follows:] 

JOINT PREPARED STATEMENT OF ROBIN E. KANE AND PAUL BENDA

NOVEMBER 3, 2011 

Good afternoon, Chairman Rogers, Ranking Member Jackson Lee, and distinguished Members of the subcommittee. Thank you for the opportunity to testify 

today about the Transportation Security Administration’s (TSA) use of technology 

that supports our layered approach to securing the Nation’s transportation systems 

while ensuring freedom of movement for people and commerce. To accomplish this 

mission, we employ risk-based, intelligence-driven operations to prevent terrorist attacks and reduce the vulnerability of the Nation’s transportation system. While no 

layer on its own addresses all risk, in combination they create a strong and formidable system. 

Last fall, TSA Administrator John S. Pistole directed the agency to explore ways 

to develop a strategy for achieving risk-based security. I am pleased to have an opportunity today to discuss with the subcommittee the processes employed by TSA 

to advance innovation through new technologies that strengthen our multi-layered 

security system. 

CREATING INNOVATIVE SOLUTIONS BY PARTNERING WITH INDUSTRY

TSA has forged a number of partnerships to develop and deliver solutions to combat emerging and evolving threats to transportation security. Specifically, TSA 

works with the DHS Science and Technology Directorate (S&T) to create innovative 

solutions to threats and challenges. TSA also collaborates with the private sector 

including National labs, Federally-funded research and development corporations 
80 

(FFRDCs), universities, and other qualified vendors at industry days, technical forums, conferences, and program reviews. 

COLLABORATIVE APPROACHES TO TECHNOLOGY INNOVATION

TSA is also working closely with trade associations that focus on homeland security issues to share its vision with industry stakeholders. Since early 2010, TSA has 

issued an annual Broad Agency Announcement (BAA) to collect innovative concepts 

from industry to inform future decisions for research and development (R&D) efforts 

and to identify innovation already available in the marketplace. In the last year, 

TSA pursued several submissions for proof-of-concept demonstrations focused on insider threat analysis, behavior detection, and explosive detection, and is currently 

reviewing numerous other proposals. 

ADVANCING AVIATION SECURITY WITH TECHNOLOGY INVESTMENTS

To address the evolving threats to aviation, TSA continues to advance security by 

investing in innovative technologies, improving workforce efficiencies, and pursuing 

initiatives to further standardize and integrate equipment. Such advancements and 

initiatives include: 

Advanced Imaging Technology and Automated Target Recognition 

Advanced Imaging Technology (AIT) helps Transportation Security Officers 

(TSOs) screen passengers for metallic and non-metallic explosives as well as other 

non-metallic threats. Currently, there are more than 500 AIT units at nearly 100 

airports. Two months ago, TSA purchased an additional 300 machines, which are 

being deployed with Automated Target Recognition (ATR) software. ATR software 

upgrades are designed to further enhance passenger privacy by eliminating passenger-specific images and instead displaying a generic outline of a person that is 

identical for all passengers. By removing the need for an officer to view images in 

a remote location, the use of the software also improves throughput capabilities of 

the technology and streamlines the checkpoint screening process. The ATR software 

provides the same high level of detection as AIT without the software and it allows 

for more targeted pat-downs because of the manner in which anomalies are displayed. The President’s fiscal 2012 budget requests funding for an additional 275 

AIT units. The availability of this equipment supports long-term needs while increasing efficiencies at checkpoints with even more effective ATR software and a reduced footprint, which will inform future deployment strategies. 

Credential Authentication Technology/Boarding Pass Scanning Systems 

The Credential Authentication Technology/Boarding Pass Scanning Systems 

(CAT/BPSS) provide TSOs with an effective tool to quickly detect fraudulent or altered documents, enhancing security and increasing efficiency. This equipment automatically and concurrently verifies passenger boarding passes and IDs that passengers present to TSA during the security checkpoint screening process, as well as 

those IDs presented by airport and airline personnel to access sterile areas. 

We plan to conduct CAT/BPSS technology pilots in the coming months and 

throughput will be evaluated very closely as we determine the overall operational 

suitability of the various solutions. If testing proves successful, the technology could 

replace the current manual ‘‘lights and loupes’’ method of ID and boarding pass authentication. 

Automated Wait Time 

Automated Wait Time (AWT) systems utilize technology to monitor and track 

queuing traffic at the security checkpoint, enabling TSA to reallocate resources to 

areas of higher congestion and priority as needed. TSA preliminarily tested an AWT 

system at the TSA Systems Integration Facility (TSIF) and anticipates testing it in 

airports in the coming months. 

Next Generation Advanced Technology X-Ray 

TSA is in the process of upgrading currently deployed AT X-ray systems, as well 

as deploying next generation, or AT–2 systems. This technology is used to screen 

carry-on luggage at the security checkpoint. In addition to other upgrades that 

streamline the bag check process, next generation AT X-ray units feature enhanced 

explosive detection capabilities that enable TSA to detect new threats. 

There are currently more than 1,000 AT units at nearly 100 airports. These systems enhance security effectiveness and efficiency, and deployments will continue 

into calendar year 2012. We are working closely with DHS S&T and our qualified 

vendors to assess the AT–2 system’s capability to detect liquids, aerosols, and gels 

(LAG), which would help to expedite the secondary bag search process. 
81 

Bottled Liquids Scanners 

Bottled Liquids Scanner (BLS) screening systems are used to detect potential liquid or gel threats which may be contained in a passenger’s property while differentiating between liquid explosives and common, benign liquid such as baby formula 

and insulin. Next-generation bottled liquids scanner screening systems have the 

ability to detect a wider range of explosive materials and use light waves to screen 

sealed containers for explosive liquids. TSA recently deployed 500 next-generation 

BLS units to airports Nation-wide to add to the more than 1,000 BLS units currently deployed at 230 airports. 

Shoe-Scanning Detection Technology 

Shoe-Scanning Detection (SSD) technology is an advanced technology which would 

be capable of detecting both metallic and non-metallic threats concealed in passenger footwear without requiring passengers to remove their footwear at the checkpoint. DHS S&T recently issued a Broad Agency Announcement that supports R&D 

efforts to develop shoe-scanner detection systems that meet TSA detection requirements. 

Explosives Trace Detection 

Explosives Trace Detection (ETD) technology is used at security checkpoints 

around the country to screen carry-on baggage and passengers for traces of explosives. Officers may swab a piece of luggage or passenger hands and then use ETD 

technology to test for explosives. The swab is then placed inside the ETD unit, 

which analyzes the content for the presence of potential explosive residue. TSA is 

expanding its use of ETD technology in airports as part of its layered approach to 

aviation security. 

Explosives Detection Systems Recapitalization and Optimization 

Over the next 5 years, a large number of Explosives Detection Systems (EDS) will 

reach the end of their useful life and replacing these aging units is a top priority. 

TSA will fund recapitalization projects, which include the work required to remove 

the existing EDS, minimal modifications to the Baggage Handling System infrastructure, and the associated purchase and installation of the new EDS. TSA’s plan 

to replace the aging EDS fleet of equipment will be prioritized based on a combination of age and maintenance data. 

RISK-BASED SECURITY

In the past, Administrator Pistole has spoken to this subcommittee about TSA’s 

risk-based approach to enhancing security. I would like to provide you with the current status of two of our new risk-based programs that are supported by technological advancements: 

TSAPre✔TM

This past October, TSA began testing a limited and voluntary passenger prescreening initiative with a small known traveler population at four U.S. airports 

(Miami, Dallas-Ft. Worth, Detroit, and Atlanta). This pilot program will help assess 

measures designed to enhance security, by placing more focus on pre-screening individuals who volunteer information about themselves prior to flying in order to potentially expedite the travel experience. By learning more about travelers through 

information they voluntarily provide, and combining that information with our 

multi-layered system of aviation security, we can better focus our limited resources 

on higher-risk and unknown passengers. This new screening system holds great potential to strengthen security while significantly enhancing the travel experience, 

whenever possible, for passengers. 

During this pilot, TSA is using pre-screening capabilities to make intelligencebased risk assessments for passengers who voluntarily participate in the 

TSAPre✔TM program and are flying domestically from one of the four airport pilot 

sites. Eligible participants include certain frequent flyers from American Airlines 

and Delta Air Lines as well as existing members of U.S. Customs and Border Protection’s (CBP) Trusted Traveler programs including Global Entry, SENTRI, and 

NEXUS who are U.S. citizens and are flying on participating airlines. The data collected from these pilot sites will inform our plans to expand the program to include 

additional airlines as well as other airports that participate in CBP’s Global Entry 

program, once they are operationally ready. 

TSAPre✔TM passengers are pre-screened each time they fly from participating airports. If the indicator embedded in their boarding pass reflects eligibility for expedited screening, the passenger is able to use the TSAPre✔TM lane. Because we know 

more about these passengers, TSAPre✔TM travelers are able to divest fewer items, 
82 

which may include leaving on their shoes, jacket, and light outerwear, as well as 

other modifications to the standard screening process. As always, TSA will continue 

to incorporate random and unpredictable security measures throughout the security 

process. At no point are TSAPre✔TM travelers guaranteed expedited screening. 

Transportation Security Officers (TSOs) in the four pilot airports are receiving 

very positive feedback from TSAPre✔TM travelers while the two partner airlines 

have successfully demonstrated the technical capabilities required to participate in 

the program, thus paving the way for other airlines to follow. As we learn from 

these pilots, we are working closely with other airlines and airports to determine 

when they may be operationally ready to join. We are also working with CBP to 

ensure that individuals who want to apply for Trusted Traveler Programs are able 

to do so in an efficient manner. 

Known Crewmember 

We hold airline pilots responsible for the safety of the traveling public every time 

they fly an aircraft. It makes sense to treat them as our trusted partners. To build 

on our risk-based approach to security, we are currently testing another identitybased system to enable TSA security officers to positively verify the identity and employment status of airline pilots. The Known Crewmember program is a joint initiative between the airline industry (Air Transport Association) and pilots (Air Line 

Pilots Association, International (ALPA)), which allows uniformed pilots from 22 airlines to show two forms of identification that are checked against a database called 

the ‘‘Cockpit Access Security System (CASS),’’ which confirms identity. After more 

than 2 months into the pilot program, and with deployments nearly complete at the 

seven participating airports, over 59,000 uniformed pilots have been cleared through 

the process with an average of nearly 1,900 approvals per day. Both Known Crewmember and TSAPre✔TM are clear examples of TSA’s commitment to focusing its 

attention and resources on those who present the greatest risk, thereby improving 

security and the travel experience for passengers across the country. 

CONCLUSION

TSA will continue to enhance its layered security approach through state-of-theart technologies, expanded use of existing and proven technology, passenger prescreening, and other developments that will continue to strengthen aviation security. Chairman Rogers, Ranking Member Jackson Lee, I thank you for the opportunity to appear before you today, and I look forward to answering your questions 

about the use of innovative technology to provide additional layers of security to our 

Nation’s transportation systems. 

Mr. ROGERS. I thank you. 

As a fellow who got to go through the PreCheck system this past 

week for the first time, that lane was wonderful. I got to keep my 

shoes on and my belt and everything. All I had to do was take my 

keys and phone out. That is a great initiative. I am hopeful that 

we can see that soon expanded after the first of the year everywhere, because a lot of people are going to like it. 

Now I would like to recognize the Ranking Member, my friend 

and colleague from Texas, for her opening statement. 

Ms. JACKSON LEE. Mr. Chairman, first of all, let me thank you 

for your courtesies and thank the witnesses. 

I notice, I assume, Mr. Chairman, you have indicated that there 

is a vote on the floor, and let me acknowledge the fact that in overlapping committees, I think there is some law enforcement officers 

even in the room, I know that Ms. Bell and Mr. Daniels are guests 

that are here in the room, one with Ultimate Lock, one a law enforcement officer. We were dealing with synthetic drugs, Mr. Chairman, in Judiciary in a markup. I was in the middle of a markup. 

I deeply appreciate your courtesies. 

Other Members, let me give comfort and defense to other Members. There are overlapping hearings. But this is a very important 

series of hearings, and I want to thank the witnesses, but I want 

to thank the Chairman. I think we have gained a lot of knowledge, 
83 

that hopefully we will even come with an omnibus bill dealing with 

technology, small businesses, how we can improve our security. 

Mr. Chairman, you won’t mind if I do one slight tongue-in-cheek 

moment on technology that will include blinders on TSA inspectors 

for suitcases. We don’t want to tempt anyone for what they might 

see in suitcases. 

Mr. Chairman, I guess you have missed the news, but I have expressed my great consternation in that, and I hope that Mr. Nayak 

is listening to me when I say that you should stick to the work that 

you are supposed to be doing when you are inspecting suitcases. 

But let me quickly, because—they will get that after the fact, Mr. 

Chairman—I want an omnibus bill on that. Will you join me in cosponsoring legislation? 

As we have discussed in the past, securing our Nation requires 

not only vigilance and resources but also innovation and imagination. As I indicated, this is a very important series of hearings that 

we have explored in focusing on TSA reform but also to generate 

guidance on how we move forward in the 21st Century. 

New technology, helping small businesses, creating the opportunity, if you will, for small businesses to show their wares to secure the homeland. That is what I want to be the resounding part 

of this series of hearings. How do we ensure that we miss no important technology that could help secure the homeland? 

One year ago, U.S. officials discovered a plot to plant explosives 

aboard a cargo plane leaving North Africa and bound for America. 

We are fortunate that that plot was uncovered and no lives were 

lost. That was not high technology. But the question of how that 

managed to go through and penetrate security is a question for the 

type of sophisticated technology we should be looking at. 

The anniversary of this al-Qaeda-inspired plot should remind us 

that this Nation’s security depends upon our willingness to find 

and fix known security vulnerabilities before they occur. Our adversary’s determination to exploit security vulnerabilities must be met 

and exceeded by our determination to fill the gaps. The challenge 

of mitigating threats can only be accomplished by our refusal to 

settle for the status quo. 

We must continually improve our security policies, develop and 

explore innovative security technologies, take the necessary steps 

to increase our security posture, and a sentence that I will repeat 

again, we must open the door for small businesses to access and 

provide exposure to their technology. 

To that end, policy should not undermine the ability of the Department to procure cutting-edge technologies developed by small, 

innovative firms. Having said that, I would caution that the Department must be prudent in its approach to testing, evaluating, 

and approving innovative security technology. As we saw with the 

purchase and deployment of the puffer machines under the previous administration, the failure to exercise due diligence in tests 

and evaluating innovative technologies before purchase can lead to 

wasted tax dollars. In these tight budgetary times, the Department 

must have a clear vision. 

I look forward to working with the Chairman, the Chairman of 

the full committee, the Ranking Member of the full committee as 

we open the doors of opportunity but yet have as our No. 1 criteria 
84 

our commitment to the safety and security of the American people. 

We can do both. We can walk down that journey together, jobs, 

technology, security of the American people all intertwined, all No. 

1. 

As it says in Proverbs, where there is no vision, the people perish. I believe the Department of Homeland Security tragically came 

out of an enormous and deeply despairing time during the history 

of America. But we have generated great employees, agencies that 

have come under one head, and certainly under the leadership of 

Secretary Napolitano there is vision. I, however, want to see that 

vision impacted, Mr. Chairman, as we work together to not deny 

technology but as well to be able to ensure that those doors are 

open. 

