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THE SAFE PORT ACT: STATUS OF 

IMPLEMENTATION ONE YEAR LATER 

HEARING 

BEFORE THE

SUBCOMMITTEE ON BORDER, MARITIME, 

AND GLOBAL COUNTERTERRORISM 

OF THE

COMMITTEE ON HOMELAND SECURITY 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED TENTH CONGRESS 

FIRST SESSION 

OCTOBER 30, 2007 

Serial No. 110–80 

Printed for the use of the Committee on Homeland Security 

Available via the World Wide Web: http://www.gpoaccess.gov/congress/index.html 


Congress.#13
COMMITTEE ON HOMELAND SECURITY 

BENNIE G. THOMPSON, Mississippi, Chairman 

LORETTA SANCHEZ, California, 

EDWARD J. MARKEY, Massachusetts 

NORMAN D. DICKS, Washington 

JANE HARMAN, California 

PETER A. DEFAZIO, Oregon 

NITA M. LOWEY, New York 

ELEANOR HOLMES NORTON, District of 

Columbia 

ZOE LOFGREN, California 

SHEILA JACKSON-LEE, Texas 

DONNA M. CHRISTENSEN, U.S. Virgin 

Islands 

BOB ETHERIDGE, North Carolina 

JAMES R. LANGEVIN, Rhode Island 

HENRY CUELLAR, Texas 

CHRISTOPHER P. CARNEY, Pennsylvania 

YVETTE D. CLARKE, New York 

AL GREEN, Texas 

ED PERLMUTTER, Colorado 

VACANCY 

PETER T. KING, New York 

LAMAR SMITH, Texas 

CHRISTOPHER SHAYS, Connecticut 

MARK E. SOUDER, Indiana 

TOM DAVIS, Virginia 

DANIEL E. LUNGREN, California 

MIKE ROGERS, Alabama 

BOBBY JINDAL, Louisiana 

DAVID G. REICHERT, Washington 

MICHAEL T. MCCAUL, Texas 

CHARLES W. DENT, Pennsylvania 

GINNY BROWN-WAITE, Florida 

MARSHA BLACKBURN, Tennessee 

GUS M. BILIRAKIS, Florida 

DAVID DAVIS, Tennessee 

JESSICA HERRERA-FLANIGAN, Staff Director & General Counsel 

ROSALINE COHEN, Chief Counsel 

MICHAEL TWINCHEK, Chief Clerk 

ROBERT O’CONNOR, Minority Staff Director 

SUBCOMMITTEE ON BORDER, MARITIME, AND GLOBAL 

COUNTERTERRORISM 

LORETTA SANCHEZ, California, Chairwoman 

JANE HARMAN, California 

ZOE LOFGREN, California 

SHEILA JACKSON-LEE, Texas 

JAMES R. LANGEVIN, Rhode Island 

HENRY CUELLAR, Texas 

AL GREEN, Texas 

BENNIE G. THOMPSON, Mississippi (Ex 

Officio) 

MARK E. SOUDER, Indiana 

BOBBY JINDAL, Louisiana 

DAVID G. REICHERT, Washington 

MICHAEL T. MCCAUL, Texas 

GUS M. BILIRAKIS, Florida 

PETER T. KING, New York (Ex Officio) 

ALISON ROSSO, Director 

DENISE KREPP, Counsel 

CARLA ZAMUDIO-DOLAN, Clerk 

MANDY BOWERS, Minority Senior Professional Staff Member 

(II) 

(III) 

C O N T E N T S 

Page 

STATEMENTS 

The Honorable Loretta Sanchez, a Representative in Congress from the State 

of California, and Chairwoman, Subcommittee on Border, Maritime, and 

Global Counterterrorism: 

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

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

The Honorable Mark E. Souder, a Representative in Congress from the State 

of Indiana, a Ranking Member, Subcommittee on Border, Maritime, and 

Global Counterterrorism ..................................................................................... 3 

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

the State of Mississippi, and Chairman, Committee on Homeland Security: 

Oral Statement ..................................................................................................... 4 

Prepared Statement ............................................................................................. 5 

The Honorable Gus M. Bilirakis, a Representative in Congress from the 

State of Florida ..................................................................................................... 39 

The Honorable Henry Cuellar, Representative in Congress from the State 

of Texas ................................................................................................................. 44 

The Honorable Al Green, a Representative in Congress from the State of 

Texas ..................................................................................................................... 40 

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

State of Texas ....................................................................................................... 42 

The Honorable Daniel E. Lungren, a Representative in Congress from the 

State of California ................................................................................................ 3 

The Honorable Michael T. McCaul, a Representative in Congress from the 

State of Texas ....................................................................................................... 83 

The Honorable Bill Pascrell, Jr., a Representative in Congress from the 

State of New Jersey ............................................................................................. 45 

WITNESSES

PANEL I 

Mr. Stephen L. Caldwell, Director, Homeland Security and Justice Issues, 

Government Accountability Office ...................................................................... 32 

Ms. Maurine Fanguy, Program Director, Transportation Security 

Administration, Department of Homeland Security: 

Oral Statement ..................................................................................................... 7 

Prepared Statement ............................................................................................. 8 

Mr. Vayl Oxford, Director, Domestic Nuclear Detection Office, Department 

of Homeland Security: 

Oral Statement ..................................................................................................... 28 

Prepared Statement ............................................................................................. 30 

Captain Francis Sturm, U.S. Coast Guard, Department of Homeland Security: 

Oral Statement ..................................................................................................... 11 

Prepared Statement ............................................................................................. 13 

Page

IV 

Mr. Thomas Winkowski, Assistant Commissioner, Office of Field Operations, 

Customs and Border Protection, Department of Homeland Security: 

Oral Statement ..................................................................................................... 21 

Prepared Statement ............................................................................................. 23 

PANEL II 

Ms. Mary Alexander, Chair, Joint Industry Group: 

Oral Statement ..................................................................................................... 67 

Prepared Statement ............................................................................................. 69 

Mr. Wade Battles, Managing Director, Port of Houston Authority: 

Oral Statement ..................................................................................................... 73 

Prepared Statement ............................................................................................. 74 

Mr. Robert F. Blanchet, Teamster Port Representative, International 

Brotherhood of Treamsters: 

Oral Statement ..................................................................................................... 53 

Prepared Statement ............................................................................................. 55 

Mr. Christopher Koch, President, World Shipping Council: 

Oral Statement ..................................................................................................... 58 

Prepared Statement ............................................................................................. 59 

Mr. Lindsay McLaughlin, Legislative Director, International Longshore and 

Warehouse Union: 

Oral Statement ..................................................................................................... 49 

Prepared Statement ............................................................................................. 51 

APPENDIXES

A: Executive Summary of C–TPAT Partners Cost-Benefit Survey Prepared 

by the University of Virginia for U.S. Customs and Border Protection .......... 87 

B: Additional Questions and Responses 

Panel I 

Responses from: 

Mr. Stephen L. Caldwell .............................................................................. 91 

Ms. Maurine Fanguy .................................................................................... 95 

Mr. Vayl Oxford ............................................................................................ 97 

Captain Francis Sturm ................................................................................. 100 

Mr. Thomas Winkowski ................................................................................ 106 

Panel II 

Responses from: 

Ms. Mary Alexander ..................................................................................... 116 

Mr. Wade Battles .......................................................................................... 120 

Mr. Robert F. Blanchet ................................................................................. 124 

Mr. Christopher Koch Responses ................................................................ 126 

(1) 

THE SAFE PORT ACT: STATUS OF 

IMPLEMENTATION ONE YEAR LATER 

Tuesday, October 30, 2007 

U.S. HOUSE OF REPRESENTATIVES, COMMITTEE ON HOMELAND SECURITY, SUBCOMMITTEE ON BORDER, MARITIME, AND GLOBAL COUNTERTERRORISM, Washington, DC. 

The subcommittee met, pursuant to call, at 2:17 p.m., in Room 

311, Longworth House Office Building, Hon. Loretta Sanchez 

[chairwoman of the subcommittee] presiding. 

Present: Representatives Sanchez, Jackson Lee, Langevin, Green, 

Thompson (Ex Officio), Souder, McCaul, Bilirakis, and King (Ex 

Officio). 

Also Present: Representative Lungren. 

Ms. SANCHEZ. The Subcommittee on Border, Maritime and Global Counterterrorism will come to order. And the subcommittee is 

meeting today to receive testimony on the SAFE Port Act Status 

of Implementation One Year Later. 

I would, at this time, ask unanimous consent that Mr. Lungren 

of California be allowed to sit and question at today’s hearing. No 

hearing no objection, welcome, Mr. Lungren. Always great to have 

a fellow Californian on. 

Thank you to our witnesses for joining us today, particularly 

since this hearing was postponed from earlier in the month. And 

I appreciate your flexibility in coming before our committee again. 

Today we will be discussing the status of the implementation of 

the SAFE Port Act, as you know, one of the pieces of legislation 

from the 109th Congress that I think is probably one of the most 

important we passed. And, of course, we passed it on the last day 

of that Congress. The legislation was a cumulation of years of work 

by many on this committee and other Members of Congress, and 

I do believe that once it is implemented, it will improve the security of our Nation’s ports. And as a member of a district who lives 

20 minutes away from the largest port system in the United States, 

that is Long Beach-Los Angeles, it is incredibly important to me 

personally and to the people that I represent. 

So, it is our intention, and certainly my intention that we implement this and we oversee it and we get it done as quickly as possible. As you know, we have already held a 6-month hearing on the 

SAFE Port Act, and here we are 6 months later wanting to know 

what has been going on. 

I hope that today’s hearing will update us on many of the initiatives. I have several that I am particularly interested in. You all 

2 

probably already know, but just in case, an explanation of the aspects of C–TPAT’s third-party verification program, the pilot, and 

the update on its progress, the status of the empty security pilot 

program that was required by the law, the Coast Guard’s longrange vessel tracking capability, and their ability to view that data 

in a usable format; and of course, the delayed progress on the 

Transportation Worker Identification Credential, or the TWIC. 

And I hope that our witnesses will address these items as well 

as many of the others that need to be addressed as to what is going 

on with the SAFE Port Act. And I am pleased to hear that the 

agencies within the Department are making progress on some of 

these provisions, but we want to make sure you are making 

progress as quickly, as safely as possible. 

Some of my concerns also include the establishment of the container security standards and improvements to CBP’s risk targeting, a lack of the fully operational vessel tracking system to tell 

us what vessels are coming to American ports, and of course, the 

efficient rollout of the TWIC program that would ensure that our 

ports are safe without compromising American jobs or adding excessive costs. 

And I would like to thank my ranking member, Mr. Souder, for 

his interest in this important issue, and at this moment I would 

like to recognize the ranking member of the subcommittee, the gentleman from Indiana, for his opening statement. 

PREPARED STATEMENT OF THE HONORABLE LORETTA SANCHEZ, CHAIRWOMAN, 

SUBCOMMITTEE ON BORDER, MARITIME, AND GLOBAL COUNTERTERRORISM

Good Afternoon. 

Thank you to our witnesses for joining us today, particularly since this hearing 

was postponed from earlier in the month. We appreciate your flexibility. 

Today we will be discussing the status of implementing the SAFE Port act, over 

one year after it became law. 

This Subcommittee held a similar hearing six months ago and I know my colleagues and I are eager for an update on the Government’s progress. 

I believe that the SAFE Port Act was one of the Homeland Security Committee’s 

most significant actions of the 109th Congress. 

This legislation was the culmination of years of work by numerous Members of 

Congress, and it made long overdue improvements to the security of our nation’s 

ports. 

As a Member whose district is close to the Los Angeles and Long Beach Ports, 

I am very aware of the direct impact port security has on the lives and livelihoods 

of all Americans. 

I intend to make sure that the 110th Congress conducts appropriate oversight to 

ensure that the SAFE Port Act is fully implemented. 

As we all know, the SAFE Port Act covered a wide range of programs and 

invitiatives at the Department of Homeland Security. 

I hope that today’s hearing will provide us with an update on these many initiatives. 

There are several issues that I am particularly interested in. 

These include: 

• An explanation of aspects of the C–TPAT 3rd party validator pilot program 

and an update on its progress; 

• The status of the empty container security pilot program required by the law; 

• The Coast Guard’s long range vessel tracking capability and their ability to 

view that data in a useable format; 

• AND, or course the delayed progress on the Transportation Work Identification Credential, or TWIC. 

I hope our witnesses will address these items among many other critical issues 

in the SAFE Port act. 

3 

I am pleased to hear that the agencies within the Department are making 

progress on some of the provisions in the SAFE Act, but we must ensure that the 

law is fully implemented so our ports are as secure as possible. 

Some of my concerns include: 

• The establishment of container security standards and improvements to 

CBP’s risk targeting; 

• The lack of a fully operational vessel tracking system to tell us what vessels 

are coming to American ports; 

• AND the efficient roll out of a TWIC program that ensures the security of 

our ports without compromising American jobs, or adding excessive costs. 

I’d like to thank my ranking Member, Mr. Souder for his interest in this important issue. 

Mr. SOUDER. Thank you very much, Madam Chair. And we are 

1 year out from the enactment of the SAFE Port Act and 6 months 

from the implementation status. Like with other areas of homeland 

security, there is no silver bullets. Securing maritime transportation system from the beginning of the supply chain through the 

arrival at U.S. ports and delivery, requires overseas cooperation, 

participation from the private sector, technology, resources and intelligence. 

In many ways, defending against terrorists is similar to detecting 

and disrupting illegal narcotics. Step one, stop the terrorist activity 

and plans in the source country. Step two, prevent weapons and 

terrorists from exiting the source country for the United States. 

Step three, interdict the illicit activity en route. Step four, stop it 

at the port of entry or along the border in coastal areas. Five, detect movement within the United States. And, six, address the 

threats on the streets of our towns and cities. 

Addressing these steps requires a layered security strategy. The 

one absolute about terrorists is that they strive to be unpredictable. 

To counter this, we have to have some level of uncertainty in our 

security response and robust layers of security throughout the supply chain. Ultimately, intelligence is our best weapon. It is not possible to do everything all the time. We have to have some odds projection inherent in our security measures. We also have to be constantly changing our pattern so that terrorists are lost at sea when 

it comes to learning and exploiting our vulnerabilities. This enhances the deterrent factor. 

I look forward to the testimony today and to hearing what 

progress has been made implementing the SAFE Port Act and 

where we are lacking. According to the committee Republican staff 

report that reviewed the Department’s efforts over the past year, 

DHS has made substantial progress in many areas. The secure 

freight initiative stands out as one where DHS is ahead of schedule 

in implementing the 100 percent inspection pilots in complete accordance with the laws so far. 

In other areas, there is clearly more work to do. TWIC, setting 

standards for securing containers, and enhancing the high-risk targeting system are several areas where I am looking forward to 

hearing from our witnesses. 

That will complete my statement, and I would like to yield the 

rest of my time to Congressman Lungren who was the sponsor of 

the SAFE Port Act and is a member of the full committee. 

Mr. LUNGREN. I thank the gentleman for yielding. I thank the 

Chairlady for allowing me to participate in this hearing today. I 

will have to leave at one point in time to represent our side in the 

4 

defense authorization conference on behalf of the Homeland Security Committee, but I share the gentlelady’s appreciation for the 

tremendous positive impact that the ports of Long Beach and L.A. 

have, not only in California, but throughout the country and the 

importance of this bill. 

There is, of course, no perfect bill, there is no perfect law, and 

there is no perfect implementation. But I think we can take tremendous pride in the fact that we delivered a good bill that was 

signed into law by the President and that, based on our staff’s review of this and based on GAO’s review of this, that by and large, 

this has been implemented well under all circumstances that would 

be considered. 

We can always do better. But I think it is an important message 

for us to give the American people that they are safer as a result 

of the actions that have been taken by this Congress in cooperation 

with the administration since 9/11, and specifically since October 

13 of last year when the President signed H.R. 4954, the SAFE 

Port Act, we have moved forward. And I look forward to hearing 

the testimony here, the details, and also what more we might be 

able to do to assist in further implementation. And I thank the 

gentlelady. 

Ms. SANCHEZ. The Chair will now recognize the chairman of the 

full committee, the gentleman from Mississippi, Mr. Thompson, for 

an opening statement. 

Mr. THOMPSON. Thank you very much, Madam Chairman. I am 

happy to be here for this hearing. It has been a year since the 

SAFE Port Act was signed into law, and we are here today to learn 

about the Department of Homeland Security’s implementation of 

this important Act. 

Maritime security is a paramount importance to the United 

States. 95 percent of the goods destined for the United States arrive in our Nation’s seaports. These seaports and the men and 

women who work on these ports must be protected. Unfortunately, 

the Department of Homeland Security is not protecting these men 

and women to the extent it should. The Department of Homeland 

Security, plagued with a lack of leadership, is allowing these men 

and women to remain at risk. We owe the American people security. We owe them accountability. And, most importantly, we owe 

them freedom from fear. 

We are here today to find out why the Department of Homeland 

Security has failed in its mission to improve the maritime security. 

The Department of Homeland Security’s failure to implement the 

Transportation Worker Identification Credential is a perfect example of this failure. The Department began rolling out the TWIC 

program, which was mandated 5 years ago. just 2 weeks ago. Already, there are glaring problems. The Department significantly 

underestimated the number of workers who are required to get a 

TWIC. The Department estimated that 30,000 workers would need 

to get a TWIC card in the Port of Houston. According to the Port 

of Houston, the real number is closer to 350,000. At the Port of 

New York and New Jersey, the Department again underestimated 

the number. The Department’s estimate was 60,256. The real number is closer to 125,000. 

5 

The Department’s inability to successfully project the correct 

number of workers is compounded by the fact that the TWIC readers are years away from installation. Without the readers, a TWIC 

is merely a flash pass that can be fraudulently duplicated and misused. This misuse has already begun. Last week, the Coast Guard, 

issued an advisory stating that criminal elements were trying to 

obtain information about the TWIC program at the ports of Los Angeles and Long Beach. 

Five years and millions of dollars later, this program has already 

been compromised. The potential compromise is shocking, considering the fact that the Department has only rolled out the TWIC 

at one port. The Department provided the list today of its tentative 

rollout schedule for the rest of the ports. 

As in the past, the list does not contain concrete information; it 

contains vague dates. Vague dates are not good enough. Our ports 

should be given specific information to enable them to successfully 

roll out the TWIC at their ports. 

Unfortunately, TWIC is not the Department’s only troubled program. The Department has failed to develop a container security 

device regulation required by the SAFE Port Act. The Department 

claims that the technology does not exist. It does, and I have one 

that I would like to show to Customs and Border Protection here 

today. This device is made by General Electric. Other companies 

have developed their own versions. So it does exist. The Department’s failure to develop the regulation is just another example of 

the Department’s unwillingness or inability to follow the mandates 

clearly laid out by Congress. We established these mandates because we are committed to improving our Nation’s maritime security. We specifically told the Department to develop a strategic plan 

to enhance the security of the international supply chain. The Department did not develop a plan; it developed yet another document that will sit on the shelf collecting dust. 

Philip Spayd, in an August 27, 2007 article in the Journal of 

Commerce, summed it up best: The 128-page plan would receive a 

high grade as a research project for a graduate school class in 

international logistics, but which lacks any operational grounding. 

It is time for the Department to develop this operational grounding, and it is time for the Department to meet the mandate set by 

the American public, freedom from fear. 

PREPARED STATEMENT OF THE HONORABLE BENNIE G. THOMPSON, CHAIRMAN, 

COMMITTEE ON HOMELAND SECURITY

ood morning and thank you for being here today. 

It has been a year since the SAFE Port Act was signed into law, and we are here 

today to learn about the Department of Homeland Security’s implementation of this 

important Act. 

Maritime security is of paramount importance to the United States. Ninety-five 

percent of the goods destined for the United States arrive at our nation’s seaports. 

These seaports and the men and women who work on these ports must be protected. 

Unfortunately, the Department of Homeland Security is not protecting these men 

and women to the extent it should. The Department of Homeland Security, plagued 

with a lack of leadership, is allowing these men and women to remain at risk. 

We owe the American people security. We owe them accountability. And most importantly, we owe them freedom from fear. We are here today to find out why the 

Department of Homeland Security has failed in its mission to improve the maritime 

security. 

6 

The Department of Homeland Security’s failure to implement the Transportation 

Worker Identification Credential (TWIC) is a perfect example of this failure. The 

Department began rolling out the TWIC program, which was mandated five years 

ago, just two weeks ago. 

Already there are glaring problems. The Department significantly underestimated 

the number of workers who are required to get a TWIC. The Department estimated 

that 30,000 workers would need to get a TWIC in the Port of Houston. According 

to the Port of Houston, the real number is closer to 350,000. At the Port of New 

York and New Jersey, the Department again underestimated the number. The Department’s estimate was 60,256. The REAL number is closer to 125,000. 

The Department’s inability to successfully project the correct number of workers 

is compounded by the fact that the TWIC readers are years away from installation. 

Without the readers, a TWIC is merely a flash pass that can be fraudulently duplicated and misused. This misuse has already begun. Last week, the Coast Guard released an advisory stating that criminal elements were trying to obtain information 

about the TWIC program at the Ports of Los Angeles and Long Beach. Five years 

and millions of dollars later, this program may already be compromised. 

The potential compromise is shocking considering the fact that the Department 

has only rolled out the TWIC at one port. The Department provided a list today of 

its tentative rollout schedule for the rest of the ports. 

As in the past, this list does not contain concrete information—it contains vague 

dates. 

Vague dates are not good enough—our ports should be given specific information 

to enable them to successfully roll out the TWIC at their ports. 

Unfortunately, TWIC is not the Department’s only troubled program. The Department has failed to develop the container security device regulation required by the 

SAFE Port Act. The Department claims that the technology does not exist. It does 

and I have one that I would like to show to Customs and Border Protection today. 

This device is made by General Electric and other companies have developed their 

own versions. The Department’s failure to develop the regulation is just another example of the Department’s unwillingness or inability to follow the mandates clearly 

laid out by Congress. 

We established these mandated because we are committed to improving our nation’s maritime security. We specifically told the Department to develop a Strategic 

Plan to Enhance the Security of the International Supply Chain. The Department 

did not develop a plan; it developed yet another document that will sit on the shelf 

collecting dust. 

Philip Spayd in an August 27, 2007 article in the Journal of Commerce sums it 

up best the ‘‘128-page plan would receive a high grade as a research project for a 

graduate school class in international logistics, but which lacks any operational 

grounding.’’ 

It is time for the Department to develop this operational grounding and it time 

for the Department to meet the mandate set by the American public—freedom from 

fear. 

Ms. SANCHEZ. Other members of the subcommittee are reminded 

that, under the committee rules, opening statements may be submitted for the record. 

I welcome our first panel of witnesses. I will go through your 

backgrounds a bit, and then we will start from my left through the 

right for 5 minutes apiece, or under, if you can do that, to summarize your testimony. 

Our first witness, Ms. Maurine Fanguy, is director of the Transportation Worker Identification Credential, the TWIC program, at 

the Transportation Security Administration. And prior to joining 

TSA, she provided business and technology consulting services to 

private and public sector clients. She also worked on a wide range 

of homeland security-related projects there, including border management issues and the application of biometric technologies. 

Our second witness is Captain Francis Sturm, Deputy Director 

For Prevention Policy under the Assistant Commandant For Marine Safety, Security, and Stewardship at U.S. Coast Guard Headquarters. In this position, which he has held since May of 2006, 

Captain Sturm establishes and coordinates policies and priorities 

7 

for inspection and compliance field missions. He previously served 

as chief office of port and facility activities at Coast Guard Headquarters from August of 2004. 

Our third witness is Mr. Winkowski, Assistant Commissioner for 

the Office of Field Operations at U.S. Customs and Border Protection. In that position, which he has held since August, he manages 

an operating budget approaching $2.5 billion, directs the activities 

of 24,000 employees, and oversees programs and operations at 20 

major field offices, 326 ports of entry, 58 operational container security initiatives ports, and 15 pre-clearance stations in Canada, 

Ireland, and the Caribbean. Thank you for making the time to be 

here with all that. 

Our fourth witness is Mr. Vayl Oxford, director of the Domestic 

Nuclear Detection Office at the Department of Homeland Security. 

Mr. Oxford was appointed director in December of 2006. He is responsible for DNDO’s jointly staffed office which serves as the primary entity in the United States Government to improve the Nation’s capability to detect and report unauthorized attempts to import, possess, store, develop, or transport nuclear or radiological 

material for use against the Nation and to further enhance this capability over time. Welcome. 

And our final witness on the first panel is Mr. Stephen L. 

Caldwell, Director of Homeland and Justice Issues, Homeland Security and Justice Issues, Government Accountability Office. In 

this capacity, he provides direct support to congressional committees and to the individual Members of the House and Senate on 

Maritime Security and U.S. Coast Guard issues. 

Ms. SANCHEZ. Welcome to all of you. And, without objection, your 

full testimonies will be inserted in the record. And I will now ask 

each witness to summarize his or her statement for 5 minutes, beginning with Mrs. Fanguy. 

STATEMENT OF MAURINE FANGUY, DIRECTOR, 

TRANSPORTATION SECURITY ADMINISTRATION, 

DEPARTMENT OF HOMELAND SECURITY 

Ms. FANGUY. Good afternoon, Madam Chairwoman, Ranking 

Member Souder, Chairman Thompson, and distinguished members 

of the subcommittee. My name is Maurine Fanguy, and I am the 

program director for the Transportation Worker Identification Credential program, also known as TWIC. Today I am here to show 

you the results of our efforts, the TWIC credential. In all of our 

previous meetings, we have talked to you about what we needed to 

do and what we are going to do. Now I would like to tell you what 

we have done. 

Since I last testified before you in April, I am proud to say we 

have completed testing and have made significant advances in all 

aspects of the program. Most importantly, we began enrollments in 

Wilmington, Delaware on October 16. Enrollment is going well to 

date. We have enrolled more than 700 people and have more than 

7,000 people pre-enrolled nationwide. Average enrollment time is 

under 15 minutes, and average wait time in Wilmington is about 

6 minutes. These are real numbers that demonstrate real progress. 

As we speak, our team is preparing to begin enrollments in Corpus Christi this Thursday, November 1. After we verify successful 

8 

operations in Corpus Christi on Thursday, we will issue the specific 

dates for the next 10 ports. Based on our progress to date, we are 

on track for mid November rollout in Baton Rouge, Beaumont, 

Honolulu, Oakland, and Tacoma. This group will be followed in late 

November by Chicago/Calumet, Houston, Port Arthur, Providence, 

and Savannah. 

TWIC is one of the world’s most advanced interoperable biometric credentialing programs and is powered by state-of-the-art technologies. As we continue to roll out across the Nation, TSA will vet 

as many workers in one day as we did in one year of prototype. 

That is over 5,000 workers a day. This program will impact hundreds of thousands of American workers who represent the backbone of global commerce. The start of enrollment represents a significant milestone in the program, and we have also taken other 

critical steps in our multi-layered approach to securing our Nation’s ports. 

First, we added 17 new TWIC enrollment sites based on stakeholder input. We understand the importance of making enrollment 

as convenient and accessible as possible. The additional sites bring 

the total number to fixed enrollment centers to 147 nationwide. We 

have also added mobile enrollment to take TWIC directly to the 

workers. Second, we reduce the price of a standard TWIC card to 

$132.50. It is very important to us to limit the cost to workers as 

much as possible. Third, we publish technical specifications for 

TWIC biometric card readers. This allows industry to enhance access control technologies used at 3,200 facilities and on 10,000 vessels. 

And, fourth, we held kickoff meetings with five card reader pilot 

participants. The Port Authorities of Long Beach, Los Angeles, 

New York and New Jersey, and Brownsville, as well as watermark 

cruises in Annapolis, were selected to represent a broad range of 

operating environments. We are continuing to meet with interested 

stakeholders to identify additional participants. We are pleased to 

have started in Wilmington, and look forward to the start of enrollment in Corpus Christi later this week. We will continue to work 

with our partners, the Coast Guard, maritime stakeholders, and 

this committee, to ensure the ongoing success of the TWIC program. We appreciate your support most recently in sending a staff 

delegation to Wilmington, and we look forward to hosting you at 

one of our enrollment centers soon. 

Thank you for the opportunity to appear today, and I would be 

happy to answer any questions. 

Ms. SANCHEZ. I thank the gentlelady. 

[The statement of Ms. Fanguy follows:] 

PREPARED STATEMENT OF MAURINE FANGUY

Good afternoon Chairwoman Sanchez, Ranking Member Souder, and distinguished members of the Sub-Committee. Thank you for this opportunity to share 

with you the significant progress we have made on the Transportation Worker Identification Credential (TWIC) program. I would like to acknowledge the leadership 

this sub-committee has provided in defining the vision for TWIC. 

The TWIC program is moving towards its objectives while making sound decisions 

focused on enhancing port security and a reasoned, phased-in program implementation approach. I am happy to inform the Committee that TWIC enrollments began 

in Wilmington, Delaware, on Tuesday, October 16, 2007. After successful start-up 

in Wilmington, we will now proceed to Corpus Christi in early November. By midVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00012 Fmt 6633 Sfmt 6621 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
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November, enrollment will start in Baton Rouge, Beaumont, Honolulu, Oakland, 

and Tacoma. This group will be followed in late November by Chicago/Calumet, 

Houston, Port Arthur, Providence, and Savannah. 

In addition to announcing the implementation of the program, we have made significant progress in other areas since our last appearance before this sub-committee: • Implementation of the pre-enrollment capability; • Completing test milestones on the enrollment system; • Adding TWIC enrollment sites based on stakeholder input; • Reducing the price of a TWIC card; • Establishing reader technical specifications; and • Identifying card reader pilot participants and holding kick-off meetings. 

Completing Test Milestones on the Enrollment System 

TWIC will impact hundreds of thousands of American workers essential to the 

smooth flow of global commerce. Once TWIC is up and running, TSA will vet as 

many workers in one day as we did during the entire year-long prototype. The importance and enormity of this task within the maritime environment, with a dynamic and mobile workforce, has demanded a methodical approach with rigorous 

testing. 

TWIC will be one of the world’s most advanced, interoperable biometric 

credentialing programs and is powered by state-of-the-art technologies. We have 

completed our ‘‘flight test’’ of the full TWIC system, which has five main components: • Pre-Enrollment Web Site: allows workers to schedule appointments and 

provide information ahead of time to make enrollment easier. 

• Enrollment Center: captures a worker’s biometric and biographic information and submits the information for security processing. 

• TWIC Core System: routes applicant information for processing, conducts 

data integrity checks, and manages the status of TWIC cards. 

• Screening Gateway: aggregates security threat assessment data from the 

FBI, Citizenship and Immigration Services, and watchlists. It is important to 

note that the Screening Gateway is used across all of TSA’s vetting programs. 

• Card Production: electronically loads an applicant’s information onto a 

TWIC smart card and then physically produces the card. 

All five of these parts were first tested individually. Next, these pieces were integrated to ensure the functionality of the end-to-end process of conducting accurate 

and timely security threat assessments and producing high quality credentials. In 

addition, security and privacy requirements were validated throughout the process. 

After our contractor verified system readiness, TSA completed independent 

verification before beginning final test enrollments in the field using live vetting on 

government and trusted contractor personnel. 

Today the switch has been turned on and the doors have opened with the commencement of enrollment in Wilmington, Delaware. After we verify successful enrollment operations in Wilmington, we will move forward to expand TWIC across 

the nation. 

Adding TWIC Enrollment Sites 

The TWIC final rule established a network of 130 enrollment sites located across 

the nation. Understanding the importance of making enrollment as convenient and 

accessible as possible, we have worked with maritime stakeholders, the Department, 

and our partners in the United States Coast Guard to add additional locations for 

TWIC enrollment centers. At this time, we will field 146 fixed enrollment centers. 

In addition, we have worked with our contractor to add a mobile enrollment capability to take TWIC to the workers. 

Reducing the Price of a TWIC Card 

TWIC is a fee-based program paid for by applicants. We fully realize that these 

costs are significant, and we are mindful of the need to identify areas for cost reduction. Recently, we announced that the fee for a standard TWIC will now be $132.50, 

a decrease from the price anticipated in the Final Rule. Workers with current, comparable threat assessments including HAZMAT, Merchant Mariner Document 

(MMD) or Free and Secure Trade (FAST)) will receive a discounted fee of $105.25. 