That is why I was proud to support the amendment my colleague 

from Illinois, Mr. Davis, offered during committee consideration of 

the DHS authorization bill. His amendment would have established 

an Office of Public-Private Partnership within the S&T Directorate 

responsible for enhancing the Department’s collaboration in the 

area of security technologies with stakeholders, including small 

businesses. Unfortunately, this amendment was defeated. I hope 

we can turn it around again. 

Turning to my panel of witnesses, I am pleased that we have witnesses before us today who are current officials of the Department 

of Homeland Security. We look forward to your insight. 

In particular, I look forward to hearing from Mr. Edwards, the 

Acting Inspector General, because we want to do what is right. I 

am delighted to be able to hear from those who are involved every 

day in procurement. 

I am also eager, as I indicated, to hear from Dr. Nayak as the 

new Chief Procurement Officer. Congratulations. I look forward to 

learning of your challenges and how you are involved in this effort. 

I look forward to hearing from Mr. Benda on the potential impact 

that the cuts contained in the House-passed Republican Homeland 

Security appropriations would have on the S&T Directorate. 

During the 111th Congress it has been certainly my challenge as 

the former Chairwoman to be delighted that this committee conducted oversight, held hearings, and saw that the House passed 

legislation addressing the development, procurement, and deployment of innovative security technologies. 

Let’s work together, Mr. Chairman, and go forward with a vision 

helping to expand opportunities for America and securing the 

homeland. 

With that, I yield back. 

Mr. ROGERS. I thank the gentlelady. 

We have been called for votes. We have got about 5 minutes to 

get over there. Fortunately, there are only going to be two votes, 

so we should be back in 20 minutes. I apologize, but they didn’t ask 

me. 

So we are in recess until we can get back from votes. 

[Recess.] 

Mr. ROGERS. I will call the hearing back to order and again 

apologize for the interruption, but I don’t think we will have another one before this is over with. 
85 

Mr. Benda, you are up. We look forward to hearing your testimony. 

STATEMENT OF PAUL BENDA, CHIEF OF STAFF, DIRECTOR, 

HOMELAND SECURITY ADVANCED RESEARCH PROJECTS 

AGENCY, U.S. DEPARTMENT OF HOMELAND SECURITY, ACCOMPANIED BY SUSAN HALLOWELL, DIRECTOR, TRANSPORTATION SECURITY LABORATORY 

Mr. BENDA. Great. Thank you, Mr. Chairman Rogers, Members 

of the committee. 

I appreciate the opportunity to come before you today to talk 

about the Science and Technology Directorate and its role in the 

technology development and acquisition process. I would like to lay 

out for you how we plan on operating S&T in the future, especially 

in these constrained budget environments; and there are three 

areas in particular I would like to highlight. 

One, as S&T investment technologies, we are going to focus our 

investments on transitioning products to use. This is something we 

haven’t done as well in the past as we would like, and this is going 

to be an effort for us moving forward. 

We are going to do this by looking at how the components do 

their work, look at their operations, look at where their bottlenecks 

occur, look at how they currently do things, and we are going to 

identify areas where technologies can make them more efficient. 

We are going to look at ways we can leverage our technical innovation, from large companies, from small, and ways to improve their 

processes and make them more efficient. We think this will create 

a pull from the components for them to want the technologies that 

we are deploying, and we have to work with our component partners to make sure that we are developing things they are interested in. 

Second, we understand the challenges that S&T faces trying to 

solve the problems of the Homeland Security enterprise. This mission space is too large for one R&D entity to solve all these challenges, so we are going to do what we like to call forage for technologies that exist out there and forage for partners to help us 

achieve these technical innovations that we are looking for. 

When I talk about that, I mean working with the interagency, 

working with the Department of Defense and look at what technologies they are developing and how can we leverage it. Work 

with our international partners to see what areas they are interested in. They face a lot of the same challenges. How can we leverage the technology that they are doing? Work with our university 

partners, Auburn University being a perfect example, Mr. Chairman, of some of the innovation that is going on there. 

We hope to bring to bear things such as DOD’s investment in a 

$25 million basic research program called Compressed Sensing that 

we think can be the baseline for our next-generation automatic target recognition program that we hope to transition to TSA. 

We are looking at things such as working with the intelligence 

community on a new broad-spectrum IR laser that would allow us 

to do standoff explosives detection in a time line that is relative to 

mass transit. We are actually leveraging an intelligence community 
86 

investment one-for-one dollars, so they are sharing half the cost 

with this investment. 

Third, we have to ensure that we leverage S&T’s technical core 

for the use of the Department. We have got a mandate to focus on 

operational test and evaluation, the back end of the process, and 

I think we have done a great job of implementing that, and I think 

it is a very positive development for the Department as a whole to 

have a standardized OT&E process. 

But we need to leverage the technical capabilities that S&T 

brings to bear on the front end of the process. How do the components set their requirements? Can we assure that they are technically achievable? Are we not reaching for a brass ring that might 

be beyond our reach? So working in partnership with the components to achieve that. 

One key component of our test and evaluation, especially in the 

context of this hearing, is the Transportation Security Lab. S&T 

has developed a very strong partnership over the last couple of 

years with TSA, and TSL is a key component of that. They perform 

the qualification and certification testing for all the explosive detection technologies that TSA deploys. 

We work very closely with them and have worked to improve our 

processes to ensure that this is friendly to vendors, friendly to industry, but also provides a robust test environment so that nothing 

gets deployed before it is technically capable of achieving the mission needs as defined by TSA in the field. 

We have worked with TSA to develop an R&D strategy focused 

on aviation security that Mr. Kane had referenced in his testimony 

that was published in March 2011. In August 2011, we created a 

publicly releasable version of that testimony. We think we need to 

leverage not just with the interagency agency and our international 

partners but also with industry, and the best way to do that is for 

industry to know where we want to go. 

So this R&D strategy that we have we think is extremely important to get out there so they can see the priority investment areas 

for S&T as well as for TSA, and we are going to expand this. We 

are going to do a mapping of how TSA does operations, look at 

where technology can improve that mapping, and then create what 

we call an integrated support strategy document for TSA. We are 

going to prepare this in conjunction with my partner Robin over at 

TSA and then hopefully come up with a document that both Administrator Pistole and Dr. O’Toole can sign showing the investment and priorities for S&T and TSA into the future and make 

that public so industry can see where we are going. 

In closing, I would like to say that S&T does face some significant challenges. We think we have identified a good path forward 

where we can leverage interagency and commercial partners. We 

think we have established good relationships with our component 

partners. 

But the challenge we face is that in fiscal year 2011 our budget 

was cut 19 percent during the CR. In fiscal year 2012, the Houseapproved budget cut our budget by 77 percent, if you focus on our 

core R&D investments. If this comes to pass, we obviously have to 

scale back significantly our investments in technology. We will 

have to stop our cybersecurity research, which has won awards. We 
87 

will have to stop our investment in small businesses. We will go 

from 60 CIBER awards down to four. We will have to stop our investment in biodefense research areas. 

So this will be a challenge as we move forward, and it will not 

allow us to invest in the requirement setting and testing/evaluation 

process. We hope that this budget gets reconsidered, and I look forward to handling any of your questions you have for the future. 

Thank you. 

Mr. ROGERS. Thank you very much, Mr. Benda. 

Mr. Edwards, I look forward to your opening statement. 

STATEMENT OF CHARLES K. EDWARDS, ACTING INSPECTOR 

GENERAL, U.S. DEPARTMENT OF HOMELAND SECURITY 

Mr. EDWARDS. Good afternoon, Chairman Rogers, Ranking Member Jackson Lee, and distinguished Members of the subcommittee. 

I am Charles Edwards, Acting Inspector General for the Department of Homeland Security. Thank you for inviting me to testify 

about procurement policies at the Transportation Security Administration. 

My testimony today will focus on two audit reports that my office 

completed this year: DHS’s oversight of component acquisition programs and DHS’s Department-wide management of detection 

equipment. While neither of these reports focused solely on TSA 

procurement, the findings and recommendations in both are relevant to the subcommittee’s discussion today. 

The Department oversees acquisition programs at or about $300 

million in life-cycle cost. Individual components such as TSA are 

responsible for the oversight and controls for acquisition programs 

below the $300 million threshold. 

We have reviewed 17 DHS acquisition programs, including eight 

programs at TSA, to determine whether the Department has established adequate management and oversight controls. We concluded 

that, while DHS generally had management oversight and controls 

in place, it needs to further define policies and strengthen oversight. 

We identified two areas for improvement: Clearer guidance and 

mandated use of available tools. We found that many components 

needed clearer guidance for determining when an acquisition was 

costly and complicated enough to be managed as an acquisition 

program or when the acquisition could be handled as a simple procurement. 

For example, TSA personnel reported that they classified all acquisitions that appeared to be programs as acquisition programs 

because the Department’s guidance was unclear. We recommended 

that the Department create a decision matrix tool that the components can apply in pre-planning phases of the purchasing process 

in order to reduce this confusion. The Department concurred with 

our recommendation and agreed to develop a decision matrix. 

Another area where the Department can improve its oversight of 

acquisition programs is by mandating that components use the acquisition tools available to them. For example, the Department has 

created a Strategic Sourcing Program Office, or SSPO, to help components engage in market research, identify best practices, mini-
88 

mize duplication of effort, and provide Department-wide contract 

vehicles. 

Unfortunately, we found during our review that the Department 

was not ensuring or mandating that components use the SSPO 

when managing acquisition programs. We recommended that the 

Department make sure component personnel are at least considering the use of SSPO during the planning stages of their acquisitions. The Department agreed with this recommendation. 

The issue of strategic sourcing came up again during the second 

audit that I will discuss today, our audit of Department-wide management of detection equipment. Detection equipment includes 

metal detectors, explosive detection systems, and radiation detectors. For fiscal year 2010, DHS components had a combined inventory of detection equipment of more than $3.2 billion. TSA’S share 

of the equipment accounts for about two-thirds of that inventory. 

While DHS has applied strategic sourcing strategies for many 

common-use items such as firearms, ammunition, and office supplies, the Department is not using strategic sourcing to manage its 

purchase of detection equipment. Thus, we recommended that the 

Department establish a commodity council for detection equipment 

that can strategically source these items. Commodity councils are 

a crucial element of developing an effective Strategic Sourcing Program, including representatives across the organization who act as 

subject matter experts in the acquisition process. 

Generally, the component purchasing the largest quantity of a 

particular item takes the lead role in acquiring the commodity or 

service and may serve as the commodity’s single item manager. 

Other Federal agencies such as DOD use the Commodity Council 

concept and DHS itself has created the Commodity Council to manage its acquisitions of weapons and ammunition. The Department 

agreed that an analysis of potential strategic sourcing for detection 

equipment is warranted. 

In conclusion, the Department has made considerable progress in 

establishing its acquisition management practices and procedures 

through improved guidance to the components and increased use of 

tools like strategic sourcing. The Department and its components, 

such as TSA, will continue to improve its acquisition processes. 

Chairman Rogers, this concludes my prepared remarks. 

I would be happy to answer any questions that you or other 

Members may have. 

[The statement of Mr. Edwards follows:] 

PREPARED STATEMENT OF CHARLES K. EDWARDS

NOVEMBER 3, 2011 

Good morning Chairman Rogers, Ranking Member Jackson Lee, and distinguished Members of the subcommittee: I am Charles K. Edwards, Acting Inspector 

General of the Department of Homeland Security (DHS). Thank you for inviting me 

to testify today about improvements that can be made to the procurement and acquisition practices at DHS and specifically at the Transportation Security Administration (TSA). 

As you know, the DHS Office of Inspector General (OIG) was established in January 2003 by the Homeland Security Act of 2002, which amended the Inspector General Act of 1978. The DHS OIG seeks to promote economy, efficiency, and effectiveness in DHS programs and operations and reports directly to both the DHS Secretary and the Congress. We fulfill our mission primarily by issuing audit, inspec-
89 

tion, and investigative reports that include recommendations for corrective action, 

and by referring cases to the United States Attorney General for prosecution. 

I am pleased to have the opportunity to testify about two of our audit reports 

today. I will describe some of the serious challenges facing DHS in acquisition management and address some improvements the Department can make in the oversight of components’ acquisition programs. I will also offer some recommendations 

regarding the Department’s acquisition of detection equipment. 

BACKGROUND

Acquisitions consume a significant part of the DHS’ annual budget and are fundamental to the Department’s ability to accomplish its mission. In fiscal year 2010, 

DHS awarded over $13 billion for more than 88,000 procurement actions. TSA’s 

budget authority for fiscal year 2010 was over $7.5 billion. 

The Under Secretary for Management (USM) is responsible for the overall DHS 

acquisition process. As the Department’s Chief Acquisition Officer, the USM is responsible for managing, administering, and overseeing the Department’s acquisition 

policies and procedures. The USM delegates the responsibility for effective Department-wide procurement policies and procedures, including procurement integrity, to 

the Chief Procurement Officer (CPO). The Office of the CPO (OCPO) is responsible 

for oversight of most DHS acquisition activities and services, including management, administration, and strategic sourcing. OCPO responsibilities also include developing and publishing Department-wide acquisition regulations, directives, policies, and procedures. 

Recognizing the continued increase in the quantity and complexity of DHS acquisitions, in November 2008 the USM classified acquisitions into three levels to define 

the extent and scope of required project and program management and the specific 

official who serves as the Acquisition Decision Authority. For level 1 acquisitions 

(greater than or equal to $1 billion), the Acquisition Decision Authority is the Deputy Secretary or Under Secretary for Management. Level 2 acquisitions (between 

$300 million and $1 billion) are normally overseen by the USM or the Deputy USM 

and are potentially delegable to Component Acquisition Executives. For level 3 acquisitions (less than $300 million), the Acquisition Decision Authority is the component head. Thus, the Department oversees acquisition programs at or above $300 

million in life-cycle cost. Individual components such as TSA are responsible for the 

oversight and controls for acquisition programs below the $300 million threshold. 

On May 26, 2010, the USM issued the Department’s latest Major Acquisition 

Oversight List. The list identified 86 major acquisition programs, projects, and services requiring direct Departmental oversight. TSA had seven level 1 and five level 

2 acquisition programs on that list. These programs included: 

• Information Technology Infrastructure Program (Level 1) 

• Transportation Worker Identification Credentialing (Level 1) 

• Electronic Baggage Screening Program (Level 1) 

• HRAccess (Level 1) 

• Passenger Screening Program (Level 1) 

• Screening Partnership Program (Level 1) 

• Secure Flight (Level 1) 

• Field Real Estate Management (Level 2) 

• National Explosives Detection Canine Team Program (K9) (Level 2) 

• Security Technology Integrated Program (Level 2) 

• Specialized Training (Level 2) 

• TTAC Infrastructure Modernization Program (Level 2) 

ADDITIONAL DHS OVERSIGHT NEEDED FOR COMPONENT ACQUISITION

While the Department has taken steps to improve its acquisition oversight processes and controls, our report OIG–11–71, DHS Oversight of Component Acquisition 

Programs (April 2011) identified additional areas for improvement. We made four 

recommendations to the CPO to strengthen the Department’s management oversight and controls over component acquisition programs. The CPO agreed with our 

recommendations and initiated corrective actions. 