The cost of a lost, damaged or stolen credential is $60. 

Establishing Reader Technical Specifications 

The TWIC technical architecture is compatible with the credentialing standards 

established in Federal Information Processing Standard (FIPS) 201–1. This alignment is critical to support card and reader interoperability within the maritime 

mode. In response to comments received on the initial TWIC Notice of Proposed 

Rulemaking (NPRM), TSA and the Coast Guard decided to remove the requirement 

10 

for biometric readers from the TWIC final rule to allow time to establish technology 

specifications to support maritime operations. 

TSA and the Coast Guard sought the advice of the National Maritime Security 

Advisory Committee (NMSAC), which established a working group to collaboratively 

develop new technical specifications that complement FIPS 201–1 and add features 

that will support high-volume physical access in the harsh maritime environment. 

The working group included representatives from both the maritime and technology 

industries. 

TSA recently published the TWIC reader hardware and card application working 

technical specification. The working specification establishes the requirements for 

biometric card readers for the pilot projects required by the SAFE Port Act. These 

readers will be tested during the pilot program. As the card and readers are envisioned to operate when TWIC is fully implemented, use of a PIN will not be necessary to release the biometric, unless the owner/operator chooses to use contact 

readers and the contact side of the credential. 

Identifying Card Reader Pilot Participants and Holding Kick-Off Meetings 

As required by the SAFE Port Act, we have initiated pilot programs with five 

partners across the country to test card readers. The pilots will test access control 

technologies in real world marine environments. Our current list of participants includes the Port Authorities of Los Angeles, Long Beach, Brownsville, and New York/ 

New Jersey, in addition to Watermark Cruises in Annapolis, Maryland. As part of 

the outreach efforts for the TWIC program and the Department’s Port Security 

Grant Program, we continue to seek additional participants. Our objective is to include pilot test participants that are representative of a variety of facility vessels 

which operate in a variety of geographic locations and environmental conditions. 

There appears to be sufficient interest from the maritime community to achieve this 

objective. 

We are in the process of finalizing the test approach for the pilots. We are working with the Department of Homeland Security’s Science and Technology component 

and the National Institute of Standards and Technology (NIST) to establish a test 

plan that will evaluate the card-reader interface under a variety of conditions and 

assess its impact on operations. Through the pilot tests, we will investigate the impacts of requiring biometric identity verification on business processes, technology, 

and operational impacts on facilities and vessels of various size, type, and location. 

As the program proceeds, the pilots will inform the TWIC reader rulemaking process and ultimately result in final regulations that require the deployment of transportation security card readers consistent with the findings of the pilot program. 

Lessons Learned and Future Efforts 

We are proud of the significant progress we have made in the past six months 

and are mindful of the challenges ahead. As we move forward in the TWIC program, 

we are committed to incorporating our lessons learned to drive sound management 

decisions geared at improving all aspects of the program, including: 

• Look for efficiencies by eliminating duplicative regulatory processes. TSA and 

Coast Guard are developing procedures for the sharing of fingerprints, identity 

verification, criminal history, and photographs for TWIC which is expected to 

save not only money but time. In addition, merchant mariners will no longer 

be required to visit a Regional Exam Center to obtain and renew their credentials, resulting in substantial time and travel savings. 

• Place the highest value in stakeholder input; it is time well spent. The public 

hearings, comments to the NPRM, meeting with operators and associations, and 

contributions of advisory councils all added great value. We came away from 

each and every one of these efforts better informed about the challenges, the 

unacceptable impacts, and the practicable options for protecting our ports. 

• Address the impact on small businesses. TSA and the Coast Guard worked 

closely with the Small Business Administration to minimize the financial and 

operational impact on small businesses wherever possible. The rule includes 

provisions that allow MTSA-regulated passenger vessels (excluding cruise ships) 

to establish employee access areas for crewmembers that do not require 

unescorted access to secure areas such as the pilot house and engine room. This 

provision reduces the impact on those employees who rarely need to use spaces 

beyond those designated for support of passengers while maintaining the integrity of vessels’ secure areas. We are also producing and distributing a Small 

Business Compliance Guide to assist small businesses in their implementation 

of the program. 

• When practical, preserve State regulatory flexibility. Mariner regulations and 

port security plans preempt state regulations. However, the TWIC regulations 

do not preempt States from requiring background checks and badging systems 

11 

for non-security purposes in addition to TWIC. States may need to set standards for important purposes other than terrorism threats, such as theft or organized crime. 

• Plan for privacy. All data collected at an enrollment center will be completely 

deleted from the enrollment center work stations after transmission to TSA. 

The entire enrollment record (including all fingerprints collected) is stored in 

the TSA system, which is protected through role-based entry, encryption, and 

segmentation to prevent unauthorized use. No paper records with personal 

identification information are created in the enrollment process. 

• Technical innovation requires adaptive contract management. TWIC is attempting to develop a 21st century technology that accommodates evolving IT 

standards suited to emerging needs that span local, international, public, and 

private interests. This requires continual reevaluation of the scope and methods 

of contracting. The recent Lockheed Martin performance-based contract award 

is a culmination of our efforts to date. We will continue to look for and implement adaptive program planning, contractor oversight, and metrics to ensure 

the success of the program. 

• Plan to address what issues may arise during testing. Evolving technology, 

such as card readers, create a changing environment and program control constraints. This is especially the case when the technology must be deployed to 

a vast multitude of entities with remote connectivity challenges (e.g., vessels) 

and varying degrees of access control system capabilities. 

Conclusion 

The steps we are taking will be an extremely important aspect to the security of 

our port facilities and vessels. TSA will continue to work with our partners, the U.S. 

Coast Guard and maritime stakeholders, to ensure that for the first time in history 

thousands of independent businesses will have one interoperable security network 

and workers will hold a common credential that can be used across that entire network. 

I appreciate the keen interest that this Sub-Committee has in an effective implementation of TWIC, and I thank you for your support. Madame Chairwoman, this 

concludes my testimony, and I would be pleased to answer any questions that you 

may have. 

Ms. SANCHEZ. And I now recognize Captain Sturm to summarize 

your statement in five minutes, please. 

STATEMENT OF CAPTAIN FRANCIS STURM, DEPUTY 

DIRECTOR, CHIEF OF THE OFFICE OF PORT, VESSEL, AND 

FACILITY SECURITY, UNITED STATES COAST GUARD 

Captain STURM. Good afternoon Chairwoman Sanchez, Ranking 

Member Souder, Chairman Thompson, distinguished members of 

the subcommittee. My name is Captain Frank Sturm, acting director of Prevention Policy for the U.S. Coast Guard. It is a pleasure 

to appear before you today to discuss the Coast Guard’s efforts in 

implementing the SAFE Port Act requirements. 

The primary objective of the SAFE Port Act is to improve maritime and cargo security through an enhanced layered defense. The 

Coast Guard has been intimately involved in achieving many of the 

Act’s requirements. In the interest of time, I will address the key 

SAFE Port Act requirements which involve Coast Guard action. 

The resumption of commerce and recovery of the Marine Transportation System, or MTS, following a significant disruption is a 

national issue of concern. The Maritime Transportation Security 

Act, or MTSA of 2002, required that the National Maritime Transportation Security Plan include a plan to restore cargo flow following a national transportation security incident. The Coast 

Guard held a national symposium in August of 2006 that resulted 

in specific recommendations on NTS recovery, and these are being 

jointly addressed within the Department of Homeland Security. 

These follow-up actions as required by section 101 of the Act inVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00015 Fmt 6633 Sfmt 6601 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
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clude the development of salvage response plans within each area 

of Maritime Security Plan, or AMSP. The AMSP update is planned 

for completion by area maritime security committees during the 

summer of 2009 as part of the 5-year plan update cycle established 

by MTSA. 

Section of 104 of the SAFE Port Act includes a number of statutory requirements governing the implementation of the Transportation Worker Identification Credential, or TWIC. The Coast Guard 

and TSA met the section’s first deadline with the posting of the 

TWIC final rule on January 1, 2007. The TWIC rule, together with 

the Merchant Mariner Credential Rule, which was published on 

January 25, 2007, will allow mariners to apply for or renew Merchant Mariner credentials through the mail concurrently with the 

TWIC enrollment process, thereby eliminating travel to Coast 

Guard regional exam centers and removing duplicative background 

checks and other application redundancies. 

The TWIC final rule also incorporates a background check process to enable newly hired workers to begin working while awaiting 

issuance of their TWIC. To enhance both the safety and security 

of vessels transiting our waters, the Act requires the establishment 

of a long-range automated vessel tracking system. This requirement demands a multi-faceted approach. Using the full range of 

classified and unclassified vessel tracking information, including 

some information purchased some vendors where appropriate, the 

Coast Guard currently meets or exceeds the tracking requirements 

of the Act. The Long-Range Identification and Tracking Notice of 

Proposed Rulemaking was published in the Federal Register on October 3, 2007. 

In accordance with section 113 the Coast Guard is supporting the 

Federal Emergency Management Agency, or FEMA, in implementing requirements relating to port security training. Collectively, progress has been made in establishing a program delineated in the Act. The Coast Guard and the Maritime Administration, or MARAD, have developed model courses for facility personnel to meet the requirements of 2002. These model courses establish a competency based standard and also cover the majority 

of the requirements of the SAFE Port Act. 

In addition, FEMA has awarded a $6.18 million cooperative 

grant to Florida State University to develop courses meeting requirements MTSA requirements and covering the eight port security related topics required under the SAFE Port Act. 

Federal funds have also been awarded to assist ports with security enhancements. Over $200 million in port security grand funding were available in fiscal year 2007. Initial reviews of the fiscal 

year 2007 grant applications were completed first by local captains 

of the port and then by a national review panel. Funds were 

awarded based on analysis of risk and the effectiveness of proposed 

investments, and results were announced on May 30, 2007. An additional $110 million was provided by Congress in supplemental 

port security grant funding earlier this calendar year. Awards for 

this funding were announced in September of 2007. 

Finally, in accordance with the Act, the Coast Guard has increased the pace of foreign port assessments and is on track to 

complete an initial assessment of all of our trading partners by 

13 

March of 2008. We intend to conduct assessments on a two-year 

cycle thereafter and continue capacity building efforts overseas. 

In conclusion, the Coast Guard is committed to implementing all 

the various statutes within the SAFE Port Act. We continue to 

make headway on all fronts and look forward to future progress 

and partnerships with international, Federal, State, and local port 

organizations. 

Thank you for the opportunity to testify today. 

Ms. SANCHEZ. Thank you, Captain, for your testimony. 

[The statement of Captain Sturm follows:] 

PREPARED STATEMENT OF CAPTAIN FRANCIS J. STURM

Good afternoon Madame Chairwoman and distinguished members of the Subcommittee. I am Captain Francis J. Sturm, Acting Director for Prevention Policy 

under the Assistant Commandant for Marine Safety, Security and Stewardship at 

Coast Guard Headquarters. It is a pleasure to appear before you today to discuss 

the Coast Guard’s efforts in implementing the Safety and Accountability for Every 

Port (SAFE Port) Act requirements one year after its implementation. 

The objective of the SAFE Port Act is ‘‘to improve maritime and cargo security 

through enhanced layered defenses.’’ The Coast Guard is cited as one of the primary 

organizations identified with specific responsibilities for implementing this overall 

objective. Several components within our organization have been involved in achieving the requirements since October 13, 2006 and I will address the SAFE Port Act 

requirements section-by-section. 

We have had many successes to date in meeting the requirements of the SAFE 

Port Act, including requirements involving the inclusion of Salvage Response Plans 

in Area Maritime Transportation Security Plans (Section 101); Unannounced Inspections of Maritime Facilities (Section 103); the Port Security Training Program (Section 113); the Port Security Exercise Program (Section 114); and Foreign Port Assessments (Section 234). 

We recognize, however, that there is still work to be done. There are some 

timeline requirements in the SAFE Port Act that we have not met, including those 

related to Notice of Arrival for Foreign Vessels on the Outer Continental Shelf (Section 109) and Enhanced Crewmember Identification (Section 110). We are committed to working closely and diligently with our DHS partners to meet these and 

other requirements of the SAFE Port Act. 

Section 101 Area Maritime Transportation Security Plan to include salvage response plan 

Development of Salvage Response Plans within each Area Maritime Security Plan 

(AMSP) has been integrated into the five-year plan update cycle established by the 

Maritime Transportation Security Act (MTSA) of 2002. The AMSP update will be 

performed by Federal Maritime Security Coordinators in consultation with their respective Area Maritime Security Committees and is planned for completion during 

early summer 2009. 

A Salvage Response Plan will be a major element of the U.S. Marine Transportation System (MTS) recovery section of each AMSP and will provide the coordination and procedural foundation to support development of unified command incident 

action plans under the Incident Command System (ICS) construct when salvage response becomes necessary to facilitate resumption of trade. Authorities, capabilities, 

and other salvage issues are currently being coordinated with government and other 

partners. Consultation with national-level salvage industry representatives is continuing with the development of a Memorandum of Understanding (MOU) between 

the Coast Guard and the American Salvage Association. The MOU will establish a 

partnership with the goal of strengthening the communication and working relationship between the Coast Guard and the marine salvage and fire fighting industries 

to improve vessel and personnel safety; enhance national security preparedness and 

response; promote timely and professional salvage response to marine casualties; 

and enhance the protection of the environment along our nation’s waterways. 

Resumption of commerce and recovery of the marine transportation system (MTS) 

following a significant disruption is a significant national issue of concern. The Maritime Transportation Security Act (MTSA) 2002 required that the National Maritime Transportation Security Plan include a plan to restore cargo flow following a 

National Transportation Security Incident (NTSI). The Coast Guard held a National 

Recovery Symposium at the National Maritime Institute of Technology and GradVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00017 Fmt 6633 Sfmt 6621 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
14 

uate Studies on August 1st and 2nd, 2006. The symposium was attended by over 

150 executive level participants from numerous branches of state and Federal government, as well as the private sector. 

The Coast Guard is currently developing a concept of operations and specific planning requirements and organizational structures to ensure a focus on MTS recovery 

following a significant disruptive incident. MTS recovery guidance will be harmonized with, and support implementation of, the Strategy to Enhance International Supply Chain Security recently completed by the Department of Homeland 

Security with Coast Guard and interagency input. Implementation guidance will 

also harmonize with MTS recovery principles gleaned from Hurricane Katrina lessons-learned that have already been published in the U.S. Coast Guard Incident 

Management Handbook. 

Review of maritime security developments since the implementation of MTSA, 

MTS recovery lessons from Hurricane Katrina, best Area Maritime Security practices from the field, and an update of MTSA implementation guidance are in 

progress. Review results to date have formed the basis for revising Navigation Vessel Inspection Circular 09–02 which is used to guide the five-year AMSP update. 

Consistent with the overriding requirement to deter, and when necessary, mitigate the effects of Transportation Security Incidents (TSIs), the Coast Guard is 

working to make AMSP coordination and procedures ‘‘all-hazard and transportation 

disruption’’ compatible as much as practicable. This, in conjunction with oil and hazardous materials response coverage provided through Area Contingency Plans 

(ACP), application of Incident Command System (ICS) principles and structures per 

the National Incident Management System (NIMS), is intended to support an integrated and coherent preparedness approach across all transportation disruptions 

without requiring additional port-level plans. 

Section 102 Requirements relating to maritime facility security plans 

The Coast Guard recognizes that information on ownership of maritime facilities 

and the companies that operate them is vitally important to the management of the 

security posture and the clear delineation of security responsibilities within the 

port. Currently, in 33 CFR 104.415(b)(2), 105.415(b)(2), and 106.415(b)(2), the Coast 

Guard requires a security plan audit whenever the owner or operator of a vessel, 

facility or Outer Continental Shelf (OCS) facility changes. Should the audit reveal 

that an amendment to the security plan is necessary, the security officer of the vessel, facility or OCS facility will submit the amendment to the cognizant Captain of 

the Port or District Commander for approval. Consistent with the requirement in 

Section 102 of the SAFE Port Act, the DHS Appropriations Act of 2007 requires the 

Coast Guard to gather ownership information on vessel and facility security plans. 

In order to meet the requirements in these statutes, the Coast Guard has initiated a regulatory project to update 33 CFR Subchapter H regulations and will incorporate these new ownership reporting requirements. 

Implementation of the Transportation Worker Identification Credential (TWIC) 

regulations published in January 2007 will meet the requirement in Section 102 for 

a qualified individual having full authority to implement security actions for a facility to be a citizen of the United States, unless the Secretary waives the requirement 

after a determination based on a complete background check of the individual. 

These regulations, found in 33 CFR 105.205(a)(4), require facility security officers 

(the qualified individuals in the statute) to possess and maintain a TWIC. The security threat assessment conducted as part of the TWIC program involves a complete 

background check, including a criminal history records check, a legal status check, 

and an intelligence and terrorist watch list check, to satisfy the relevant mandate 

within this section. In addition, the Coast Guard is addressing the requirement for 

Facility Security Officers to be U.S. citizens in the regulatory project to update Subchapter H. A final fee was published on September 28th along with some modifications to the earlier rule. 

Section 103 Unannounced inspections of maritime facilities 

Currently, Coast Guard policy calls for an annual inspection of each facility, supplemented by periodic spot checks. The fiscal year 2007 Homeland Security Appropriations Act provided $15M to, among other efforts, fund additional port security 

inspections. With this funding, the Coast Guard has created 39 new field billets to 

add to the current 350 facility inspectors. Thirty-seven of these new billets were 

filled during the 2007 transfer season, and the remaining two are in the process of 

being filled. The Coast Guard conducted more than 7,500 annual inspections and 

spot checks of 3,200 facilities in calendar year 2006. We have also applied additional 

reserve billets this year to increase facility visits and ensure each facility is inspected not less than two times this year. At least one of those inspections will be 

unannounced. 

15 

Section 104 Transportation security card 

Section 104 of the SAFE Port Act includes a number of statutory requirements 

relating to the implementation of the TWIC program. The effort to promulgate 

TWIC requirements through the rulemaking process met its SAFE Port Act deadline of January 1, 2007 with the posting of the TWIC Final Rule. This rule, together 

with the Merchant Mariner Credential Supplemental Notice of Proposed Rulemaking published on January 25, 2007, will allow mariners to apply for or renew 

merchant mariner credentials through the mail concurrently with the TWIC enrollment process, eliminating travel to Coast Guard Regional Exam Centers and removing duplicative background checks and other application redundancies which exist 

under each program. Also, the TWIC final rule incorporates a background check 

process to enable newly hired workers to begin working while awaiting issuance of 

their TWIC, in accordance with the Act. 

The Coast Guard continues to support the Transportation Security Administration’s (TSA’s) efforts to implement the TWIC program by providing field and industry guidance to assist with compliance and enforcement activities. In addition, the 

Coast Guard is working closely with DHS and TSA on the pilot program to test the 

implementation of card readers to provide critical information and lessons to inform 

a second rulemaking to address TWIC readers. As part of our support for this effort, 

the Coast Guard, jointly with TSA, charged the National Maritime Security Advisory Committee (NMSAC) to form a working group of maritime industry and biometric technology representatives to propose specifications for TWIC cards and card 

readers using a contactless (or proximity) interface. The NMSAC presented recommended specifications on February 28, 2007. A notice of availability of the specifications was published in the Federal Register for public comment on March 16, 

2007 and the notice of availability of the final contactless specification was published in the Federal Register on September 20, 2007. 

Work continues on several aspects of the TWIC Program. The Coast Guard intends to purchase handheld card readers in fiscal year 2008 for use during vessel 

and facility inspections and spot checks. After the compliance date passes in a given 

port, the Coast Guard will use the card readers to randomly check the validity of 

an individual’s TWIC. Also, the provision for newly hired employees to work while 

they await issuance of a TWIC is in development and on track. The Coast Guard 

has received stakeholder comments on policy and included them in the form of a 

Navigation and Vessel Inspection Circular (NVIC) which provides guidance and instruction on how to implement TWIC regulatory requirements for access control on 

facilities and vessels. This NVIC was published in July 2007. 

Section 107 Long-range vessel tracking 

The Coast Guard currently meets the intent and requirements of the Act, using 

the full range of classified and unclassified vessel tracking information available. 

However, it takes up to two years to develop and finalize a regulation. While the 

Long Range Identification and Tracking (LRIT) NPRM did not meet the April 1, 

2007 deadline, it was published in the Federal Register on October 3, 2007. The Act 

requires the DHS Secretary to establish a long range automated vessel tracking system that meets the following: 

• Tracking: Provided for all vessels in U.S. waters equipped with Global Maritime Distress and Safety System (GMDSS) or equivalent satellite technology; 

and 

• International: Consistent with international treaties, conventions and agreements. 

Tracking: 

The SAFE Port Act requirement demands a multi-faceted approach. Using the full 

range of classified and unclassified vessel tracking info available, including some information purchased from vendors where appropriate, the Coast Guard currently 

meets and exceeds the tracking requirement of the Act. Currently, sufficient tracking information exists; however more work is needed in processing, display, and 

training in the use of this information. 

International: 

Our work to establish a system through the International Maritime Organization 

(IMO) will provide an unclassified global tracking capability in 2008 as a part of 

an existing IMO convention and give the United States a system that is compatible 

and interoperable with the global maritime community. The Coast Guard has been 

working with the IMO since shortly after 9/11 to implement a global tracking system for the types of vessels described in the Act. Following considerable diplomatic 

efforts, the international agreement to implement such a system was reached last 

year, and the global tracking system will be in effect at the end of 2008. In the long 

run, this approach is more advantages to the United States because it applies globVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00019 Fmt 6633 Sfmt 6621 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
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ally to all the world’s ships of the kind described by the Act instead of just those 

in U.S. waters or vessels intending to make ports call in the United States. Under 

this system, the U.S. will have access to information for U.S. Flag vessels regardless 

of their current location, and vessels bound for U.S. ports when they declare intent 

to arrive. Information on all other vessels will be available whenever a ship is within 1,000 nautical miles of the U.S. coast. The Coast Guard is examining funding 

strategies for this important international system. 

To complement the above activities, the Coast Guard also initiated a rulemaking 

to implement in Title 33 of the Code of Federal Regulations rules that require ships 

to report identifying and position data electronically. These rules provide guidance 

to U.S. and foreign ships on how to comply with this new reporting requirement, 

as well as an additional enforcement mechanism for ships that fail to comply. 

Section 108 Establishment of Interagency Operational Centers for Port Security 

Section 108 requires a budget and cost-sharing analysis for implementing interagency operations centers. The report required by this Section was submitted in 

July. It identified the estimated total acquisition cost of upgrading the 24 Coast 

Guard Sector Command Centers (SCCs), which encompass the Nation’s high priority 

ports, as approximately $260 million. The major cost elements of this five-year 

project plan include an information management software suite, a sensor package 

and facility recapitalization. 

The establishment of interagency operations centers is currently not funded. In 

cooperation with the Department of Justice (DOJ), the U.S. Navy, and the DHS Office of Science and Technology, five prototype centers have been established to date. 

These centers are each configured differently as test beds for concepts, tactics, procedures and equipment. Cost sharing arrangements exist among the various participants. 

Designator Location Cost-Sharing Agencies 

Seahawk Joint Task Force Charleston, SC Dept. of Justice/U. S. Coast Guard.

SCC*-Joint Hampton Roads, VA U. S. Coast Guard/U.S. Navy.

SCC-Joint San Diego, CA U.S. Coast Guard/U.S. Navy.

SCC–Joint Jacksonville, FL U.S. Coast Guard/U.S. Navy.

SCC–Joint Seattle, WA U.S. Coast Guard/U.S. Navy.

*Sector Command Center

Additionally, seven ports have been identified for short and medium term pilot 

projects to evaluate joint operations design models between the Coast Guard and 

Customs and Border Protection (CBP). These pilots will include examination of 

methods for implementation of a virtual command center construct using various 

collaboration tools for daily coordination and vessel inspection planning. 

Command 21, when funded, will field the capabilities necessary to create interagency operations centers as required by Section 108. This establishment of proposed interagency operational centers for port security is a major system acquisition 

tailored to each port and designed to close gaps in port and coastal maritime security. 

Command 21 will: 

• Improve maritime port and coastal security systems to complement Secure 

Border Initiative (SBI) Net; 

• Improve unity of effort in a multi-agency operations center environment; 

• Accelerate deployment of a net-centric tactical system that implements DHS 

enterprise standards for the sharing of situation data and services across multiple DHS interagency domains and Coast Guard systems; and 

• Counter the small vessel threat in port and coastal areas. 

The Coast Guard’s experience with interagency operations centers demonstrates 

that many tangible benefits to improve maritime safety, security, and stewardship 

can be achieved. Some of these include: 

• Cooperative targeting and coordination of intelligence facilitates information 

sharing; 

• Daily field-level coordination breaks down barriers between agencies; 

• Collective use of tactical sensors (radars/cameras) saves time, money and effort; 

17 

• Cooperative planning improves readiness and efficiency; and • Sharing of law enforcement information helps reduce criminal activity in the 

port and cut off potential funding to terrorist groups. 

Command 21 will close a critical gap between current capabilities and the desired 

interagency end state. Future interagency operations will be greatly improved as all 

partners will be able to: • See maritime activities using port surveillance sensors; • Understand the scene by automatically bringing tactical and intelligence information together; and 

• Share this tactical data with each other as they work side by side in improved facilities. 

To close the gap between the current Sector Command Center (SCC) capabilities 

and the future state desired by the Act, the Coast Guard must field a sensor network and an information system allowing the centers to monitor maritime activities 

in critical areas. That system must link vital data on vessel history, crew, and cargo 

to the activities observed. The current SCC facilities must also be sufficiently expanded to host port partners in an interagency operations environment, as directed 

by the SAFE Port Act and the Maritime Transportation Safety Act. 

Command 21 will publish tactical data in an open standard that allows other systems across multiple DHS domains to subscribe to the information and use according to the individual needs of each agency. It provides the maritime component of 

the Department of Homeland Security’s Secure Border Initiative (SBI). Good government demands that both programs move forward in parallel to increase deterrence 

capabilities. Moving ahead on both fronts will provide collaborative opportunities to 

leverage critical resources to broaden the impact of both programs toward securing 

our borders. 

Section 109 Notice of arrival for foreign vessels on the Outer Continental 

Shelf 

The regulations for Notice of Arrival for foreign vessels on the Outer Continental 

Shelf (OCS) have been developed and incorporated into an existing Coast Guard 

rulemaking project related to OCS activities. This rulemaking, the updating of 33 

CFR Subchapter N, ‘‘Outer Continental Shelf Activities,’’ already includes Notice of 

Arrival requirements for foreign vessels operating on the OCS. The Coast Guard has 

completed evaluation of the proposed regulations and public comments, and an interim rule will be issued to implement the provisions of Section 109 as expeditiously 

as possible. The earliest anticipated action would be an Interim Rule by March 

2008. If an NPRM is required, anticipated completion time would be at least two 

years. 

Section 110 Enhanced crewmember identification 

Historically, the Coast Guard advanced the effort to negotiate the international 

seafarer’s identification initiative at the International Labor Organization (ILO), resulting in the ILO–185 Seafarer’s Identification Document (SID). However, a requirement within ILO 185 prohibiting implementing nations from requiring a visa 

for seafarers holding a SID to be eligible for shore leave has prevented the U.S. from 

ratifying ILO 185. 

In accordance with the Act, the Coast Guard has prepared a draft NPRM defining 

the identification documents necessary for all foreign mariners calling on U.S. ports. 

The proposed identification requirements would also apply to US mariners arriving 

at U.S. ports from a foreign port of place of departure. 

Section 111 Risk assessment tool 

The Maritime Security Risk Analysis Model (MSRAM) is being used by Captains 

of the Ports/Federal Maritime Security Coordinators (FMSCs) and Area Maritime 

Security Committees (AMSC) to analyze and prioritize scenario-based risks within 

their areas of responsibility, and to measure risk reduction potential in the evaluation of port security grant program proposals. FMSC and AMSCs are required to 

validate the MSRAM data on an annual basis. This was last completed in the summer of 2007 using MSRAM version 2. 

Section 112 Port security grants 

The Coast Guard worked with the DHS Office of Grants and Training, who has 

fiduciary responsibility for the Port Security Grant Program, to complete the report 

to Congress required by this Section. The report was submitted to Congress on April 

27, 2007. 

The Port Security Grant Program (PSGP) provides grant funding to port areas for 

the protection of critical port infrastructure from terrorism. fiscal year 2007 PSGP 

funds are primarily intended to assist ports in enhancing risk management capabilities; domain awareness; capabilities to prevent, detect, respond to and recover from 

18 

attacks involving improvised explosive devices (IEDs) and other non-conventional 

weapons; as well as training and exercises. 

$201,670,000 was available for Port Security Grants in fiscal year 2007. These 

funds were divided amongst four tiers of ports. Within Tier I, eight of the highest 

risk port regions were allocated a fixed amount of funding based on risk. In many 

cases, multiple port areas were grouped together to reflect geographic proximity, 

shared risk, and a common waterway. Port areas submitting applications within 

Tier II and III were eligible to compete for the fiscal year 2007 PSGP but were not 

guaranteed funding. Section 112 of the SAFE Port Act also required that any entity 

addressed in an Area Maritime Security Plan also be eligible to apply. Tier IV was 

established for those new entities not within the port areas in Tiers I–III. This 

added approximately 259 ports to the 102 highest risk ports for a total of 361 that 

were eligible to compete, but were not guaranteed funding. 

Funds were awarded based on analysis of risk and effectiveness of proposed investments by the applicants. Risk to port Infrastructure Protection Program Detail 

areas was assessed using a methodology consisting of threat, vulnerability, and consequence factors. The majority of port security grant funds—$120.6 million—was allocated to eight Tier I ports or port areas that we consider to be the highest risk. 

Grant applicants had 60 days from January 6, 2007 to complete this process for 

the remaining $81M. Applications were required to be submitted electronically via 

the grants.gov web site no later than March 6, 2007. The initial reviews were completed by the local Captain of the Port. These results were forwarded to a national 

review panel comprised of representatives from the Coast Guard, the Transportation 

Security Administration (TSA), DHS Infrastructure Protection (IP), Grants and 

Training (G&T), the Domestic Nuclear Detection Office (DNDO), and the Maritime 

Administration (MARAD) that convened on April 9, 2007. The results were announced on May 30, 2007. 

The $110 million was provided by Congress in supplemental Port Security Grant 

Funding (P.L. 110–28, the U.S. Troop Readiness, Veterans’ Care, Katrina Recovery, 

and Iraq Accountability Appropriations Act, 2007). Using the same risk-based analysis utilized during the initial fiscal year 2007 Port Security Grants, funds were allocated to Tier I and II ports to develop a Port–Wide Risk Management/Mitigation 

and Business Continuity/Resumption of Trade Plan which will identify a prioritized 

listing of items to be addressed within future grant applications. Tier III ports that 

previously submitted projects under the initial fiscal year 2007 PSG Program which 

were validated but unfunded, are to be funded with the Supplemental Grant. Tier 

IV ports also applied for TWIC and Training under the Supplemental Grant funding. The application period has closed. Both field and national review of the Supplemental applications have been completed, with announcement of all awards completed in September 2007. 

Section 113 Port Security Training Program 

The Coast Guard is supporting the FEMA National Preparedness Directorate’s 

National Integration Center through Training and Exercises Integration (formerly 

known as the DHS Preparedness Directorate, Office of Grants and Training Division). Collectively, we are making progress in establishing the program delineated 

in the Act. There are a number of existing initiatives and new initiatives that will 

address the requirements in this section. 