Our report DHS Oversight of Component Acquisition Programs resulted from an 

audit that was designed to determine whether the Department established adequate 

management oversight and controls over component acquisition programs. As part 

of this audit, we reviewed 17 DHS acquisition programs, including 8 programs at 

TSA. The following TSA acquisition programs were included in our review: 

• Screening Partnership Program (Level 1) 

• TTAC Infrastructure Modernization (Level 2) 

• National Explosives Detection Canine Team Program (Level 2) 
90 

• HAZMAT Threat Assessment Program (Level 3) 

• Freedom Center (formerly Trans Security Ops Center) (Level 3) 

• Performance and Results Information System (Level 3) 

• Consolidated Screening Gateway (Level 3) 

• Intermodal Security Training Exercise Program (Level 3) 

Our report recognized that the Department has made improvements to its acquisition oversight processes and controls through implementation of a revised acquisition management directive. However, the Department needs to provide additional 

detailed guidance and improve controls in some areas. The Department has neither 

fully defined an acquisition program for its components, nor developed consistent 

guidance for reporting acquisitions in its standard system. In addition, the Department has not ensured that components are using all acquisition tools available and 

that they have adequate policies and procedures in place to manage acquisition programs. 

As a result, components created program management offices to manage simple 

procurements, incurring unnecessary administrative program costs without adding 

value to the programs. Additionally, without adequate controls in place, the Department did not have complete visibility of all programs within its acquisition portfolio. 

UNCLEAR GUIDANCE

The Department has not fully defined when a component should manage an acquisition under the requirements of the Acquisition Lifecycle Framework or manage 

it as a simple procurement. We found that many components were committed to following the Department’s guidance but needed more structure for determining when 

to establish a program to acquire a product or service. We requested a list of all 

programs from each component and received numerous questions and conflicting responses. For example, TSA personnel reported that they classified all acquisitions 

that appeared to be programs as acquisition programs because the definition was 

unclear. 

Directive 102–01, which prescribes guidance over the Acquisition Review Process, 

Acquisition Lifecycle Framework, and Acquisition Review Board, establishes the 

overall policy and structure for acquisition management within the Department. But 

the directive does not provide a decision-making tool to determine if an acquisition 

warrants the higher level of internal controls required by the Acquisition Lifecycle 

Framework. The supplemental Acquisition Instruction/Guidebook 102–01–001 

(Guidebook) provides detailed instructions on implementing and managing acquisitions, but also does not provide clear instruction for determining if an acquisition 

should become an acquisition program, and in attempts to comply with the directive, 

components over-classified programs. 

We reviewed several acquisition programs that do not clearly fit into the Acquisition Lifecycle Framework process. Ten of the 17 (59%) programs we reviewed, with 

an estimated life-cycle cost of about $5.3 billion, were acquisitions that identified 

commercial-off-the-shelf equipment or existing contracts to fulfill the needs identified by the program office. Component personnel likely could have managed these 

as simple procurements rather than acquisition programs. For example, the TSA 

classified renovation of an existing warehouse building as an acquisition program. 

It leased the 104,000-square-foot building in 2003 and renovated approximately 

89,000 square feet for about $42 million over the initial 10-year leasing period. In 

2008, TSA primarily relied on existing contracts to complete 12,500 of the remaining 

15,000 square feet of the warehouse building. According to TSA personnel, the renovation for the additional 12,500 square feet cost about $2.5 million, with construction completed in January 2010. For this small renovation project, TSA personnel 

could have used simple procurement rules but instead increased administrative 

costs by implementing the more complicated internal control structure prescribed in 

Directive 102–01. 

Based on the definition of an acquisition program in the Guidebook, this renovation could possibly be an acquisition program. However, based on the processes and 

procedures laid out in Directive 102–01’s Acquisition Lifecycle Framework and Acquisition Review Process, this renovation does not meet the intentions of the existing guidance or present a high enough level of risk to warrant the increased costs 

of being managed as a program. 

Components should not create acquisition programs for acquiring products and 

services that are outside the intent and spirit of Directive 102–01. The Department 

can reduce some of the conflicts at the component level by developing a decision matrix that the components can apply in the pre-planning phases of the purchasing 

process. 
91 

1Office of Management and Budget memorandum to Chief Acquisition Officers, Implementing 

Strategic Sourcing (May 20, 2005). 2 In 2004, the Department created the Office of Procurement Operations to provide acquisition 

services to components that did not have a procurement office. 

USE OF AVAILABLE TOOLS

The Department developed inconsistent reporting requirements for components to 

follow when reporting an acquisition’s progress in nPRS, the Department’s standard 

reporting system. nPRS is an integrated system that provides DHS headquarters 

visibility of components’ level 1, 2, and 3 acquisition investments. It can also store 

working and approved key acquisition documents, earned value management information, and risk identification. Component personnel are responsible for entering 

and updating information regarding their acquisition programs in nPRS. This information includes, but is not limited to, cost, budget, performance, and schedule data. 

Since nPRS became operational in 2008, the Department has issued conflicting 

guidance and enforcement for reporting level 1, 2, and 3 acquisition programs. 

Moreover, the Department has not ensured or mandated that components use nPRS, 

which would provide transparency and efficiency of component acquisition programs. Because the Department has not consistently mandated use of nPRS, component personnel have developed, or are in the process of developing, their own datatracking systems. For example, TSA hired and spent approximately $100,000 for a contractor in 

2005 to develop the TSA Acquisition Program Status Report, which served as its 

data-tracking system. As of June 2010, TSA had merged its acquisition program 

portfolio, levels 1, 2, and 3, into nPRS and will no longer use the TSA Acquisition 

Program Status Report. As of August 2010, nPRS is TSA’s official tracking system 

for acquisition programs. 

The Department has also not ensured that the components use the Strategic 

Sourcing Program Office (SSPO) when managing acquisition programs. According to 

a 2005 memorandum from the Office of Management and Budget: 

‘‘Strategic sourcing is the collaborative and structured process of critically analyzing 

an organization’s spending and using this information to make business decisions 

about acquiring commodities and services more effectively and efficiently. This process helps agencies optimize performance, minimize price, increase achievement of 

socio-economic acquisition goals, evaluate total life-cycle management costs, improve 

vendor access to business opportunities, and otherwise increase the value of each 

dollar spent.’’1

The Department created the SSPO to help components identify best prices available for a requirement, engage in market research to identify the best available vendors and manufacturers, minimize duplication of effort for market research, and 

provide Department-wide contract vehicles. Because the current guidance is silent 

regarding the use of the SSPO, the Department may be incurring increased cost for 

component procurements. In addition, components may be conducting duplicative 

market research for procurements that the SSPO has performed. The Department 

should make sure that personnel at TSA and other components are at least considering the use of the SSPO during the planning stages of their acquisition programs. 

DEPARTMENT-WIDE MANAGEMENT OF DETECTION EQUIPMENT

Our recent audit report, OIG–11–47, DHS Department-wide Management of Detection Equipment (March 2011), highlighted some of the acquisition challenges facing 

the Department when multiple components have similar requirements or are buying 

the same type of equipment. We identified steps the Department can take to improve its acquisition processes. With improved management, DHS can streamline 

the acquisition process, improve efficiencies, and provide uniform equipment inventory information. 

DHS has eight different procurement offices that purchase detection equipment. 

Seven of these offices are at the component level, and each has its own head of contracting. These components are as follows: 

• United States Customs and Border Protection 

• Federal Emergency Management Agency 

• Federal Law Enforcement Training Center 

• United States Immigration and Customs Enforcement 

• Office of Procurement Operations 2

• Transportation Security Administration 

• United States Coast Guard 

• United States Secret Service 
92 

Components maintain separate inventories for their detection equipment. For fiscal year 2010, the components had a combined inventory of more than $3.2 billion 

worth of detection equipment, most of which is deployed. The components purchased 

an average of about $387 million worth of detection equipment in each of the last 

3 years, ranging from about $280 million to $511 million. This equipment includes 

metal detectors, explosive detection systems, and radiation detectors (including 

some personal protective safety equipment) for screening people, baggage, and cargo 

at airports, seaports, and land ports of entry, as well as Federal buildings. As of 

March 1, 2010, TSA’s detection equipment accounted for 66% of the Department’s 

total inventory. 

Our audit work showed that DHS can better manage the acquisition of detection 

equipment by developing processes based on best practices such as strategic 

sourcing. 

STRATEGIC SOURCING

As discussed above, DHS has established a Strategic Sourcing Program and has 

applied strategic sourcing strategies for many common use items, such as firearms, 

ammunition, and office supplies; however, the Department is not managing its detection equipment through this program. According to DHS officials, components are 

encouraged but not required to use the Strategic Sourcing Program and generally 

do not coordinate and communicate when acquiring detection equipment. There is 

no mechanism in place for components to standardize equipment purchases or identify common mission requirements among components. For example, the Department’s Joint Requirements Council is inactive, and components do not have the expertise of commodity councils or single-item managers to rely on when acquiring detection equipment. Further, components view detection equipment as unique to 

their missions and do not attempt to identify common mission requirements among 

other components. This results in numerous inefficient purchases by individual components instead of consolidated purchases. 

STANDARDIZING EQUIPMENT PURCHASES

Some components did not standardize equipment purchases and purchased a variety of different detection equipment models. For example, United States Citizenship 

and Immigration Services (USCIS) has 24 and CBP has 21 different models of small 

X-ray equipment, and CBP and USCIS each have 14 different models of walkthrough metal detectors. When components have multiple models of equipment to 

meet similar missions, DHS incurs higher procurement administrative costs and logistic support costs for maintenance, training, and support. In contrast, TSA, which 

uses and maintains the largest inventory of detection equipment in the Department, 

uses only seven different models of small X-ray equipment and three models of 

walk-through metal detectors. By limiting the number of models and types of equipment, TSA is in a position to increase efficiencies in procurement, maintenance, and 

personnel flexibilities. 

COMMON MISSION REQUIREMENTS

We identified about $170 million worth of small X-ray machines, metal detectors, 

and personal and hand-held radiation detectors that DHS could acquire through 

strategic sourcing strategies. Although multiple components were using similar 

equipment to meet similar screening missions, each component purchased the equipment separately. Components did not coordinate with each other to identify common 

requirements, consolidate purchases to gain buying power, or consolidate logistic 

support requirements. 

DHS Management Directive 1405 established a Joint Requirements Council (JRC) 

as a senior-level requirements review board to identify cross-cutting opportunities 

and common requirements among DHS organizational elements for non-information 

technology investments. The JRC met periodically between fiscal years 2004 and 

2006. Representatives on the JRC reviewed programs and processes for potential 

mission overlap and redundancies. Among the programs reviewed were TSA’s Secure Flight and Registered Traveler and CBP’s Consolidated Registered Traveler 

programs. In 2006, the JRC stopped meeting after the Department assigned the 

council chair to other duties. However, DHS now recognizes the importance of the 

JRC and indicated that it might revive the council or pursue another alternative 

to identify duplicate programs and processes across the Department. This undertaking should include an effort to identify common data elements and nomenclature 

within inventories and to establish a data dictionary for the Department’s detection 

equipment. 
93 

In addition to the JRC, commodity councils are an integral element of developing 

an effective strategic sourcing program. Commodity councils include representatives 

from across the organization. The members act as the subject matter experts in the 

acquisition process and in establishing requirements for a specific commodity or 

service. Generally, the component purchasing the largest quantity of a particular 

item takes the lead role in acquiring the commodity or service and may serve as 

that commodity’s single-item manager. 

DHS and other Federal agencies use the commodity council concept. For example, 

in 2003, DHS established the Weapons and Ammunition Commodity Council to create a Department-wide strategy for consolidating requirements and gaining economies of scale for the acquisition of weapons and ammunition. The council, which includes representatives from each component that uses weapons, developed requirements for firearms, ammunition, and body armor. ICE took the lead role, using service-level agreements with other components to establish one overall contract, which 

is available to all DHS entities. 

The Department has agreed in principle with our two recommendations, and is 

taking action to implement the recommendations. DHS is evaluating reestablishing 

the Joint Requirements Council and other alternatives to achieve the same goal. It 

will perform a business case analysis of detection equipment and establish a commodity council or working group if it determines that this equipment can be strategically sourced. 

CONCLUSION

Though DHS was established by combining 22 agencies with different legacy systems, missions, and cultures, it has made considerable strides in establishing its acquisition management practices and procedures. It has established oversight policies, clarified roles and responsibilities for acquisition, and worked to address staff 

shortages. It needs to continue improvements that affect its cohesion as a Department and its bottom line. Increased use of such tools as strategic sourcing and a 

commonly-applied definition of an acquisition program will help the components 

such as TSA and will result in more cost-effective and efficient acquisitions. 

Mr. Chairman, this concludes my prepared statement. Thank you for the opportunity to testify and I welcome any questions from you or Members of the subcommittee. 

Mr. ROGERS. Thank you. Great. Thank you very much. 

I will start off on the questions. 

Dr. Nayak, what is the one thing that DHS could do differently 

in engaging with the private sector that would have the largest impact on industry’s ability to better support Homeland Security, in 

your view? 

Mr. NAYAK. That is a great question. I don’t think there is any 

one particular thing, but let me give you one, and let me also just 

add the entire list, because you really have to do a number of 

things. 

When we talk about industry, we are talking about everybody 

that is out there, as you well know, and being open and transparent in communicating with them. So one of the things that we 

can do is specific industry days around procurements have to be 

done better. You can’t have one-way communication. You have to 

have two-way communication. You have to sit there and you have 

to wait for every question from everybody who participates in that 

industry. That is one. 

You obviously know RFIs. We need to increase the number of 

RFIs that we use, increase the number of draft RPs. It is a little 

challenging sometimes in general because of the way we get our 

money and funding. For instance, in the last fiscal year, we had to 

spend $10 billion in the last 5 months of the fiscal year. 

But a couple other things that I am doing that are new. One is 

we have created an industry liaison in every component. So we 

have got an on-line forecasting system of procurements in advance. 
94 

Industry sees it. They call up. They get a program manager. Now 

we have a belly button that they can actually go to a live person 

to really find out what is the status of that. 

Mr. ROGERS. Let me go back to your industry days—because you 

talked about that in your opening statement, too—about the revisions you are going to make in it. Two questions I have. 

One is: What is your time line for seeing that new and improved 

industry days program implemented? Then, second, you have 

talked about how different the industry segments are, and you are 

right. When you are interacting with Lockheed or Boeing, it is not 

the same as a small hub-zone company that you deal with. So in 

these industry days, will you do those separately? Like will you 

have an industry day for small businesses separate and apart from 

the one with the big guys, or do you do them all at once? 

Mr. NAYAK. Okay, so great question. Let me address the first 

point first, what are we doing different in terms of industry days 

themselves and when is the time line. 

The time line is immediate. I have already issued an acquisition 

alert that essentially gives everybody across DHS direction. We 

have got to do these things well. But those are the ones around 

specific procurements. 

Outside of that, we have got to have a mechanism to talk to industry at large about capabilities, outside and away from procurements, so that we can have continuing dialogue. That is something 

that some people will classify as an industry advisory council. 