In response to Congressional mandate, the Coast Guard and MARAD developed 

model courses for the training of facility and other personnel to meet the requirements of the Maritime Transportation Security Act of 2002. These model courses establish a competence based standard and contain most of the requirements under 

this Section of the Act. The model courses were developed in support of the facility 

security plan requirements, and apply to all personnel working in a port facility or 

required to enter a port facility in response to an emergency. These model courses 

are available via website to Federal, state and local personnel from the public and 

private sector and they are undergoing a review to include lessons learned and the 

additional topics required under the Act. To ensure quality training, Coast Guard 

and MARAD developed and implemented a voluntary course acceptance and certification process using the model courses as the guidelines for acceptance. The Coast 

Guard is currently revising the regulations for security training for facility personnel to ensure all training is measured against a standard of competence, including the topics required under the SAFE Port Act. 

The FEMA National Preparedness Directorate’s National Integration Center, 

through Training and Exercises Integration, has awarded a $6.18 million Cooperative Grant to the Florida State University to develop courses meeting the Maritime 

Transportation Security Act of 2002 requirements (model courses), and covering the 

eight port security-related topics required under the Act. MARAD and the Coast 

19 

Guard are actively assisting DHS to ensure this training will be consistent with existing standards and will provide the maximum possible return on investment. It 

is envisioned that these courses will be available for in-classroom and on-line training; and will be available both to Federal, state and local personnel as well as members of the private sector who work in the port security realm. 

In addition, the FEMA National Preparedness Directorate’s National Integration 

Center, through Training and Exercises Integration, has made available other training courses that address individual port security topics required under the Act. 

These courses are provided to State and local emergency responders and other identified audiences by Training and Exercises Integration, and are coordinated by each 

State’s governor-designated Training Point of Contact. 

Section 114 Port Security Exercise Program 

Current port security exercise programs conduct live, risk-based exercises that are 

realistic and evaluate total capability by focusing on the port community, in order 

to evaluate the entire capability. These exercises involve State and local governments, as well as facilities and vessels, to ensure that consistent methodology is applied and that all requirements are met as a result. Although current programs do 

not mandate facility participation in these annual exercises, participation has been 

strong and continues to increase. Facilities, as well as vessels, are encouraged to observe and/or participate in these port security exercises. When they choose to participate, they are offered the opportunity to put forth exercise objectives tailored to 

meet their specific needs. 

Since January 2005, the Coast Guard has assisted TSA in implementing their 

Port Security Training and Exercise Program (PortSTEP). Similarly, since October 

2005, the Coast Guard has sponsored its own Area Maritime Security Training and 

Exercise Program (AMStep) that exercises the port stakeholder’s ability to implement the provisions of the Area Maritime Security Plan. The Coast Guard and TSA 

have synchronized AMStep and PortSTEP to maximize coverage across the U.S. and 

minimize duplication of effort. In fiscal year 2007, these two programs collectively 

sponsored 41 port security exercises. Exercise types have included basic and advanced table-top, discussion-based exercises to full-scale, operations-based exercises. 

The type of exercise and scenario selected are collectively decided upon by Area 

Maritime Security Committee (AMSC) members, through application of their most 

current risk-based port assessment and assessment of preparedness needs. The results of both these exercise programs and all lessons learned, best practices, and 

corrective actions are documented in a semi-annual report to Congress. 

The ‘‘Training’’ aspect of current port security exercise programs focuses on the 

National Incident Management System (NIMS) Incident Command System (ICS). 

Training, such as I–200 (Basic), I–300 (Intermediate) and I–320 (Team training), is 

offered to the entire port community prior to each annual exercise. Security-specific 

training is provided from within the port community. 

Initial performance measures for port security exercises were established under 

Coast Guard NVIC 09–02, Change 2. These measures, outlined as objectives, are 

currently being revised by the Coast Guard to align with MTSA requirements to test 

the AMSPs and with the Homeland Security Exercise and Evaluation Program. All 

Lessons Learned, Best Practices, and Remedial Action Items are captured in the 

Coast Guard’s Contingency Preparedness System (CPS), which can be accessed by 

the entire Coast Guard. Additionally, through the use of Homeport, the Coast 

Guard’s communications and collaborations Information Technology application, 

Lessons Learned and Best Practices, can be made available to the entire port community (Federal, state, local, tribal and industry). 

Although AMStep is currently being carried out under contract support, the Coast 

Guard has begun the hiring of personnel to staff National-level and Regional-level 

exercise support teams. These teams will assist Coast Guard Sector Commands 

(port-level) and Districts with the following contingency exercise programs: port security, oil/hazardous substance response, natural disaster, mass rescue, alien migration interdiction, civil disturbance, counterterrorism, military outload, combatant 

commander support, and physical security/force protection. This is an ‘‘All Threats 

/ All Hazards’’ approach. 

Section 115 Facility exercise requirements 

Current regulations in 33 CFR 105.220(c) require facilities to conduct an annual 

exercise. These exercises may include either live, tabletop, or participation in a nonsite-specific exercise. In order to meet the requirement in Section 115, the Coast 

Guard has initiated a regulatory project to update 33 CFR Subchapter H regulations 

and will incorporate definition of ‘‘high risk facility’’ and the requirement for high 

risk facilities to conduct bi-annual full-scale exercises. The NPRM for this rulemaking is scheduled to be published in the spring of 2008. 

20 

Section 128 Center of Excellence for Maritime, Island and Extreme/Remote 

Environment Security 

The Coast Guard is assisting the DHS Science and Technology (S&T) Directorate 

to meet the requirements of Section 108. The Broad Area Announcement (BAA) for 

a Center of Excellence (COE) for Maritime, Island and Extreme/Remote Environment Security was announced at the beginning of February 2007. This BAA incorporated Maritime Domain Awareness (MDA) study as a central component of a 

broader system of research into maritime security. This solicitation is still open, and 

there has been good response from the academic community. DHS S&T expects to 

award the COE by the end of 2007. The Coast Guard looks forward to this important new research component that will support DHS. 

Section 201 Strategic plan to enhance the security of the international supply chain 

The Coast Guard assisted the Department of Homeland Security’s authoring team 

in drafting the required Strategy to Enhance International Supply Chain Security, 

providing lead authors for sections on response and recovery. Looking forward, the 

Coast Guard is working to structure the first required five-year update to Area Maritime Security Plans (AMSP) to position them to support field-level implementation 

of the strategy as it pertains to Transportation Security Incidents (TSI). A planning 

objective is to make these community-based coordination arrangements and procedures compatible for application during other forms of transportation disruption, insofar as practicable. We assigned the same Coast Guard subject matter experts to 

support each initiative, thereby facilitating content alignment for this purpose. 

Section 233 International cooperation and coordination 

The Coast Guard has been working with a variety of international organizations 

including the Asia Pacific Economic Cooperation (APEC) Forum, the Group of Eight 

(G8), and the Organization of American States (OAS) to conduct capacity building 

activities to improve the port security regimes of developing countries. Coast Guard 

representatives serve on maritime security expert groups of these organizations and 

have been intimately involved in identifying and executing projects. 

Of particular note is our work with the OAS, an organization that is specifically 

mentioned in the SAFE Port Act for close coordination. Through the Inter–American 

Committee on Counter–Terrorism (an OAS body), and in conjunction with Canada, 

the Coast Guard is developing a series of exercises and best practice conferences. 

The first port security exercise was completed in Argentina in September 2007. 

‘‘The North Pacific Coast Guard Forum has had some notable successes in the 

area of joint operations recently, and the North Atlantic Coast Guard Forum will 

hold its first meeting late in October in Sweden.’’ 

Section 234 Foreign port assessments 

The Coast Guard has increased the pace of assessments and is on track to complete an initial assessment of all of our trading partners by March 2008. The Coast 

Guard intends to conduct assessments on a two year cycle thereafter. 

This two year cycle is consistent with the guidance contained in the fiscal year 

2007 DHS Appropriations Act, which called on the Coast Guard to double the rate 

of assessments (basically from three per month to six per month). This reassessment 

cycle actually exceeds the requirement of the SAFE Port Act which call for reassessments to be conducted on a three year cycle. Additional resources (approx. $6.7M 

and 32 FTE) provided in the fiscal year 2007 DHS Appropriations Act support this 

increase in activity. 

Section 303 Research, development, test, and evaluation efforts in furtherance of maritime and cargo security 

DHS and the Coast Guard have current and planned efforts to support the furtherance of maritime and cargo security. The Coast Guard RDT&E efforts for fiscal 

year 2007 include: 

Mission Areas Programs/Projects 

Boarding Team Support and 

Communications 

1. Maritime Biometrics, ID at Sea 

2. Boarding Team Connectivity 

3. Next Generation Underway Connectivity 

4. Boarding Officer Tools and Equipment Support 

Compel Compliance 1. Anti-Personnel 

2. Stopping Mid-Sized Vessels 

21 

Mission Areas Programs/Projects 

Platforms and Sensors 1. Acoustic Buoy 

2. Multi-Sensor Performance Prediction 

3. Global Observer 

4. Small UAS Evaluations 

Sector and Port Security Operations 1. Maritime Domain Awareness Community of Interest 

2. National Automatic Identification System 

Miscellaneous 1. Net-Centricity 

2. Weapons of Mass D 

Mission Areas Programs/Projects 

Boarding Team Support and Communications 1. Boarding Team Communications 

Sensor, Data Fusion, & Decision Aids (Maritime) 1. Visualization Tools 

2. Hawkeye Watch keeper Prototype 

3. Offshore Buoys for Vessel Detection 

4. Emergence Response Blue Force Tracking 

5. Swimmer/Diver Detection 

6. Global Observer 

DHS S&T fiscal year 2008 funding has yet to be defined. The Coast Guard is 

planning a comparable dollar figure to support the furtherance of maritime and 

cargo security in fiscal year 2008. Through the DHS S&T established Capstone Integrated Product Teams (IPT), fiscal year 2009–2013 funding has been identified for 

the furtherance of maritime and cargo security through the Maritime Security Capstone IPT and the Cargo Capstone IPT. 

Conclusion 

The Coast Guard is committed to implementing the Security and Accountability 

for Every Port Act. We continue to make headway on all fronts and look forward 

to future progress and partnerships with international, Federal, state, and local port 

organizations. Thank you for the opportunity to testify before you today. I will be 

happy to answer any questions you may have. 

Ms. SANCHEZ. And I now recognize Mr. Winkowski to summarize 

his statement for 5 minutes. 

STATEMENT OF THOMAS WINKOWSKI, ASSISTANT 

COMMISSIONER, OFFICE OF FIELD OPERATIONS, U.S. 

CUSTOMS AND BORDER PROTECTION 

Mr. WINKOWSKI. Good afternoon, Chairwoman Sanchez, Ranking 

Member Souder, and Chairman Thompson and distinguished members of the committee. Thank you for this opportunity to discuss 

with you today the status of U.S. Customs and Border Protection’s 

efforts since the passage of the SAFE Port Act one year ago. 

I would first like to thank Congress and in particular this committee for your continued interest in the important subject of maritime and supply chain security. As you know, CBP as developed 

and implemented unprecedented initiative to achieve our twin 

goals of both strengthening the security of cargo entering our borders and facilitating the flow of legitimate trade and travel. CBP 

uses a multi-layer approach to ensure the integrity of the supply 

chain from the point of stopping through vessel arrival at U.S. 

ports of entry. This multi-layered approach includes a use of 

trained CBP officers, technology automation, electronic information, and partnerships with the trade and foreign governments. 

22 

I would like to take a moment to highlight some of the important 

accomplishments that demonstrate how far we have come since 

September 11, and provide insight on some of the efforts CBP has 

made over the last 12 months to meet the requirements of the 

SAFE Port Act. 

CBP, through the Container Security Initiative, and in coordination with the Department of Energy’s megaport program, has 

partnered with other countries to deploy personnel and technology 

in an effort to prevent terrorists and terrorist weapons from entering the United States. Today, CSI is now operational in 58 ports 

covering 86 percent of the maritime containerized cargo shipped to 

the United States. At these 58 locations worldwide, CBP officers 

and ICE agents working alongside their host government counterparts identify the highest risk cargo and perform examinations before the cargo is laden on board a vessel destined for the United 

States, and CBP continues to enhance and improve upon this program for the Secure Freight Initiative. 

I am pleased to announce that on October 13, the first phase of 

SFI became fully operational at three ports, thus meeting the requirements of the SAFE Port Act. Through a successful partnership of DHS and Departments of Energy and State, containerized 

shipments from Pakistan, Honduras, and United Kingdom, South 

Hampton, now undergo 100 percent scanning before the containers 

are loaded on their vessel destined for the United States. Surpassing the SAFE Port Act requirements, DHS is also partnering 

with four of the world’s largest container ports to further explore 

the concept of 100 percent scanning in the real world environment, 

Singapore, Busan, Oman, and Hong Kong. 

The size and complexity of these larger ports require initial limited deployment and will enhance our understanding of the challenges of 100 percent scanning in high volume and trans-shipment 

ports. DHS will submit a report to Congress in April 2008 detailing 

the progress made under SFI. The data experience and lessons 

learned from the initial phase of SFI will provide necessary insight 

into the practicality and benefits of 100 percent scanning, and will 

certainly guide any decisions regarding the potential expansion of 

SFI. 

One of the key components of CBP’s layered defense is the advanced electronic cargo information required of all modes of transportation by the Trade Act of 2002, the SAFE Port Act mandated 

provisions of additional data elements for four improved high-risk 

targeting and the overall enhancements targeting system. 

Working with the advisory committee on commercial operations, 

CBP has proposed a new security filing better known as 10-plus2 in an effort to obtain additional advanced cargo information and 

enhance our ability risk-based targeting. Under this initiative, the 

importer’s designated agent will file 10 new unique data elements 

not currently provided to CBP, while carriers will provide stoweplan data and container status messages. 

C–TPAT. Another important layer of our strategy is a C–TPAT 

program. Under C–TPAT, CBP works in partnership with the trade 

community to better secure goods moving through the international 

supply chain. As of October 26, there were 7,800 companies certified in the C6,100 validations in 85 countries today, with another 

23 

800 validations in progress which will be complete by year’s end. 

CBP’s goal is to meet the SAFE Ports Act requirement and to validate all members within one year of certification, and revalidate all 

validated members not less than once every 4 years. 

Working with COAC, CBP has also developed and implemented 

a pilot program using third parties to validate supply chains where 

CBP currently lacks full access. 

In May 2007, CBP selected 11 firms to act as validators in 

China. Interest in the pilot program has thus at minimum over 300 

C–TPAT importers were invited to participate in this voluntary 

program in June, and to date less than a dozen importers have 

opted to do so. Upon conclusion of the pilot in June 2008, we will 

provide a full report on the effectiveness of using third-party firms 

to perform C–TPAT validations. 

With that, I conclude my comments and look forward to your 

questions. 

Ms. SANCHEZ. Thank you. 

[The statement of Mr. Winkowski follows:] 

PREPARED STATEMENT OF THOMAS S. WINKOWSKI

Introduction 

U.S. Customs and Border Protection (CBP) appreciates this opportunity to discuss 

with you today the Security and Accountability For Every Port Act (SAFE Port Act) 

and the efforts of CBP nearly one year after its passage. 

It is noteworthy that CBP worked quite closely with the House and Senate in the 

development of the SAFE Port Act and applaud the high level of Congressional interest in securing United States ports and the global supply chain. Much of what 

is in the SAFE Port Act codified initiatives that the U.S. Customs Service, now 

CBP, undertook immediately after 9/11 and has been implementing successfully 

ever since. 

Below are updates on the primary areas of activity being undertaken by CBP to 

fully implement the Act. 

Container Security Initiative (CSI) 

To meet the priority mission of preventing terrorists and terrorist weapons from 

entering the United States, CBP has partnered with other countries through the 

Container Security Initiative (CSI) to deploy multi-disciplined teams to selected foreign seaports to identify cargo containers that pose a potential risk for terrorism 

and inspect those containers at the foreign ports before they are shipped to the 

United States. CSI is an example where the SAFE Port Act codified existing DHS 

programs, and CBP is in compliance with the Act’s mandates. 

Almost 32,000 seagoing containers arrive and are off loaded at United States seaports each day. In fiscal year 2006, that equated to 11.6 million cargo containers 

annually. Because of the sheer volume of sea container traffic and the opportunities 

it presents for terrorists, containerized shipping is uniquely vulnerable to terrorist 

exploitation. CSI’s effectiveness and successes can be measured by several factors. 

At its core is the cooperation and information sharing between the CBP officers in 

the foreign seaports and the host government personnel. Additionally, CSI has been 

instrumental in enhancing port security. Through CSI, many foreign ports that previously did not utilize or possess non-intrusive inspection (NII) equipment now have 

either purchased their own or have access to NII equipment. Additionally, CSI has 

partnered with Department of Energy’s Megaports Initiative at several CSI ports to 

further enhance the host nation’s capability to screen cargo for nuclear and other 

radioactive materials that could be used by terrorists against the United States or 

a host country. This fiscal year CSI expanded to 8 additional ports, and reached a 

milestone of 58 ports worldwide covering 85% of the container traffic destined to the 

United States. This is significant progress. 

Secure Freight Initiative (SFI) and 100% Scanning 

Building upon the success of the Container Security Initiative (CSI), on December 

6, 2006, the Secretary of Homeland Security, in cooperation with the Department 

of Energy (DOE), Department of State (DOS) and with the maritime industry and 

foreign government partners, announced Phase One of the Secure Freight Initiative 

(SFI). SFI is an unprecedented effort to build upon existing port security measures 

24 

by enhancing the United States government’s ability to scan containers for nuclear 

and radiological materials in seaports worldwide and to better assess the risk of inbound containers. 

I am pleased to announce that the first phase of SFI became fully operational on 

October 12, 2007 at three ports meeting the requirements of the SAFE Port Act. 

Southampton, United Kingdom, Puerto Cortes, Honduras and Port Qasim, Pakistan 

are now scanning 100% of containers destined for the United States. 

The initial phase of the SFI involves the deployment of a combination of existing 

technology and nuclear detection devices to three ports as per the requirements of 

the SAFE Port Act. This will provide a more complete analysis for SFI by including 

different operational and geographic settings at each port and will provide exposure 

of different models for future 100 percent scanning. In addition to the first three 

ports, SFI Phase I will also include four additional ports that will conduct 100% 

scanning in a more limited capacity. Those ports are Port Salalah, Oman, Brani 

Terminal at Port of Singapore, Gamman Terminal at Port Busan, Korea, and the 

Modern Terminal in Hong Kong. 

By conducting the pilot at these four additional ports, this new, integrated technology can meld smoothly into the logistics, operations, and risk management process while complementing the flow of commerce at high-volume and transshipment 

ports. Additionally, this first phase of SFI will provide the partnering governments 

with a greater window into potentially dangerous shipments moving through their 

seaports. Secure Freight will provide carriers of maritime containerized cargo with 

greater confidence in the security of the shipment they are transporting, and it will 

increase the likelihood for shippers and terminal operators that the flow of commerce will be both uninterrupted and secure. SFI will use the latest scanning technology, however data analysis, using the Automated Targeting System, will continue 

to be our primarily method in screening containers. 

The lessons learned and experience gained from Phase One represent critical 

steps in the process of determining whether the concept of 100% overseas scanning 

is technologically and economically feasible and the degree to which it increases the 

security of the international supply chain. 

DHS will submit reports to Congress in February and April 2008 detailing the 

progress made under SFI. These reports will also outline the successes and challenges associated with the implementation of 100% scanning in foreign locations, including issues related to the availability, capabilities and efficiency of technology 

and equipment; the process of negotiations/discussions with host nation counterparts as well as foreign input and feedback; the impact on the movement of cargo 

through ports and across the global supply chain; the staffing and human capital 

requirements that will be necessary both abroad and domestically and numerous additional considerations. 

Domestic Radiation Detection and Imaging 

The SAFE Port Act requires that a deployment strategy plan be developed for the 

placement of radiation portal monitors (RPMs) throughout the nation’s ports of 

entry. That plan has been submitted to Congress by the Department. 

CBP began deploying RPMs in October 2002, with the first deployment at the 

Ambassador Bridge in Detroit. Since that time, CBP and the Domestic Nuclear Detection Office (DNDO) have deployed over 1,000 RPMs at mail facilities, seaports, 

and land border crossings and will deploy the first RPM in the air cargo environment by the end of calendar year 2007. Specifically, the SAFE Port Act mandates 

that all containers entering through the top 22 seaports be scanned for radiation. 

Currently, the Department has deployed radiation detection equipment to each of 

these 22 ports. Due to unique operational considerations at some of these ports, not 

every terminal within a port is currently equipped with such equipment. However, 

to satisfy the requirements of the SAFE Port Act and to further enhance port security, CBP and DNDO continue to work with these considerations, and by the end 

of this calendar year will scan approximately 98% of all containerized cargo at these 

22 seaports. 

With the additional deployment of radiation scanning equipment, CBP currently 

scans 91% of the cargo and 81% of the passenger vehicles arriving from Canada; 

97% of the cargo and 92% of the passenger vehicles arriving from Mexico, as well 

as 93% of arriving sea-borne cargo containers. To put this in perspective, just 18 

months ago CBP was scanning 37% of arriving sea containers. 

Additionally, CBP has deployed over 1,000 Radiation Isotope Identifier Devices 

(RIID) and over 16,000 Personal Radiation Detectors (PRD). These devices allow 

CBP to inspect 100% of all identified high-risk cargo. 

Since CBP began scanning conveyances for radiation, over 195 million conveyances have been scanned, and over 1.1 million alarms have been resolved. This is 

25 

a tremendous workload, and the SAFE Port Act authorized 200 new CBP Officers 

in each of the next five years to help accomplish this mission. Furthermore, the Department is currently testing the next generation of radiation detection equipment 

known as Advanced Spectroscopic Portals at eight locations nationwide—at Piers A 

and J in Long Beach, at the APM and PNCT Terminals in Newark, at the Colombia 

and World Trade bridges in Laredo, at the Blue Water Bridge in Port Huron, and 

at the Fort Street crossing in Detroit. Future deployments of ASPs, pending Secretarial certification, will allow CBP to quickly differentiate between benign materials 

such as kitty litter or granite, while determining which shipments pose a true risk. 

This perfectly supports CBP’s twin goals of increasing security while facilitating the 

flow of legitimate trade and people. 

In addition to the deployment of radiation detection equipment, CBP continues to 

deploy large scale imaging systems and has deployed 195 large-scale gamma ray or 

x-ray imaging systems nationwide. NII technology serves as a force multiplier that 

allows officers to detect possible anomalies between the contents of the container 

and the manifest. In fact, well over 5.5 million scans using NII systems were conducted in FY 07. 

Automated Targeting System (ATS) 

CBP requires advanced electronic cargo information as mandated in the Trade Act 

of 2002 (including the 24-hour rule for maritime cargo). Advanced cargo information 

on all inbound shipments for all modes of transportation is effectively evaluated 

using the Automated Targeting System (ATS) before arrival in the United States. 

The SAFE Port Act requires CBP to seek additional data elements for ATS as well 

as to evaluate the entire system. CBP is complying with both these mandates. 

As a matter of background, ATS provides decision support functionality for CBP 

officers working in Advanced Targeting Units (ATUs) at United States ports of entry 

and CSI foreign ports. The system provides uniform review of cargo shipments for 

identification of the highest risk shipments, and presents data in a comprehensive, 

flexible format to address specific intelligence threats and trends. ATS uses a rulesbased program to highlight potential risk, patterns, and targets. Through rules, the 

ATS alerts the user to data that meets or exceeds certain predefined criteria. National targeting rule sets have been implemented in ATS to provide threshold targeting for national security risks for all modes: sea, truck, rail, and air. 

Working actively with the trade through the Departmental Advisory Committee 

on Commercial Operations (COAC), CBP has developed a new Security Filing in an 

effort to obtain additional advanced cargo information and enhance their ability to 

perform risk-based assessments prior to cargo being laden on a vessel overseas. The 

CBP proposal, better known as ‘‘10 plus 2’’ covers the following key areas: • Ten unique data elements from importers not currently provided to CBP 24 

hours prior to the foreign loading of cargo; 

• Two additional data elements provided by the carriers including the Vessel 

Stow Plan, which is currently utilized by the vessel industry to load and discharge containers, and the Container Status Messaging, which is currently utilized by the vessel industry to track the location of containers and provide status notifications to shippers, consignees, and other related parties. 

A Notice of Proposed Rulemaking (NPRM) is currently being developed. Obtaining 

additional information earlier in the process will increase the transparency of the 

global supply chain enabling the refinement of CBP’s targeting processes and will 

provide additional information to make a more fully informed decision with respect 

to the risk of individual shipments. 

In addition to Security Filing, CBP continually monitors the performance of 

weight sets and uses data analysis to modify rules and weight sets in ATS. Since 

2004, ATS has undergone independent audits from the GAO and the IG. Furthermore, CBP regularly reevaluates to improve the data sets in ATS. The Office of 

Field Operations National Targeting and Security (NTS) office and the Office of Information Technology Targeting and Analysis Systems Program Office (TASPO) 

have been working together to enhance the ATS Maritime rule set capabilities for 

ocean cargo targeting. Under the direction of the office of field operations (OFO), 

TASPO placed the updated rule sets into production on March 21, 2007, to conduct 

initial assessments. Since that time, OFO subject matter experts and members of 

the Maritime Targeting Working Group have provided feedback to NTS, which resulted in further refinements and enhancements to the maritime rule set. Currently 

NTS is modeling several versions of the new Country of Interest list to include 

iterations of different scores and scenarios to include entity concepts such as first 

time, unknown, and high volume. OFO is currently using the updated rule set for 

maritime threshold targeting. 

Customs-Trade Partnership Against Terrorism (C–TPAT) 

26 

Customs-Trade Partnership Against Terrorism (C–TPAT) is an integral part of 

the CBP multilayered strategy. CBP works in partnership with the trade community to better secure goods moving through the international supply chain. C–TPAT 

has enabled CBP to leverage supply chain security overseas where CBP has no regulatory reach. Throughout 2007, CBP has continued to expand and strengthen the 

C–TPAT program and ensure that certified member companies are fulfilling their 

commitment to the program by securing their goods moving across the international 

supply chain to the United States. To carry-out this critical tenet of C–TPAT, teams 

of Supply Chain Security Specialists (SCSS) will conduct validations and begin revalidations of C–TPAT members’ supply chains to ensure security protocols are reliable, accurate, and effective. 

The SAFE Port Act not only legislatively recognized C–TPAT, but the Act also 

added greater accountability by mandating that certain program activities be completed within specific time frames, and that greater program oversight be developed 

for the program. CBP began implementing such changes, which were first outlined 

in GAO reports from 2003 and 2004, eighteen months prior to the passage of the 

Act and continues to make progress in this regard. 

Specifically, clearly defined minimum security criteria have been developed and 

implemented for the major enrollment sectors and will be completed for all current 

enrollment sectors by this fall. The SAFE Port Act requires CBP to work with the 

COAC to review and modify as appropriate these criteria on an annual basis, and 

they have done so. This program enhancement will be completed each year as part 

of the development of the C–TPAT annual plan, another SAFE Port Act requirement. CBP is finalizing revisions to the C–TPAT Strategic Plan, which was first 

published in December 2004. 

The SAFE Port Act also required CBP to review their certification processes for 

new members and make adjustments to strengthen this initial review if necessary. 

CBP has done so, and all new applications are being reviewed within 90 days. 

Additionally, the Act requires that all new certified members undergo their initial 

validation within 1 year of acceptance into the program and be revalidated every 

four years. In 2007, CBP’s goal is to complete 3,000 validations. As a point of reference, CBP completed 133 validations in 2003; 287 in 2004; 1,080 in 2005; and 

2,398 in 2006. This is real progress, and it has been made possible by adding Supply 

Chain Security Specialists to the program. 

With current staffing levels, the C–TPAT program should fulfill its operational 

goals for both the 2007 and 2008 calendar years. With the projected level of validations and revalidations needed to be in compliance with the Act set at just less than 

3,000 per year, the current staff of 150 SCSS’s should be able to manage this workload. The SAFE Port Act mandates that all revalidations must occur within 4 years 

of the initial validation, while the FY07 DHS Appropriations Act called for revalidations to occur within 3 years of the initial validation. Thus, the C–TPAT program 

is moving forward on a 3 year revalidation model to ensure compliance. 

Projected revalidations alone will reach over 2,300 in 2009. The addition of Mexican Highway Carrier validations (done annually due to higher risk models) will add 

approximately 400. Further, required initial validations within 1 year of certification are being projected at 1,800. As a result, the final validation/revalidation totals needed would well exceed 4,000 for 2009 creating compliance issues with the 

current staffing numbers. 

However, an additional staffing of 50 SCSS’s will be brought on board with the 

creation of two new offices, one in Buffalo, NY, to focus principally on Canadian 

membership, and an office in Houston, TX, to focus on Mexican enrollment. With 

the addition of this staff, expected by early calendar year 2008, the C–TPAT would 

again see compliance with SAFE Port Act mandated timelines. 

Working with COAC, CBP has also developed and implemented a pilot program 

using third parties to validate supply chains where CBP currently lacks full access. 

In May 2007, CBP selected 11 firms to act as validators in China as the Chinese 

government continues to deny access to CBP personnel wishing to conduct supply 

chain security validations. The Chinese Government has officially indicated that the 

matter is under review within their government, noting initially that the private 

sector in China may be reluctant to have C–TPAT validations conducted in-country. 

In an effort to show there was trade support for the process, CBP identified a certified C–TPAT partner that has significant business in China to demonstrate their 

willingness to participate in the validation process. Additionally, the CBP Commissioner and senior managers have traveled to China to discuss this matter with their 

counterparts in an effort to clarify the validation process as well as to offer a joint 

validation pilot involving five currently certified C–TPAT companies willing to participate. We have received no official response to this proposed project as of this 

date. 

27 

Interest in the pilot program has thus far been minimal. Of the more than three 

hundred (300) C–TPAT importers that were invited to participate in this voluntary 

pilot in June, less than a dozen importers have opted to do so to date. The primary 

concerns expressed by C–TPAT members for not participating lie in the sharing of 

proprietary business and security data with a third party and with the costs associated with the validation, which, as outlined in the SAFE Port Act, must be incurred 

by the C–TPAT member. 

Container Security Standards and Procedures 

CBP strongly supports and continues to seek opportunities to enhance supply 

chain security efforts, including enhancements to the security of the container. Indeed, securing the container is a critical part of a multi-layered approach to supply 

chain security. However, in order to establish minimum standards for container security, it is first necessary to ensure that there are available solutions that would 

significantly improve container security without significantly disrupting the flow of 

legitimate commerce. It should be noted that minimum security criteria for participants in the C–TPAT program do include a requirement that all C–TPAT importers 

must affix a high security seal to all loaded containers bound for the United States. 

These seals must meet or exceed the current ISO/PAS 17712 specifications for high 

security seals. C–TPAT membership currently accounts for 46% of total importations into the U.S. 

Any technological solution would also need to be adopted as part of a broader supply chain security program. While CBP does not believe that, at the present time, 

the necessary technology exists for such solutions, CBP is working closely with the 

Department and is actively working with industry to test different technologies and 

methodologies that would provide economically and operationally viable enhancements to container security. 

In-Bonds 

The SAFE Port Act also required CBP to submit a report on in-bond cargo no 

later than June 30, 2007. CBP apologizes for the lateness of this report, which is 

still undergoing review, and expects to have the report issued shortly. 

The final report includes a plan for closing in-bond entries at the port of arrival; 

an assessment of the personnel required to ensure 100 percent reconciliation of inbond entries between the port of arrival and the port of destination or exportation; 

an assessment of the status of investigations of overdue in-bond shipments and an 

evaluation of the resources required to ensure adequate investigation of overdue inbond shipments; a plan for tracking in-bond cargo within the Automated Commercial Environment (ACE); an assessment of whether any particular technologies 

should be required in the transport of in-bond cargo; an assessment of whether ports 

of arrival should require any additional information regarding shipments of in-bond 

cargo; an evaluation of the criteria for targeting and examining in-bond cargo; and 

an assessment of the feasibility of reducing the transit time for in-bond shipments, 

including an assessment of the impact of such a change on domestic and international trade. In addition, CBP is in the process of utilizing the evaluation of inbond criteria to assist in the creation of a weight set for use in ATS to further assist 

in the identification of potential in-bond diversion cargo shipments. 