Sometimes when you hear ‘‘industry advisory council’’ you only 

think large business and you don’t think small business. So what 

we have got to do, the nut we have to crack, is to figure out how 

to do this in a transparent way working with the private sector. So 

that is one big thing that will make a huge difference moving forward. 

The last thing I want to mention, and it is something new, it is 

something that we heard from industry, is to have reverse industry 

days. So often when we have industry days, we are communicating 

to industry. By the way, it is both large and small business, anybody who wants to come in. But a reverse industry day would be 

where we say here is the capability. Industry can come in and talk 

to us about the capability. We can get a little bit smarter, again, 

away from procurements where things get extremely sensitive. 

Mr. ROGERS. That is what our industry panel talked about. They 

would like to see more of that dialogue, more of a skull session. 

I serve on the Armed Services Committee as well. One of the 

things the DOD will do is bring in industry and say: Here is the 

problem we got, and we are trying to figure out how to meet this 

problem. What are your thoughts? Everybody just kind of thinks 

out of the box in that session, and they go back and they work on 

it, too. 

That is the kind of dialogue I am hoping to see developed in DHS 

so that it is more of a partnership in trying to solve problems. 

Mr. NAYAK. So that is what you are going to see moving forward. 

Mr. ROGERS. That is great. 

Mr. NAYAK. One more point, and that is on small business. We 

connect with small business. Every communication in industry 

days is open to everybody, but we do have specific and unique 
95 

events for small business. We participate in over 100 outreach 

events, and then we have 10 separate vendor outreach segments 

where we meet one-on-one with companies. So across the board—— 

In a previous hearing you had a gentleman here from CSIS, I believe, testify. Obviously we contract to support the mission, but it 

is also neat to know that our business is spread pretty evenly 

amongst large, medium, and small business. 

Mr. ROGERS. That is great. 

Mr. Kane, you made reference to some new scanning system that 

you are going to be implementing pretty soon that will be able to 

determine or detect fraudulent ID. How will that work? 

Mr. KANE. Mr. Chairman, we call it—it has a long name—the 

credential authentication technology and boarding pass scanner 

system. So when you come up today you walk up to the travel document checker at the checkpoint, and they typically have a light 

and a loupe that they are going to look at those documents. 

This is technology that will read credentials such as your driver’s 

license, such as a passport, which is the two most common you will 

see at a checkpoint. Then it will say, yes, this is a valid Virginia 

State driver’s license and it has all the characteristics that a Virginia State driver’s license has. It is going to look at that boarding 

pass and say, yes, this is a valid boarding pass and the name 

matches between these two documents. So the two documents 

match each other, and it is a valid boarding pass for that day. So 

that gets away from a lot of the manual errors that can be made. 

Mr. ROGERS. Will there have to be a handler involved, a person, 

or will they just go up to a kiosk? 

Mr. KANE. Right now, there will still be that travel document 

checker in the process right now. It will be a little more automated 

in that the passenger will put their boarding pass up, but the officer will actually handle the credential. 

Mr. ROGERS. Excellent. 

My time has expired. I now yield to the Ranking Member, Ms. 

Jackson Lee, for any questions she may have. 

Ms. JACKSON LEE. Mr. Chairman, thank you very much. 

Let me also acknowledge the presence of Mr. Davis of Illinois. I 

know you have acknowledged the distinguished gentleman, Mr. 

Turner, I think and Mr. Cravaack for their presence here today. 

I want to pose a question. Mr. Edwards, I mentioned Mr. Davis 

because he had offered an amendment during the DHS authorization that would have established an Office of Public-Private Partnerships within the S&T Directorate responsible for enhancing the 

Department’s collaboration area of security technologies with 

stakeholders, including small businesses. I know that part of his 

intent is to ensure that these directorates work well. 

So let me pose a question to you, Mr. Edwards: In crafting for 

us, what is the most critical problem with the relationship between 

TSA, the Department of Homeland Security, DHS, S&T, and DHS 

Office of Procurement, and how can lawmakers or officials at the 

Department address it? 

Mr. EDWARDS. Thank you, ma’am. 

S&T tests a variety of technologies, including systems made up 

from a number of technologies. S&T provides test information 

along with its recommendations for best models to TSA and other 
96 

components. TSA and other operational components make the 

product selection and procurement decisions and are not required 

to follow S&T’s recommendations on products. 

Also, you know, if you use S&T in a similar way as their sitting 

role in the Acquisitions Review Board, rather than having them review during the acquisition process, if there is a decision memorandum that leverages S&T’s technical expertise prior to the acquisition process, it can potentially save lots of dollars and time. 

Ms. JACKSON LEE. If there is a—I am sorry? 

Mr. EDWARDS. There should be a decision memorandum from 

S&T giving their technical expertise and their opinion ahead of— 

before the processes get started. That would really go a long ways. 

Ms. JACKSON LEE. So information goes a long way if the memorandum exists that can either be passed from whether it is DHS, 

TSA. Of course, you indicated they don’t have to accept the recommendation or the information—they can accept the information, 

not the recommendation. That is a document that we can track and 

we can utilize for, I think, informed decisions. 

Mr. EDWARDS. Absolutely. 

Ms. JACKSON LEE. I think that is an important way of coordinating. More communication I assume would—and I don’t want to 

call it forced communication, but should there be some structure 

that puts in a mechanism for required communication? Is that—— 

Mr. EDWARDS. Absolutely. I quite agree with you. 

Ms. JACKSON LEE. Dr. Nayak, thank you, and let me welcome 

you to the position. I understand you have been here about a year. 

Let me do one question that might seem as if I am asking you 

for a 3-hour presentation, but I am not because, I have a followup question. 

What is your vision for the procurement area for DHS? 

I heard in another hearing someone making a statement that the 

Federal Government buys things, needs things, and utilizes products; and many times small, medium, and large businesses are either rebuffed or confused about how to access providing their product to the Federal Government. So, quickly, what is your vision? 

That is my first question. I am going to put them both together. 

That may be two or three sentences in what you want to see happen. 

But then the other part of it is we are grappling with not only 

the supercommittee but the existing proposed House budget which 

impacts DHS’ effort to assure accountability—or how would you 

think that is impacting assuring accountability—and an acquisition 

workforce. This budget, how is it impacting an acquisition workforce adequate to stimulate growth and innovative solutions in 

Homeland Security technology? So what direct impact—these proposed cuts in the DHS budget as it relates to your area, what direct impact will it have? 

So the first question is your quick vision for what you perceive 

you can do and the second would be that direct impact. 

Mr. NAYAK. Thank you for the questions. 

The vision in a nutshell is really my job as the chief procurement officer and hovering over $14 billion to spend is I have got to be 

able to prove that we are getting a good deal for the taxpayer with 

all of that spend. 
97 

Specifically, I have four priorities, and those support getting a 

good deal for the Government and for the taxpayer. 

They are quality people. I have got to have the best people in 

place. We have about 1,400 contracting people right now. 

We have to do good contracting. 

I mentioned strategic sourcing. Mr. Edwards mentioned strategic 

sourcing, mentioned detection equipment, which we are moving 

well along the way to strategically sourcing detection equipment. 

Quality program support. I have to influence the success of the 

more than 500 DHS programs that are supported by contracts that 

deliver quite a bit of the mission. 

Ms. JACKSON LEE. How many programs did you say? 

Mr. NAYAK. There is more than 500. There is about 82 major programs with a life-cycle cost of over $300 million. 

Then the other priority I have added as the new CPO for a little 

bit more than a year is quality interaction with industry. I mean, 

it is absolutely key. If we are going to contract with industry for 

$14 billion, we have to talk to them at every stage of the process. 

Talking to them well in advance, all businesses of all sizes, helps 

us clarify requirements, and that ultimately helps us get a better 

deal. So, all in all, the vision is to get a better deal. 

In terms of the budget impact and specifically in my area, line 

of business, which is acquisition, it would really, really basically set 

us back. I have been through this myself when I was with the IRS. 

When I came into the IRS, there was a lot of talk about not being 

able to modernize tax systems; and since then, at a minimum, we 

have E-File. 

When I got there in procurement, there were only 20 or 30 procurement people. We built it up to 500 people, and since then they 

have a fairly premier procurement program. 

Similarly, at DHS, if we had to sustain these cuts, here is what 

pretty much would go out the window: Replenishing our acquisition 

workforce, gone; program oversight over those 500 programs, gone; 

oversight in terms of all of our procurement actions, 90,000 actions 

in nine contracting offices across the Department, minimal at best. 

The $14 billion is spread through nine contracting offices. Two 

are of them report directly to me, and they account for about $6 

billion. So if my organization, which includes those folks, are cut, 

you know, there may be an immediate cost savings in the cut itself, 

but the long-term impact is going to be devastating. We most likely 

will be back here chatting about all kinds of stuff in terms of acquisition that we really don’t want to. 

Ms. JACKSON LEE. Let me just ask one quick question, if the 

Chairman will yield to me for a minute. 

Mr. Edwards mentioned one fix could be, in terms of communication between TSA, DHS, and S&T, is an S&T memoranda that you 

would ultimately get, Dr. Nayak, and others, so that when some 

S&T product has been researched and reviewed there would be 

some chain of fielding that work, that assessment to you, to TSA, 

and others. In addition to I think I said maybe a structure that 

would channel that document so you would promptly get an assessment of a new technology that had been reviewed. 

Would that be helpful, Dr. Nayak? I was speaking to you. I was 

saying Mr. Edwards mentioned an S&T memorandum, and I men-
98 

tioned a structure to get that memorandum to the appropriate persons. Would that be helpful to you once a product was reviewed? 

Mr. NAYAK. I think helpful to the Department, yes. 

Ms. JACKSON LEE. So getting a quick document to you that assessed a product would be helpful? 

Mr. NAYAK. Yes. 

Ms. JACKSON LEE. Would be helpful in streamlining your work, 

or at least assessing whether that product should be utilized? 

Mr. NAYAK. Yes. 

Ms. JACKSON LEE. I will yield back now. Thank you. 

Mr. ROGERS. The Chairman is now proud to recognize our newest 

Member here on the subcommittee, Mr. Turner, who has recently 

been elected in New York, of all places. So we are proud to have 

you and look forward to your questions for the witnesses. 

Mr. TURNER. Thank you, Mr. Chairman. New York continues to 

elect people. Not too many Republicans. That was the odd thing. 

A question, please, for Mr. Kane. We have aging technology, and 

I would like to hear what is in the pipeline, how it might be affected by the budget realities. I am particularly interested in the 

shoe technology which I find is the most abhorrent of all the security techniques, as necessary as it absolutely is. If you would? 

Mr. KANE. Congressman, yes, sir. 

We have a number of technology programs in the works right 

now. You know, as TSA stood up 10 years ago, obviously we used 

a lot of equipment that was in place and then we built out the baggage screening system in a very quick time frame. So much of that 

technology is nearing the end of its life, particularly the expensive 

technologies, which is the baggage screening equipment down in 

the baggage rooms. 

We have a recapitalization strategic plan to replace that equipment. I think what you will see us do is focus more of our budget 

resources on the recapitalization effort, focused on EDS, rather 

than new in-line systems in airports. With the Recovery Act, with 

some of the other funding that has come our way over the past couple of years, we have been very fortunate to build out a number 

of the in-line systems or get them funded so that the airports could 

build out their systems. So just the EDS in particular, we are going 

to focus on the recapitalization of those pieces of equipment. 

We also, of course, have the advanced imaging technology going 

into the checkpoints that replaces or sits alongside today the walkthrough metal detectors, a completely new ability to detect nonmetallic threats. It just didn’t exist before we brought that technology to the airports. 

We also are recapitalizing the X-rays, the carry-on bag X-rays as 

well with the multi-view X-ray and with some ability to have autodetection on there for bulk explosives. 

In addition, I mentioned previously the credential authentication 

technology. As I described earlier, if that proves successful in our 

field tests, after the beginning of the year you would see that start 

to show up at every checkpoint in the country as well. 

So we are doing a lot of work. We are trying to improve those 

technologies over time and have a spiral development approach, 

and that is where S&T helps us quite a bit. 
99 

Then I think with the shoe scanner in particular—and it is everyone’s favorite topic a lot—we found that just a difficult technology challenge to solve with everything that comes with a pair 

of shoes in the airport environments. I think a lot of what we are 

doing with our TSA PreCheck and prescreening and identifying 

those travelers who we feel are very low risk to the system and 

moving away from an one-size-fits-all approach will help us solve 

some of the shoe issue, allowing people to keep shoes on, for the 

most part, and those expedited screening lanes will help solve some 

of that problem and some of the frustration especially frequent 

travelers feel when they have to do that. 

Mr. TURNER. Thank you. I will continue to wear slip-on loafers 

until that day. 

I experienced something 2 weeks ago on an international flight 

that would apply to domestic, and I don’t know if this is solved 

through technology or procedure. One of the military personnel 

traveling with me, we went through two checkpoints. In the first 

checkpoint, he bought a bottle of expensive brandy, and it was 

handed to him after he got through security. Yet on the next flight 

we were checked again, and he was stopped for liquid. It was 

poured down the drain. 

That same thing may happen coming back, say, from Europe to 

the States, going from international to domestic. You have a carryon that goes through again. 

Any comment? Was that just tough luck? 

Mr. KANE. I think it is understanding the systems that are in 

place. So, internationally, I can’t speak to all the different regimes, 

although I know a lot of people will allow the duty-free liquids onto 

the flights, particularly with the secure technology, the tamper-evident bags they have over in Europe. 

We don’t accept that in the United States. So when you come 

into the United States you need to put that bag from your carryon into your checked baggage, and in virtually every case you are 

going to have to recheck that bag and you have to shift it over. If 

you don’t understand that, you will sometimes experience difficulties at the checkpoint. 

Another technology challenge the world is obviously trying to 

solve is liquids packed in bags. We haven’t cracked that yet. We 

are working towards it. It is another difficult challenge, though, to 

be able to do that and understand explosives in bags. On the other 

hand, it is a real threat. So we have to be able to address that 

threat. 

Mr. TURNER. Thank you. 

I yield. 

Mr. ROGERS. I thank the gentleman. 

The Chairman now recognizes the gentleman, Mr. Davis, for any 

questions he may have. 

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

Mr. Kane, during his appearance before the Senate Homeland 

Security and Governmental Affairs Committee yesterday, in response to concerns expressed by Senators Lieberman and Collins, 

Administrator Pistole expressed his concern that there is a perception that TSA’s X-ray whole-body scanners are not as safe as they 

could be. 
100 

I have some concerns about both the perception and the reality 

of the safety of these machines. My concerns extend to both the flying public and the Transportation Security Officers that work in 

the vicinity of these machines on a daily basis, and that is why I 

encourage the inclusion of language in the TSA authorization bill 

that would require an independent third party to carry out a study 

on the machines. I commend subcommittee Chairman Rogers for 

including that language in his bill. 

In light of the bipartisan and bicameral concerns about the safety of these machines, do you believe that an independent thirdparty assessment of the safety of the machines and the operating 

environment validating TSA’s findings might be helpful? 

Mr. KANE. Congressman, I think we have had a number of independent third-party assessments of the technology. Johns Hopkins 

University did it. The Army’s Public Health Command has done an 

assessment of the machines, and they do so on a regular basis in 

airports. We had an experiment with them in our lab, but they ran 

it where we took over 93,000 different samples. We are awaiting 

the final report on that. But it is going to show again that they are 

well within the safety standards that are set and that we set in the 

requirements that we published out to industry. 

Over and over again, the people we have had study this have 

said the technology is safe and well within the standards that we 

need to meet to be able to use that technology; and the benefit— 

the security benefit that we get by being able to detect a nonmetallic threat and maturing that type of detection capability in 

the airports is substantial. 

Mr. DAVIS. Thank you very much. 

Gentlemen, let me ask you, within my Congressional District, 

which includes a large part of the City of Chicago, our average 

daily ridership of bus and rail combined is 1.6 million riders a day. 

Over 75 percent of those riders use buses to go to work, to the grocery store, and many other places that they use to live their lives. 

I have major concerns about technology related to bus system security. 

In the past year in my district, and even in Chairman King’s district, city buses were stolen and operated by non-transit employees 

for hours. In Chicago, a man stole a Chicago Transit Authority uniform, got in a bus on the south side, and drove from 8 o’clock a.m. 

to midnight, and then returned the vehicle to the garage and 

struck a parked bus. Fortunately, there were no passengers. But 

this incident could have taken place while he was driving the bus 

route. 

My question is: Are there any technologies that are ready for use 

or in the process of being created that you are aware of that would 

specifically deal with bus safety and security? 

Mr. KANE. The only one I am really aware of—and I am not very 

current, I have to admit, Congressman, on where we are on this— 

there are some technologies that from a remote location you could 

shut down a bus. So if you knew that bus had been taken that you 

could use that. The bus authority, the transit authority could use 

that to shut the bus down. 
101 

Clearly, there is locator technologies that trucking companies 

and shipping companies use that allow them to track different 

things. So you could use that technology as well. 

I know we have run some pilots on those types of technology. I 

am not sure exactly where we are. We would put something like 

that on our approved equipment list that would then be able to be 

available for grant programs or for transit authorities to be able to 

procure off that approved equipment list. That just kind of says, 

hey, TSA has taken a look at this many times with S&T. It is a 

good technology, and here is the capabilities that that would have. 

Mr. DAVIS. Are any of the rest of you familiar with anything 

other than that? 

Mr. BENDA. Congressman, Paul Benda from S&TP. 

We do have one new technology that we developed in public-private partnership with industry which is called the Brave Camera. 

One of the issues that we have seen in the past in Israel, if you 

have a suicide bomber come on board a bus, if you have any type 

of surveillance in place, it destroys the camera and the recording 

that allows you to go back to do forensics. 

So we partnered with industry, put our requirements out, and 

they used their own internal dollars to build a camera that could 

meet the explosive blast and actually allow us to gather the data 

off that camera rather quickly. S&T then sponsored a test actually 

of getting a bus that was out of its life cycle and blowing it up with 

the camera inside. 

So that type of camera in place, while it is forensic, if you had 

that type of camera system in place, you would monitor it from a 

central location, as Mr. Kane had stated, in case an activity went 

on. But if the worst did happen, you could actually find out who 

that perpetrator was and learn from that incident so it doesn’t happen again. 

Mr. DAVIS. Thank you, gentlemen, very much. 

Mr. Chairman, I yield back. 

Mr. ROGERS. The Chairman now recognizes my colleague from— 

what State is that—Minnesota, for 5 minutes. 

Mr. CRAVAACK. God’s country, sir. God’s country. 

I thank the panel for being here today. I appreciate it very much. 

Thank you for coming here and enlightening us. 

I did have a quick question, Dr. Nayak. Could you tell me a little 

bit, do you know how many—it is my understanding we have purchased 700 AT carry-on baggage X-ray devices, is that correct? 

Mr. NAYAK. I am going to have to defer to Robin. 

Robin, do you have an answer to that? 

Mr. KANE. Yes, sir. The last procurement we made was slightly 

over 700. We, prior to that, had around 900 in the field. So the 

total is near 1,600. 

Mr. CRAVAACK. So you have purchased around 1,600 machines. 

Okay. All right. 

What is the total—I hope I will be able to get a group consensus 

here. What is the total cost per unit of these AT–2 machines? Do 

you know? 

Mr. KANE. In round numbers, it is around $150,000. 

Mr. CRAVAACK. Per unit? 

Mr. KANE. Yes, sir. 
102 

Mr. CRAVAACK. Are these devices being used at any current TSA 

airports right now? 

Mr. KANE. Yes, Congressman. We have at least 950 in the field, 

and a number of the 700 are also out into the field. 

Mr. CRAVAACK. So you have about 950 in the field and you purchased about 1,600, is that correct? 

Mr. KANE. That is correct. 

Mr. CRAVAACK. Is there any that are being stored or warehoused 

in Dallas, Texas, right now? 

Mr. KANE. Yes. We have some still remaining in the warehouse 

down in Dallas. 

Mr. CRAVAACK. Do you know how many those are? 

Mr. KANE. It would be whatever we have not deployed of the 700, 

but it is probably over 600. 

Mr. CRAVAACK. Okay. Do you know what the cost of warehousing 

these are? 

Mr. KANE. I don’t have the specific cost for that. We pay—I 

would have to get you the number for the record, Congressman, in 

terms of what we pay for our overall warehousing. 

Mr. CRAVAACK. Okay. Could you do that by November 10? Would 

that be a possibility? 

Mr. KANE. I could certainly work through our folks to be able to 

provide that. 

Mr. CRAVAACK. Okay, great. 

I want to turn a little bit to the puffer machines, if I could. Has 

the TSA destroyed all its collection of the puffer machines at this 

time? 

Mr. KANE. We disposed of all of those. We don’t destroy them. 

We turn them over to the Defense Reutilization Office, and they 

dispose of them or reuse them. I suspect most of them have been 

disposed of. I don’t know that for certain. 

Mr. CRAVAACK. Do you know what the cost is for the destruction 

of each machine? 

Mr. KANE. I don’t. 

Mr. CRAVAACK. Okay. All right. Then you are probably not going 

to be answering my last question. I would like—if you would, 

please, I would like to get the answer to that question as well by 

November 10. 

Then also I am curious to know what is the total cost of the program, including the purchase, storage, and the destruction of each 

one of these machines and how many machines, puffers, were 

there? 

Mr. KANE. I forget the exact number of the puffers that we have 

had. We disposed of them really prior to my coming on this job, so 

it has been a few years. I know the total value is somewhere I 

think in the $30 million range of that program. 

Mr. CRAVAACK. For the purchase? 

Mr. KANE. Right, for the purchase. The disposal cost is going to 

be a small fraction. At the end of the day, again, that will be 

lumped into the aggregate cost that we budget every year for disposal. 

Mr. CRAVAACK. Okay. Could you also have the TSA provide my 

office with the most recent quarterly warehouse inventory report? 

Mr. KANE. We can get that back for the record as appropriate. 
103 

Mr. CRAVAACK. Okay, I appreciate that. 

I guess the next question I might have, I would go back to Mr. 

Nayak, if I could. What are the consequences if the TSA does not 

follow DHS procurement guidance? 

Mr. NAYAK. The answer would be it depends on what stage of the 

acquisition life cycle they are not following guidance. If you have 

any specifics, I would be happy to answer it. 

Mr. CRAVAACK. What if, for example, that we weren’t following 

procedures in regards to the puffer machines and the AT–2 machines? 

Mr. NAYAK. So with regard to major programs like that, these 

kinds of decisions would be coming up to our Investment Review 

Board, and they most likely would not make it through at this 

stage in our evolution of the Investment Review Board. I was not 

around during these purchases. 

Mr. CRAVAACK. It is a hot potato. 

Mr. NAYAK. Yes. 

Mr. CRAVAACK. Thank you very much for that. 

I would also like, Mr. Kane, if I could ask you just real briefly, 

what are we doing for expediting passage through TSA checkpoints 

for the business leaders or people that travel on business routinely? 

They are pretty much trusted travelers. 

Mr. KANE. Yes, sir. So we kicked off four proof of concepts in four 

airports on October 4 called TSA PreCheck, and that is to a small 

group of the known travelers, just to prove out the concept of being 

able to assess that risk, understand it within our secure flight system, put it within the boarding pass, and allowing those people an 

expedited screening process through those four lanes that we are 

proving out the concept in. 

In those lanes, they will typically get to leave their jackets on, 

leave their shoes on, leave their belts on, and put their carry-on— 

their laptops back in their carry-ons and a compliant 311 back in 

their carry-on. So we have—those pilots are running. 

I believe the administrator also testified yesterday that he thinks 

those will expand, as long as we are successful there and can prove 

out the concept. 

Mr. CRAVAACK. My time has expired. I yield back. 

Mr. ROGERS. Great. I thank the gentleman. 

Mr. Benda, in your comments earlier you made a statement industry needs to know where we want to go, and I really liked hearing that. How do you envision seeing that happen? 

Mr. BENDA. Well, I think it is a two-step process for us, sir. I 

think the first step we have already taken with TSA. They have 

actually been a partner in terms of developing requirements and 

putting together a plan, having an aviation security research and 

development plan. Then having one that is publicly accessible I 

think is key, so that people know exactly what we are doing. 

I think TSA does a good job of putting their requirements out in 

terms of what their detection technologies need to be, but we are 

looking to expand that. We are looking to go just beyond the aviation security R&D and into all of the R&D that we are going to be 

doing for TSA. 

So they have agreed to develop a pilot process with us where we 

are going to examine the different mission areas that we are going 
104 

to focus our investments on, map out how those operations are 

done, try and identify where we think technology can achieve some 

efficiencies to be gained, and then identify those, identify what investment S&T is going to make, what procurement investments 

TASA plans to make in the future—because there is no point in investing in R&D dollars if there is not a future investment strategy 

or market for that technology—and then come up with a publishable document that we can put out to industry to show them this 

is where we are going to be investing our dollars as well as where 

TSA will be procuring. 

Mr. ROGERS. This would be for any one of you that want to take 

it, but one of the complaints that we have gotten from industry, 

particularly smaller companies, is that you all will put out an RFP 

and they will spend a significant amount of time and money preparing for it, and then you withdraw it or decide not to go forward. 

How frequently does that happen and why? 

Whoever would be the right person to hit that one, I would appreciate it. 

Mr. NAYAK. I will just jump in, Chairman. 

It does not happen that frequently, but here is the problem. 

When it does happen, it hurts. You know, I was in small business. 

I was in large business. I understand it, because I also was the guy 

that did the proposals. So I lived and breathed that. 

So, you know, it did something we totally don’t strive to do. It 

doesn’t serve us well either. We drag our own folks through the 

process. It is never our intention, and then occasionally it does happen and industry does express themselves. So we make every attempt to not have that happen. 

Again, very importantly, it is really the minority. It not the majority. It is the exception. 

Mr. ROGERS. Well, I would like to know if you could do a review, 

like go over the last 3 years, how frequently has that taken place. 

I have one company that spent about $100,000 preparing. You 

know, for a small company, that is a lot of money to have it then 

withdrawn. It does hurt. So I would appreciate it if you could give 

me a ballpark number of how often that happened and what percentage that is. It may indicate just what you said, that it is a very 

rare occasion. 

Mr. Kane, does TSA fully adhere to DHS acquisition guidance in 

all of its procurements? 

Dr. Nayak, you can feel free to follow up on that. 

Mr. KANE. Mr. Chairman, we certainly strive to adhere to all the 

DHS guidance in our all of our procurements. I think we have all 

gotten better at that. But I would not say we are 100 percent compliant with everything it is we need to do, just in catching up with 

when the acquisition directive was published and many of our procurements were on-going and getting ourselves square with all the 

guidance as we have these on-going procurements happening. But 

we do follow the process with a very stringent test regime. 

The one thing the Department and us, I think we are the first 

operational test agent within the Department, meaning we can 

sign off our own test reports, still with the oversight of S&T’s independent authority to have oversight there. Then we go through the 

investment review process with all those test results and with all 
105 

those folks who are sitting in the room with the knowledge of the 

program. 

So I think we are much better at adhering to the guidance, and 

we intend to bring ourselves fully aligned in the near future. 

Mr. NAYAK. So I will just add to that and just say that we have 

the Investment Review Board. There is a lot required of major programs at DHS, a lot of documentation, appropriate cost estimates. 

Part of this is staffing up appropriately in the components, which 

we have had a difficult time doing, frankly. So I wouldn’t say everybody is perfect, but I would say our system now has evolved to 

a point where we can slowly move towards perfection. 

Mr. ROGERS. Mr. Kane, development and procurement of the Advanced Imaging Technology, AIT, is of great interest to this subcommittee. To what can extent did TSA adhere to the established 

DHS acquisition process administered by the DHS Acquisition Review Board in procuring AITs? 

Mr. KANE. So we adhered to the process, but that was one of 

those procurements that was on-going as the acquisition directive 

102, AD 8102 as we know, it was promulgated. So there were some 

of these documentation requirements that we did not complete. 

But what we did with the AIT, we went out and we did operational test and evaluation. We had those results reviewed. We 

presented those results to the Acquisition Review Board and any 

adjustments we had made in terms of many of the requirements 

along the way and got an affirmative decision for the full procurement and deployment of those systems. 

Mr. ROGERS. Okay. To what extent do the AITs deliver in the 

performance initially promised in the original performance specifications? 

Mr. KANE. Sir, we are getting probably into areas of sensitive security information, Mr. Chairman. But the AITs are obviously the 

most effective technology we have for defecting nonmetallic threats 

and the only one we have for detecting nonmetallic threats on people. 

Mr. ROGERS. Thank you very much. 

My time has expired. The Chairman now recognizes the Ranking 

Member for any further questions she may have. 

Ms. JACKSON LEE. Thank you, Mr. Chairman. 

I want to pursue making sure that we have all the resources that 

we need to have to address all levels of business. But in particular 

we are finding through these hearings the need to focus on small 

businesses, with probably a great amount of both talent but also 

a great amount of inventiveness. 

Mr. Benda, you are in a very important area, and so my question 

is: If the present budget was to go forward as proposed by the 

House budget, what would happen in your area with respect to any 

impact on small businesses and the work that you do, the work 

that your particular area is engaged in, S&T? 

Mr. BENDA. Thank you for the question, ma’am. 

We consider small businesses to be the engine of innovation for 

this country. We think they are critical to our success. Some examples if that budget did go forward, as I stated earlier, our core R&D 

funding would be cut by 77 percent. What that would mean is that 

our current SBIR process, our small business innovative research 
106 

program, we fund around 60 programs a year, would drop down to 

four. You would see a massive decrease in the amount of funds 

going to small businesses through that program. 

Ms. JACKSON LEE. Give me that number again. You fund how 

many? 

Mr. BENDA. Currently, on average, ma’am, we fund 60 programs 

through our Small Business Innovative Research Program. If the 

budget went through as proposed, we would only be able to fund 

four. 

We also leverage small businesses, and where we have seen a lot 

of growth in our funding of small businesses is in the cybersecurity 

area. A lot of small start-ups happen on the coast. 