CBP believes that the report is responsive to the concerns expressed by Congress, 

and a dedicated working group of experts has just concluded an in-depth review of 

the in-bond process and their recommendations will also address the report topics. 

Office of International Trade 

The mandates of the SAFE Port Act and the actions of CBP intersected again 

when CBP formed the Office of International Trade in October 2006. The establishment of this office serves to strengthen CBP’s ability to carry out our mission of facilitating the flow of legitimate trade across U.S. borders while securing the borders 

and protecting the American economy from unfair trade practices and illicit commercial enterprises. The Office of International Trade consolidates trade policy, program development, and compliance measurement functions into a single office, providing greater consistency within CBP with respect to its international trade programs and operations. In addition, CBP’s close working relationship with the trade 

community, a hallmark of CBP’s operations and programs, has been further enhanced. The new Office of International Trade is providing CBP and the Trade community with an organization that can effectively address the growing volume and 

complexities of international trade and is enabling us to successfully meet the challenges inherent in managing the balance of trade and security. 

In June 2007, to meet the Congressional requirements of the SAFE Port Act, CBP 

provided to Congress a resource optimization model (the ‘‘model’’) for the commercial 

operations and revenue function. The objectives of the model are to: (1) optimally 

28 

align the workforce to achieve management performance outcomes and goals; (2) 

adequately address risks inherent in the priority trade issues; and (3) comply with 

statutory requirements. The model has been designed to determine the right number and right mix of resources to facilitate legitimate trade while enforcing the trade 

laws. 

Additionally, in preparation of submitting a report on the reorganization into the 

Office of International Trade, CBP has been meeting regularly with the COAC subcommittee on the Office of International Trade. During this first year, the subcommittee has been working together to find mutually beneficially process improvements to facilitate legitimate trade, which in turn will assist CBP in its trade enforcement efforts. 

Conclusion 

The steps that CBP is taking to implement the SAFE Port Act are and will be 

an extremely important aspect to the security of the nation. Through the SAFE Port 

Act, Congress has recognized and bolstered many of our aggressive programs to enhance security while assuring the facilitation of legitimate trade. We appreciate the 

close cooperative relationship the Department of Homeland Security and CBP had 

with the House and Senate in the development of the Act, and we look forward to 

the continued interaction to promote our mission and ensure the safety of American 

citizens and commerce. 

Ms. SANCHEZ. I ask unanimous consent that Mr. Pascrell be allowed to sit and question at today’s hearing. 

Next, we will hear from Mr. Oxford to summarize his statement 

5 minutes. 

STATEMENT OF VAYL OXFORD, DIRECTOR, DOMESTIC 

NUCLEAR DETECTION OFFICE, DEPARTMENT OF 

HOMELAND SECURITY 

Mr. OXFORD. Chairman Sanchez, Ranking Member Souder, 

Chairman Thompson, and other members of the committee, I would 

like to thank you for the opportunity to share the progress we have 

made in improving port and cargo security. 

Keeping our Nation’s ports secure is a critical layer in protecting 

our citizens against nuclear terrorism. The SAFE Port Act formerly 

authorized the establishment of DNDO, also identified a number of 

goals and reporting requirements for our Department. 

I am happy to share that DNDO is meeting the requirements 

outlined in the SAFE Port Act. We have made excellent progress 

in deploying radiation detection technology at our busiest ports and 

land borders, resulting in the scanning of 94 percent of all incoming cargo into the United States. 

Two years ago, only 40 percent of incoming containerized cargo 

was being scanned for radiological and nuclear threats. DNDO has 

worked closely with CBP to develop a joint RPM deployment strategy that balances risk against the measures of insuring the flow of 

commerce. RPM deployments to the Nation’s 22 busiest seaports 

are complete. We are scanning over 95 percent of cargo coming 

through our seaports, using 374 radiation portal monitors. At select 

seaports, scanning now covers 100 percent and vehicles. By the end 

of 2007, 98 percent of all containerized sea cargo entering the 

United States will be scanned for radiological and nuclear threats. 

Deployments to our land borders are also proceeding. There are 

241 RPMs operating on the northern border and 353 RPMs operating on the southern border. This results in the scanning of 91 

percent of containerized cargo coming across the northern border 

and 99 percent across the southern border. 

29 

As a result of this progress, we are meeting the mandates set 

forth in the SAFE Port Act that require that all containers entering high-volume ports by vessel be scanned for radiation. Also, the 

SAFE Port Act outlines five reporting requirements for DNDO. My 

written testimony covers the status of those reports, but suffice it 

to say, that we have met all reporting and requirements. 

The SAFE Port Act also requires DNDO to establish an intermodal radiation detection center. There are several seaports that 

load cargo directly from ships to rail cars, bypassing the typical 

exit gates scanning operations used by CBP. Today we do not have 

a detector that can address this challenge. An intermodal rail test 

center will help develop additional passive detection systems that 

meet unique port requirements, thereby enabling DNDO to provide 

solutions that enable us to scan 100 percent of cargo containers entering the United States. The Port of Tacoma was chosen as the 

location of the rail test center because more than 70 percent of imported cargo through this port is handled by rail. We are working 

with the Port of Tacoma and CBP to begin operational testing associated with the intermodal rail concepts and evaluating technical 

solutions to fit the unique detection requirements of intermodal terminals. 

I would also discuss additional port security efforts involving 

DNDO. These are not outlined specifically in the SAFE Port Act, 

but contribute to security in the maritime environment and for our 

country overall. 

We are working with the Coast Guard to implement an acquisition plan in which DNDO develops and acquires systems for U.S. 

Coast Guard use. As a result, we will deploy radiation detection capabilities to every Coast Guard inspection and boarding team by 

the end of 2007. We also recently announced the West Coast maritime pilot that is beginning in the Puget Sound of Washington 

State and will expand into San Diego, California. The pilot will 

provide maritime radiation detection capabilities for State and local 

authorities with the goal of reducing risk of radiological and nuclear threats that can be illicitly transported on recreational or 

small commercial vessels. 

This pilot program is being worked in close cooperation with the 

U.S. Coast Guard and CBP, as well as State and local officials. We 

expect to deploy human, portable, mobile, and fixed radiation detection systems as part of this pilot. We will also be working with 

maritime partners to assess the geographic configurations of the 

ports to maximize detection and interdiction opportunities. Maritime stakeholders will also receive guidance from DNDO on operational protocols, training exercises that support small vessel radiation interdiction operations. 

In conclusion, port security is a critical component in protecting 

the U.S. from nuclear terrorism. The SAFE Port Act codified many 

of the requirements and strategies that will ensure a robust defense against threats to our Nation. The NDO and its partners 

have made significant progress over the last 2 years and will continue to make progress in keeping this Nation safe. I look forward 

to working with all of our partners in DHS, other departments, 

State and local agencies, and the members of this subcommittee as 

well as Congress in continuing the pursuit of this goal. 

30 

This concludes my prepared statements. I look forward to your 

questions. 

[The statement of Mr. Oxford follows:] 

PREPARED STATEMENT OF VAYL S. OXFORD

Introduction 

Chairwoman Sanchez, Ranking Member Souder, and distinguished Members of 

the Committee, as Director of the Domestic Nuclear Detection Office (DNDO), I 

would like to thank you for the opportunity to share the progress we have made 

in improving port and cargo security. Keeping our Nation’s ports secure is a critical 

layer in protecting our citizens against nuclear terrorism. 

One year ago, the President signed the SAFE Port Act, which formally authorized 

the establishment of the DNDO. This important piece of legislation also identified 

a number of goals and reporting requirements for our Department. It helped ensure 

that we have the right security strategies in place and that we maintain our momentum as we implement protective measures. 

I am happy to share that DNDO is meeting the requirements outlined in the 

SAFE Port Act. We have submitted a number of reports to Congress due earlier this 

year (including our comprehensive strategy for the deployment of radiological and 

nuclear detection equipment) and we expect to meet the deadlines for those that remain. We also have made excellent progress in deploying radiation detection technology at our busiest ports resulting in the screening of 93 percent of all incoming 

seaborne cargo into the United States. 

Port Security Strategy 

Before I go into more detail about the progress we have made in regards to the 

SAFE Port Act, I would like to explain our strategy at DNDO for deploying detection technologies to our Ports of Entry (POEs). Eighteen months ago, only 37 percent of incoming seaborne containerized cargo was being scanned for radiological 

and nuclear threats. DNDO worked in partnership with our colleagues at Customs 

and Border Protection (CBP) to develop a joint radiation portal monitor (RPM) deployment strategy that incorporates an optimized mix of current—and next-generation technologies, balancing our need for better capability with a desire for increased 

coverage against the associated costs of each. This joint strategy is predicated on 

placing next-generation systems, like the Advanced Spectroscopic Portal (ASP), at 

the highest throughput ports, where reductions to secondary inspection rates will 

have the greatest benefit. Deployment of ASP systems will be dependent upon the 

Secretarial certification of the systems as required by the FY 2007 Homeland Security Appropriations Act (P.L 109–295). 

Our strategy up to now has prioritized deployment activities based on risk, vulnerability, or consequence, as influenced by major populations, industries, importance to the economy and supply chain, or military bases located nearby. We also 

consider prior records of illicit activities. Finally, we consider whether locations had 

upcoming port reconfiguration. 

We have taken steps to prepare for additional deployments and are conducting 

site surveys, developing site designs, and starting negotiations to award construction contracts for each of the crossings. As a general practice, DNDO works with 

the port authority to proactively schedule construction to coincide with any other 

activities at the port. This helps prevent scheduling delays and expedites the deployment process overall. 

Our priority remains to finish deploying RPMs to high volume seaports and land 

border crossings. However, our future plans are addressing the hundreds of smaller 

crossings that dot the Northern and Southern borders, including rail crossings. We 

will also begin scanning of international air cargo. 

Status of Deployments 

RPMs have been deployed to all of the Nation’s 22 busiest seaports. We are currently scanning 93 percent of cargo coming through our seaports using 358 RPMs. 

Moreover, at select major seaports, exit scanning now covers 100 percent of all containers and vehicles. By the end of this calendar year, 98 percent of all containerized sea cargo entering into the United States at the 22 busiest ports will be 

scanned for radiological and nuclear threats. 

It is also important to mention deployments to our land borders. There are 241 

RPMs operating on the Northern border and 343 RPMs operating on the Southern 

border. This results in scanning 91 percent of containerized cargo coming across the 

Northern Border and 97 percent coming across the Southern. In addition, a total 

of 60 RPMs are deployed to sites such as mail and express courier consignment faVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00034 Fmt 6633 Sfmt 6621 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
31 

cilities. By focusing on major ports of entry first, we have been able to dramatically 

boost the scanning levels of incoming cargo. We are also conducting scanning of privately owned vehicles (POVs). Our detection equipment currently scans 81 percent 

of POV traffic coming across the Northern border and 92 percent across the Southern. 

Meeting the Requirements of the SAFE Port Act 

Based on the progress we have made with RPM deployments at POEs, we are 

meeting the mandates set forth in the SAFE Port Act that require that all containers entering high-volume ports by vessel be scanned for radiation. In addition, 

we have developed the required strategy for the deployment of radiation detection 

capabilities, and that strategy has been submitted for the record as an amendment 

to this testimony. However, there are a number of other requirements outlined in 

the Act that we have been asked to fulfill and I would like to give you an update 

on each. 

In total, the SAFE Port Act outlines five reporting requirements for DNDO. Our 

deployment strategy was submitted first to Congress in March 2007 and included 

information on a risk-based prioritization of ports, a proposed timeline for deployment, the types of equipment that we are proposing for each port, documentation 

of standard operating procedures for examining containers, operator training plans, 

and the Department’s policy of using non-intrusive imaging equipment. As I mentioned earlier, one aspect of our joint deployment plan with CBP is how we plan 

on introducing next-generation technologies like ASP into the field. Right now, ASP 

is pending Secretarial certification and will not be fully deployed until that certification process is complete. If the outcome of the certification process is positive, we 

will submit an amendment to our strategy to identify the locations at which we will 

deploy ASP. The report also included a classified annex that details plans for covert 

testing of the top 22 seaports, as required by Section 121 of the Safe Port Act. The 

DNDO Red Team is working with CBP to build and maintain documentation of 

these activities. 

Secondly, in April 2007, we submitted a joint report with the Science and Technology Directorate, CBP, and DHS Office of Policy Development that outlined the 

feasibility of and strategy for development of chemical, biological, radiological and 

nuclear (CBRN) detection equipment. DNDO submitted content that clearly documented both near- and long-term research and development efforts that will provide 

improved nuclear detection capabilities. 

The third report required that DNDO, along with CBP, complete an evaluation 

of health and safety issues related to the use of non-intrusive imaging (NII) technology to scan containers. DHS fully understands the environmental health and 

safety impacts of NII technology. DHS has a comprehensive radiation risk reduction 

plan, and will continue to work closely with the Nuclear Regulatory Commission, 

Occupational Safety and Health Administration, and the National Institute for Occupational Safety and Health to minimize radiation exposure of workers and the 

public to levels as low as reasonably achievable. Additionally, DHS will continue to 

monitor environmental health and safety impacts associated with NII technology by 

constantly addressing these impacts with systems currently deployed and systems 

under development. As next-generation NII systems are developed, DNDO will 

make a constant effort to address environmental health and safety issues by consulting with the National Council on Radiation Protection and Measurements, and 

conducting modeling and benchmarking. This report was submitted in July 2007 

and received no comments from Congress except for a request to make our findings 

open for distribution to the private sector. We complied with this request and modified the document so that it was no longer For Official Use Only (FOUO). 

The two remaining reports, an overall investment strategy for radiological and nuclear detection across the US government, and a report on how DNDO authorization 

language impacted the Homeland Security Act of 2002 and DHS research and development efforts to detect, prevent, protect, and respond to chemical, biological, radiological, and nuclear terrorist attacks, are scheduled to be delivered in October. We 

are working with other DHS components and across the interagency to ensure that 

these reports are comprehensive in nature and delivered to Congress in a timely 

manner. 

The SAFE Port Act also required DNDO to establish an Intermodal Rail Radiation Detection Test Center. This was a very forward thinking requirement and one 

that DNDO strongly supports. There are several seaports that load cargo directly 

from ships to rail cars, therefore bypassing typical exit gate scanning operations. 

Right now, we do not have a detector that can address this challenge. An intermodal 

rail radiation detection test center will help develop additional passive detection design variants that meet unique port requirements, thereby enabling DNDO to proVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00035 Fmt 6633 Sfmt 6621 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
32 

vide solutions that enable us to scan 100 percent of cargo containers entering the 

United States. The test center was announced in May of this year and was awarded 

to the Port of Tacoma, Washington. The Port of Tacoma was chosen as the location 

of the Rail Test Center because more than 70 percent of its total import cargo volume is handled by rail at its multiple intermodal rail terminals. We are working 

diligently with the Port of Tacoma and CBP to begin testing the operational needs 

associated with intermodal rail, as well as evaluating innovative technical solutions 

to fit the unique radiological and nuclear detection requirements of intermodal terminals. 

Additional Port Security Efforts 

I wanted to take the opportunity today to also discuss additional port security efforts in which DNDO is involved. These are not outlined in the SAFE Port Act, but 

contribute to security in the maritime environment and for our country overall. 

DNDO has an excellent working relationship with our Coast Guard operators. We 

have a joint acquisition plan in place that will allow DNDO to both develop and acquire systems for USCG use. DNDO provided handheld and backpack radiation detection devices to fulfill imminent operational needs in fiscal year 2007. We will deploy radiation detection capabilities to every Coast Guard inspection and boarding 

team by the end of 2007. The Secretary stated that this is one major goal for this 

Department, and we are going to meet that goal. We are also developing next-generation technologies that have the identification capabilities, connectivity, and ruggedness required in the maritime environment. 

We also recently announced the West Coast Maritime pilot program that is beginning in the Puget Sound region of Washington State and will expand into San 

Diego, California. The three-year pilot will provide maritime radiation detection capabilities for State and local authorities with the goal of reducing the risk of radiological and nuclear threats that could be illicitly transported on recreational or 

small commercial vessels. We will be conducting this pilot program in close coordination with the U.S. Coast Guard and Customs and Border Protection. DNDO expects to deploy non-intrusive, passive detection sensors, such as human-portable radiation detection equipment, mobile sensors, and fixed-position detectors. We will 

also be working with maritime partners and local authorities in both areas to assess 

the geographic configurations of the ports to maximize detection and interdiction opportunities. Additional analyses for local partners will include a baseline survey of 

the existing radiological and nuclear detection architecture, a gap and risk assessment, and associated recommended actions to be developed in conjunction with maritime stakeholders. Maritime stakeholders will also receive guidance from DNDO on 

operational protocols, training, and exercises that support small vessel radiation detection capabilities. 

Conclusion 

The mission of the DNDO reaches far beyond port security. However, port security is a critical component in protecting the U.S. from nuclear terrorism. The SAFE 

Port Act codified many of the requirements and strategies that we will ensure a robust defense against threats to our Nation. The DNDO and its partners have made 

significant progress over the last two years, and will continue to make progress in 

keeping this Nation safe. I look forward to working with all of our partners within 

DHS, other departments, State and local agencies, and the members of this subcommittee and Congress in continuing to pursue this goal. 

This concludes my prepared statement. Chairwoman Sanchez, Ranking Member 

Souder, and Members of the Committee, I thank you for this opportunity and would 

be happy to answer any of your questions at this time. 

Ms. SANCHEZ. I now recognize Mr. Caldwell to summarize his 

statement in five minutes. 

Mr. CALDWELL. Madam Chairman, Mr. Souder, and also Chairman Thompson, thank you very much for inviting me back 6 

months after your initial hearing on the SAFE Port Act. Not only 

has it been a year now since the SAFE Port Act was enacted, but 

now we are approaching the 5-year mark on the enactment of 

MTSA which, as you know, really created the framework for maritime security that the SAFE Port Act actually enhanced. 

Given the breadth of the SAFE Port Act, the statements of the 

other witnesses, and my already submitted lengthy statement, I 

33 

think I am going to focus my oral comments on two areas. One is 

interagency operation centers, and the other is port recovery issues. 

Regarding interagency operation centers, as you know, the SAFE 

Port Act required the establishment of these centers. In 2003, let 

me give you a little history, Congress appropriated $50 million for 

Project Sea hawk in Charleston Harbor. This was designed as a 

program that would take different agencies and different technologies and try to combine them to prevent and deter terrorist attacks at least in Charleston. About that same time, in 2003, in the 

wake of the U.S.S. Cole attack, as well as the 9/11 attack, the Navy 

was looking for a way to help protect its ships that were in homeport in the U.S. 

They partnered with the Coast Guard to develop something 

called Joint Harbor Operations Centers, or JHOCs. There is one of 

these originally in San Diego and in Hampton Roads. Then finally, 

also about that time in 2003, Coast Guard began a reorganization 

to combine some of its operational units with some of its marine 

environmental and safety units, and combining these into something called sectors and started developing sector command centers. The important difference between Seahawk and JHOC and 

the sectors was that the Seahawk and the JHOC centers were really focused exclusively on maritime security whereas the sector command centers in some ways leveraged resources further in focusing 

on the wide variety of Coast Guard missions that would be included, such as in search and rescue, protection of fisheries, all the 

other missions the Coast Guard sector would have. The Coast 

Guard now reports that it has sector command centers in all 35 of 

its sectors, and the SAFE Port Act has then required DHS to establish something called interagency operation centers at high-priority 

ports within three years. DHS has provided Congress with a plan, 

a five-year plan to upgrade these current sector command centers 

into interagency operation centers at 24 ports and estimated the 

cost at $260 million. 

Moving forward on these operational centers, we found there is 

a couple of challenges ahead for Congress and for the Executive 

Branch. One is the obvious resource question. While there is an estimate of $260 million, those funds have not been identified or appropriated. In addition, every port is different and I think we have 

all heard that deal with ports, and so there needs to be clear roles 

and responsibilities among the multiple agencies. I think for the 

Coast Guard the roles and responsibilities are fairly clear, but at 

different ports you have several other important stakeholders, 

whether they are the Navy or Customs or other state and local 

stakeholders. And, finally, one of the issues we have identified in 

the past that is not completely resolved is the issue of security 

clearances for all appropriate stakeholders. 

Moving on to recovery. The SAFE Port Act asks for more emphasis in both plans and exercises on recovery issues. Going back to 

MTSA, MTSA required that there be security plans in every port, 

every major port at least, and the Coast Guard has implemented 

those with general guidance. However, our review of these plans 

found that the guidance was fairly vague in terms of recovery 

issues. 

34 

1See GAO, ‘‘MARITIME SECURITY: The SAFE Port Act: Status and Implementation One 

Year Later’’, Tuesday, October 30, 2007, GAO–08–126T. 

While there is some national level guidance in terms of the national maritime infrastructure recovery plan, those plans as well as 

the exercises associated with them need to be focused more at the 

port level. And the Coast Guard has taken steps to do this, but I 

think as Captain Sturm has mentioned, some of these will not be 

in place until these individual port plans are revised by July 2009. 

With that, I would like to close out my statement. And be happy 

to answer any questions. GAO will continue to work with this committee and others in Congress to provide oversight over the SAFE 

Port Act to best practical port security for our Nation. Thank you. 

[The statement of Mr. Caldwell follows:] 1

Ms. SANCHEZ. I thank all of our witnesses for their testimony. 

I will remind each member that he or she will have 5 minutes 

to question the panel. And I will now recognize myself for a couple 

of questions. 

On your testimony, Mr. Caldwell, you said that the Coast Guard 

had general guidance, under general guidance. From whom? 

Mr. CALDWELL. The Coast Guard’s guidance came out in the form 

of a NAVIC, correct me if I am wrong, Captain, but that is Navigation and Vessel Information Circular, providing some guidance on 

what each area maritime security plan should have. And this went 

out to the committees when they first developed their plans in 

2004. 

Ms. SANCHEZ. Thank you for that clarification. 

I would like to ask Mr. Winkowski, this has to do with C–TPAT, 

a program that I am particularly interested in. The pilot program 

that was included in the SAFE Port Act was to provide additional 

validation options at a time when CBP was unable to perform 

enough validations; they had gotten behind. It is interesting now 

to me, and I am pleased that we have been able to validate a majority of the C–TPAT members security plans, I think, also because 

we provided some additional personnel to be able to do that. 

So my question is, do you believe that there are still third-party 

validation processes which would be useful? In other words, do we 

still need them? Are we going to stay full up and continue to do 

these reevaluations at least once every four years with just the personnel? Or do you think that there is still room for this third-party 

validation process to exist? 

Mr. WINKOWSKI. Well, first, I would like to thank the committee 

for being so generous with the C–TPAT program. We have a full 

complement of staff on. We have increased it. We have opened up 

offices in Buffalo and Houston as well, and that has enabled us to 

move along quickly to validate. I think it is too early to tell on the 

third-party validators. 

As I mentioned in my opening statement, only nine importers 

have signed up, and 11 validators were selected. To my knowledge, 

they still have not been able to do the validations. It has to do with 

pricing, it has to do with an individual’s willingness to want to 

hand over sensitive trade related information. 

35 

So I am optimistic, Chairwoman Sanchez, that at some point 

here in the not so distant future, that China will open its doors and 

our team will be able to go in there and do the validations. 

Ms. SANCHEZ. On the pilot, you chose as the universe for thirdparty validators to look at only members, only C–TPAT members 

with 75 percent or more of their supply chain in China. I think 

that this would result in a small number of potential universe for 

these third-party validators to actually take a look at. I am told 

something around 300 eligible. What made you, what made you 

choose that particular 75 percent figure? 

Mr. WINKOWSKI. There was an analysis done based on threat and 

other factors, and we came up with the 75 percent figure. 

Ms. SANCHEZ. Because of threat factor? 

Mr. WINKOWSKI. Threat, trade volumes, things of that nature. 

And from there we came up with that 75 percent number. 

Ms. SANCHEZ. Okay. I have heard also that the supply chains in 

China aren’t considered very risky in the C–TPAT program. How 

do we know that if we have never actually been allowed to go in 

and look at the supply chain? 

Mr. WINKOWSKI. C–TPAT was set up from a terrorist standpoint, 

and we have had no information that China is a threat from that 

standpoint. 

Ms. SANCHEZ. We have no information that China is a, has terrorists who would be wanting to go from there in hurting our commerce or our people? 

Mr. WINKOWSKI. That is correct. 

Ms. SANCHEZ. Okay. What is the status of the negotiations for 

China to allow our CBP validators to go into China? 

Mr. WINKOWSKI. We are waiting for a letter from the Chinese 

government that we anticipate getting at any time now to open up 

the doors. And we have already selected team members. Our C– 

TPAT supply chain specialists have been selected. And as soon as 

we get that letter and they open the doors, we will be in there beginning the validation process. 

Ms. SANCHEZ. When we go to other countries and look at the C– 

TPAT and do the validations, is that a long-term situation where 

we put employees there, or do we just house them in hotels, they 

go and do it for a week’s time? 

Mr. WINKOWSKI. They stay in hotels. They are not permanently 

stationed there. Depending on the size of the supply chain, it depends on the size of the supply chain and determines how long 

they would be there. 

Ms. SANCHEZ. I see that my time is up. So at this moment, I will 

yield 5 minutes to the ranking member for his questions. 

Mr. SOUDER. Mr. Winkowski, if North Korea wanted to move 

something through the United States, would they likely use China? 

Mr. WINKOWSKI. I don’t know. 

Mr. SOUDER. Seemed a fairly broad statement to say that we 

have no concerns about China, given the amount of shipments that 

we have go through there. I think you accurately stated that we 

haven’t any publicly released incidents. But I think there is grave 

concerns about even whether China can call Western China, as 

their Muslim population, where things may move through their 

36 

ports. Malaysia clearly has people moving every which direction 

and Indonesia and the Philippines. 

Mr. WINKOWSKI. But from the supply chain standpoint, China’s 

threat is clearly more on the import safety side of it. 

Mr. SOUDER. I understand that, given the bulk that that is true, 

but I don’t know that I agree with your underlying assumption. I 

wanted to ask you and Mr. Oxford the statement that the SAFE 

Port Act includes a list of criteria that has to be evaluated, and I 

know a lot of this is relatively new. But we ran into this last week 

on our border implementation, and so I want to go through the list 

of things that you have to give feedback before you roll this out. 

One was the ability of the automated targeting system to utilize 

the images and the data capture during the scanning, which is one 

of the problems that we have had in the borders, is that we get the 

info but we don’t know how to handle it. 

The second is the effectiveness of the scanning equipment in detecting shielded and unshielded nuclear material. In other words, 

can we see actually what we are trying to see. The ability of the 

software to automatically identify potential anomalies in scanned 

containers, for years this has been a challenge in narcotics and 

other types of things and I have seen many variations both overseas and in the United States. The feasibility of expanding the pilots to other ports, including available infrastructure, processing 

speed, cost to install and maintain, and the number of staff required. And I am wondering if each of you could give us a preliminary on those four key points. 

Mr. OXFORD. The problems that you have stated with scanning 

in the past, especially the imaging as opposed to the passive 

scannings, is something that technology will quickly advance. What 

we are working with CBP to do is to look at the various scanning 

systems that are out there and find out the information content 

that comes in each one of those scans. What we have been doing 

in the past or what CBP is doing at the borders, if you have visited 

there, is essentially doing a manual processing of the imaging, and 

then they are trying to make a determination integrating automatic algorithms into that scanning process to immediately alert 

the operator there is an anomaly, is the technology within our 

grasp. What we need to identify are the systems that we can now 

integrate that technology or that capability into to further enable 

the CBP officers as they are trying to make these targeting systems. 

So, from a technology point of view, it is within our grasp. We 

need to find the right systems to integrate the automated processing piece of this, which has not been a requirement in the past. 

So this is a new requirement that needs to be integrated in the imaging systems. 

Mr. WINKOWSKI. And we work very closely with DNDO on that. 

Mr. SOUDER. Have you been able to position the images themselves? Is what you are bringing in, for example, being able to be 

used by the National Targeting Center? 

Mr. WINKOWSKI. Yes, they are. As a matter of fact, I was at the 

Center yesterday. And when you look at Pakistan, the images are 

very, very clear that are being transmitted out of the SFI port. 

Mr. SOUDER. Thank you. 

37 

Mr. Oxford, I appreciate the time that we spent earlier talking 

about a number of these issues. And one of the things that has 

been a question is how you do a cost benefit analysis of your new 

technologies. Could you explain a little bit some of the struggles 

that you have had those, the tradeoffs you have had and the costs 

and the expensiveness versus the return? 

Mr. OXFORD. The trade-off boils down to two principle factors. 

First of all, is the technology providing a significant enough increase in performance to warrant the cost of that system? It also 

then gets back to the balance that I mentioned earlier where we 

are trying to manage the threat. And, again, without going into our 

threat basis in terms of the amount of material we are trying to 

scan for domestically, it is a fairly low number and I won’t go into 

the depth on that. But that trade-off between that and what CBP 

officers have to do at every port of entry becomes the principle factors in our cost benefit analysis. 

How much time does it take to go through a current protocol, 

versus the benefit that new technology, while managing the threat 

better, also benefits the operators in terms of their performance. 

Mr. SOUDER. When you are dealing with potential catastrophic 

threat that you are dealing with, how does that change a normal 

calculation as opposed to risk of illegal immigration, risk of narcotics, risk of patent violation? Nuclear is a whole different standard. 

Mr. OXFORD. When you look at traditional cost benefit analysis, 

one of the methodology factors is the cost of regrets. So if you factor 

in the prospect of allowing a nuclear weapon into one of our major 

urban areas, the associated costs that could run into the trillions 

immediately suggests that you would pay whatever it takes to provide enhanced security at the border regardless of what the technology costs. 

Mr. SOUDER. Okay. 

Ms. SANCHEZ. I thank the gentleman for that. 

And I would now like to recognize other members for questions 

that they may wish to ask the witnesses. And in accordance with 

our committee rules, I will recognize members who were present at 

the start of the hearing based on seniority on the subcommittee, alternating between the majority and minority. And those members 

coming in later will be recognized in order of their arrival, and of 

course, those members who are not traditionally on the committee 

will be recognized after that point. 

So at this point, I would like to recognize the gentleman from 

Mississippi, our chairman, Mr. Thompson, for 5 minutes. 

Mr. THOMPSON. Thank you very much, Madam Chairwoman, for 

this very important hearing. As has already been said, we have 

been talking about TWIC for about 5 years now. Ms. Fanguy, can 

you tell me if you are aware of the Coast Guard’s advisory stating 

that criminal elements were trying to obtain the information about 

the TWIC program in the Ports of Los Angeles and Long Beach? 

Ms. FANGUY. Yes, I am. And we have been working very closely 

with the Coast Guard to look at that intelligence. 

Mr. THOMPSON. We will go into that a little more. The TWIC 

card was supposed to be the one card that provided uniformity and 

38 

consistency. What steps has TSA taken to pre-empt state access 

cards like those issued in Florida? 

Ms. FANGUY. The TWIC regulation currently does not preempt 

States or localities from issuing their own cards. In the case of 

Florida, however, we recently participated in a roundtable chaired 

by Congressman Mica to discuss some of the concerns of the state 

of Florida and to identify ways that we can work more closely together so that we can have one card. 

Mr. THOMPSON. So are you giving us testimony that at some 

point it is the Department’s hope that all these other access cards 

will go away and this TWIC card will be the single entity that employers, and employees will have to use? 

Ms. FANGUY. Everybody who needs unescorted access to the Nation’s ports and vessels will require a TWIC. But currently, it is up 

to local business operators and States and local officials to determine if additional cards are required. But everybody will have a 

TWIC, which will provide a common and uniform credential across 

the entire maritime mode. And we feel that adds significant security benefits. 

Mr. THOMPSON. But you are aware that if each State develops an 

access card, we have created a real problem for the employees. 

Ms. FANGUY. We certainly have heard from a number of our 

stakeholders about the challenges that they face with multiple credentials. And that is why we are putting out the TWIC card, which 

is a common and consistent credential used nationally. 

Mr. THOMPSON. And I appreciate your comments. But if 10 

States decide to have their own access card, that means that a potential employee would have to have 10 access cards if they operate 

in those areas plus a TWIC card. 