We recently lead a cyber BAA—it is a broad agency announcement, it’s a contract vehicle—and we had over 1,000 respondents 

to that vehicle, even though it is fairly small if you compare it to 

DOD standards. It is around $75 million over 5 years. We had 

1,000 respondents, and we had a whole range of companies that responded to that, with a significant part of that being small businesses. 

Those kinds of efforts would end. We would not have any money 

to pursue cybersecurity efforts. We would have no money to pursue 

any additional funding for bio-attacks, any additional funding for 

detecting submersibles that could smuggle drugs into the country 

or nuclear weapons. We would have to end all of our R&D in those 

areas. We estimate that the S&T funding currently funds around 

1,400 science and engineering jobs. Those would all be lost. 

So we think that these kind of cuts would be catastrophic, at 

least towards the future of homeland security. That we would simply have to make do with what we have, not be able to innovate 

or improve our efficiencies. 

Ms. JACKSON LEE. Thank you very much. 

That sounds pretty devastating to me, and particularly since we 

know we live in a different environment of franchise terrorism and 

one that acts on surprise, and even though intelligence is very important, but acts on innovative technologies that can be created. 

Thank you very much. 

Dr. Nayak, let me ask you to think about or to recommend for 

TSA in order to issue and award contracts in an efficient manner, 

we just have highlighted the puff technology, while at the same 

time ensuring competition in the proper use of TSA funds in technology development, so what do you recommend that TSA engage 

in in order to issue and award contracts in an efficient manner? 

What would be your suggestion? 

Mr. NAYAK. I think, as Mr. Kane alluded to, we have a good process in place now through this management directive with respect 

to managing major programs. We just need to see that actually sort 

of take place over time. 

In other words, we have got an Investment Review Board. Major 

programs come up at least 11 times for review. We now have and 

we are developing an information technology tool where we have 

insight, real time insight, into—eventually it will be all 500 programs but, right now, our major programs. So just having the components go through that process will ensure effectiveness. 
107 

Ms. JACKSON LEE. Let me follow up with just one more question. 

Thank you. 

I am not sure if this was articulated in your testimony, but I am 

going to ask for sort of an ABC on that new process. I know you 

articulated it just to me. But if there is a non-classified ‘‘here is 

what is in place,’’ I think it would be helpful for it to be in this 

committee or directed to all of us. 

Mr. Chairman, I am asking if that document or summary could 

be submitted to us, please. 

Mr. NAYAK. I am happy to do that. 

Ms. JACKSON LEE. Thank you. 

Let me go to this idea of small businesses, and it builds on testimony that we received on the Department’s growing number of 

contracting operations with small and medium-sized businesses. 

We appreciate that growth. In fact, I am going to make a statement that we want to see that growth across the spectrum of Government agencies. 

We also learned that, based on the Federal procurement data 

system, DHS currently spends about 70 percent on service contracts and 30 percent on product contracts. One would tend to believe that a small business could work closely with the idea of service contracts. How does the Department reach out to small businesses to determine what current or emerging technology has been 

developed that could be applied to Homeland Security initiatives, 

particularly in this scheme that you have 70 percent service-30 percent product, and how can we ensure that the Department maintains a healthy process with medium and small businesses? How 

can Congress continue to support this mission? Dr. Nayak. 

Mr. NAYAK. Thank you. 

So with respect to technology specifically, I will let my fellow witnesses—— 

Ms. JACKSON LEE. Mr. Kane, maybe, from S&T. 

Mr. NAYAK [continuing]. Can share. But I would like to share 

how we are doing. 

Just business overall, the spread is essentially about—there really is no definition for medium business, but the CSIS report that 

the gentleman who came and testified in the second hearing, about 

40 percent of our business goes to large business, about 30 to what 

they defined as the middle, and 30 to small business. 

What I do want to share is, from a Departmental perspective, we 

take all businesses seriously in order to achieve the mission. But 

with respect to small business specifically, I do want to say it is 

important to note that we rank either one or two in every small 

business category among the top seven spending agencies in the 

Government which comprise 90 percent of the $500 billion spent in 

Government. 

So, just very briefly, in overall small business, we achieved 29 

percent, and that was No. 2. In small and disadvantaged business, 

we achieved 11.5 percent of our spend. That was No. 1. In womenowned small business, we achieved 5.9 percent. That was No. 2 

among the top seven spending agencies. In small disadvantaged 

veteran-owned business, we were No. 2 with 4 percent. No. 1 was 

the Veterans Administration, who has statutory authority to award 

contracts to veteran-owned businesses. We are very proud of that. 
108 

HUBZone, which is very difficult to achieve, we achieved 3 percent. 

We were ranked No. 1. 

So we take small business extremely seriously. We have had significant achievements over the past 3 years. At a macro level, the 

SBA has a new rating system. They give you A through F. We have 

had an A the last 2 years. We believe we are going to get another 

A in fiscal year 2011. 

But with respect to connecting with small business and technology I would ask Robin or Paul if they had anything to add. 

Mr. KANE. I would just briefly add that we have support contractors that support our technology programs, and one of those we set 

aside for a small business set-aside and awarded those contracts, 

a multi-award contract for professional engineering and logistic 

services that we did as a set-aside for small business, and we used 

multiple small businesses in the task quarters of that award. 

Ms. JACKSON LEE. I yield back at this time and thank the witnesses. 

Mr. ROGERS. The Chairman now recognizes the gentleman from 

Minnesota for any further questions he may have. 

Mr. CRAVAACK. Thank you, Mr. Chairman. There will just be 

one. 

Prior military—the military I have seen through the years, especially in aircraft where you would have a joint conglomeration of 

technologies in, for example, the Joint Strike Fighter. Though it 

might have a varied mission but at the same time being able to 

land at sea, the knuckles and the landing gear have got to be a little bit tougher, but mainly the same type of platform. 

What I want to see, I was wondering what the TSA is doing like 

in collaborating with some of the other agencies, say Border Patrol, 

in being able to combine the technology and the cost savings, and 

how much—I don’t know if Mr. Kane or Dr. Nayak, you can answer 

these questions—but in combining the technologies, how much cost 

savings do you see there? 

Mr. NAYAK. Let me first turn the mike on. 

Through our Strategic Sourcing Program, okay, so, essentially, 

we have 90,000 transactions, $14 billion for the last 3 years that 

we spent. 

What is strategic sourcing? It is the capability to look at those 

transactions and decipher how you can do exactly what you mentioned, Congressman, and that is see where there are opportunities 

to bring things together, leverage volume, just get a better deal 

overall. 

We have 42 initiatives in the Department that we have awarded. 

We have saved over $1 billion since our program got up and running in 2005. Our goal this year was $200 million. We have another 13 or 14 initiatives on the way. In fact, the canines was a 

strategic sourcing initiative success story. That is how we work it. 

That is done out of my office. It is on-going. 

Detection equipment, which Mr. Edwards mentioned, is another 

interesting one where we agreed with the IG’s Office. Detection 

equipment is an interesting one. 

In fact, all of these are very interesting. They take a little bit of 

time. Because you have to first sort of find the opportunity, which 

now we have the ability to do that. The second thing is get a work-
109 

ing group together to figure out what of this can you really strategically source. On the surface, it sounds really good. Detection 

equipment, let’s do it all. But a working group has to sort of work 

that out. Then eventually we get to the actual procurement, which 

replaces other contracts and saves dollars over time. 

Mr. CRAVAACK. So you do have something in place already that 

you can talk to other components to see if you can combine the purchase. Are you saying it is working well at this point? 

Mr. NAYAK. It is working well, and we want to do more of it. 

Mr. CRAVAACK. That is good to know. 

With that, sir, I yield back. 

Mr. ROGERS. I think that is the result of the IG report, right? 

That was one of the focuses you all had, and you are responding 

to that. 

Mr. NAYAK. Only detection equipment. We had the program up 

and running. Their recommendation was to use the program specifically for detection equipment. But we have 42 initiatives that already on-going. In other words, canines we figured out on our own. 

Mr. ROGERS. Mr. Davis, do you have any additional questions? 

Mr. DAVIS. No. 

Ms. JACKSON LEE. I do. I just want to make a comment. I just 

have a comment. So are you getting ready to do your questions? 

Mr. ROGERS. Mr. Benda, you invite industry to bring its technologies to TSL at a fairly developmental stage for testing and for 

guidance on how their detectors can be improved to meet TSA 

needs. There is no cost to industry for this service, which can go 

on for months or years, which means you essentially provide a free 

research and development feedback resource. What are your perceptions as to how well industry appreciates this resource and is 

there anywhere else they can go for this kind of testing and evaluation service? 

Mr. BENDA. Sure, sir. I appreciate the question. 

I think industry, the level of appreciation on the resource, it depends on whether they have gotten certification or qualification approval from the labs. So I think it all depends on where you are 

sitting. 

I do think it is an unusual aspect that the Transportation Security Lab offers, supported by the HSARPA, which I run, to work 

with them to move technologies through the process. We use what 

is called a collaborative research and development agreement, 

CRADA. It is a public-private partnership. Basically we think we 

need to improve that process, and I have been working with Susan 

and her staff as well as my explosive division director on how we 

can do that, as well as Robin’s chief technology officer. 

Because it shouldn’t take years, sir. If you are coming in, and we 

need to make up a better assessment early on, do we think this 

technology can meet the TSA requirements, and, if it can, we need 

to spend some time on that. But we need to put some bounds on 

it. We need to understand what market this technology can fill, 

what existing technology has filled that market already. 

We can’t necessarily fund every technology that can eventually 

fill it or subsidize them with Government money. So if that market 

is already being filled adequately by an existing technology, the 
110 

Government shouldn’t subsidize them, as I imagine you would 

agree. 

So we want to look at that. We want to develop a process that 

is in place. We want to scope that support and make sure that, instead of taking years—no one should take years—but expedite that 

process to be a matter of months and make sure that those that 

have the best value come first. 

Mr. ROGERS. Great. I note that TSL has recently improved its 

process for working with private sector through cooperative research development agreement which allows the maximum amount 

of information sharing to companies with clearances, even if they 

do not have a procurement contract. This sounds to me like a real 

DHS success story. Tell me how the agreement will help further industry’s goals to provide needed technologies and grow their businesses. 

Mr. BENDA. Again, that CRADA process is what you are referring 

to. The challenge that some small businesses have, as you have 

said, they can’t get a clearance unless they have a contract in 

place. The CRADA allows us to use what is called, in technical parlance, a DD–254. We leverage a DOD process in place that says 

there is an existing agreement with the Government and allows us 

to share classified information with them because it is in the best 

interests of the Government, which also turns out to be in the best 

interests of the business. So when those processes are in place, 

they get a better understanding of what those requirements are. 

As you are certainly aware, we can’t share with everyone what 

those technical requirements are because we can’t let those become 

public. 

But the CRADA, once that is in place and once that sharing is 

in place, we are going to do a better job. The big process improvement we are going to make is that scoping up front and putting 

more documentation in place, both on the front end and the back 

end of the process. So people will understand what we are going 

to do in the CRADA. We will be very clear on our requirements, 

very clear on what we what we hope to achieve, very clear on the 

time lines, as well as at the end of the process in terms of what 

we have gotten out of it. 

Mr. ROGERS. Great. 

We have Susan Hallowell here, and I have two questions for her. 

Susan, if you would come up to the microphone. 

Once the testing and evaluation is complete at TSL in New Jersey and including an additional stint in Florida for homemade explosives testing, I understand that machines are then sent to 

Washington Reagan Airport for initial field testing for liability and 

maintainability and then on to airports across the Nation for fullscale operational T&E. 

Some in industry balk at this prolonged process, which can take 

months, if not longer, and which requires shipping machinery 

across the Nation. They cite a better model in some countries in 

Europe where private companies are contracted to do the certification and they do it more quickly and efficiently than the Government can. We have also heard that delays sometimes happen because of simple things that are easily fixed, but the process requires a complete redo. 
111 

Dr. Hallowell, can you please tell me whether and why every 

step of this process is necessary to ensure the efficacy of the technology that TSA is purchasing? 

Ms. HALLOWELL. Thank you, Mr. Chairman. 

Mr. ROGERS. Just turn the microphone on. 

Ms. HALLOWELL. Actually, that overall process is held by TSA, so 

that is more of a TSA issue. The actual certification we do at the 

laboratory is just one small cog in a larger process. So I would put 

that question to Mr. Kane. 

Mr. ROGERS. Okay. Mr. Kane. 

Mr. KANE. Yes, sir. Many of the things you just talked about, 

while they are virtually all true, as I understand what you just 

said, that is our process, much of which is required by the acquisition guidelines that we have to follow, and it is put in place to prevent things that have happened in the past such as the puffers. 

So our integration facility at Ronald Reagan is to get into a nearoperational environment for equipment before we actually put it 

out into airports, and they have to experience what the real results 

are, and we find out things that aren’t explosives detection. 

What TSL does, not exclusively, but what they do, their large expertise lies in explosive detection and qualifying that, yes, it can 

detect the things that we need. There are many other requirements 

that machines have to meet to operate in the airports, as you know 

and as we have experienced in the past. 

So we run this whole process. It does take time to run a test at 

the TSL, to run a test at our facility at Reagan, and then to do actual field testing. But that is a rigor that we want to put into this 

process so when we are making decisions on hundreds of millions 

of dollars that we are making the right decisions. 

Mr. ROGERS. Okay. Then I won’t ask this follow-up question, 

since it was Mr. Kane. 

Mr. Edwards, how much money do you think the Department 

could save if it used strategic sourcing to acquire all of its detection 

equipment? 

Mr. EDWARDS. Thank you, sir. 

We looked at just the detection equipment itself, and if they had 

used strategic sourcing they could save $170 million. 

Mr. ROGERS. Excellent. 

What steps do you recommend be taken to standardize the inventory technology so that all components in the Department are 

aware of what other components already have and are purchasing? 

Mr. EDWARDS. Strategic sourcing is known for best practices. It 

results in efficiencies, economies of scale, and volume buying. It 

also reduces overhead costs for procurement. 

For instance, in the detection equipment, if you are buying— 

every component is buying different types, then you are going to 

increase the maintenance costs, the training costs. So if components work together and buy these—and have less number of the 

different types, then there is going to be volume savings. 

It also is good for the industry because you have a single point 

of contact that you can go to. They can just go to the Strategic 

Sourcing Program Office and the vendors can just go to them, rather than going to the different components. 
112 

Mr. ROGERS. Dr. Nayak, do you want to comment on that?—or 

you don’t have to. 

Mr. NAYAK. I think he accurately covered it. 

Mr. ROGERS. That is great. 

The Chairman now recognizes the Ranking Member for any further questions. 

Ms. JACKSON LEE. Thank you, Mr. Chairman. 

I will be concluding on this note. I am not sure you are having 

another round. 

Mr. ROGERS. I have more, but I am going to give them in writing. 

Ms. JACKSON LEE. Okay, and I am going to do that as well. 

But let me ask this question of Mr. Kane, and I am going to say 

to you that I would like to have a more extensive answer in writing. So that means a period of time that you may take that you 

can abbreviate. 

One of our increasing concerns across the Federal Government is 

the possibility of theft of large volumes of sensitive information 

contained in mobile data storage devices. What is the DHS policy 

concerning what portable data is encrypted and are there currently 

any DHS processes where portable data is not encrypted? 

Mr. KANE. Okay, and I will be happy to take that one back for 

the record. I am not the expert in this. 

But all of our portable devices, the CIO imposes requirements for 

encryption on those devices, and they actually have an approved 

list of those that we are allowed to use. So I can’t just take any 

memory stick out and put it in my computer. It has to be an approved memory stick that I can use today. 

Ms. JACKSON LEE. Mr. Chairman, I would almost say that this 

would warrant a classified briefing. There are so many various 

portable devices going around in many people’s hands, and this is 

not a question of the integrity of the staff of DHS as much as it 

is the need to be secure. So I am going to submit this letter into 

the record—I am sorry, excuse me—this question into the record 

for a more extensive response. 

Let me quickly go to Mr. Edwards. 

TSA has confused purchases and acquisitions. There was some 

detection that IG released a report indicating that. Can you please 

explain the difference between an acquisition program and procurement and explain why additional costs may have been incurred by 

TSA in this case? 

Mr. EDWARDS. Thank you, ma’am. 

A simple procurement is a simple one-and-done action. For example, if you are buying paper, it can be managed by a single procurement. In contrast, an acquisition program is a more complex process that includes planning, purchasing, maintaining, managing, 

and overseeing an acquisition of goods and services. High-value 

items are normally usually acquired through an acquisition program. 

For example, if the Coast Guard is buying a Coast Guard cutter, 

it is managed and overseen by an acquisition program. In this case, 

what we are talking about in our report is TSA managed the renovation of a 12,500-square-feet warehouse as an acquisition program rather than using it as a simple procurement. By treating 

that relatively small renovation project as an acquisition program, 
113 

TSA increased administrative costs and also due to additional personnel and also overhead costs it incurred because of the oversight 

and internal controls required for an acquisition program. 

Because of this confusion incurred by TSA and other components, 

we recommended to the Department that they double up the decision matrix tool about whether acquisitions should be managed as 

a simple procurement or an acquisition should be managed as an 

acquisition program. So the Department agreed to our recommendation and is in the process of implementing it. 

Ms. JACKSON LEE. I think that is a great improvement. Thank 

you very much. 

Mr. Chairman, I just wanted to put two issues on the record. I 

made a somewhat humorous comment earlier, but I wanted to clarify two things. 

One, I wanted to conclude by thanking the witnesses and acknowledging to Dr. Nayak—I wanted to acknowledge the seemingly 

celebratory numbers that you are citing relating to your outreach 

to small businesses. I think whenever an agency comes forward, we 

should say thank you, and I want to thank you for what appears 

to be very positive numbers. 

I would only comment that I want our reach to be not only small 

businesses but the non-sophisticated small businesses that may be 

in States far and wide that don’t have the experience that some 

who are in tune to working with the Federal Government—and if 

you live in this area long enough, you know that there is a constituency of small businesses, no discredit to them, that work with 

the Federal Government. That is their work. They know how to do 

it. That doesn’t mean they are in Alabama. It doesn’t mean they 

are in Texas. It doesn’t mean they are in Illinois. It doesn’t mean 

they are in Minnesota and various other places. I want us to get 

our numbers where we show that demographic or that geographic, 

excuse me, diversity, so that when we go home, wherever we might 

be, there will be someone who says that they received some information on that opportunity. 

That is the first thing, Mr. Chairman. 

The second thing, as I sit in this committee—and I will be brief— 

I think they pointedly put that picture, Mr. Chairman, in front of 

the Chairman and the Ranking Member, straight ahead, if you look 

and you will see it on the wall, for a reason, for us to know our 

purpose and our cause here. So I am serious. 

I want to publicly apologize for the actions of one TSA inspector 

that violated the trust of this work and violated a traveler’s personal belongings. In this instance, it was a woman, and in this instance it probably would create humor, but I didn’t think it was 

funny. 

So I am going to ask that we will perspectively have a meeting, 

we are overdue for a meeting with Mr. Pistole on a number of 

issues. I count that on the issue of professional development and 

training. I have been a champion of TSA in terms of its workforce 

for training, professional development, the ability to ascend to a 

higher position, and I am very disappointed in that particular act 

that occurred about a week or so ago. 

The second aspect, Mr. Chairman, that I would raise a point with 

is seemingly the confusion—I have not gotten a final report on the 
114 

question asked as to whether or not TSA checks on checked weapons. As you well know, you can check a weapon in your suitcase, 

and I think the public is a little aghast that we have no record. I 

think we thought we were doing everything that we could, and I 

think there was a question of whether they were loaded or unloaded. But the answer came that that was not TSA’s responsibility 

to determine that in a suitcase, lodged in a suitcase. 

I think we need to change that policy and there needs to be a 

way of determining what ammunition and weapons are in checked 

luggage. Our first line can be domestically versus internationally. 

We can maybe start with that, and I would like for us to take up 

that issue. That is not an NRA issue. 

Mr. ROGERS. Where did you hear that? I went to the Atlanta Airport 2 weeks ago, not a flight, just to go over there and let them 

take me through their screening systems. One of the areas they 

took me through was where they screen the baggage. They do require that the gun be unloaded and it be in a box that is sealed. 

If the passenger doesn’t disclose to you that they have got one in 

their bag, what they do, they will tag the bag so that you know he 

has disclosed it or she has disclosed it. But if not, they do run it 

through a scanner where they look for the gun. They allow you to 

have it, but it has got to be unloaded. 

Mr. Kane, am I stating that right? 

Mr. KANE. Sir, just to clarify, there are requirements for how you 

have to check a firearm. Our detection technology does not detect 

firearms in checked baggage. 

Mr. ROGERS. Well, when I went through Atlanta, they said it did. 

Mr. KANE. If you are looking visually, you may see it on a visual 

image. But as a general rule, especially in our big in-line systems, 

this equipment is designed to detect explosives, and it does not detect a firearm. 

Mr. ROGERS. Well, I agree with the Ranking Member. We need 

to find out more about this. 

Ms. JACKSON LEE. I think that would warrant a classified briefing. 

Mr. ROGERS. I agree. 

Ms. JACKSON LEE. Because we don’t want to expose it. I thank 

Mr. Kane for his honesty in clarifying it for both the Chairman and 

myself. So I would list that as an item that is left with questions, 

and I believe it is appropriate for us to handle that in a manner 

appropriately. 

So, Mr. Chairman, because of the burden of our responsibility, I 

just want to make sure that we cross every t and dot every i, and 

I would look forward to pursuing those issues. 

Mr. KANE. Can I offer just two comments, Mr. Chairman, if I 

could? 

First, on the incident with the officer, I would just like to be on 

the record as saying TSA took that very seriously as well and instituted—this is a discipline issue and we clearly would institute a 

disciplinary process swiftly in that case, in all cases. 

Second, a firearm in a bag that you don’t have access to is a 

much different proposition than a firearm in a carry-on bag. I just 

would like to note that. There are reasons for some of the differences we have. 
115 

Ms. JACKSON LEE. Oh, I fully understand that, but I think we 

need to get it clarified. As they say, that building reminds us that 

something can always go wrong, and that is the only reason I 

brought it up. 

Mr. ROGERS. I just want to make sure I am clear on that. I understood when I was seeing that in-line process that it could determine a gun. We will follow up with you all and get somebody in 

that can help us in a classified setting explain the technology and 

its capabilities and limitations. 

I, first of all, want to thank all of you. I know we are over time, 

and I am not going to drag this out. But I have got a ton more 

questions. But what I am going to do is submit them to you in writing. The record will left open for 10 days, so if you can get us a 

reply to those, it will be very helpful to us. 

I do want to let you know I wanted to have this hearing on the 

record to raise a lot of these questions and give you an opportunity 

to offer your thoughts. But I would like to have a chance to sit 

down with you all again and the Ranking Member and let’s just 

kind of talk through more of these for our edification in a more informal fashion. Because you all obviously are a great resource for 

us to draw on, and you have got a lot more that I would like to 

know. 

But I do think that I have gathered from your comments here 

today that you all are working on what I want to see, and that is 

more transparency and more interaction with the private sector as 

to how we can in partnership achieve our security goals, and that 

is encouraging. So I am very happy about that. 

The one thing I did want to ask, and it follows up to what the 

Ranking Member was pursuing, and that is, as you go forward 

with these industry days, and this will particularly be for Mr. 

Benda and Dr. Nayak, and you look at this new and improved 

version, how do you outreach to small businesses? How do you get 

the word out that you are inviting their participation? 

Mr. NAYAK. Well, for us, it is very simple. We use the open announcement with what is called Fedbizopps. So it is an announcement to the world, and that is standard. That is what everybody 

who does business with the Government knows to go to. 

Mr. BENDA. We follow the same process, sir. We will put out a 

request for information. We will use Fedbizopps. 

Mr. ROGERS. Okay. Do you pretty much count on the their industry associations to kind of spread that word after they get the 

Fedbizopps release? 

Mr. NAYAK. You know, there is about five or six. I noticed you 

had participation from one in a previous hearing. They cover a subset of the universe. They do have large and small business. But 

they are not the universe. So we do work very closely with them. 

Quite often—I speak at literally every one of the associations. But, 

again, we have to use something that goes out to the world. 

I mentioned an industry advisory council. Again, whatever we 

create has to be very open, very transparent, and that is the trick 

to sort of figuring this out. But we are working with those associations as well as others to figure it out. 

Mr. ROGERS. Well, you know, I talked with the Ranking Member 

about this. I have been Chairman of this committee now for almost 
116 

a year, and I didn’t know what fbo.gov was until 3 days ago as I 

prepared for this. Trust me, I am a low-tech fellow. I worry like she 

does about people who aren’t sophisticated but have some contributions they can make. 

One of the things I am going to be doing is setting up a Transportation Security Caucus, and the Ranking Member has already 

indicated her desire to participate in that. We want to work with 

you all about some ideas about how we can stir interest out there 

and get folks who may not be computer-sophisticated aware that 

there are opportunities here and we want their participation. 

I thank all of you. This has been a very worthwhile hearing, and 

we are now adjourned. 

[Whereupon, at 4:18 p.m., the subcommittee was adjourned.] 
(117) 

A P P E N D I X 

QUESTIONS SUBMITTED BY CHAIRMAN MIKE ROGERS FOR NICK NAYAK

Question 1a. You have stated that one of your strategic objectives is to establish 

quality communication between industry and DHS. One way you aim to accomplish 

this is to require acquisition planners to develop vendor engagement strategies for 

major acquisitions that may include activities such as Industry Days or conferences; 

the ‘‘DHS Acquisitions Planning Guide’’ was just amended for this purpose. 

Do these requirements apply to all acquisitions planners across the Department, 

even within components like TSA that have their own acquisitions office? 

Answer. Response was not received at the time of publication. 

Question 1b. Do you expect DHS and TSA to put into effect a similar planning 

model to DOD’s, whereby multi-year acquisition plans are provided to the vendor 

community to help better align private sector R&D with the needs of DHS and TSA? 

It seems to me that a 5-year budget estimate included in TSA’s annual request to 

Congress would go a long way toward this end. 

Answer. Response was not received at the time of publication. 

Question 2. This committee has been spending some time, including through other 

hearings, looking at how the Department utilizes technologies that have been deployed in other agencies, such as the Department of Defense. One of the greatest 

tools at our disposal to save the Department needed dollars is to leverage existing 

technologies. 

Are existing technologies always considered when developing acquisition policy at 

the Department? If not, what one policy change would have the most impact on enhancing the Department’s ability to effectively leverage emerging technology? 

Answer. Response was not received at the time of publication. 

Question 3a. The importance of establishing realistic and risk-based requirements, 

and sharing them with the vendor community as early and as much as possible, 

cannot be overstated. 

Do you feel that requirements should be primarily based on mission needs, or on 

the existing capabilities of commercial technologies that vendors currently have? 

Answer. Response was not received at the time of publication. 

Question 3b. What is the proper role for vendors in setting technology requirements? 

Answer. Response was not received at the time of publication. 

Question 3c. Mr. Kane, as a follow up, what process does TSA follow to establish 

performance requirements for technologies it seeks to procure? And how does TSA 

use information from the scientific community to inform the development of key requirements? 

Answer. Response was not received at the time of publication. 

Question 3d. What options are open to the Department for establishing rigorous 

requirements that are threat- and risk-based, and for which there is cross-component input? 

Answer. Response was not received at the time of publication. 

QUESTION SUBMITTED BY RANKING MEMBER SHEILA JACKSON LEE FOR NICK NAYAK

Question. In your testimony, you assert that the Department has made progress 

in providing better training and certification for several acquisition career fields. 

What challenges, if any, have you faced in increasing training of DHS program managers? How have improvements in training and certification lead to a more effective 

acquisition process? 

Answer. Response was not received at the time of publication. 
118 

QUESTIONS SUBMITTED BY CHAIRMAN MIKE ROGERS FOR ROBIN E. KANE

Question 1a. TSA has recently undertaken a structural reorganization. Mr. Kane, 

you now lead the Office of Security Capabilities. TSA has stated that under the new 

system, all of the former Office of Security Technology and elements of the Office 

of Security Operations and the Office of Intelligence are grouped together, creating 

‘‘a single office with responsibility for defining and developing both the security and 

technology capabilities required to execute our counterterrorism mission’’ and 

matching ‘‘capabilities against threats to identify and deliver high priority capabilities to the field.’’ 

How does the TSA reorganization result in more streamlined development and 

procurement? Please provide us with some concrete examples of how this works. 

Answer. Response was not received at the time of publication. 

Question 1b. What is the ‘‘Security Policy and Industry Engagement’’ office responsible for? 

Answer. Response was not received at the time of publication. 

Question 2a. The joint TSA-S&T aviation security technology strategy states, ‘‘To 

encourage consistent dialogue and proactive involvement with S&T, TSA will 

produce and maintain technology roadmaps that outline desired capabilities, highlevel development milestones and dependencies for major technology products and 

incremental capability enhancements. Strategy roadmaps indicate key mission capability needs and the TSA efforts to accelerate the development of advanced solutions.’’ 

Have these roadmaps been completed and shared with the private sector? If not, 

when will they be complete and publicly available? 

Answer. Response was not received at the time of publication. 

Question 2b. Has the strategy resulted in new or improved technologies? 

Answer. Response was not received at the time of publication. 

Question 3. The ‘‘For Official Use Only’’ version of the joint TSA-S&T aviation security technology investment plan has a time line for achieving specific goals and 

sub-goals that extends through fiscal year 2014. 

Has this timeline been shared with industry? While I’m sure you need to be careful about broadcasting predictions that may change due to emerging threats, by the 

same token, industry needs some kind of roadmap to strategize and formulate semilong term business plans. 

Answer. Response was not received at the time of publication. 

Question 4. The importance of establishing realistic and risk-based requirements, 

and sharing them with the vendor community as early and as much as possible, 

cannot be overstated. 

What process does TSA follow to establish performance requirements for technologies it seeks to procure? And how does TSA use information from the scientific 

community to inform the development of key requirements? 

Answer. Response was not received at the time of publication. 

Question 5a. Goal 4 from your aviation security technology strategy states that 

TSA is looking to ‘‘increase capability to respond to emerging threats through development of flexible security solutions.’’ 