Ms. FANGUY. In the example you give, that is correct. And we are 

hoping that people will embrace the TWIC credential. And the way 

that we have designed it is that you can integrate it within many 

legacy systems in a lot of different ways. So we are hoping that the 

flexibility will allow people integrate it easily into their existing 

systems. 

Mr. THOMPSON. Are you aware of any instances where the rollout 

at this point has produced any compromising of the TWIC card? 

Ms. FANGUY. Not at this point. 

Mr. THOMPSON. Can you tell us, according to the witness who 

will be only next panel from the Port of Houston, why the Department missed the estimated number of employees by more than 90 

percent? 

Ms. FANGUY. In terms of any port in the Nation, we certainly 

have heard a number of different estimates. Let me assure you 

that no matter how many workers there are, we are ready to take 

them. We have a flexible approach to be able to handle whatever 

volume comes our way. As an example, in the Ports of Los Angeles 

and Long Beach, we can do 24 by 7 enrollment. That is a 24 by 

7 port. In places like Houston, where there are large populations, 

we are working very closely with field personnel to identify where 

some of the discrepancies may lie and to make sure that we have 

the resources there to be able to handle large volumes of workers. 

39 

Mr. THOMPSON. So, now, did the Department come up with these 

numbers internally? Or did we hire somebody to give us the estimates? 

Ms. FANGUY. When TSA began developing the regulations for the 

TWIC program with the Coast Guard, we did extensive analysis. 

We worked to try to obtain numbers from trade associations, from 

labor groups. We worked with the Department of Labor. And we 

looked to all the various sources of data that we had available to 

us to identify the overall population estimates. But we continue to 

work closely with local stakeholders to make sure that if there is 

new information, that we take that into account and we have a 

flexible approach to be able to handle any group of workers that 

come our way. 

Mr. THOMPSON. I understand. But what I was trying to say, was 

did we pay somebody to come up with these estimates, or did the 

Department internally come up with the estimates? 

Ms. FANGUY. It was a Department-led initiative, and I am sure 

that we had contractor support. So we need to get back to you with 

some of the details if you are interested in more information. 

Mr. THOMPSON. So you are not aware of any contract that went 

out to give the Department the estimated number of people who 

will be eligible for the TWIC card? 

Ms. FANGUY. Again, it was a Department-led initiative. But I do 

know the way contractors support, but in terms of the statement 

of work specifically for that, we need to get back to you with those 

specifics. 

Mr. THOMPSON. So do you know about any of the contracts? 

Ms. FANGUY. Absolutely. The contract that supported the population estimates, I apologize it was before I was actually hired at 

the TSA, so I want to make sure to get you the right information, 

and I am sure we can get that for you as soon as we are done here. 

Mr. THOMPSON. Thank you. Will you please get us that information? 

Ms. FANGUY. Sure. 

Ms. SANCHEZ. I will now recognize Mr. Bilirakis for 5 minutes. 

Mr. BILIRAKIS. Thank you. And I want to thank the chairman for 

zeroing in on the TWIC card issue. We simply cannot require maritime workers in Florida or any other state to obtain multiple cards 

for the same purposes. 

I want to commend you, Ms. Fanguy, for your willingness to 

work with me, my state’s congressional delegation, also leaders 

from the Florida legislature on this particular issue. I hope by 

working through these issues that we can come to a mutually acceptable solution to improving port security in Florida and throughout the country. 

I have a couple questions for you, Ms. Fanguy. I understand that 

just a few hours ago TSA released a quarterly deployment plan 

which indicates that TWIC enrollment is scheduled for most Florida ports in the first three months of next year. Do you know when 

TSA will be announcing specific enrollment dates for those particular ports? 

Ms. FANGUY. As we get started on the program, we began in Wilmington. Once we verified that things were going successfully in 

Wilmington, we put out the date for Corpus Christi. So on ThursVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00043 Fmt 6633 Sfmt 6601 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
40 

day we are looking forward to getting the real data back, and then 

we will announce a lot more dates. So as we go through the next 

couple of months here, I would anticipate that we would begin to 

put out further information with specific dates and locations for the 

upcoming ports. But we want do this in a measured way and we 

want to make sure to control the release of information so we don’t 

confuse workers, and all of a sudden, have workers show up at an 

enrollment site only to be turned away if we have not begun enrollment in that location. But I would anticipate that that would be 

coming very shortly after we verify successful operations in these 

first ports. 

Mr. BILIRAKIS. At a roundtable discussion on the TWIC last 

week, as you mentioned, former DHS Deputy Secretary Michael 

Jackson indicated that he believed that several of the outstanding 

TWIC issues could be resolved before TWIC is implemented in 

Florida. Could you please share with us what steps your office is 

taking to address the major unresolved issues and whether you 

have established a timetable for doing so, especially in light of today’s deployment announcement. 

Ms. FANGUY. We are working very closely within the Department 

of Homeland Security to take the feedback from that roundtable, 

and we have developed a plan. We are working very closely with 

the FBI to identify ways that we can make sure that at the national level, that we have access to complete criminal history 

records information that will allow us to complete more accurate 

security threat assessments. We have also prepared a letter to go 

to the FBI so that we can identify other ways that we can work 

more closely to address some of the issues that were brought up in 

the roundtable. 

Ms. FANGUY. We have been working very closely with officials in 

the State of Florida, and I anticipate that we are going to continue 

to do that as we move forward with TWIC rollout to make sure 

that we have come up with a mutually agreeable solution. 

Mr. BILIRAKIS. At the discussion, Secretary Jackson also said 

that he would also inform his successor about the discussions we 

had last week and direct him or her to make resolving the issue 

a top priority. Will you commit to me here today that will ensure 

that the Acting Deputy Secretary Snyder is aware of Florida’s concerns and that he or she, the successor, will follow through on Secretary Jackson’s promise in a timely manner? 

Ms. FANGUY. Absolutely. And, in fact, he was already briefed and 

we gave him further information when we met with him last week 

to bring him up to speed on some of the issues that we discussed. 

Mr. BILIRAKIS. This is very critical to Florida, so thank you for 

your cooperation and your willingness to continue to work for me. 

Thank you. 

Thank you, Madam Chair. 

Ms. SANCHEZ. The gentleman from Florida is welcome. 

I believe now we have the gentleman from Texas, Mr. Green, for 

5 minutes. 

Mr. GREEN. Thank you, Madam Chair; and I thank the witnesses 

for appearing today. Because time is of the essence I will move as 

expeditiously as possible. 

Ms. Fanguy or Fangee? Help me with the pronunciation. 

41 

Ms. FANGUY. It is Fanguy, but I will answer to almost anything. 

Mr. GREEN. Thank you. I want to be as appropriate as possible. 

Permit me to retrace some of the comments made. You indicated 

earlier that it would take approximately 15 minutes as an enrollment time and about a 6-minute wait period; is that correct? 

Ms. FANGUY. That is the data that we are seeing to date. 

Mr. GREEN. And you might be able to enroll as many as 5,000 

workers per day? 

Ms. FANGUY. That is correct, once we are rolled out nationwide. 

Mr. GREEN. At 147 sites? 

Ms. FANGUY. Correct. 

Mr. GREEN. Now obfuscation does not necessitate malice 

aforethought, and I do not in any way imply that there is any malice aforethought, but I do have to ask you, are you indicating to 

us that we now have a working paradigm that we can monitor and 

that we can review wherein the card which necessitates that you 

have two things to happen, a reader that can read the card and can 

also read some part of my body so as to cross-check? Are we saying 

that that system is operable today? 

Ms. FANGUY. Yes. 

Mr. GREEN. And it is operable at 147 sites? 

Ms. FANGUY. In terms of—there are two parts to the TWIC program. So, right now, we are moving forward with the rollout of enrollment of workers. And then the second part will be to require 

owners and operators at those ports to install readers. 

Mr. GREEN. I understand, but do we have the readers at these 

sites? 

Ms. FANGUY. Currently, they are not required to have readers. 

Mr. GREEN. Is your answer no? 

Ms. FANGUY. That is correct. It is no. 

Mr. GREEN. If we do not have readers at the sites, then we will 

have persons who will have cards who will be permitted to enter 

a facility, but we won’t have the ultimate cross-check, which is the 

reader that will identify the person as the proper holder of the 

card; correct? 

Ms. FANGUY. Correct. 

Mr. GREEN. That would mean then today I could take someone 

else’s card who looks a lot like me—not a lot of people do, but assuming there is someone who looks a lot like me—and I could enter 

the facility—‘‘thank God’’ someone just said. I could enter the facility with someone else’s card if the person looks a lot like me; is this 

correct? 

Ms. FANGUY. We would hope that the security officials at the 

port—— 

Mr. GREEN. I understand, but you don’t have that crucial element of the cross-check with some biometric; is that correct? 

Ms. FANGUY. That what we are working very closely on in the 

rollout—yes, the readers. 

Mr. GREEN. The reason I mentioned obfuscation is because the 

way your testimony came across could cause someone to conclude 

that we have sites currently operable where this actual 

functionality is taking place and you are saying to me this is not 

true? 

42 

Ms. FANGUY. We have enrollment sites that are open, and the 

next part of the program will be to require readers. 

Mr. GREEN. Which makes my statement correct then. You don’t 

have the sites with the reader and the enrollment card? 

Ms. FANGUY. For the readers, you are correct. 

Mr. GREEN. Which means we are still at a point where we are— 

to use the vernacular of Texans—we are fixin’ to do something. 

True? 

Ms. FANGUY. Well, the first part of the program needs to be to 

get cards in the hands of workers so that then when you implement readers that everybody has a card. So we don’t want to put 

a lock on the doors until everybody has a key, and what we are 

doing now is giving everybody the key. 

Mr. GREEN. So you are 100 percent confident that the reader 

that you will eventually utilize will function with the card that you 

have developed? 

Ms. FANGUY. When we developed—— 

Mr. GREEN. I might have to ask you to say yes or no, given that 

I only have 55 seconds left. 

Ms. FANGUY. Yes, I am confident that we will have the—that we 

will be able to read the cards. 

Mr. GREEN. One hundred percent confident? 

Ms. FANGUY. Yes. 

Mr. GREEN. The delay in getting the TWIC card developed and 

on line, would the vacancies in DHS have played any part in the 

implementation of the SAFE Port Act? Not just of the card but 

would these vacancies have had any impact? 

Ms. FANGUY. Since I have been at the TSA, I was actually hired 

to take things forward with TWIC about a year and a half ago. We 

have hired additional staff to be able to move forward with the 

TWIC program, and we feel that we have a good staff in place to 

carry the program forward and continue successful operations. 

Mr. GREEN. And I will take that as a nebulous answer, and I am 

not sure whether you said yes or no. Could you kindly give me 

some clarity, please? Are you saying yes or no? 

Ms. FANGUY. I am not aware of any of the vacancies affecting the 

TWIC program. 

Mr. GREEN. I will yield back the balance of my time with this 

comment. I am somewhat disappointed that after 5 years we still 

don’t have the readers and the cards being dispatched. That causes 

me some degree of consternation, given that this is a key element 

in the SAFE Port Act. 

I yield back. 

Ms. SANCHEZ. I thank Mr. Green, and now we will go to Ms. 

Jackson Lee for 5 minutes. 

Ms. JACKSON LEE. Let me thank the witnesses for their testimony and as well for their service and express the same kind of 

concern. I won’t use the terminology ‘‘frustration’’ but ‘‘concern.’’ 

Because I do believe that there has been an effort to move forward, 

by the witnesses’ testimony. But, at the same time, I think that we 

are long overdue in where we should be. 

Let me ask a pointed question to Ms. Fanguy and to the Commissioner. This program was supposed to be rolled out on January 

1, 2008—I know in your testimony you have said a number of 

43 

things—at the top 20 to 50 ports. Give me your best answer that 

you will in fact be able to roll this program out at the top 20 to 

50 ports January 1, 2008, which is a short distance away from 

today. 

Ms. Fanguy, why don’t you start? 

Ms. FANGUY. Today we put out a schedule; and by January 1, 

2008, we are currently anticipating that we will be at 39 sites. In 

January to March of next year, we are currently anticipating 55 

more sites being brought on line and quickly bringing on the remaining 147 sites, so that by next September we would anticipate 

that we would have the full complement of fixed enrollment sites. 

Ms. JACKSON LEE. Let me stop you there. You will have 39, 

which is between 20 and 50. And why do you think you are not 

able to do the complete 50 by Januaryμ1, 2008? And will the 39 

that you have, will it meet the litmus test? Will you be comfortable 

that it will be a functioning process, the ones that you will have 

at that point? 

Ms. FANGUY. That is exactly why we are rolling it out the way 

that we are. We want to make sure that we roll this out in a measured way and a controlled way to make sure that it continues to 

work successfully, that we can handle the volumes and continue to 

turn cards around in a timely fashion. 

Ms. JACKSON LEE. We have listed as one of the problems that the 

Department has not yet finalized a rollout schedule for all the 

ports. Are you suggesting that there is finalized schedule and it is 

not a problem anymore? 

Ms. FANGUY. We do have a finalized schedule that we have put 

out, and we will continue to put out more information about specific dates for each port as we move forward in the program. 

Ms. JACKSON LEE. Let me hear that again. You said what? 

Ms. FANGUY. We have a working schedule, and today what we 

have put out is time frames for the 147 ports. So for the next couple of month up to the end of December we have given time frames, 

but we need to make sure that we are verifying success at each 

port before we put out the dates for the next ports, because we 

don’t want to have a situation where we announce a date for workers at a certain port and then we have to change those dates. 

Ms. JACKSON LEE. Mr. Commissioner, why is this taking so long? 

And the second question is, why did you choose China in this pilot 

program? Why is this whole process taking so long? 

Mr. WINKOWSKI. Congresswoman, I have nothing to do with 

TWIC. It is not under Customs and Border Protection. 

Ms. JACKSON LEE. Then answer the question. You are still a part 

of the Department. I am sure you can contribute to that. Why did 

you select China as a pilot program? 

Mr. WINKOWSKI. I am sorry. I thought you were talking about 

TWIC. From the standpoint of the third-party validators? 

Ms. JACKSON LEE. Yes. 

Mr. WINKOWSKI. China was picked due to the fact that the Chinese government would not let us in China. And so going by the 

SAFE Port Act and going by the requirements of the SAFE Port 

Act China was selected, hoping that we could get some C–TPAT 

validations completed. 

44 

Ms. JACKSON LEE. But you picked a nation that wouldn’t let you 

in? I am trying to understand that. 

Mr. WINKOWSKI. We had some issues from the standpoint of 

doing our validations there, and we felt that in order to help out 

the importers that wanted to be under the C–TPAT program that 

the third-party validators could perhaps move it along. 

Ms. JACKSON LEE. Are you where you need to be with China 

now? 

Mr. WINKOWSKI. No, we are not, but I am hoping in the next few 

days that we will be notified by China that our C–TPAT supply 

chain specialists will be able to go into China and begin the process 

of validations. 

Ms. JACKSON LEE. I appreciate the service of everyone, but the 

question I posed to the commissioner was purposeful. It seems that 

no one at DHS knows what the other person is doing and has no 

contribution to it and can’t help anyone. I will just make the point 

that coordination is lacking. 

I have some other questions, but I know that my time is over. 

Thank you. 

Ms. SANCHEZ. I will now recognize the gentleman from Texas, 

Mr. Cuellar, for 5 minutes. 

Mr. CUELLAR. Thank you, Madam Chair. 

I want to thank the witnesses for being here. 

Commissioner Winkowski, let me ask you about the primary goal 

of the SAFE Port Act. It is the improvement of risk targeting for 

maritime cargo containers inbound to the United States from overseas locations. What is the status of the 10 plus 2 initiative? 

Mr. WINKOWSKI. The 10 plus 2 initiative, the regulations have 

been forwarded up to the Department and OMB for further review 

and approval. So I think when you look at 10 plus 2, I think it is 

really testimony to how government and industry can sit down, 

take on a very difficult issue and come up with a solution. 

Mr. CUELLAR. So your best timetable is by when? 

Mr. WINKOWSKI. Hopefully, sometime—I am anticipating sometime this calendar year. 

Mr. CUELLAR. What about the global trade exchange, the GTX 

initiative? What is the status of that? 

Mr. WINKOWSKI. We continue to work through that. It is an initiative that we have had a series of meetings on. It is a data warehouse. It is a vision that we have. Our attorneys are going through 

the legal challenges that we have with the global trade exchange, 

and we continue to move along. 

Mr. CUELLAR. Have you all included the custom brokers, the industry? I talked to their association, and they feel quite strongly 

that they have been left out of the conversation. 

Mr. WINKOWSKI. Not at this point, Congressman, because it is 

really something that we are trying to get our arms around. But 

I can assure you that once we get our arms around it and issue 

the RFQ that there will be very, very strong consultation with the 

trade community. 

Mr. CUELLAR. Okay. So when you do get your arms around that 

you will still have flexibility to—if they would want to see some 

changes, you would have flexibility to make any changes from the 

input? 

45 

Mr. WINKOWSKI. Oh, yes. 

Mr. CUELLAR. Let me ask you a question about the container security devices required under the SAFE Port Act. Have you all developed any container security devices required by the Act? 

Mr. WINKOWSKI. We have been working on our requirements. We 

believe that there is a need to continue to explore the technology, 

particularly for the CSDs. 

We believe that if we are going to have a CSD it has got to meet 

our standards. We want to make sure that we don’t have a lot of 

false positives where we are chasing down containers. We also feel 

that it should be used in a selective mode. 

Mr. CUELLAR. Are you all asserting that the technology does not 

exist? 

Mr. WINKOWSKI. No, the technology exists. The question becomes 

the reliability. 

Mr. CUELLAR. Okay. Not promoting any particular product—I 

want to make that clear for the record—but, I mean, there is some 

technology that already exists that I think has been validated. Why 

isn’t your testing or the Department’s testing from the technology 

that is available out there? 

Mr. WINKOWSKI. Well, we understand there is a technology out 

there, and we also believe that there is application out there. We 

don’t believe that they should be hung on all 11.4 million seaport 

containers coming into the country, number one. Number two, it 

should be used on a selective basis; and, number three, we have 

got to make sure that we are testing that technology. Because if 

you have a device that is reliable at 95 percent or 96 percent, you 

are talking about many containers where you could have false 

positives on. So we are working through those issues. We are not 

dismissing the use of CSDs. 

Mr. CUELLAR. Would you keep the committee advised on your 

progress on that at least? 

Mr. WINKOWSKI. Absolutely. Absolutely. 

Mr. CUELLAR. On the transportation worker identification credentials—I guess this is to the Coast Guard—you all sent out a security alert I guess just less than a week ago dealing with Long 

Beach and L.A. possibility of gang members dock workers, organized criminal elements trying to solicit information on TWIC. Any 

further status on that? 

Captain STURM. Congressman, I don’t have anything to add at 

this time. I would clarify that I think that was an attempt at our 

local office there to just alert local facility operators that there are 

criminal elements looking to exploit, you know, gather information 

for possible exploitation in the future. But there was no indication 

that there was any success in that area. 

Mr. CUELLAR. Okay. All right. Well, thank you. 

I have no further questions, Madam Chair. Thank you. 

Ms. SANCHEZ. The Chairwoman recognizes the gentleman from 

New Jersey, Mr. Pascrell, for 5 minutes. 

Mr. PASCRELL. Thank you. 

I want to thank everyone for their service to their country, but 

I still believe strongly that port security remains one of the biggest 

homeland security vulnerabilities in our Nation and more has to be 

46 

done and a sense of urgency, I think, has to be part and parcel of 

our everyday work so that we can face these threats. 

The SAFE Port Act was passed by Congress as a strategic plan 

to enhance the security of all of our ports, but the many agencies 

within the Department of Homeland Security have fallen too far 

behind in implementing key provisions. 

Last year, we passed the critical legislation I authored with Dave 

Reichert from Washington, a member of this committee, to direct 

the Secretary to establish a port securities training program. This 

program was intended to enhance the capabilities of each of our 

Nation’s seaports to prevent and to prepare for response to and to 

mitigate against acts of terror, to mitigate against natural disasters and other emergencies by providing validated training to all 

disciplines that are involved in operations and safety at our ports. 

So my question, Captain Sturm, is, has the Coast Guard established port security training and exercise programs which is required by the SAFE Port Act? It is our understanding that port 

workers still lack the necessary training. Could you be brief and to 

the point? 

Captain STURM. Yes. Mr. Congressman, under MTSA 2002 there 

were some existing requirements for training and exercises. Model 

courses for facility workers as well as members on the shipboard 

community were developed. Now extra money has been allocated to 

Florida State University which has been developing actual courses 

that specific unions, employers and other groups can use, more or 

less off-the-shelf, to build their own training programs, making it 

that much easier to conduct training. 

So we continue to move forward on building—providing assistance for training to people in the maritime community. 

Mr. PASCRELL. Thank you. 

Are you satisfied with the progress of not only the training but 

the exercises that were very definitive in the port securities bill? 

Captain STURM. Well, with respect to exercises, that process continues to evolve as well. The first 2 years after MTSA 2002, most 

of our exercises focused on the prevention and protection nature of 

area maritime security plans. Last year, approximately 35 percent 

of our exercises also included recovery and reconstitution. This 

coming year, we expect 50 percent of those exercise will. So, as 

maritime security efforts mature in ports, our exercise program 

will continue to mature as well; and we will provide additional 

guidance to our field units. 

Mr. PASCRELL. Assistant Commissioner Winkowski, although it 

was recommended by the GAO and the SAFE Port Act that minimum technical operating standards for nonintrusive inspection 

equipment at CSI ports have yet to be established, without such 

standards, what assurances does our Nation have that this equipment that you have been talking about is capable of detecting 

weapons of mass destruction within these high-risk containers? 

Mr. WINKOWSKI. Well, we rely on the expertise of the scientists 

from an operations standpoint, whether it is Department of Energy 

or the DNDO. 

Mr. PASCRELL. Where are you with the standards? How can you 

make an evaluation or a judgment unless you have established the 

standards by which we can conclude that we are protecting this 

47 

Nation from weapons that I have described coming into our ports, 

and what assurances can you give us if you don’t have the standards? 

Mr. WINKOWSKI. I don’t have the answer to that question. 

Mr. PASCRELL. I think that is pretty significant, don’t you, that 

we get the answer? 

Mr. WINKOWSKI. Yes, I agree. 

Mr. PASCRELL. Because everything is evolving here. The favorite 

word of Homeland Security is ‘‘evolving.’’ Life is evolving. I believe 

in evolution of ideas, evolution itself, but we have got to get to a 

point where—we are never going to have a seamless situation. Nobody is saying that. Everybody understands that. But we can be 

doing much better in terms of the length of time we have had to 

put this together. 

The resources that everybody says we have, Madam Chairwoman, we have these resources. We don’t need more money. We 

do not need this or we don’t need that. Then why don’t we ever get 

to the point where we are saying, we are satisfied, we have established a standard, and we have met that standard? 

And I would like to ask, if I may, one more question. 

Ms. SANCHEZ. I will indulge the gentleman from New Jersey for 

his question. 

Mr. FANGUY. Ms. Fanguy, how do you expect poor operators and 

trucking companies to continue operating in the face of the provisions that have been laid out in the SAFE Port Act and the TWIC 

program, in the face of these provisions which may mean a significant chunk of their workforce will now be ineligible to enter the 

ports in the first place? 

Ms. FANGUY. We have established a very robust appeals and 

waivers redress process for workers. And we certainly understand 

that some people may have some of the criminal disqualifiers in 

their past, but we want to work very closely with these workers. 

The process that we have laid out is the same as that that we 

use in the HAZMAT program. And I want to reassure you that we 

work closely with the drivers in the HAZMAT program today. 

Based on the most recent statistics that we have, we have processed approximately 700,000 drivers through the HAZMAT program; and in terms of waivers that have been denied, we have denied approximately 70. 

So for people who will work with us, we want to make sure that 

we can get the information to be able to clear their information. If 

it is an appeal and we have incorrect information, we want to correct that. If it is somebody who has something in their past and 

they no longer pose a security threat, we will work closely with 

them to make sure that we can note that and give them the credential that they need. 

So we are doing it today on HAZMAT, we will use the same process on TWIC, and we want to reassure you that it is something 

that is very important to us. 

Mr. PASCRELL. Thank you. 

Ms. SANCHEZ. Let me get a clarification on that. You said you denied 70 under the HAZMAT? 

Ms. FANGUY. That is correct. 

Ms. SANCHEZ. How long has the HAZMAT program been going? 

48 

Ms. FANGUY. The HAZMAT program has been going approximately 2 years now. 

Ms. SANCHEZ. How many HAZMAT certifications have you given 

out? 

Ms. FANGUY. Seven hundred thousand. 

Ms. SANCHEZ. Seven hundred thousand. Good. Thank you for 

that. We wanted that on the record. 

I would thank the panel for being before us, and we will again 

thank you for your work. We will probably have some other questions which we will put in writing to you, and we hope that you 

will get back the information we need as quickly as possible. 

We will dismiss the first panel and ask the second panel to 

please approach and get ready, and I will give a 5-minute intermission for people to stretch their legs and get business done, and 

we will be back in 5 minutes with the second panel. 

[Recess.] 

Ms. SANCHEZ. I welcome the second panel of witnesses. 

Our first witness is going to be Mr. Lindsay McLaughlin, the 

chief lobbyist—that is the first time I have heard you called a lobbyist—chief lobbyist for the International Longshore and Warehouse Union. In this role, since 1991, he has advocated for a wide 

variety of issues to benefit the members of his union, including the 

process protections for longshore workers undergoing background 

checks and adequate port security training. 

Our second witness is Mr. Robert Blanchet, Representative for 

the Port Division of the International Brotherhood of Teamsters. 

He currently represents the Teamsters Port Division on the west 

coast, serving the ports of Oakland, Long Beach, Seattle-Tacoma 

and Portland; and in that capacity he helps represent over 5,500 

longshoremen, clerks, truck drivers, tugboat deckhands, tugboat 

captains, port authority employees, guards and warehousemen who 

work at our Nation’s ports. He has been a member of the Teamsters Union for 39 years. Welcome. 

Our third witness is Mr. Chris Koch, President and CEO of 

World Shipping Council, a trade association representing the international liner shipping industry. The Council’s members represent 

over 93 percent of the international liner industry capacity serving 

U.S. international commerce. Mr. Koch was hired by the industry 

to establish this organization in August of 2000. 

And our fourth witness is Ms. Mary Alexander, Director of Government Relations at Panasonic Corporation North America. She 

has been with Panasonic for over 19 years, focusing on international trade, tax, and general corporate affairs issues; and she 

currently chairs the Joint Industry Group, an ad hoc coalition of 

Fortune 500 companies, carriers, customs brokers, trade associations, service providers and law firms with a common interest in 

global commerce. 

And our final witness is Mr. Wade Battles, Managing Director 

for the Port of Houston Authority; and as managing director, a position he has held since 1999, Mr. Battles is the equivalent of the 

chief operating officer, overseeing all of the port’s administrative 

and operational departments. A long-time maritime professional, 

he has been an active member of numerous industry associations 

49 

and committees, including the American Association of Port Authorities and the National Maritime Security Advisory Committee. 

And without objection, the witnesses’ full statements will be inserted into the record. 

Ms. SANCHEZ. I will now ask my friend, Mr. McLaughlin, to summarize his statement for 5 minutes. 

STATEMENT OF LINDSAY MCLAUGHLIN, LEGISLATIVE 

DIRECTOR, INTERNATIONAL LONGSHORE AND WAREHOUSE 

UNION 

Mr. MCLAUGHLIN. Thank you, Chairwoman Sanchez and members of the subcommittee. Thank you for inviting ILWU to testify. 

As you know, the ILWU represents longshore workers on the west 

coast of the United States. 

There are a number of important provisions of the SAFE Port 

Act that I would like to talk about. First, port security training and 

exercises. To date, most of our longshore workers don’t know what 

the evacuation procedures are. There haven’t been any live exercises. 

Recently, the ILWU officers met with Rear Admiral Bone on the 

west coast to talk about a wide variety of port security issues, including training; and what we told him is that our major priority 

is that we have a whole cadre of people who are willing and able 

to work on recovery efforts in case there is an attack and that we 

need training for these people that would volunteer in HAZMAT 

and—somebody has got to move these containers out of the way in 

the event of an incident. We need to start somewhere. That is 

somewhere. 

On TWIC, the rollout is going to be mid-November. Our membership has some concerns, the loss of privacy involved in submitting 

to the background check. The fee for the card is a burden for some 

of the lower-paid workers such as security guards. Many of our 

members have expressed concerns that they are going to go 

through this process and pay money when there are no readers in 

place to read the cards. 

But our leadership has asked the union to cooperate with the 

TSA; and we are in discussions at those ports, Honolulu, Oakland, 

and Tacoma, to establish mobile units in the halls. That is a good 

thing. 

But it is instructive to look at the experience of the HAZMAT 

truck drivers in obtaining their security clearance. TSA claims that 

they processed 700,000 applications, resulting in the disqualification of 5,500 individuals. Ninety-five percent of the disqualified individuals did not respond to the initial letters explaining their 

rights to appeals and waivers, and we are concerned about that for 

a number of reasons. We are concerned about people not being able 

to understand the letters that are going to them, perhaps because 

of literacy or because English is the second language. And it is imperative that a worker understand his or her rights right up front 

and that they are able to understand this communication that they 

get. So it needs to be in different languages, and there needs to be 

interpreters or people need interpreters. 

Another concern of the ILWU is the inaccuracy and incompleteness of the FBI rap sheets that will be used to determine whether 

50 

a member has passed a background check. The experience of workers in the hazardous materials certification process demonstrates 

this problem. TSA has reported that more than 3,000 people were 

initially found to have failed the criminal background check, even 

though they had actually had no disqualifying convictions and otherwise met the requirement for issuance of a TWIC. These incorrect initial determinations were caused by rap sheets that were incorrect or incomplete or that failed to distinguish between felonies 

and misdemeanors. 

Now, given the wide scale inaccuracy and incompleteness of the 

FBI rap sheets, TSA must be required to conduct a further investigation before making an initial determination to deny somebody 

a TWIC and workers must be allowed to continue doing their jobs 

until the appeals process is exhausted. 

Another concern of ours is on the west coast we have traveling 

longshoremen. They might be a longshoreman in a small port, and 

there is no work, so they travel up and down the coast. You might 

have a longshoreman who needs to take care of a sick family number, so he travels to another area. We are concerned about the compliance date; and the compliance date on the west coast we believe 

should be the same, given that we have traveling people. 

Another point I would like to make, the Federal Government is 

spending millions of dollars on a system to control access to port 

facilities for perhaps a million American workers. Yet the Department of Homeland Security is missing a huge, gaping hole, so we 

are going to have this access control for people going in and out of 

our gates, yet empty containers go in and out of our gates every 

day unchecked. 

And we have this example in the Port of Ashdod in Israel where 

people did get in through a container and people died because of 

it. Longshoremen were blown up because of it. 

It makes no sense to us that you are spending millions of dollars 

to control access to our Nation’s ports, yet not even a simple pilot 

program, as I understand it, is going on; and we need to go much 

further than that. This is something that they used to do, check 

containers as they were going into the gates to ensure that they 

are actually empty and that there are no people or contraband or 

things in that container that shouldn’t be. 

And another issue I would like to wrap up is the port security 

regulations. Right now, they require terminal operators to check 

seals to ensure that they have not been tampered with as they are 

going into the facility and upon storage, and this just is not being 

done. In fact, some of the terminal operators since 9/11 have discontinued this process because of the competitiveness factor, we believe. And there are regulations in place. We have questions as to 

why, 5 years after the regulations, there is no enforcement. 

Finally, we would like to talk a little bit about the preemption 

issue. I think several unions have brought this up, and it is an important—that they don’t need multiple cards. Either we are going 

to have a uniform card or we are not. 

Again, I appreciate you allowing me to testify today behalf of the 

ILWU. 

Ms. SANCHEZ. Thank you for your testimony. 