Since many of the technologies that TSA acquires are still undergoing additional 

development, how does the agency ensure that the technologies are improved once 

acquired? 

Answer. Response was not received at the time of publication. 

Question 5b. Is it going to become necessary for vendors and TSA to reach an 

agreement at some point that allows an open, standard data file format that allows 

TSA to contract out upgrades to the best vendor? Will TSA need rights to the data 

at some point to allow for true flexibility and efficiency in upgrading its systems? 

Answer. Response was not received at the time of publication. 

Question 6a. TSL provides a technical service for TSA by certifying equipment 

that meets its requirements, or determining what equipment does not meet TSA’s 

requirements. 

Has TSA ever purchased equipment that did not meet certification standards as 

tested to by the TSL? 

Answer. Response was not received at the time of publication. 

Question 6b. Has TSA ever considered using the TSL in a different way, that is, 

harnessing its decades of experience working with technologies so that TSL is actually involved in the developing of requirements, and not solely testing to them? 

Answer. Response was not received at the time of publication. 

Question 7a. TSA used to engage in extensive research and development activities. In fiscal year 2006, Congress consolidated TSA’s R&D activities with those in 

the S&T Directorate. 
119 

What effect does the separation of research and development activities from acquisition and operational activities have on TSA’s ability to adopt new technologies? 

What benefit, if any, would accrue from transferring back to TSA its research and 

development responsibilities? 

Answer. Response was not received at the time of publication. 

Question 7b. After the transfer of TSA R&D activities, TSA and S&T signed a 

memorandum of understanding regarding the use and priorities of the TSL. How 

successful is your partnership with S&T regarding use, upkeep, and priority setting 

for the TSL? 

Answer. Response was not received at the time of publication. 

Question 8. How does TSA incorporate the results of covert tests into its evaluation of existing technology and future procurements? 

Answer. Response was not received at the time of publication. 

Question 9a. According to the GAO, the S&T Test & Evaluation and Standards 

Office expressed concerns about TSA’s operational test agent for the Passenger 

Screening Program. The T&E Office cited the lack of independence of the test agent 

since the test agent was part of the same TSA office responsible for managing the 

program. The T&E Office provided an interim approval valid for 1 year and outlined 

measures for TSA to take to ensure necessary independence. 

How has TSA responded to these actions by the S&T Directorate? 

Answer. Response was not received at the time of publication. 

Question 9b. What advantages, if any, might accrue from establishing a fully independent operational test agent in TSA, the S&T Directorate, or some other part of 

the Department? 

Answer. Response was not received at the time of publication. 

Question 10a. The testing and evaluation capabilities that the TSL and the Office 

of Test & Evaluation and Standards provide are key to ensuring that all machinery 

purchased by TSA meets its own prescribed standards. 

Does TSA leverage these capacities completely? Was that done with AIT? 

Answer. Response was not received at the time of publication. 

Question 10b. I understand that TSL often evaluates TSA technology, but not always. Why is that, and can you tell me about some technologies that you purchased 

that were not put through TSL testing? 

Answer. Response was not received at the time of publication. 

Question 11a. The S&T Directorate has established as one of its strategic goals 

to leverage its technical expertise to assist DHS components’ in establishing operational requirements, and to select and acquire needed technologies. This requires 

the S&T Directorate to have a firm understanding of the technical and environmental constraints of the DHS components’ operations and a close working relationship between S&T Directorate program managers and DHS component decision 

makers. 

In your experience, what activities, both formal and informal, has the S&T Directorate taken to increase its role in TSA’s establishment of operational requirements? 

Answer. Response was not received at the time of publication. 

Question 11b. How successful have these activities been, and what results have 

come from them? 

Answer. Response was not received at the time of publication. 

Question 12. This committee has been spending some time, including through 

other hearings, looking at how the Department utilizes technologies that have been 

deployed in other agencies, such as the Department of Defense. One of the greatest 

tools at our disposal to save the Department needed dollars is to leverage existing 

technologies. 

Is there a process in place to evaluate the most advanced and innovative technology that may be in use elsewhere, and could now be utilized at TSA? And are 

existing technologies always considered when developing acquisition policy at the 

Department? 

Answer. Response was not received at the time of publication. 

Question 13. Is TSA satisfied with its current process for paying for technology 

procurement (purchasing technologies subject to yearly appropriations), or are there 

other models it is looking at? 

Answer. Response was not received at the time of publication. 

Question 14a. In October 2009, GAO reported that TSA had not completed a costbenefit analysis on investments for screening passengers at airport checkpoints because they failed to develop life-cycle cost estimates for these technologies. While 

TSA has recently developed life-cycle cost estimates, GAO reported that TSA has 

still not completed a cost-benefit analysis. 

To what extent does TSA analyze the benefits of technology acquisitions and ensure that the additional capabilities gained provide sufficient benefits to justify their 
120 

significant costs? That is, do you perform a cost-benefit analysis for every acquisition, and at what point in the process does this happen? 

Answer. Response was not received at the time of publication. 

Question 14b. Does TSA engage its vendors in completing life-cycle costs and costbenefit analyses? If not, are there changes that should be made to this process? 

Answer. Response was not received at the time of publication. 

Question 15. Would you consider establishing a technology advisory group made 

up, in part, of security technology manufacturers? Are there other advisory bodies 

within TSA on which industry already serves? 

Answer. Response was not received at the time of publication. 

QUESTIONS SUBMITTED BY RANKING MEMBER BENNIE G. THOMPSON FOR ROBIN E. 

KANE

Question 1. Over the past few years, TSA has increased the number of Behavioral 

Detection Officers at airports Nation-wide. Has TSA developed a scientific method 

for measuring the ability of Behavioral Detection Officers to identify people who intend to commit an act of terrorism or pose a threat to aviation? How many terrorist 

plots have been interrupted by Behavioral Detection Officers? Without scientific validation or proven results, how can TSA justify the expansion of the number of Behavioral Detection Officers? Does the Department perform covert testing on Behavioral Detection Officers like it does with passenger and baggage screeners? 

Answer. Response was not received at the time of publication. 

Question 2. TSA recently announced a major reorganization of its components and 

realignment of certain functions across the agency. How does this reorganization 

allow for an increase in cost savings associated with administrative and procurement functions? How will the proposed reorganization affect TSA’s interaction with 

S&T and DHS? How will the proposed reorganization affect oversight of the development of new technologies? 

Answer. Response was not received at the time of publication. 

Question 3. TSA continues to make changes to its process for screening of passengers at airport checkpoints. Does TSA have a plan for ensuring that the use of 

new technology is integrated into new screening initiatives such as the Precheck 

program? Also has TSA updated its Passenger Checkpoint Program Strategy to reflect the increased use of AIT, BDOs, and the Precheck pilot? 

Answer. Response was not received at the time of publication. 

QUESTIONS SUBMITTED BY RANKING MEMBER SHEILA JACKSON LEE FOR ROBIN E. 

KANE

Question 1. Last Congress, you testified that TSA and S&T have worked on 

streamlining processes and coordinating effectively with one another. What steps 

has TSA taken to streamline its relationship with the S&T Directorate and 

strengthen acquisition and procurement practices with DHS Office of Procurement? 

Please provide specific examples. Furthermore, can you provide more information on 

how AIT machines were purchased and vetted by the Department of Homeland Security? 

Answer. Response was not received at the time of publication. 

Question 2. Recently, TSA purchased 300 AIT machines equipped with ATR software that enhance passenger privacy. Have these enhanced AIT machines reduced 

delays and wait times in passenger screening? Can the existing 500 AIT units be 

updated with the new ATR software? 

Answer. Response was not received at the time of publication. 

Question 3. TSA has announced plans to conduct CAT/BPSS technology pilots to 

determine the sustainability of technology that would replace the current manual 

‘‘lights and loupes’’ method of ID authentication. What challenges has TSA faced 

with the current ‘‘lights and loupes’’ system? How would CAT/BPSS technology enhance ID authentication? 

Answer. Response was not received at the time of publication. 

Question 4. TSA has deployed 500 next generation Bottled Liquids Scanners (BLS) 

to airports Nation-wide. In your judgment, how effective are the next generation 

BLS units in comparison to the existing BLS units? Does TSA plan on replacing the 

existing 1,000 BLS units? 

Answer. Response was not received at the time of publication. 

Question 5. One of our increasing concerns across the Federal Government is the 

possibility of theft of large volumes of sensitive information contained in mobile data 

storage devise. What is TSA policy concerning what portable data is encrypted and 

are there currently any DHS processes where portable data is not encrypted? 

Answer. Response was not received at the time of publication. 
121 

Question 6. In October 7, 2011, the President issued an Executive Order directing 

Federal agencies to better safeguard classified information, to set up internal audit 

systems, and to make sure that reluctance to share critical intelligence in the aftermath of the Wiki Leaks exposure does not hamper collaboration across agencies. A 

component of the Executive Order makes individual agencies primarily responsible 

for securing the information they obtain and share. Has DHS given consideration 

as to how this order affects them and how will they go about evaluating possible 

solutions? 

Answer. Response was not received at the time of publication. 

QUESTIONS SUBMITTED BY CHAIRMAN MIKE ROGERS FOR PAUL BENDA

Question 1. The TSL cannot necessarily relay to industry the classified technical 

requirements to which it is testing. 

Do you feel that the Department is sufficiently transparent in relating requirements for testing? Is the new CRADA that was described in your testimony sufficient to solve this problem? 

Answer. Response was not received at the time of publication. 

Question 2. The TSL provides testing services for agencies other than TSA, such 

as the U.S. Secret Service, the U.S. Coast Guard, and Customs and Border Protection. 

Have you found that these components have similar needs to TSA, which could 

perhaps benefit from joint requirements setting or strategic sourcing? 

Answer. Response was not received at the time of publication. 

Question 3. The Government Accountability Office recently released a report describing TSA’s failure thus far to implement its 2010 requirements for explosives detection systems. One of the reasons GAO cited for this lapse is that TSA and S&T 

have experienced challenges in collecting explosives data needed to procure and deploy systems that meet those requirements. 

While it is understandable that scientific endeavors like this can be unpredictable, 

on the other hand, does the process somehow need to be revised so that industry 

is not gearing up to meet requirements for an acquisition that may not happen due 

to scientific challenges? What can we learn from this experience so that we do not 

find ourselves in a similar position in the future? 

Answer. Response was not received at the time of publication. 

Question 4a. For many years the Science and Technology Directorate has invested 

in technology development aimed at detecting explosives in the transportation context. MagViz technology, for example, has received funding since at least fiscal year 

2007. Under Secretary O’Toole has previously testified that the S&T Directorate is 

now attempting to develop a ‘‘checkpoint of the future’’ that can integrate many of 

these technologies to provide a multi-faceted detection capability. 

How would you characterize S&T Directorate support for these technologies? Are 

they research or development projects? What is the expected time frame for delivery 

of a final product? Of the technologies under consideration for integration into the 

‘‘checkpoint of the future,’’ how many of them are mature and have undergone successful developmental and operational test and evaluation? 

Answer. Response was not received at the time of publication. 

Question 4b. Historically, the S&T Directorate has developed technologies to be 

transitioned to end-users rather than systems that incorporate those technologies. 

How significant a role will the S&T Directorate undertake in systems integration? 

With respect to the ‘‘checkpoint of the future,’’ what challenges do you envision in 

attempting to integrate these technologies together into a single system? 

Answer. Response was not received at the time of publication. 

Question 4c. The S&T Directorate has established the Apex projects starting in 

fiscal year 2012. The ‘‘checkpoint of the future’’ is not one of them, although the impact of integrating and improving technologies so widely deployed at domestic and 

international airports provides the opportunity for substantial risk reduction and 

savings through operational efficiencies. Why has the S&T Directorate not designated this as an Apex project? What discussions has the S&T Directorate had with 

TSA leadership to identify whether this should become an Apex project? 

Answer. Response was not received at the time of publication. 

QUESTION SUBMITTED BY RANKING MEMBER BENNIE G. THOMPSON FOR PAUL BENDA

Question. The Under Secretary for Science and Technology has stated that the 

S&T Directorate should play a greater role in the acquisition of technologies by DHS 

components. Would an expanded role for the S&T Directorate in the acquisition of 

technologies by TSA increase the likelihood that acquired technologies will succeed 

in the field? Would such an expanded role for the S&T Directorate result in a more 
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cumbersome process for private-sector vendors seeking to work with the Department 

on their security technologies? 

Answer. Response was not received at the time of publication. 

QUESTION SUBMITTED BY RANKING MEMBER SHEILA JACKSON LEE FOR PAUL BENDA

Question. How did the Detroit Flight 253 incident and the discovery of the Yemen 

cargo plot impact priorities and planning at the Transportation Security Lab and 

throughout the Science and Technology Directorate? How will the proposed budget 

cuts affect that work? 

Answer. Response was not received at the time of publication. 

QUESTION SUBMITTED BY RANKING MEMBER SHEILA JACKSON LEE FOR CHARLES K. 

EDWARDS

Question. In your testimony you state that while DHS has taken steps to improve 

its acquisition oversight processes and controls, additional areas for improvement 

remain. What is the single most important improvement you believe needs to be implemented? Does the Department have a plan in place to implement the needed improvements? 

Answer. The Department of Homeland Security (DHS) continues to face challenges associated with implementing a fully integrated acquisition function. A successful acquisition process requires an effective acquisition management infrastructure. Acquisition management is a complex process that goes beyond simply awarding a contract. It begins with the identification of a mission need; continues with 

strategy development, while balancing cost, schedule, and performance; and concludes with contract closeout. It also includes managing operational and life cycle 

requirements, to include formulating concepts, assessing tradeoffs, and managing 

programs risks. We have performed various audits over the years that have identified the Department’s improvements and challenges, which we outline annually in 

the Major Management Challenges Facing the Department of Homeland Security report. The one recurring need over the last several years has been an emphasis on 

further development and refinement of oversight and internal controls. 

The Department’s most recent major management challenges report, OIG–12–08, 

dated November 2011, identified several areas which needed improvement. The Department concurred with our assessment and continues to make refinements and 

improvements. However, to address your specific request we refer you to our March 

2011 audit report, DHS Department-wide Management of Detection Equipment, 

OIG–11–47. In this report, we determined that the Department could improve its 

management of detection equipment by applying the principles of strategic sourcing. 

Strategic sourcing requires that the Department standardize equipment purchases, 

identify common mission requirements among components, and develop standard 

data elements for managing the inventory accounts. 

Although we made these recommendations to address improving the Department’s 

management of detection equipment, the strategic sourcing/logistics concepts 

imbedded as best business practices can be applied across the Department. These 

best practices provide for efficiencies of purchasing scale; serve to create greater 

competitive opportunities for more businesses, both large and small; and establish 

a foundation for standardization and transparency. The Department is in the process of implementing these recommendations by establishing a Steering Committee 

and a commodity working group that has begun to identify specific missions and 

needs. We will continue to monitor the progress of the Department in its actions 

to implement these recommendations and will encourage its leadership to apply 

these principles across its components and commodities. 

We have also continued to audit the Department’s acquisition process, both system-wide and in specific component programs, and we plan to release those reports 

in the second quarter of 2012. 

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