[The statement of Mr. McLaughlin follows:] 

51 

PREPARED STATEMENT OF LINDSAY MCLAUGHLIN

Thank you Chairwoman Sanchez and Members of the Subcommittee for inviting 

the International Longshore and Warehouse Union (ILWU) to testify on the status 

of the Security and Accountability For Every (SAFE) Port Act. 

As you know, the ILWU represents longshore workers in the states of Washington, Oregon, California, Hawaii, and Alaska. We have long advocated the development and implementation of practices to limit the risk of terrorism at our work 

sites and to keep our ports from becoming conduits for unconventional weapons. To 

that end, it is imperative that the ILWU workforce be utilized as the first line of 

defense against maritime terrorist activities; law enforcement and other first responders should recognize us as a natural ally. 

Within each jurisdiction, key union officers are members of the Area Maritime Security Committee. Our relationship with the Coast Guard has never been better; we 

applaud that agency for its cooperation and for performing its job admirably—often 

with limited resources. 

There are a number of important provisions of the SAFE Port Act that deserve 

immediate attention and action from the relevant agencies. First, the SAFE Port 

Act requires the Department of Homeland Security, in coordination with the Coast 

Guard, to establish a port security training program to enhance the capability of 

each facility to prevent, prepare for, respond to, mitigate, and recover from acts of 

terrorism or natural disasters. Additionally, the Act requires each high-risk facility 

to conduct live or full scale exercises not less frequently than once every two years. 

The Act calls for training involving evacuation procedures in the event of an incident. Most longshore workers have no idea how to orderly evacuate facilities. To 

date, longshore workers have not been trained, with the exception of union-conducted initiatives. Our employers resist live exercises because it may temporarily 

disrupt commerce. However, without live exercises, any plan cannot be tested and 

improved in the event of unforeseen problems. The disruption to commerce in the 

event of any large-scale incident would certainly be much more significant with an 

unprepared workforce. 

Recently, ILWU officers met with Coast Guard Rear Admiral Bone in San Francisco for a wide-ranging discussion of port security. The ILWU emphasized our high 

priority placed on training. It is critical for our nation’s economy that our members 

get back to work as soon as is practical and safe following an incident. Someone will 

have to move containers out of the way; commerce will have to resume. Our union 

needs to be integrated into the emergency command structures. We have discussed 

with our employers forming a voluntary cadre of longshore workers to train for and 

be prepared to work in potentially hazardous environments. While discussions are 

helpful, we must begin implementation as soon as possible. 

The Transportation Security Administration (TSA) began enrolling individuals for 

a Transportation Worker Identification Credential (TWIC) at the Port of Wilmington, Delaware on October 16. On the West Coast, TWIC will initially be rolledout at the Ports of Honolulu, Oakland, and Tacoma in mid-November. Workers will 

be charged $132.50 for a card lasting 5 years. Our membership has raised many 

concerns with TWIC, including the loss of privacy involved in submitting to a background check. The fee for the card is a burden for lower paid workers such as security guards. Our members are also concerned that the card will be used for purposes 

other than simple access control. There is a fear amongst longshoremen that truckers and other individuals who must gain access to the port will not have to be compliant given the industry’s fear that there may be a trucker shortage. Longshore 

workers see this issue as a matter of fairness that every individual on the docks, 

regardless of occupation—management and labor alike—should have to go through 

the same process. Finally, it may be years before card readers are installed at our 

nation’s ports. It makes little sense to issue cards to people for the purpose of access 

control without having readers for the cards. 

The ILWU leadership has urged our Locals and ILWU members to cooperate with 

TSA and Lockheed Martin to enroll our members in an orderly fashion. Discussions 

are occurring with these entities to establish a mobile unit at the union halls or in 

the vicinity of the union halls to accommodate our workforce. 

It is instructive to look at the experience of Hazardous Material truck drivers obtaining their security clearance pursuant to the USA PATRIOT Act. TSA claims 

that they processed 700,000 applications resulting in the disqualification of 5,500 individuals. Ninety percent of the disqualified individuals did not respond to the initial letters explaining their rights to appeals and waivers. The ILWU is concerned 

with this statistic for a number of reasons. We are concerned that thousands of individuals may not have understood the communication to them because of literacy 

issues or perhaps because English is the individual’s second language. It is imperaVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00055 Fmt 6633 Sfmt 6621 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
52 

tive that a worker be able to understand his or her rights during this process if initially denied a card. This means that TSA must make materials available in multiple languages, not merely English and Spanish, and must make interpreters available to ensure that the non-English-speaking members of our workforce are able to 

continue their work in the industry. It is equally important that all written materials be drafted using plain language that can be easily understood. 

Truck drivers have a choice whether to transport hazardous materials or not; 

longshore workers do not have a choice. Longshore workers must have a card to 

work unless an escort procedure is worked out with the terminal and approved by 

the Department of Homeland Security. Given the importance of this card to our 

members’ livelihoods, we urge the TSA to revise their regulations to allow some initial waivers to be granted to an individual without having to apply for the waiver. 

Another concern of the ILWU is the inaccuracy and incompleteness of the FBI 

‘‘rap sheets’’ that will be used to determine whether our members pass the background check. The experience of workers in the Hazardous Materials certification 

process demonstrates this problem. TSA has reported that more than 3,000 people 

were initially found to have failed the criminal background check even though they 

actually had no disqualifying convictions and otherwise met the requirements for 

issuance of a TWIC. These incorrect initial determinations were caused by rap 

sheets that were inaccurate or incomplete or that failed to distinguish between felonies and misdemeanors. These approximately 3,000 workers were able to successfully utilize the appeals process to correct the erroneous initial determination. However, it is almost certain that an untold number of other workers who were erroneously denied certification did not appeal, perhaps because they did not understand their rights or could not read the information provided to them. Thus, in addition to these 3,000 workers who successfully appealed, there are almost certainly 

countless others who met the requirements for a Hazardous Materials certification, 

but are now barred from hauling Hazardous Materials because of inaccurate or incomplete records. 

In the ports, where workers will have to have TWICs in order to keep their jobs, 

the impact of the faulty records has the potential to be far more damaging. Workers 

who are denied a TWIC will lose their ability to work in the industry altogether. 

And even those workers who appeal an incorrect initial determination and ultimately prevail will be unable to work until the appeals process is complete. This 

means that a worker erroneously denied a TWIC, will be off work for at best several 

months while he or she appeals the incorrect determination. Given the wide-scale 

inaccuracy and incompleteness of the FBI rap sheets, TSA must be required to conduct a further investigation before making an initial determination to deny someone 

a TWIC and workers must be allowed to continue doing their jobs until the appeals 

process is exhausted. 

We would be very surprised if any members of the ILWU are terrorism security 

risks. Last year, the Coast Guard asked the union to cooperate in checking our 

members’ names against the Terrorist Watch List; they presumably found no 

matches. We remain adamant that felony convictions for past crimes are not necessarily an indication of a terrorism security risk. We urge TSA to utilize the waiver 

procedures included in the Act. The Coast Guard must adequately staff independent 

Administrative Law Judges to hear appeals from individuals denied a waiver. And 

as with the appeals process, workers should be permitted to keep their jobs while 

they are exhausting the waiver process. 

At the Senate Commerce Committee hearing on port security on October 4, 2007, 

Senator Cantwell asked the TSA how they would accommodate longshore workers 

who travel to work across various port zones. We are concerned that the response 

from TSA is ambiguous. Each Captain of the Port will determine when their zone 

is ready for TWIC compliance. The ILWU has an established travel system whereby 

workers regularly move between ports. Workers at small ports where work is scarce 

may not yet require a TWIC card but seek work in the ports where the TWIC cards 

are indeed required. Thus, the compliance date for implementation of TWIC must 

be uniform on the West Coast. 

The federal government is spending millions of dollars on a system to control access to port facilities for perhaps a million American workers. Yet the Department 

of Homeland Security continues to ignore a gaping hole in the maritime security 

system. Empty containers are a real risk as a means to transport weapons or people. Few terminals on the West Coast are visually inspecting containers to ensure 

that they are indeed empty. Given that empty containers are unsealed, it is easy 

for an individual to climb into a container and gain access to secure areas of a port 

facility. The SAFE Port Act requires a pilot program that includes the use of visual 

inspections of empty containers. We are not aware that any pilot program has 

begun. We recommend that the Committee go much further and simply require that 

53 

facilities visually inspect the empty containers, given the expensive investment we 

are making to control access through the TWIC program. 

There have been legitimate concerns raised by our counterpart on the East Coast, 

the International Longshoremen’s Association, and the sea-going maritime unions 

over states and localities such as Florida implementing their own version of TWIC. 

Workers should only go through one TWIC process and the due process protections 

embodied in federal port security law must apply to all states and localities. 

On March 14, 2004, ten dock workers were killed in the Israeli Port of Ashdod 

by suicide bombers; these terrorists were able to enter the port facilities undetected 

by hiding inside a cargo container. We must not experience a similar tragedy before 

we get serious about the cargo and empty containers that enter our port by sea or 

by land. 

Existing port security regulations require that container seals be inspected to detect and deter any tampering when entering a port facility and upon storage on the 

docks. This is simply not being done at most facilities; unbelievably, some facility 

operators have discontinued this practice since September 11, 2001 in order to further enrich themselves. Is there some reason that these important regulations are 

not being implemented 5 years after the Maritime Transportation Security Act was 

signed into law? 

The Act requires the National Institute for Occupational Safety and Health and 

OSHA to evaluate the environmental and safety impacts of non-intrusive imaging 

technology and to develop and put into place a radiation risk reduction plan to minimize the risks to workers and the public. Such evaluation needs to proceed. We are 

alarmed at the lack of independent study of the long-term effects of this technology 

on the human body. The ILWU will continue to place the safety of our members’ 

lives first. 

In conclusion, the ILWU urges that port security training and exercises move 

from discussion to action. Longshore workers should be trained to assist in the recovery efforts in the event of an incident. We urge the Committee to go beyond the 

pilot program on empty containers and mandate the visual inspection of empties, 

especially given the focus on access control at our ports. We urge that current regulations requiring seal inspection actually be implemented and enforced. An independent study on the safe use of radiation devices must go forward. Finally, the 

TWIC implementation must not jeopardize the livelihoods of workers who do not 

pose a terrorism security risk. 

Thank you for this opportunity to testify. 

Ms. SANCHEZ. And now we will hear for 5 minutes from Mr. 

Blanchet to summarize his statement. 

STATEMENT OF ROBERT F. BLANCHET, TEAMSTER PORT 

REPRESENTATIVE, INTERNATIONAL BROTHERHOOD OF 

TEAMSTERS 

Mr. BLANCHET. Chairwoman Sanchez, Ranking Member Souder 

and members of the subcommittee, my name is Bob Blanchet, Representative of the Teamsters Port Division. I serve on the San 

Francisco Bay Area Port Commission, where I work with Captain 

Uribi of the U.S. Coast Guard. 

While the TWIC is just now being implemented in the Port of 

Wilmington, tens of thousands of port truck drivers go unchecked 

in our Nation’s ports every day. Indeed, many port drivers show up 

and are issued a day pass to circumvent security systems that 

some ports like Savannah, Georgia, already have in place. The 

ports look the other way because moving containers trumps security. 

Today, security checks for most truck drivers consists of merely 

flashing a license, a license that could be forged or fraudulent. Let 

me tell you, that is exactly the case for the port of Oakland. I 

watch drivers every day being waved into the port terminals by 

flashing their commercial drivers’ licenses to the security guards. 

The security guard has no way of knowing that the driver he just 

54 

let through the gate has a forged CDL, or commercial driver’s license. 

I am not talking or making up a story. I will take any member 

of this committee to a truck stop on Santa Ana Boulevard in Oakland, California. That is where a little white van often drives up 

as a convenient drive-in counterfeit center. You pay $200 up front 

and the friendly vendor opens up a side door and pulls out a blue 

curtain for a backdrop, takes a picture. You return a few hours 

later and you pay a second $200 for your almost instant license. 

It takes place at every port. 

Last Friday, I called and asked one of our organizers in Los Angeles to pick up a couple of counterfeit licenses. He got his at the 

corner of Pacific and Florence in Huntington Park. I have them 

here, one in the name of Bennie Thompson, one in the name of Michael Chertoff. The fake license business is so competitive in 

Southern California that they only cost him $100 each. And I 

would like to submit the drivers’ licenses. 

Ms. SANCHEZ. ‘‘Class A’’ meaning? 

Mr. BLANCHET. Class A driver’s license. I have mine here. Anybody on the committee that would like to look at one. I have a 

HAZMAT endorsement. I have every endorsement. 

Ms. SANCHEZ. That would be the commercial trucker’s license. 

Mr. BLANCHET. This is a valid, legal driver’s license. Those two 

are fraudulent, forged. 

Don’t tell us that you have the situation under control. When 

TWIC is implemented on the west coast, nothing will change until 

the readers are in place. The mob producing false CDLs, green 

cards, Social Security cards, and DLT medical certificates will easily produce fake look-alike TWIC cards. 

Already, before the TWIC is implemented, there is a whole industry in existence right now where the drivers who have credentials bring containers out of the port and hand them off to other 

drivers who may not have a port credential, a HAZMAT endorsement or even a CDL. These containers are dropped right on the 

street outside the port terminal gate and picked up by these drivers. 

Similarly, a terrorist without a TWIC can drop a container in the 

street outside of a port and hand it off to a TWIC credentialed driver and take it inside. 

I have photos we took this past weekend that shows our port container relay operations. Every person who drives a container truck 

or handles or repairs or stores a container inside or outside the 

port terminal should be required to have a TWIC identification 

card. 

We look forward to working with the committee and finding realistic ways to create a safe port. I look forward to answering any 

questions that the subcommittee members may have. But also I 

would like to say this on behalf of my family, my children, and 

grandchildren: Thank you for your hard work and please save this 

country in the future for them. 

Ms. SANCHEZ. Thank you, Mr. Blanchet. I thank you for your testimony. 

[The statement of Mr. Blanchet follows:] 

55 

PREPARED STATEMENT OF ROBERT F. BLANCHET

Chairwoman Sanchez, Ranking Member Souder, and Members of the Subcommittee: 

My name is Bob Blanchet, Representative for the Port Division of the International Brotherhood of Teamsters. We represent over 5,500 longshoremen, clerks, 

truck drivers, tugboat deck hands, tow boat captains, port authority employees, 

guards and warehousemen who work at our nation’s ports. I have been a member 

of the Teamsters Union for 39 years, working in the freight industry as a driver 

before being elected as Vice President and then President of Local 287 in San Jose, 

California. I have served as a business agent and organizer as well, and currently 

represent the Teamsters Port Division on the West Coast—serving the ports of Oakland, LA-Long Beach, Seattle, Tacoma and Portland. 

I am in and around the ports on a daily basis and have an opportunity to interact 

with port drivers and other port workers regularly. I have been appointed to serve 

on the San Francisco Bay Area Port Security Commission, where I work with Captain Harold Uribi of the Coast Guard. I have witnessed first hand the dedication 

and concern of this Captain of the Port in implementing security measures to protect our ports against potential terrorist attacks. 

It is a daunting task to secure both the land and seaside areas of a port. Are the 

ports more secure one year after enactment of the SAFE Port Act? Certainly, improvements have been made in some areas, but in others, security is severely lacking. And while the Transportation Worker Identification Credential (TWIC) is a 

noble effort to control ingress and egress into and out of the ports, the Teamsters 

Union has many concerns with the structural and planning shortcomings of the 

TWIC and how this program will work on the ground when finally implemented. 

These include driver turnover; cost of the TWIC and other forms of ID required by 

various ports; efforts already underway to circumvent container pickup in the ports; 

the lack of readers allowing for potential counterfeit TWICs; the possible loss of 

work while drivers apply for the TWIC and wait out the waiver and appeal process 

if needed; and the list of disqualifying offenses themselves. We are supposed to be 

weeding out potential terrorists, not denying jobs to hardworking port workers who 

may have an irrelevant transgression in their past. 

Driver Turnover Presents Security Challenges 

As the Teamsters Union pointed out in our earlier testimony before the combined 

MARAD/Coast Guard field hearings, the assumptions of driver turnover are way out 

of whack! The port drivers are not a stable workforce like the dockworkers and 

other port employees. According to statistics provided by the American Trucking Association, these poor exploited drivers have an annual turnover rate of 120% per 

year. This figure dwarfs the 12% average turnover rate used by TSA to estimate 

the resources and cost needed to implement the TWIC. Poor and abusive working 

conditions have created these astronomic turnover rates for short-haul container 

drivers, which will make it virtually impossible for TSA to collect names, let alone 

conduct background checks and issue TWICs quick enough to keep commerce flowing efficiently through our ports. The Coast Guard recognized this problem last 

year, when it failed to include port drivers in its initial Maritime Identification Credentials notice issued on April 28, 2006. And it continues to confirm this difficulty 

by refusing to implement Section 125 of the Safe Port Act (PL 109–347) that required port drivers to undergo the same security protocol as every other port worker—the check against the terrorist watch list and the immigration status check. 

While the TWIC is just now being implemented at the Port of Wilmington, hundreds of thousands of port truck drivers go unchecked in our nation’s ports every 

day. Why is this happening? Unlike longshoremen and other port employees, there 

is no one in the ports that can account for port drivers. And I have to believe that 

the ports have not pushed this requirement because they fear an immediate driver 

shortage. There is no one who can provide names of all the port drivers operating 

within any given port. Indeed, many port drivers show up and are issued a day pass 

to circumvent permanent credentialing that some ports already have in place. The 

ports look the other way because moving containers trumps security. 

Under the current system, most port truckers are incorrectly classified as independent contractors. The drivers’ status as independent contractors has grave implications for port security. To begin with, because they are considered independent 

contractors, no one—not the motor carriers or brokers who utilize the drivers, nor 

the steamship lines nor the shippers—take responsibility for identifying who drivers 

are or assuring that drivers are properly credentialed. Second, as independent contractors, drivers are at the bottom of the port’s economic ladder, typically netting 

$11 to $12 per hour for a working day that often stretches to 12 hours. Drivers are 

not entitled to statutory benefits, such as worker’s compensation and typically do 

56 

not have access to medical insurance or retirement programs. Under these conditions, it is not hard to see why the port driver turnover rate is so high. 

The Ports of Los Angeles and Long Beach are considering enacting a concession 

model for port trucking which could solve many security problems related to port 

trucking. The two ports are considering requiring all motor carriers providing 

drayage services at both ports to utilize employee drivers to operate newer, environmentally ‘‘clean’’ trucks. The requirement that companies utilize employee drivers 

means that motor carriers will be responsible for assuring that their drivers are 

properly screened and qualify for TWIC. The Teamsters applaud the Ports’ efforts 

to improve security and urge the Committee to support this program. 

Lack of Card Readers Allow Security Gaps 

Today, security checks for most port drivers consist of merely flashing a license— 

a license that could be forged or fraudulent. Let me tell you—that is exactly the case 

in the Port of Oakland. There is no main port gate at Oakland. Each terminal has 

its own entrance. I watch drivers every day being waved into the port/terminal entrance by flashing their Commercial Drivers License (CDL) to the security guard. 

In most cases, these current forms of identification are not even looked at. If a 

guard recognizes the driver, he waves the driver onto port property. And, that security guard has no way of knowing that the driver he just let through the gate has 

a forged CDL. 

I am not making up a story. I will take any Member of this Committee to an area 

near the Port of Oakland. That’s where a little white van often appears as a convenient drive-in counterfeit center. You pay $200 up front and the friendly entrepreneur opens up his side door, pulls out a blue curtain for a backdrop and takes 

your picture. You return a few hours later, pay a second $200 and pick up your almost instant license. 

I would maintain that when TWIC is implemented in the Port of Oakland, until 

card readers are installed, nothing will change. Nothing will change because the 

TWIC will be forged within 48 hours. It won’t have a fancy chip or biometric identifier in it, but on its face, it will be good enough to fool the security guard, especially 

the ones who don’t even bother to closely examine it. And it won’t present itself as 

any layer of security if guards continue to wave drivers through without even looking at the credential. 

Off-Port Facilities Create Security Gaps 

Already, before the TWIC is implemented, there are ways that drivers without 

proper credentials are circumventing the system. There’s a cottage industry in existence now where drivers, who have credentials, bring containers out of the port and 

hand them off to other drivers who may not have a port credential, a hazmat endorsement, or even a CDL. These containers are dropped right on the street outside 

the port terminal gate and picked up by these other drivers. The same thing happens when the containers come back to the port. With very few empty containers 

checked on return, we don’t know who has brought that container from where and 

what he has put in it. 

In previous testimony before the Senate Committee on Homeland Security and 

Government Affairs, the Teamsters Union testified about the issue of containers sitting in the ports for days without being screened for radiation. Radiation detection 

equipment should be positioned so that containers coming off the ships are screened 

immediately. In many instances, containers are moved to on-site rail yards and 

other holding yards and may sit for days before they are screened—and only when 

they eventually leave the port. 

This raises further questions about security as containers move through the entire 

chain of custody from the port and are returned to the port. While all local port 

truck drivers who actually perform work inside the port terminal will be background 

checked to obtain the TWIC, what about those drivers who fail to secure the proper 

TWIC or who avoid the background checks altogether because of known legal problems or worse. They can continue to take part in the off-port drayage business by 

either rail, distribution work, or trans-load facility work or by batching boxes with 

someone who has TWIC credentials and can do the interchange in or out of the port 

gates. 

Every day, hundreds of intermodal boxes turn up missing, loaded with everything 

from tennis shoes to hazardous material. Sometimes these loads are not missed for 

days or even longer because of a broken system that invites disaster. What about 

rail workers, off-port lift operators, cross dock employees, marine chassis, box, or 

refer maintenance mechanics who have full access to every part of critical intermodal equipment outside the port gates, or intermodal trucking company employees 

who handle the assignment of container loading and unloading? Also, containers sit 

on rail sidings for hours and days without any security at all, or on vacant lots, at 

57 

shopping malls, or on neighborhood streets or at fuel stops. ‘‘Batching’’ takes place 

outside along side streets near the port or at rail gates. This practice involves taking 

care of paper work during normal hours of port operation and then moving loads 

or empties outside the gate and dropping containers along the street or in unsecured 

vacant lots for later delivery by others or possibly by the same trucker. This is done 

to move as many boxes as possible during normal port business hours into or just 

out of the port gates. It is also used by drivers who don’t want to come into the 

port because of congestion, waiting times, or who may have legal issues keeping 

them from taking a chance of being checked by security. Some of these drivers have 

no hazmat credentials stamped on their CDL license to haul this type of material 

or are possibly driving under revocation or suspension, maybe without insurance, 

current tags, or maybe even worse. 

Here’s a perfect example. The Port of Savannah in conjunction with the county 

& state of Georgia supported a surprise action of checking workers for outstanding 

warrants. This led to dozens being arrested on child support violations among other 

issues. However, in a matter of a few days the majority of trucking companies managed to get their boxes into & out of the port by increasing the batching. Other 

trucking companies, worried about a shortage of drivers, were willing to go into the 

port to make special arrangements for those drivers who refused to pass their boxes 

off to a clean local driver. These drivers pick up a container at a rail yard, distribution center, or customer warehouse and bring it not to a port terminal but to an 

‘‘outside drop location’’ or container yard. Workers at that off-dock container yard 

do not undergo background checks or have to obtain the TWIC. For that matter, 

the managers and owners of those yards are not checked either. A closer examination of off-port storage yards, rail yards, near dock container yards and warehouses 

is necessary to ensure that security is not compromised in an effort to avoid the 

TWIC and other security credentialing. 

Credentialing Fees Create a Financial Hardship 

The Teamsters Union has testified in the past about its concern for port drivers 

making $10—12 per hour having to pay $132.50 for the TWIC. We are also concerned about the lost time truckers may experience in visiting the enrollment center 

and waiting for their TWIC, especially where waivers or appeals may be involved. 

If drivers are forced to pay this fee, they should not have to pay additional fees at 

every port they enter or, as in the Port of Miami, each time a driver switches companies, he must pay for a new credential. 

There should be one federal credential—the TWIC. It should allow access to all 

U.S. terminals, and there should not be an additional terminal ID card issued for 

each maritime operator with an extra fee for port truck drivers and other maritime 

workers. The card should follow the worker and not be able to be removed by the 

employer, the terminal operator, nor the terminal operator’s private police force. 

Only official federal government agencies such as the TSA or the U.S. Coast Guard 

should have the authority to revoke the TWIC. The port terminal operator should 

not have the right to discriminate or ban union workers, organizers or any individual on any basis other than being a security threat to the terminal as determined 

under the TWIC program. To vest authority to revoke the card to employers, port 

authorities and others, gives extraordinary power to intimidate, harass, and threaten workers into possibly ignoring safety and health rules, work rules and other protections for workers. Imagine having the power to decide unilaterally if a driver can 

work in a port. Taking away his TWIC denies him his livelihood. That should remain the function of the TSA and the Coast Guard. 

The Florida Uniform Access Credential 

The Teamsters Union strongly questions the need for the State of Florida’s 

FUPAC—the Florida Uniform Port Access Credential, once the TWIC is implemented. While every port has the right to determine who can enter its facility on 

official business, each state should not be able to layer additional security requirements on its maritime workers. To do so will defeat the purpose of the TWIC—that 

is allowing workers to move from port to port, and will essentially create 50 different requirements for entrance to a state’s ports. It is our understanding that the 

State of Florida wants to vet workers who have been granted a waiver under the 

TWIC, to separately determine their suitability for working in the Florida ports. It 

is inconceivable that a worker who has been background checked under the TSA 

protocol and then undergoes further examination by TSA through the waiver process, which in itself is a multi-layer review process, would pose a security threat that 

the state of Florida must further examine. This is not an acceptable practice and 

TSA should not enter into any agreement or Memorandum of Understanding with 

the state of Florida to allow this to move forward. 

58 

Disqualifying Offenses 

Despite recent actions by Congress to codify disqualifying felony convictions, the 

Teamsters Union still strongly believes that the list of disqualifying offenses, in several instances, is not indicative of crimes that would make one a terrorist threat. 

We encourage the TSA to continue to outreach and communicate with potential applicants for the TWIC to make sure that those applicants understand the ability to 

request a waiver or appeal. More importantly, we encourage the TSA to act judiciously in reviewing waivers and appeals, understanding that they alone may determine the ability of these applicants to continue to make a living and provide for 

their families. Security is of utmost concern to everyone. No one wants to see another terrorist attack in this country, but we also must be cognizant of the rights 

and privacies of our citizens. 

Security at the ports has improved somewhat as a result of enactment of the 

SAFE Port Act. But much more needs to be done to address the gaps that still exist. 

We look forward to working with the Committee to achieve this objective. I look forward to answering any questions the Subcommittee Members may have. 

Ms. SANCHEZ. And I now recognize Mr. Koch to summarize has 

statement for 5 minutes. 

STATEMENT OF CHRIS KOCH, PRESIDENT, WORLD SHIPPING 

COUNCIL 

Mr. KOCH. Chairwoman Sanchez, members of the committee, 

thank you for the opportunity to be here on the oversight hearing 

on the SAFE Port Act. 

As has been discussed here today, the SAFE Port Act is a multifaceted strategy for how to deal with this challenge; and DHS is 

proceeding hopefully in close coordination with this committee as 

it develops the various initiatives. 

Today, I would like to point on that the Coast Guard is proceeding with the long-range tracking initiative mandated by the 

SAFE Port Act. It has a proposed rulemaking out allowing comments by the end of the year. We are fully supportive of that initiative. 

Much has been said on the TWIC already here today, and many 

experts are here. I will not spend time on the TWIC. But certainly 

the objective of the TWIC is to address the very problems Mr. 

Blanchet just identified, and we are hopeful that it will be able to 

do that in as expeditious a fashion as possible, recognizing, as DHS 

is trying to do, they do not want to stumble as they implement it. 

I want to spend a minute talking about supply chain security or 

container security aspects of the SAFE Port Act. 

The government strategy right now makes a lot of sense, which 

is do 100 percent screening of all containers before vessel loading. 

What they do is perform stop, and any box they have a serious 

question on before it is put on a ship for the U.S., when it gets to 

the U.S., do 100 percent radiation screening of all boxes coming 

into the U.S. and then 100 percent inspection of any container they 

have a question about. We think that is a reasoned approach, and 

we think it is working. 

In order to do that, the SAFE Port Act mandated that risk assessment to be improved should get better data, better data to perform this risk assessment. That is the 10 plus 2 initiative that Assistant Commissioner Winkowski spoke about. That MPRN is not 

yet published. We are hopeful it will be published soon, and from 

a strategic perspective we think that the CBP is doing exactly the 

right thing. There will be some controversy in the trade about it 

59 

because getting more data is not easy, but we think they are doing 

exactly the right thing. 

As to CSDs which were discussed briefly—several times here 

today, I would point out that there is no definition or set of proposed requirements for CSD yet at this point. There is no common 

agreement of what a CSD must be, what it must accomplish. There 

is no definition yet of what frequency it should operate in, what the 

requirements should be, what false positives should be, what permissible false negatives would be, what the reading infrastructure 

would be, how that reading infrastructure would interface with 

CBP and how it would be acted on. All of those issues will have 

to be addressed, and DHS is going through them at the present 

time. 

I would point out that the one device that several members put 

up in the air today is not interoperable with other vendors’ devices. 

So it would make no sense not to have requirements out there that 

all had the opportunity to comment on and understand, and we 

hope that what CBP will do is put out a pilot program to test these 

devices so we can all learn from them. 

Finally, I would like to speak on the issue of 100 percent container inspection. As you know, that was not part of the SAFE Port 

Act, but it was recently added to our statutory framework by H.R. 

1 or the implementing 9/11 Commission recommendation act. 

We would urge the committee to recognize that what has happened as a result of that provision is that a substantial part of the 

world, the governments, our trading partners, are confused about 

what the strategy is of the U.S. Government toward container inspection; and I would hope that this committee, working with DHS, 

could help try to address those questions of where really are we 

going on this, who is it that is actually expected to do the container 

inspection if we are going to go to 100 percent? 

There are certainly terminal operators out there who might be 

willing to invest in it if the government of the United States would 

recognize them as legitimate people to do it. But it is people like 

Dubai Ports World who in the past have had issues that the Congress did not regard them as appropriate to do this. So we are asking foreign governments to do it. 

Also, the question of what is to be done with the images generated by the equipment that is mandated, that is a huge issue. 

Recognizing that they are very complicated, recognizing that this 

mandate is out there, we would encourage the committee to work 

closely with the Department to try to bring some understanding. 

Because this is truly an issue that has terminal operators and governments around the world scratching their head trying to figure 

out exactly what the intention of the U.S. Government is. 

We would be happy to work with the committee in trying to answer some of those questions, and I thank you for your time. 

Ms. SANCHEZ. Thank you, Mr. Koch. 

[The statement of Mr. Koch follows:] 

PREPARED STATEMENT OF CHRISTOPHER KOCH

I. Introduction 

Good afternoon and thank you for the invitation to testify before the Subcommittee today. My name is Christopher Koch. I am President and CEO of the 

World Shipping Council (WSC or the Council), a trade association that represents 

60 

1 A listing of the Council’s member companies and additional information about the Council 

can be found at www.worldshipping.org. 

the international liner shipping industry. I also serve as the Chairman of the National Maritime Security Advisory Committee (NMSAC), a Federal Advisory Committee Act committee providing advice to the Coast Guard and the Department of 

Homeland Security (DHS) on maritime security issues, and as a member of the 

Commercial Operations Advisory Committee (COAC) that advises the Departments 

of the Treasury and Homeland Security on commercial and Customs matters. 

Liner shipping is the sector of the maritime shipping industry that offers service 

based on fixed schedules and itineraries. The World Shipping Council’s liner shipping member companies provide an extensive, network of services that connect 

American businesses and households to the rest of the world. WSC member lines 

carry roughly 95% of America’s containerized international cargo.1

Approximately 1,000 ocean-going liner vessels, mostly containerships, make more 

than 22,000 U.S. port calls each year. More than 50,000 container loads of imports 

and exports are handled at U.S. ports each day, providing American importers and 

exporters with efficient transportation services to and from roughly 175 countries. 

Today, U.S. commerce is served by more than 125 weekly container services, an increase of over 60% since 1999. 

In addition to containerships, liner shipping offers services operated by roll-on/ 

roll-off or ‘‘ro-ro’’ vessels that are especially designed to handle a wide variety of vehicles, including everything from passenger cars to construction equipment. In 2006, 

these ro-ro ships brought almost four million passenger vehicles and light trucks 

valued at $83.6 billion into the U.S. and transported nearly one million of these 

units valued at $18 billion to U.S. trading partners in other countries. 

Liner shipping is the heart of a global transportation system that connects American companies and consumers with the world. More than 70 percent of the $700 

billion in U.S. ocean-borne commerce is transported via liner shipping companies. 

The international liner shipping industry has been determined by the Department 

of Homeland Security to be one of the elements of the nation’s ‘‘critical infrastructure’’. 

Liner shipping generates more than one million American jobs and $38 billion in 

annual wages. This combined with other industry expenditures in the U.S. results 

in an industry contribution to U.S. GDP that exceeds $100 billion per year. 

II. The Focus on Maritime Security 

For the past six years, the WSC and its member companies have strongly supported the various efforts of the U.S. Coast Guard and U.S. Customs and Border 

Protection (CBP) to enhance maritime and cargo security. The multi-faceted and 

risk-based strategies and programs of the government have been able to make substantial progress toward meeting this challenge, and they continue to evolve. 

At the same time, the Coast Guard and CBP recognize the fact that the industry 

is transporting on average roughly 50,000 containers, holding roughly $1.3 billion 

worth of cargo owned by U.S. importers and exporters, each day through U.S. ports. 

Significant delays to this flow of legitimate commerce could have substantial adverse effects on the American economy. 

The multi-layered maritime security strategy has a number of parts on which I 

will briefly comment today. The basic architecture of U.S. maritime security is well 

known and understandable. First, there is vessel and port security, overseen by the 

Coast Guard and guided in large measure by the International Ship and Port Facility Security Code (ISPS). Second, there is personnel security, overseen by various 

Department of Homeland Security agencies and the State Department. Third, is 

cargo security, which with regard to containerized cargo, is addressed through Customs and Border Protection’s advance cargo screening initiative, C–TPAT, and the 

Container Security Initiative—all of which are reinforced and made more effective 

by the increased deployment of container inspection technology at U.S. and foreign 

ports. 

A. Vessel and Port Security Plans 

Every commercial vessel arriving at a U.S. port and every port facility needs to 

have an approved security plan overseen by the Coast Guard. Each arriving vessel 

must provide the Coast Guard with and an advance notice of arrival 96 hours prior 

to arriving at a U.S. port, including a list of all crew members aboard—each of 

whom must have a U.S. visa in order to get off the ship in a U.S. port. 

The liner shipping industry’s operations are consistent and repetitive—its vessel 

services and crews call at the same ports every week. So long as there is consistent 

and professional implementation of the security rules, which is usually a hallmark 

61 

of the Coast Guard, liner shipping has found no problem in operating in the new 

vessel or port security environment. 

We also appreciate the Coast Guard Commandant’s admonition that the ‘‘concept 

of maritime security cannot be reduced to a single threat vector’’. There are numerous potential vectors for terrorists attack on the maritime environment that don’t 

involve cargo containers. For example, merchant vessels are in fact defenseless 

against small boat attacks. We fully support the Coast Guard in its efforts to secure 

an enormous Maritime Domain against a variety of risks. 

Long Range Information and Tracking (LRIT) of Vessels: On October 3, the Coast 

Guard published a Notice of Proposed Rulemaking (NPRM) on Long Range Information and Tracking (LRIT) in the Federal Register. The Council supports the LRIT 

objective and the enhanced visibility of vessels offshore that it will give to the Coast 

Guard and other governments. 

The Coast Guard expects existing maritime satellite communications equipment 

to be able to meet these tracking requirements. Assuming this is correct, the Council does not foresee major problems complying with these regulations. 

The LRIT system is based on a network of data centers sharing information. A 

vessel will transmit its data to the data center selected by its flag administration. 

This data center could be a national center, like in the U.S., a regional or cooperative center, perhaps like the European Union, or an international center, open to 

any country to join. Coordinating the sharing of information between the data centers is an International LRIT Data Exchange (IDE). The IDE is the body that is 

connected to all other LRIT data centers and routes information between LRIT data 

centers. The IDE shares information in accordance with the LRIT Data Distribution 

Plan. 

There may be concern, however, regarding how the Coast Guard intends to implement LRIT if the International Data Center (IDC) is not in place. The IDC is where 

a vessel whose country of registration has not established its own data center is to 

send its position reports. Many smaller nations were expected to use the IDC and 

how their vessels will comply with the LRIT requirements is in question. An agreement has been reached to allow the Coast Guard to host the International Data Exchange (IDE) on an interim basis until January 1, 2010. It is unclear what happens 

with the IDE after that date. A uniform, global operating system is the desired objective. The Coast Guard has invited comments on these issues in its recent NPRM, 

and we expect that the industry and other governments will be considering these 

issues closely. 

Small Vessels: The attacks on the U.S.S. Cole and M/V Lindbergh demonstrated 

that large vessels can be the objects of terrorist attack from small boats. The U.S. 

Coast Guard Commandant, Admiral Allen, has on numerous occasions noted this 

and other small boat vulnerabilities and the difficulty in devising effective ways to 

address the threat without significantly inconveniencing recreational and small boat 

movements. The Council notes that DHS has recently undertaken some pilot efforts 

on the West Coast to test technologies that may contribute to addressing this issue, 

and while we recognize the difficulty of the challenge, we believe that such DHS 

effort are focusing on a legitimate concern. We also appreciate that the U.S. Coast 

Guard is playing a lead role in having put this on the International Maritime Organization’s agenda in order to develop international principles and criteria for addressing this issue. 

B. Transport Worker Identification Credential 

The Council supports the credentialing of maritime workers requiring unescorted 

access to secure maritime facilities. The National Maritime Security Advisory Committee (NMSAC), with the advice and input of a wide range of U.S. maritime interests, has spent considerable effort to provide comments to the Coast Guard and the 

Transportation Security Administration on the development of the TWIC regime. 

The industry’s primary concern is that the security enhancement envisioned in this 

new system not have undue impacts on those personnel who work in port terminals 

servicing vessels or on port operations. 

The SAFE Port Act requires TWIC reader pilot projects to be run in at least five 

locations. NMSAC has recommended that the final TWIC regulations should not be 

published until the results of these pilot projects are known. 

The Coast Guard has indicated its intention to issue two sets of proposed rules 

on the TWIC regulations: the initial set to give some shape to the pilots and the 

second, supplemental proposal which is intended to finalize the proposed regulations 

when the pilots’ results are known. We support this measured approach. 

The Coast Guard also recently announced the biometric standard to be placed on 

the TWIC card. This standard contains two items that were not supported by the 

industry: encryption and a Personal Identification Number (PIN). The industry’s 

62 

concern has been that encryption will create operational complexities which have 

the potential to severely impede the flow of maritime commerce. Further, the 

NMSAC does not believe the significant additional costs associated with encrypting 

the fingerprint template are warranted given the minimal risk involved without 

such encryption. How these two items will work with readers remains to be seen, 

but the industry is hopeful that the good consultative process that the Coast Guard 

has established with NMSAC will allow for these issues to be addressed satisfactorily. 

Lastly, DHS has begun to enroll workers in Wilmington, Delaware, and has also 

listed the next eleven follow-on locations for enrollment. The industry strongly supports a measured implementation of this challenging new regime so that any unanticipated issues that may arise can be addressed as the system is rolled out in 

stages. 

C. Containerized Cargo Security 

The WSC fully supports the U.S. government’s strategy in addressing containerized cargo security. Specifically, the Council supports CBP’s risk assessment and 

screening of 100% of all containers prior to their being loaded onto vessels destined 

for the U.S., and the pre-vessel loading inspection of 100% of those containers that 

CBP’s cargo risk assessment system determines to present a significant security risk 

or question. 

The Council does not support recent legislation’s call for inspection of 100% of all 

import containers before vessel loading, because the concept has not been clearly 

considered and remains presently impractical. 

1. Container Security Initiative (CSI) 

The network of bilateral Customs-to-Customs agreements forming the ‘‘Container 

Security Initiative’’ (CSI) continues to grow. There are now 58 foreign ports participating with the U.S. in this initiative, covering 85% of U.S. containerized import 

trade. CSI is a keystone to the effective international implementation of the advanced screening and inspection of U.S. containerized cargo that presents security 

questions. It is only through these cooperative CSI Customs-to-Customs data sharing and container inspection cooperative efforts that overseas container inspection 

can occur. 

The United States’ approach to supply chain security up until now has been dominated by an interest in inbound or imported cargo. This is understandable, but as 

supply chain security regimes become more globalized, and as our trading partners 

call for ‘‘reciprocity’’ and ‘‘mutual recognition’’ of security improvements, it is very 

important that the Department of Homeland Security plan for and implement a coordinated strategy for dealing with the nation’s international import and export 

maritime commerce. 

When CBP calls for a foreign Customs authority’s assistance to check a container 

it has a question about before vessel loading, so must it plan and be able to act on 

that same foreign Customs’ authorities request for assistance on checking a U.S. export container that may raise a question. When discussing with foreign governments 

‘‘mutual recognition’’ of supply chain security protection programs, the U.S. government will be called on to address what programs enhance the security confidence 

of U.S. exports to the same extent that other governments’ programs enhance the 

security confidence of their exports. We believe that Customs and Border Protection 

is the right agency for establishing and ensuring a consistent and coordinated U.S. 

approach to such issues, and that additional planning should be undertaken in this 

regard. 

It is for this reason that the Council recently wrote to CBP to recommend that 

the agency plan for how to expand its CSI Customs-to-Customs cooperative partnerships with European customs authorities to prepare for the planned 2009 implementation of the European 24 Hour Rule under Commission Regulation 1875. The purpose of such planning would be to ensure that American export commerce receives 

the same kind of cooperative and expedited consideration when European authorities raise security questions, as European export containers receive today when CBP 

raises such a question. 

We also note that, five years after Congress passed the supply chain security 

amendments to the Trade Act, disagreement between the U.S. Departments of 

Homeland Security and Commerce still prevent regulations from being issued to implement Section 343(b) of that Act (19 U.S.C. 2071(b)), which calls for rules regarding the advance documentation of U.S. export waterborne commerce. 

2. Containerized Cargo Screening and Risk Assessment 

CBP employs a multi-faceted containerized cargo risk assessment and screening 

system, so that it can identify those cargo shipments that warrant further review, 

63 

2The ten cargo data elements of the new Security Filing have been identified by CBP as: (1) 

Manufacturer (or Supplier) Name and Address, (2) Seller (or Owner) Name and Address, (3) 

Buyer (or Owner) Name and Address, (4) Ship To Name and Address, (5) Container Stuffing 

Location(s), (6) Consolidator (or Stuffer) Name and Address, (7) Importer of Record Number, (8) 

Consignee Number, (9) Country of Origin, and (10) Commodity 6-Digit HTS Code. 

rather than those that are low risk and should be allowed to be transported without 

delay. 

C–TPAT: One element of that system is the Customs’ Trade Partnership Against 

Terrorism (C–TPAT) pursuant to which various entities in the supply chain voluntarily undertake security enhancing measures. CBP then validates participants’ 

compliance, and compliant supply chains are accordingly afforded lower risk assessments. 

24 Hour Rule: Another important element of the risk assessment system is CBP’s 

receipt and analysis of pertinent advance information about cargo shipments before 

vessel loading. This program began soon after September 11th, under which carriers 

provide CBP with the advance shipment information they possess 24 hours before 

vessel loading in a foreign port for risk screening (the ‘‘24 Hour Rule’’). The Council 

has fully supported this regulation and this strategy, which allows the CSI program 

to perform advance container risk assessment. 

Better Security Screening Data: ‘‘10 plus 2’’ Initiative: While the 24 Hour Rule has 

been in the Council’s view a logical and sound effort, the Council has for several 

years noted that more effective advance cargo security screening will require more 

data than the information provided by carriers via the 24 Hour Rule. 

Recognizing both this need for enhanced container security targeting and the existing limits of information provided in carriers’ bills of lading, the SAFE Port Act 

sets forth the following requirement to enhance the capability of CBP’s Automated 

Targeting System: 

‘‘Section 203(b): Requirement. The Secretary, acting through the Commissioner, 

shall require the electronic transmission to the Department of additional data 

elements for improved high-risk targeting, including appropriate elements of 

entry data. . .to be provided as advanced information with respect to cargo destined for importation into the United States prior to loading of such cargo on 

vessels at foreign ports.’’ 

Customs and Border Protection (CBP) is developing a regulatory proposal that 

would require U.S. importers or cargo owners to file ten additional data elements 2

with CBP 24 hours prior to vessel loading, and to require ocean carriers to provide 

two additional sources of data—vessel stowage plans prior to arrival in the U.S., as 

well copies of electronic container status messages. This is referred to as the ‘‘10 

plus 2’’ initiative. 

CBP has undertaken extensive, transparent, and open consultation with the trade 

and carrier community in developing this proposal. It is our understanding that the 

proposed regulation to implement this new requirement should be published in the 

Federal Register for public comment in the near future, with implementation beginning sometime in 2008. 

While the private sector obviously needs to await the actual proposed regulation 

before providing comments in the expected rulemaking, we would note that CBP’s 

efforts in developing this initiative have been transparent, professional and cooperative, and are in pursuit of a strategic objective that is not only mandated by the 

SAFE Port Act, but is highly logical in order to enhance containerized cargo risk 

screening. 

Global Trade Exchange (GTX): Other pending efforts within DHS regarding the 

acquisition of additional cargo shipment information for enhanced risk screening are 

less understood by the trade. Notwithstanding the fact that CBP has not yet published, let alone implemented, its proposed ‘‘10 plus 2’’ regulations requiring additional information for cargo risk assessment, DHS officials have indicated that the 

Department will be proceeding with efforts to commence an additional trade data 

gathering and analysis effort under the name of the ‘‘Global Trade Exchange’’ or 

GTX. This initiative has not yet been clearly explained to the industry. 

What we understand at the present time is that DHS is considering awarding 

funding for an initial phase of this initiative. It is our understanding that participation by members of the trade providing such additional data is expected to be voluntary, that the party to collect the data would be drawn from a restricted number 

of commercial entities acting as a third party data clearinghouse, and that secure 

and confidential treatment of any data provided is recognized to be needed. 

What services, analysis or risk assessment competence would be required of such 

vendors is unclear. What the specific data to be gathered would be has not been 

explained. The extent to which such shipment data would be shared with other govVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00067 Fmt 6633 Sfmt 6621 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
64 

3DHS has established three full scale container scanning pilots in co-operation with host governments at Southampton, U.K.; Puerto Cortes, Honduras and Port Qasim, Pakistan. Three 

other smaller scale pilots are under development at port facilities in Busan, South Korea 

(Gamman Terminal); Salalah, Oman, and Singapore. 

ernments is not clear. How this system would be integrated into CBP’s existing 

Automated Targeting System is unclear. How such a commercial third party data 

manager would make money off this program is unclear, and who would bear what 

costs for participating in such a system is unclear. What the uses of the data, other 

than assisting Customs with supply chain risk assessment, would be are unclear. 

How the data in the system would be protected is unclear. Whether ocean carriers 

would be expected or invited to participate in the provision of information is unclear. What benefit would result from participating in such an effort is unclear. 

DHS has indicated that the intent is to proceed under a ‘‘request for quotation’’ 

solicitation process, which is restricted to a limited number of vendors now established in the DHS ‘‘EAGLE’’ procurement program. 

In short, the GTX effort has not yet been explained by the government and is not 

yet understood by the trade. U.S. importers with whom the Council has discussed 

this initiative are confused by this process. There is some concern within the trade 

community over the apparent development of such an initiative without the government’s usual transparency and process of consultation. COAC has written to the 

Secretary of DHS requesting consultation on this initiative. 

3. Container Inspection 

DHS has a well established strategy to undertake radiation scanning of all containers entering the U.S. before they leave a U.S. port. CBP recently deployed its 

1000th container radiation portal monitor as it gets closer to its objective of performing radiation scanning on 100% of all inbound containers at U.S. ports of discharge. 

CBP also undertakes non-intrusive inspection technology (NII) or physical inspection of 100% of all arriving containers that are determined to pose a significant security question. CBP has no plans and no capability, however, to inspect every arriving container. Because that is not practical, the agency is utilizing, and soon will 

be enhancing, its cargo risk assessment system and the CSI program to identify 

which containers do warrant inspection. 

In order to further consider the issues involved in the application of additional 

container inspection at overseas ports of loading, DHS has undertaken the ‘‘Secure 

Freight Initiative’’, under which pilot projects are being established at several foreign ports testing more complete pre-vessel loading scanning, generating possible 

lessons to be learned for broader application of pre-vessel loading container inspection efforts.3

The ‘‘Implementing the 9/11 Commission Recommendations Act’’, which was 

signed into law in August, includes the well known provision requiring that by 2012 

100% of the containers imported into the United States be ‘‘scanned’’ before being 

loaded aboard vessels destined for the United States, meaning that the container 

would have be run through radiation detection equipment and non-intrusive imaging equipment before vessel loading. What, if anything, would be done with the images or data produced by those scannings was not addressed by the law, nor were 

a host of other highly relevant questions, including who was to perform this task, 

and whether the U.S. would perform such scanning of its own export containerized 

cargo. The WSC issued a six page statement on this legislation on July 30th, which 

is available on the Council’s website. 

Many foreign governments are obviously and justifiably concerned about the implications and meaning of this new U.S. law. We expect that they will continue to 

inform the U.S. government of their concerns, including their view that this statutory provision expects foreign governments to undertake measures for their exports 

that the U.S. government has no intention to undertake for its exports. 

The shipping industry’s customers—the hundreds of thousands of U.S. importers 

and exporters who use containers to transport their cargo—are also concerned about 

the meaning and potential effects of this law. The port terminal operators around 

the world that service the industry’s vessels are also concerned but unsure about 

the intent or effect of this statute. 

Several things seem clear. First, implementation of this law’s stated objective 

would require addressing many serious issues that the statute does not address, including the fact that implementation of overseas container inspection requires the 

cooperation of foreign governments. Second, the U.S. government has no current 

plans to scan 100% of its outbound export cargo containers, and thus foreign governments’ predictable inquiries about reciprocity will likely be unanswerable. And, if 

65 

the United States’ trading partners do not implement 100% container scanning, 

there is nothing that the U.S. government can realistically do about it other than 

cease trading with the rest of the world. We therefore see the obvious need for further international dialogue on this matter. 

At this time, this provision of the ‘‘9/11 Commission Recommendations Act’’ is an 

indecipherable riddle. The world has no idea what to make of it and does not know 

if it expresses the real strategy of the United States or not. 

If the Congress intends to pursue any kind of meaningful dialogue or progress on 

determining what would need to be addressed in order to pursue this statute’s stated vision of 100% container screening at foreign ports, then we respectfully submit 

that it should begin to consider and address a number of critical questions, including the following: 

1. Whom Does the Law Intend To Perform the Container Scanning? The legislation pointedly fails to address the issue of who is to perform this activity. It 

does not require U.S. Customs to do this, as it is clearly impossible for the Congress to require U.S. Customs to undertake such activities within the jurisdiction of other sovereign nations. It does not require foreign governments to do 

so, as it has no such authority. The legislation simply says that containers shall 

be scanned. By whom? Who is to purchase, operate and maintain the equipment? 

Is this a sovereign function to be handled by governments? Is this a private sector function? Before private marine terminal operators could seriously consider 

such an investment and activity, the Congress would need to provide clarity on 

this point and who would be trusted to perform the task and under what circumstances. 

Does Congress intend that non-government foreign port facility operators would 

perform this task? The 109th Congress took the position that one of the largest 

port facility operators in the world, Dubai Ports World, was an unacceptable security risk to buy a U.S. marine terminal operating company and hire U.S. 

workers, working under U.S. management, to service vessels in U.S. ports. 

Would Congress consider that company acceptable to perform this task in foreign ports? The largest terminal operating company in the world, Hutchison 

Whampoa, is owned and controlled by the Chinese. Would Congress consider 

that company acceptable to perform this task? 

Even if the Congress were to determine that such terminal operating companies 

were appropriate entities to install and operate the necessary scanning equipment, and even if these companies were willing to make the capital investments 

necessary to install and operate this equipment, the law fails to answer who 

will review, interpret and analyze the readings produced by the technology. It 

is extremely unlikely that these terminal operating companies would accept the 

responsibility or the liability for the actual analysis and assessment of the scanning technology. 

2. Failure to Define the Scanning Requirement: Recognizing that 100% container 

‘‘inspection’’ is impractical, the statute requires instead that every container be 

‘‘scanned by nonintrusive imaging equipment and radiation detection equipment 

at a foreign port before it was loaded on a vessel.’’ This by itself would be pointless. 

The law fails to address whether the scanning data actually has to be reviewed 

and analyzed, and if so, under what circumstance, when and by whom? The law 

fails to address whether or when the data from the scanning equipment is 

transmitted to the U.S. government and at whose cost. There are many complexities and costs involved in addressing these issues. 

Is every container radiation scan to be reviewed before vessel loading, with 

mandatory secondary inspection if there is an unusual radiation reading? 

Is every NII scan to be reviewed before vessel loading? Or, is it only those containers that trigger a certain threshold in CBP’s Automated Targeting System 

that require review of NII scans? If only a few percent of the containers would 

have their NII images reviewed before vessel loading, what is the point of requiring 100% of all containers to have NII images? Why not just perform NII 

inspections on the containers that present security questions? 

3. No Reciprocity: The statute purports to require 600 ports around the world 

to approve, implement, and utilize such technology, systems and processes for 

all cargo destined for the U.S. or effectively face an embargo on their exports, 

when the U.S. government does try or plan to perform this function on its export cargo, and scans virtually no U.S. export containers. If implementation of 

this law were actually pursued, it is entirely possible, if not highly likely, that 

foreign governments would establish ‘‘mirror image’’ requirements on the U.S., 

66 

forcing all American export containers to undergo radiation and NII scanning 

before vessel loading at U.S. ports—requirements which the U.S. government 

and U.S. port facility operators are presently and for the foreseeable future incapable of meeting. Is the Congress prepared to fund such a system for U.S. 

exports? 

4. Threshold Technology Question: The statute provides that DHS may ‘‘extend’’ 

or waive the scanning requirement, if: ‘‘(F) Systems to scan containers in accordance with paragraph (1) do not adequately provide an automated notification of questionable or high-risk cargo as a trigger for further inspection by appropriately trained personnel.’’ NII container inspection technology does not 

have any government or commercially accepted software that enables ‘‘automatic notification of questionable or high-risk cargo’’, putting aside the relevant 

question of defining what would constitute ‘‘questionable or high-risk cargo’’ 

that the technology would need to identify. Does this mean that until NII equipment can meet such a standard that has yet to be defined and agreed upon, 

that this statutory mandate is not applicable? 

The ‘‘9/11 Commission Recommendations Act’’ provisions calling for 100% overseas 

container scanning has raised more questions than it has answered. 

4. Seals and Container Security Devices 

The SAFE Port Act included the following directive: ‘‘Not later than 90 days after 

the date of enactment of this Act, the Secretary shall initiate a rulemaking proceeding to establish minimum standards and procedures for securing containers in 

transit to the United States.’’ (Section 204(a)) It was not evident what this provision 

meant or how it might be interpreted, and the section’s time deadlines were not 

going to be met. 

Accordingly, the ‘‘9/11 Commission Recommendations Act’’, Congress amended 

this section by providing that: ‘‘(B) Interim Requirement.—If the interim final rule 

described. . .is not issued by April 1, 2008, then. . . . effective not later than October 15, 2008, all containers in transit to the United States shall be required to meet 

the requirements of International Organization for Standardization Publicly Available Specification 17712 standard for sealing containers. . . .’’ Thus by next October, all U.S. inbound containers will be required at a minimum to have ISO standard security seals. This provides helpful clarity. 

As to the government’s view of ‘‘container security devices’’ (CSDs), things are less 

clear. First, CSD is not a defined term. For example, some say that a seal is a CSD; 

some say a seal is not a CSD. The Council has understood that DHS was planning 

to issue proposed draft technical requirements for container security devices and the 

operating protocols associated with such devices by the end of this year for public 

review and comment. We understand that the DHS Science and Technology directorate prepared a draft of such requirements that is undergoing further review and 

amendment within the Department. 

The Council and other members of the trade have requested that CBP/DHS allow 

for full transparency into the development of this effort and solicit public comments 

on the draft requirements, after they have completed internal government review. 

There are at present many unanswered questions about CSD requirements, including what specifically the device would be required to do and its security value, 

what acceptable false positive and false negative reading rates would be, what radio 

frequency would be used, the requirements for the installation and operation of the 

necessary device reader infrastructure, the requirements applicable to the necessary 

communications interface and protocols with CBP, the security vulnerabilities of 

such devices, the necessity of interoperability of various vendors’ devices and systems, the data to be captured and transmitted by the device, identification of who 

will have access to the data in the device, survivability and vulnerability of the device, power or battery life requirements, the probability that the device can be detected or removed without detection, required data messaging formats, event logs, 

and data encryption. 

These questions are even more complicated in the environment of international 

maritime commerce than they would be in a more controlled environment of U.S. 

border stations where CSD reading infrastructure would be under the sole control 

of CBP. 

The Council believes it is essential, if an interest in CSDs is to be pursued, for 

the government to undertake a fully transparent and very clear articulation of its 

draft views on the requirements for such technology and the related operating systems and protocols, and to provide the public with a meaningful opportunity to comment upon such draft requirements, before they are advanced as an element of the 

government’s container security strategy. 

III. Conclusion 

67 

Vigilance against terrorist risks requires the development and implementation of 

prudent security measures, and the continuing enhancement of such measures as 

the risks change and take new forms. The international trading system is too valuable and important to be left unattended. 

The liner shipping industry fully understands this and has cooperated with national governments and international organizations trying to construct meaningful 

security regimes. The industry will always be concerned that these measures not 

unduly delay or restrict commerce or impose costs that produce little added security; 

however, it has supported and will continue to support measures that are well designed and provide real security value with as little impact as possible on legitimate 

trade. 

This is clearly difficult work, but there are clearly some success stories. The International Maritime Organization’s development of the International Ship and Port 

Facility Security (ISPS) Code, the Proliferation Security Initiative, the Container 

Security Initiative, the ‘‘24 Hour Rule’’ advance cargo screening strategy and its imminent enhancement, the C–TPAT program—all have enhanced supply chain and 

maritime security. The government’s expanded use of container inspection technologies is another example of sound strategy and implementation. 

If we are to continue to make progress in enhancing maritime and supply chain 

security, progress is more likely to occur if: 

1. There is a clear and specific definition and agreement on what should be 

done to improve security. 

2. There is a clear and thoughtful prioritization of initiatives. 

3. There is sufficient certainty and clarity in purpose to do it right. In the absence of that, time and resources are poorly used and the efforts are less likely 

to improve security. 

We appreciate the Subcommittee’s continued interest and oversight of these 

issues, and would be pleased to provide additional information that may be of assistance to the government in addressing these issues. Thank you again for the opportunity to testify. 

Ms. SANCHEZ. And I will now recognize Ms. Alexander to summarize her statement for 5 minutes. 

STATEMENT OF MARY ALEXANDER, CHAIR, JOINT INDUSTRY 

GROUP 

Ms. ALEXANDER. Madam Chairlady, Mr. Souder and other members of the subcommittee, my name is Mary Alexander, Chair of 

the Joint Industry Group, a coalition of trade community members 

engaged in global commerce. I also am representing my own company, Panasonic of North America, headquartered in New Jersey, 

with sales, research and manufacturing in 24 states and the third 

largest U.S. electronics importer, bringing in over 20,000 containers per year. I will comment on the views of JIG members regarding government programs that provide security to our Nation’s 

ports and affect businesses, their supply chains, and their efforts 

to provide products to the consumer safely, quickly and at affordable prices. 

To remain competitive, U.S. companies face pressures from customers to deliver products fast and affordably. Shipping a container 

of products to numerous consignees is complicated. Any disruption 

to the supply chain can affect the efficient business process, increasing costs and wait times for retailers and consumers. Therefore, as the Federal Government proposes new security programs, 

consultation with the business community is critical. 

JIG strongly supports the multi-layered, risk-based approach to 

supply chain security developed by DHS and strengthened by Congress with the SAFE Port Act and other initiatives. These programs will strengthen our Nation’s security, once properly implemented. 

68 

Just as the need to strengthen border security is critical, so is 

the need to safeguard the smooth flow of legitimate international 

commerce. As more security programs are created, the business 

community faces increased burdens in their operations that can 

add debilitating costs and delay to business approximate. JIG 

therefore urges Congress and the administration to remain engaged in dialogue with industry on security initiatives to develop 

programs that are truly effective and minimize disruptions to the 

supply chain. 

Four specific comments: C–TPAT represents the core of CDP’s 

cargo security program, a government and private sector partnership. This voluntary program has more than 7,500 participants, including Panasonic. While membership levels continue to climb, real 

benefits remain elusive. Land border crossings have fast lanes, but 

tangible benefits for ocean cargo, such as reduced inspections, are 

not apparent and hard to verify. While the investment in C–TPAT 

membership is real and substantial, members increasingly feel that 

the promised returns have not been materialized. 

The introduction of 100 percent scanning at several foreign ports 

is an excellent opportunity to assess the viability of the secure 

freight initiative. We are pleased that Congress in its oversight role 

will have an opportunity to review a report from CBP due in April 

on the results of this pilot project. We encourage to you review 

these results before considering widespread implementation of the 

program. 

The trade community has spent considerable time working with 

CBP on its 10 plus 2 initiative. Unfortunately, nearly a year after 

it was presented, we are still waiting for the proposed rules for the 

initiative. We understand that rulemaking process takes time, but 

we are concerned that the trade community will have sufficient 

time to comment and implement the MPRM after its release. 

This past August, JIG raised several concerns with DHS about 

the proposed global trade exchange, including questions on security, confidentiality and cost. Until we have enough information, 

JIG neither supports nor opposes this program. CBP has been responsive to the trade community in developing other trade security 

initiatives, but so far development of the GTX appears to be behind 

closed doors. 

JIG appreciates the openness and availability of CBP and DHS 

staff to consult with the trade on the roughly 30 Homeland Security programs to which businesses are asked to comply. However, 

the lack of real information on proposed new programs, growing 

concern that increased costs far outweigh promised benefits, emerging skepticism that the programs are necessary to protect our country, and compliance concerns from our trading partners all need 

more serious consideration. 

Congress’ help in getting responses from the administration 

through public hearings like today’s is greatly appreciated. Madam 

Chairwoman, on behalf of JIG, thank you for this opportunity to 

testify. I will be happy to answer any questions. 

Ms. SANCHEZ. Thank you, Ms. Alexander. I would like to thank 

you for your testimony. 

[The statement of Ms. Alexander follows:] 

69 

PREPARED STATEMENT OF MARY ALEXANDER

Introduction 

Madame Chairwoman Sanchez, Ranking Member Souder and other members of 

the subcommittee, thank you for the opportunity to testify on the one-year anniversary and implementation of the SAFE Port Act. My name is Mary Alexander, and 

I serve as the chair of the Joint Industry Group (JIG). JIG is a broad coalition of 

Fortune 500 importers and exporters, shippers and carriers, customs brokers and 

forwarders, trade associations, service providers, and law firms with a common interest in global commerce. In fact, a number of our members including Hewlett 

Packard, Intel and Panasonic Avionics are headquartered in California. 

JIG frequently engages Congress and the Administration on a variety of international trade-related issues, often focusing on issues involving port and border security and customs. In particular, we work closely with U.S. Customs and Border 

Protection (CBP), the Department of Homeland Security (DHS), the Department of 

Commerce (DOC), USTR, and Congress to promote international trade policies that 

reflect the needs of both government and the private sector to secure the supply 

chain while facilitating legitimate commerce. 

While I am here to articulate JIG positions, I also am here to represent my own 

company, Panasonic Corporation of North America, headquartered in Secaucus, NJ 

and employing more than 6,000 workers in the U.S. The company sells consumer 

electronics, industrial products and professional equipment to the American consumer and is the American subsidiary of Matsushita Electric Industrial, 

headquartered in Osaka, Japan. Panasonic North America is the third largest electronics importer, bringing more than 20,000 containers into the U.S. annually. 

While worldwide the company has over 300 factories, Panasonic ships products from 

Matsushita factories in nine countries, with nearly 90 percent of imports coming 

from ports in Singapore, China, Malaysia, and Japan and to Seattle/Tacoma or LA/ 

Long Beach on the west coast. 

In my testimony today, I will provide the views of JIG members regarding the 

implementation of government programs to provide needed security to our nation’s 

seaports one year after the enactment of the SAFE Port Act. I will also offer real 

life examples of how government policies affect businesses like Panasonic, their supply chains, and their efforts to provide products to the consumer safely, quickly and 

at affordable prices. 

In order to remain competitive in today’s global economy, Panasonic and other 

U.S. businesses face constantly increasing pressure from our customers to deliver 

high-quality products faster and more affordably. Unfortunately, shipping a container of multiple products to numerous consignees is a complicated business, and 

any disruption to the supply chain can adversely impact the efficient business process. For example, Panasonic’s supply chain cycle for the Blu-ray disc player is now 

only six weeks, from the time the order is placed and transmitted to the factory in 

Japan, to the time the players arrive at the Best Buy distribution centers. This includes an ocean transit time of two weeks and an inland transit time to our distribution center of nine days. Our Lumix cameras, which are shipped by air, have 

only a four-week supply chain. The timeliness of these supply chains remains critical to the success of our company. Any delays create hardship for our company and 

increase costs and wait times for retailers and consumers. It is imperative to the 

viability of Panasonic and other U.S. businesses to guarantee the smooth flow of 

products for delivery to our customers. 

JIG strongly supports the multi-layered risk based approach to supply chain security that has been developed by DHS and strengthened by Congress through the 

SAFE Port Act and other initiatives. The programs that have been enacted will 

strengthen our nation’s security once they are properly implemented. JIG is concerned, however, that just as the need to strengthen border security is critical, so 

is the need to safeguard the smooth flow of legitimate international commerce. As 

more security-focused programs are created, the business community faces increasing burdens in their operations that can add debilitating costs and delays to doing 

business. 

JIG therefore urges Congress and DHS to remain engaged in dialogue with industry on security initiatives in order to develop programs that are truly effective and 

minimize disruptions to the supply chain. JIG also urges the U.S. Government to 

propose incentives for companies to encourage participation in these costly and extensive new security regimes. 

These issues come to light through JIG’s comments on the programs created or 

affected under the SAFE Port Act noted below: 

Customs-Trade Partnership against Terrorism (C–TPAT) 

70 

C–TPAT represents the core of CBP’s cargo security program. This is a true government and private sector partnership program, based on industry self-policing and 

self-assessment with verification by government. In sheer numbers, this voluntary 

program is working well, as evidenced by the more than 7,500 participants, including Panasonic, which was one of the first to join the program. Participants, who attest to the integrity of their security practices and communicate their security 

guidelines to their vendors and business partners, have been promised a number of 

benefits, including fewer inspections on their shipments and speedier processing 

through customs. Real strides have been made on both the certification and validation/revalidation front. 

While the membership numbers of C–TPAT continue to climb, the benefits being 

offered to participants continue to be more elusive. Presently, one real benefit at 

land-border crossings is evident through the use of FAST lanes, but tangible benefits for ocean cargo, such as reduced inspections, are not readily apparent and are 

hard to verify. While the investment in C–TPAT membership is real and substantial, members of the trade community increasingly feel as though they made these 

investments for promises that have not been fulfilled. Even today, five years after 

the program’s inception, C–TPAT participants continue to seek solid benefits in 

order to justify the numerous costs they incur as a result of the program. 

CBP has recently published a C–TPAT Cost—Benefit Survey (Executive Summary 

included as Appendix A). Based on the reported results, less than one-third of the 

respondents replied that the benefits of C–TPAT equaled or exceeded the costs from 

the program. These numbers argue for more tangible benefits. Benefits cannot be 

just about score reductions, especially as trade and security requirements converge. 

Suggested new trade compliance benefits, particularly for C–TPAT Tier II and Tier 

III partners, could include: • An annual security fee off-set refund based on the number of import shipments 

and/or • An expanded use of account-based principles within the C–TPAT program, such 

as an option for Tier II & Tier III participants to pre-file account-based commercial 

data in the aggregate. 

Finally, in a global economy, programs similar to C–TPAT need to be adopted and 

recognized among all countries, such as proposed in the World Customs Organization SAFE Framework. A central component of the Framework is mutual recognition among countries, and, in the near term, mutual recognition between the USA 

and significant trading partners is the key to the success of the SAFE Framework 

and C–TPAT. Without this, the benefit of remaining in C–TPAT is substantially reduced. We strongly encourage CBP and DHS to continue working with our trading 

partners to ensure that mutual recognition is accorded to those programs implemented under the SAFE Framework. 

Secure Freight Initiative 

The introduction of a 100 percent scanning pilot program at isolated locations 

within several foreign ports serves as an excellent opportunity to assess the viability 

of implementing the Secure Freight Initiative program unilaterally. Such testing at 

these ports should be completed before rolling out the program to other ports. This 

would help to address the biggest concern to JIG members, which is the possibility 

of delays in inspection and processing containers if the technology has not been sufficiently tested before being implemented. We recommend that Congress, in its oversight role, carefully review the report from DHS, due to this committee in April, on 

the results of the pilot program. JIG continues to believe that the DHS should implement a pilot program to test scanning technology and only deploy such technology more broadly when it is proven effective and practicable. In addition, Congress should be aware that some of our trading partners have expressed concern 

about the imposition of requirements such as 100 percent scanning of cargo exported 

to the U.S. 

Advanced Trade Data (‘‘10+2’’) Initiative 

The trade community has spent considerable time working with CBP on developing the requirements for the additional data elements required under Section 203 

of the SAFE Port Act to improve CBP’s Automated Targeting System (ATS). While 

the trade was pleased to work with CBP on these requirements, we remain concerned about compliance issues, which could result in an extra two or three days 

of inventory to meet the reporting requirements. In addition, businesses continue 

to wait to make any adjustments or rewriting of their own data collection systems 

until DHS puts out the Notice of Proposed Rulemaking (NPRM) and completes an 

economic analysis. 

Industry has provided input into the development of the NPRM through a 

‘‘strawman’’ proposal that was released at the November 2006 CBP Trade SympoVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00074 Fmt 6633 Sfmt 6621 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
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sium. In addition, the trade continued to provide input through the Trade Support 

Network and the COAC. The NPRM will provide an additional opportunity for input 

from the trade and certainly will clarify the many questions and concerns already 

raised. Unfortunately, nearly a year later, we still are waiting for the release of the 

NPRM. In addition, a JIG letter of February 5, 2007 requested CBP, when it publishes its NPRM, to give the trade community sufficient time to prepare for the 

changes. At a COAC meeting in August, the trade community was assured it would 

be released soon. It is now the end of October and the NPRM still has not been released. We understand it takes time for rulemaking to make its way through the 

government, but we urge that this NPRM be expedited and released as quickly as 

possible. 

Per the SAFE Port Act, we also understand that CBP is required to complete a 

cost/benefit analysis and feasibility study in connection with any additional advance 

trade data initiative. We are not aware that this report has been completed or has 

been discussed with the trade. It is important that this report be completed and 

shared with the trade as soon as possible, as the feasibility and value of ‘‘10+2’’ 

should be demonstrated before implementing this costly initiative. 

It is frustrating that almost a year later we still have no guidance on how this 

program will be implemented or even what the phase-in period will be. I would like 

to underscore that the trade community wants to ‘‘do the right thing’’ regarding the 

intent of ‘‘10+2.’’ However, unlike the advanced manifest requirements which merely 

drew from pre-existing data, the ‘‘10+2’’ initiative will require shippers to develop 

a brand new process. Panasonic’s logistics company says it cannot even begin to redesign its own customs and logistics management system and make other IT 

changes, let alone alert the factories of additional demands that will be put on them, 

until it has seen the proposed regulations. All current processes must be reviewed 

and analyzed to determine how best to have this information supplied from overseas 

and how to transmit the information. Reprogramming of IT systems can be a long 

and difficult process and complete information needs to be given at least a year and 

a half in advance to make sure everything is tested properly. So we need information. We urge the Subcommittee to help move the NPRM process along. 

Global Trade Exchange (GTX) 

In August of this year, JIG sent a letter to DHS Deputy Secretary Michael Jackson that raised several concerns about the proposed Global Trade Exchange. We understand that DHS envisions this program as the third leg of the Secure Freight 

Initiative, along with CSI and the ‘‘10+2’’ initiative. JIG circulated this letter widely 

within DHS and to a number of other government department s. Since then, we 

have met with government representatives seeking more information, but JIG still 

has not received any further clarification on the program. 

Our questions and concerns remain largely unchanged and include: 

• What is the incentive to participate, especially when companies traditionally 

are extremely reluctant to share confidential information with outside parties? 

• What will be the cost of providing data to the exchange? 

• How will security and confidentiality concerns be addressed regarding access 

by third parties and foreign entities? 

• What is the added security value beyond what is accomplished by other ongoing and proposed security enhancement programs? 

• Will redundant programs such as advance security filings be eliminated? 

JIG has neither supported nor opposed this program to date, and that is simply 

because we have never received enough information to develop a position one way 

or the other. CBP has been responsive to the trade community throughout most of 

the development of its various trade security initiatives. As a result of these discussions, numerous adjustments have been made to the proposed programs. This is exactly the manner in which the trade community seeks to work with Congress and 

the government. Unfortunately, however, development of the GTX has thus far 

taken place behind closed doors. The trade community has been offered little or no 

real information, and this is creating widespread concern within our membership. 

Container Security Devices 

Much of the focus on improving maritime container security has centered on technology in the form of electronic container security devices (CSDs). Considerable improvement in these devices has taken place since emphasis was placed on their development in the post 9/11 trade environment. JIG supports the continued development and voluntary use of CSDs, although we believe the current state of this technology does not yet warrant widespread use. 

General acceptance by the trade community will not be achieved until CSDs demonstrate improved performance in several key areas: 

72 

Effectiveness: CSDs must be able to consistently detect container breaches and 

communicate this data to responsible agencies in a timely fashion. 

Reliability: The single greatest hurdle CSD technology must overcome is false 

alarms. Former CBP Commissioner Robert C. Bonner suggested a minimum one 

percent false alarm standard for electronic container security devices. Even assuming such a standard is achievable, universal usage would hold the potential for false 

alarms in excess of 100,000 annually. Excessive false alarm rates will undermine 

confidence in CSDs and lead to costly delays to resolve anomalies. Compliance with 

minimum false alarm standards must be certified through independent testing by 

government approved laboratories. 

Cost: CSDs must be affordable in order to be commercially viable. Costs range 

from a few dollars for a simple RFID device to hundreds and even thousands of dollars for sophisticated devices with multiple sensors and GPS, cellular and satellite 

communications capabilities. Expensive devices add to the cost of business and are 

thus a competitive disincentive. Incentives need to exist for industry to incur this 

expense, over the current use of cheaper but still ISO-approved bolt seals. 

Response Protocols: Technology aside, there remains a significant need to develop 

standardized response protocols on how alarms are managed and responded to. Currently, when a CSD registers a container breach, who receives the data generated 

by the device, and even more importantly, who is responsible for resolving the 

alarm? Is it CBP, the port authority, the terminal operator, the carrier, the shipper, 

or the importer? If the CSD alarms overseas, is it the foreign customs administration that must respond? Such procedures are not yet in place for breach alarms generated by CSDs. Since there is no agreement as to who is responsible for resolving 

container breach alerts, such data now typically goes only to the shipper or the consignee. This may be useful for theft and pilferage analysis, but has no value for national security purposes. 

International Customs Treatment of CSDs: The customs agencies of numerous 

countries have attempted to assess duties and tariffs on devices as they enter or 

leave the national customs territory. CSDs must be treated as instruments of international trade in language similar to that provided in the UN Convention on Containers. Appropriate HTS classifications must be established through the World 

Customs Organization and duty-free treatment assured by the World Trade Organization. 

To summarize, electronic container security devices hold potential for enhancing 

the security of our maritime supply chains. To realize this potential, however, much 

work remains to increase their effectiveness and reliability, provide them at an affordable cost, and develop standardized response protocols to deal with the alarms 

they generate. 

Conclusion 

Since 9/11, several government programs have been developed to lower supply 

chain security risk, including C–TPAT, CSI, Secure Freight, etc. Roughly 30 homeland security programs in the U.S. have been identified to which businesses are 

asked to comply. JIG members need assurance from federal agencies and Congress 

that the numerous security-related programs already in place, especially the older 

programs, are necessary, not duplicative, and remain essential to protecting our 

country from terrorism. 

JIG and its members appreciate the openness and availability of CBP and DHS 

staff to consult with the trade on efforts to secure our nation’s seaports. We are fully 

supportive of the DHS mandate. However, the lack of real information on proposed 

new federal security programs, the growing concern that increased costs far outweigh promised benefits from participating in these security programs, the growing 

skepticism that the panoply of supply chain security programs are all necessary, the 

added program costs and delays that affect the bottom line of American companies, 

and the concerns expressed by our trading partners, all need to be more seriously 

considered. Given these issues, the help of Congress to seek answers to these questions, through public hearings like today’s, is greatly appreciated. Madame Chairwoman, on behalf of JIG, thank you for your help and support, and thank you again 

for the opportunity to present our comments to this subcommittee. I will be happy 

to answer any questions from you or anyone else on the subcommittee. 

Ms. SANCHEZ. I now recognize Mr. Battles to summarize his 

statement for 5 minutes. 

73 

STATEMENT OF WADE BATTLES, MANAGING DIRECTOR, PORT 

OF HOUSTON AUTHORITY 

Mr. BATTLES. Chairwoman Sanchez and the honorable members 

of the subcommittee, I am Wade Battles, the Managing Director for 

the Port of Houston Authority. On behalf of the port authority and 

U.S. seaports in general, thank you for this opportunity to address 

the subcommittee on important port security matters, including my 

thoughts on the 1-year anniversary of the SAFE Port Act. 

Mr. BATTLES. As you have heard today, the TWIC program faces 

some daunting challenges and hurdles that must be crossed in a 

very short period of time. 

The Port of Houston Authority supports the concept of a national 

identification system with background checks for transportation 

workers and has closely monitored the development of this program. We have had numerous meetings with the Coast Guard and 

with TSA officials on how we can best facilitate the rollout and the 

implementation of the TWIC program in our ports. 

Our concern is that TSA and their contractor continues to greatly 

underestimate the number of TWIC cards that will be required and 

consequently have not allocated sufficient resources in facilities or 

personnel to efficiently and effectively issue the TWIC card within 

the timeline mandated by SAFE Port. For example, the whole 

Houston Port area will have only one permanent facility and four 

mobile centers. Implementation will start in Houston next month, 

but critical issues still exist, such as what will be the required credentials, where to pick up completed TWIC cards, payment processes, and other similar issues. 

Our other main TWIC concern has to do with the readers. We 

implore that the readers be fully tested in actual maritime environments, as required by SAFE Port, before any specifications are 

mandated. 

Next, I would like to briefly discuss the 100 percent container 

scanning provision. First, the Port of Houston Authority joins other 

U.S. ports in supporting the Federal Government’s layered security 

approach and urges adequate resources be provided to Federal 

agencies to continue to carry out and improve their security programs. The CSI policy of pushing our borders overseas to inspect 

cargo before it is actually loaded on U.S. bound vessels has worked 

well for U.S. ports. 

The SAFE Port Act requires DHS to start pilot programs looking 

at scanning all containers in four selected foreign ports to more 

fully evaluate the effectiveness and practicality of 100 percent 

scanning. There is great concern that if U.S. ports require foreign 

ports to perform 100 percent scanning of all containers destined for 

the United States, foreign governments could require the same 

from U.S. ports due to reciprocity. This would have a huge impact 

on Houston due to a large volume of export cargo that is equal to 

or greater than our imports. The Port Authority does not have the 

space nor does CBP have the personnel to scan all export containers. I would encourage this committee to review the findings of 

the pilot projects and carefully study full ramifications before requiring 100 percent scanning in foreign ports. 

Congress has assisted ports with the funding of important security infrastructure. To date, the Port of Houston Authority has 

74 

been awarded $38.6 million in port security grant program funds 

and urban area security initiative fundings. I would like to compliment DHS on their new structure of the latest supplemental 

round of funding. By pushing the funding down to the area maritime security committees, the people closest to the port are deciding the priorities for port security. This is an improvement and one 

that I believe will benefit port security. 

I have several other recommendations. 

First of all, ports are struggling with the cost for maintenance 

and operation of the security projects. It would be improper to expect the Federal Government to pick up all M&O costs for the life 

of the project, but some maintenance and operational costs should 

be included in the grant application. 

Second, the port security grant program should fund the replacement and upgrade of security infrastructure that is already in 

place. Additionally, the program should allow for upgrading of previously funded security infrastructure as new technology is introduced to maximize the security at our ports. 

Before I move on from port security grants, I would like to ex- press our gratitude to this committee for authorizing $400 million 

per year in port security grants for the coming fiscal years through 

2011 in the SAFE Port Act. DHS has been a good partner with the 

Port of Houston, and we look forward to working with Congress 

and DHS to make changes in the program that will improve the 

overall security of our ports. 

In conclusion, I appreciate the opportunity to express my 

thoughts in SAFE Port at its 1-year anniversary. We believe that 

this was a good piece of legislation that can be improved with a few 

adjustments. We in the port industry are dedicated to continue to 

work with Congress in identifying and providing practical solutions 

for port security issues. 

Thank you very much. I would be happy to answer any questions 

you might have. 

Ms. SANCHEZ. Thank you, Mr. Battles. 

[The statement of Mr. Battles follows:] 

PREPARED STATEMENT OF WADE BATTLES

Introduction 

Madam Chairwoman Sanchez and the Honorable Members of the Subcommittee: 

Thank you for this opportunity to address the U.S. House of Representatives Committee on 

Homeland Security, Subcommittee on Border, Maritime and Global Counterterrorism. 

I am Wade Battles, Managing Director of the Port of Houston Authority. 

I am pleased to present my thoughts on the one-year anniversary of the SAFE 

Ports Act. 

Port of Houston 

The Port of Houston is a collection of public and private terminals along more 

than 25 miles of the 53-mile-long Houston Ship Channel. The Port of Houston is 

the largest foreign tonnage port in the nation, second largest in total tonnage and 

10th largest tonnage port in the world. 

Most of its cargo is petrochemicals, with more than 150 private refineries, chemical plants and related terminals lining the Port of Houston, the port is home to 

the world’s second largest petrochemical complex. 

The Port of Houston, as a whole, is the catalyst for 785,000 statewide jobs, generating more than $39 billion in personal income annually. Many Texans and other 

Americans owe their livelihoods to activity tied to the Port of Houston. In addition 

to jobs, the Port of Houston annually contributes to more than $117 billion of stateVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00078 Fmt 6633 Sfmt 6621 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
75 

wide economic value. As you can see from these numbers, the Port of Houston is 

a large piston of the nation’s economic engine. 

Port of Houston Authority 

The Port of Houston Authority is the local sponsor of the Houston Ship Channel 

and owns the public terminals of the Port of Houston. The port authority is an independent political subdivision of the State of Texas and is governed by a seven-member board appointed by local entities in Harris County. While the private sector terminals along the channel primarily handle oil, chemicals and other bulk materials; 

the port authority primarily handles commodities like steel and grain, project cargo, 

including oil exploration equipment, and its biggest growth area—containers. 

The Port of Houston has a long history with containers. In 1956, the first container ship departed New Jersey and arrived in Houston to deliver 58 containers 

that were secured topside on a retrofitted tanker ship, the IDEAL X. In 1977, the 

port authority opened the Fentress Bracewell Barbours Cut Container Terminal. 

The terminal was designed to handle approximately one million twenty-foot equivalent units or TEUs. Barbours Cut handled 1.6 million TEUs last year. The Port of 

Houston now handles more than 73 percent of the container cargo market in the 

U.S. Gulf of Mexico. To keep up with the demand for container capacity, the port 

authority opened its Bayport Container Terminal in February this year. The 

Bayport Terminal is designed to handle 2.3 million TEUs at buildout. 

An interesting indicator of container capacity demand at our port: in February 

2007, we opened the first phase of our Bayport facility, devoting exclusive service 

to one of our largest customers. We expected the move to relieve some of the pressure from an overburdened Barbours Cut terminal. However, demand is such that 

Barbours Cut Terminal is on pace to break last year’s record for container volume. 

In 2008, we will open the first of up to three cruise terminals at Bayport. The 

port authority was the first gulf port outside of Florida to experiment with homeport 

cruising. Now, several ports have followed suit after witnessing the success of our 

Barbours Cut cruise terminal 

Comments 

There is no greater responsibility to the Port of Houston Authority than the safety 

and security of its employees, its visitors and its neighbors. I would like to briefly 

address the Subcommittee today on the following topics: 

1. General comments on SAFE Port Act 

2. Comments pertaining specifically to TWIC 

3. Port Security Grant Program and suggested modifications 

4. The innovative Ship Channel Security District 

5. 100 percent Scanning in Foreign Ports and the impact of reciprocity 

6. C–TPAT, CSI and other aspects of the security of the international supply 

chain and 

7. CBP Staffing 

General comments on the SAFE Port Act 

The SAFE Port Act of 2006 is Congress’ strongest effort to secure our nation’s 

ports. Among many provisions under the Act, we commend the attention given to 

improving the ability of the maritime community to respond to transportation security incidents. Particularly helpful are the requirements for area maritime security 

committees to include business continuity plans as part of their overall plan and the 

required development of protocols for post-incident resumption of trade. 

The Port of Houston is familiar with resumption of trade protocols stemming from 

near-miss hurricanes, major storm events and fog. The Coast Guard, port authority 

private facilities and maritime sector along the channel have learned how to cooperatively prioritize vessel movements through practice. It is vital that ports reopen 

following an incident in an organized and methodical manner. 

One of the strengths of the Port of Houston is its close working relationship with 

the local Coast Guard and Customs and Border Patrol as well as with all other 

agencies, federal, state and local, that have a role in security. 

There is an old saying in maritime circles that says: ‘‘When you’ve seen one port, 

you’ve seen one port.’’ 

There is a great deal of truth in this, and it is important that our leaders in here 

in Washington, D.C., who work hard to secure our maritime commerce, both lawmakers and regulators, recognize that each port is unique. The best security follows 

from the ability of local authorities, such as the Coast Guard Captain of the Port, 

to work with the port members in their district and tailor security requirements to 

the unique needs and configurations of each local port. Certainly, there must be national security standards, but they must not unduly tie the hands of local authorities, who have the greatest knowledge of unique local conditions and know how to 

76 

best secure against their vulnerabilities without unduly impacting critical operational efficiency. 

As an example of cooperation at our port, we have been working with local customs officials for several years now to install radiation portal monitors at each of 

our container facilities. As a result of this cooperation, the port authority is presently in full compliance with regulations requiring that all incoming containers be 

scanned for radiation by December 31, 2007. 

The port authority has signed an agreement with our Coast Guard district, under 

which we are able to monitor the security cameras of the other in many areas of 

the Houston Ship Channel and our terminals. Additionally, we have similar camera 

network-sharing agreements with the City of Houston, Harris County and the Texas 

Department of Transportation. And, thanks to the substantial help of the Port Security Grant Program, we have a state-of-the-art Emergency Command Center at the 

Port of Houston Authority, in which we have access to the camera feeds from these 

regional government bodies. These sharing agreements, along with the emergency 

command centers that have been constructed in the region are now being linked by 

sophisticated communication systems that allow each center to be a backup for each 

other will assist in making the Interagency Operational Center required under the 

Act truly functional. 

We are also working with the United States Coast Guard to amend our Facility 

Security Plan for one of our primary port terminals to make certain the appropriate 

areas are covered by the TWIC while minimizing the impact on day-to-day operations but not jeopardize port security. This is an important example, I think, of 

how Congress and participating agencies all recognize the importance of providing 

the right balance between security and operating efficiency. 

I should mention that there has been concern that Facility Security Officers, Port 

Police Chiefs and others who take the lead in port security have found that the goal 

of information-sharing is often impeded by the inability to obtain necessary security 

clearances, particularly on the federal level, and I would ask the Committee to take 

up this important issue with the Department of Homeland Security and its maritime-related agencies so that those responsible for port security are not prevented 

from carrying out their job because they are the last to know of important threat 

and other security information. We have spoken with a number of ports on this matter, and although there may have been some attempts to address this issue, the concern still remains. 

Transportation Worker Identification Credential (TWIC) 

A major provision of the SAFE Port Act addresses the Transportation Worker 

Identification Credential program, commonly called ‘‘TWIC.’’ The Port of Houston 

Authority generally supports the concept of a national identification system with 

background checks for transportation workers and has closely monitored development of this program. In fact, I am a member of NMSAC—the National Maritime 

Security Advisory Council—that has studied and advised on many of the issues relating to TWIC. We have a multi-disciplinary security committee at the Port of 

Houston Authority that has kept abreast of developments in the TWIC program as 

well as all laws and regulations governing security at our facilities. We have had 

numerous meetings with Coast Guard officials on how we can best facilitate the rollout and implementation of the TWIC program at our port. 

The TWIC program must be implemented without substantial impacts to the operations of the port. We are now working with our Captain of the Port to re-define 

our secure areas. Our ports have been historically created with many areas functionally and geographically separate from the cargo loading and unloading along the 

ship channel. The regulations wisely provide an opportunity to place these areas 

outside the ‘‘secure areas’’ of our port facilities that will require presentation of a 

TWIC for unescorted access. We anticipate that we will come to agreement on this 

issue in a manner that will allow important public non-operational functions to continue outside of the secured areas subject to TWIC compliance. 

Last spring, we met with representatives of the Transportation Security Administration and its contractors on the TWIC program. We were surprised that the representatives dramatically underestimated the number of transportation workers at 

the Port of Houston who would require a TWIC card. Their initial estimate called 

for 30,000 TWIC cards to be issued in the Houston area. The port authority reviewed the TWIC needs for the Port of Houston with the West Gulf Maritime Association, the East Harris County Manufacturers Association and other groups. The 

study concluded that we will have approximately 350,000 potential TWIC users in 

the Houston area. 

This information was given to the TSA, which has responsibility for enrollment 

in the TWIC program. However, we have not seen evidence that TSA has moved 

77 

very far off of its original estimate. Nor have we seen substantial efforts yet by the 

TSA to notify and educate port stakeholders about TWIC. 

The port authority was recently informed that TSA would only have a single permanent enrollment center for the Houston area and just four mobile centers. We 

were also advised by TSA that they are pushing for enrollment sufficient to allow 

Coast Guard to set September 25, 2008, as the enforcement commencement date. 

Although we certainly will continue to actively cooperate and do our part in this 

process, we are concerned that TSA has substantially underestimated the number 

of TWIC applicants who need to be enrolled in the program in order to achieve timely compliance and while keeping our ports operating efficiently. 

Recently, the Department of Homeland Security selected the Port of Houston to 

be part of the continued rollout for the TWIC next month, November 2007. The port 

authority is ready to assist the TSA in setting up mobile enrollment centers and 

otherwise assist the TWIC enrollment process. Our main objective is to improve security through the TWIC process without substantially interfering with efficient operations at our port facilities. 

Some modifications to the program that I would suggest are: 

• First and foremost that our stakeholders—truck drivers, contractors, stevedores, tenants and others—all get adequate and timely notice of this program 

and a convenient enrollment center to go to in order to apply for a TWIC and 

an efficient method to receive their TWIC. 

• The TSA should bring the TWIC cards, when ready, to the same mobile enrollment centers that applicants enrolled at or allow the applicant to designate 

the ‘‘pick-up’’ center in the applicant’s region, rather than forcing the applicants 

to go to a distant and different enrollment center to pick up their cards. 

• The TSA and its contractors need to clarify the identification credentials to 

be accepted for TWIC enrollment. I believe a driver’s license and a port-issued 

ID or another second form of government issued identification should be sufficient since that is identification that is reasonable and that a port employee 

would possess. If a TWIC applicant does not have a passport, requiring an original birth certificate will cause significant problems. The cost and time for obtaining these forms of ID may severely hamper the timeliness and success of 

the TWIC enrollment program. 

• The TSA needs to ensure timely delivery of TWIC cards to new employees. 

The maritime industry cannot have long delays in credentialing a new port 

worker. The TSA should work to limit the time it takes to issue a card. 

Port Security Grant Program and suggested improvements 

Congress has assisted ports with the funding of important security infrastructure 

since 9–11. The Port of Houston Authority has been successful seeking these funds 

based on the economic and energy significance of the port. To date, the Port of 

Houston Authority has been awarded $38.6 million in Port Security Grant Program 

funds and Urban Area Security Initiative funding. 

I would like to compliment the Department of Homeland Security on the new 

structure of the latest supplemental round of funding. By pushing the funding down 

to the Area Maritime Security Committees, the people closest to the port are deciding the priorities of port security. This is an improvement and one that I believe 

will benefit port security. The Houston AMSC is using the funding to first update 

its area security assessment. This will give us an opportunity to revaluate our 

progress in port security six years after the 9–11 attacks. 

Remaining funds will be allocated to projects based on the results of the area security assessment. This is a more regional approach than prior port security grants 

that were given directly to MTSA-regulated facilities based on criteria established 

in DC. 

Even with the compliments, I do have several recommendations for improving the 

Port Security Grant Program: 

First, the Port Security Grant Program should fund replacement of and upgrades 

to security infrastructure. As an example, CCTV cameras have about a five—to 

seven-year life span in the maritime environment. These cameras will need to be 

replaced. The PSGP does not allow for replacement funding of security infrastructure. 

Additionally, the PSGP should allow for upgrading of previously funded security 

infrastructure as new technology is introduced to maximize the security at ports. 

This common sense provision will keep port security technology on the cutting edge 

to prevent and deter possible attacks. 

Second, ports are struggling with the costs of maintenance and operation of many 

of these security projects. However, it would be unfair to ask the federal government 

to pick up all M&O costs for the life of the project. I believe that if the projects are 

78 

rolled into a port’s budget, it can adjust its cash flow and other priorities to accommodate the new budget item. 

Some of the maintenance and operations costs should be included in grant applications for the PSGP. Currently, the only M&O costs allowed in the PSGP grants 

are the first year, including during construction/implementation. There is limited 

need for M&O before the project is completed. I would suggest a 5-year M&O program with a declining percentage each year funded by the grant. For instance: 

• Year One, the Grant would cover 100 percent of the M&O costs 

• Year Two, the Grant would cover 80 percent of the M&O costs 

• Year Three, the Grant would cover 60 percent of the M&O costs, etc. 

• After the 5th year of the grant, the port would pick up all M&O costs. 

I believe this would allow ports to fund more projects while determining the budgetary impacts of the M&O costs and adjusting accordingly. 

Thirdly, under present grant procedures (e.g. Round 7A of the Port Security Grant 

Program that was announced in a press release on May 10, 2007), a port is given 

a maximum of three years in which to complete a grant project. That three-year period started on June 1, 2007 for the Port Authority and ends May 31, 2010. 

However, even though ports had to submit a budget and the scope with their 

grant applications last spring, the grant administrators in Washington, D.C. have 

not given approval to these budgets, and a port cannot commit to a contractor to 

go ahead with the project until the port receives Washington’s approval of this information without risking reimbursement of the funds. In essence, the clock is ticking 

on our port grants, but we are unable to start on them until we get final approval. 

It is anticipated that the effect of this is that ports will only have approximately 

a two-year window (rather than three years as intended) in which to complete their 

projects because of the inability of the grant administrators in Washington to cut 

through this review process and approve information that they have now had for 

some seven months. 

I would recommend that the DHS trust its review of the budget and scope at the 

time of the award and not duplicate efforts by reviewing the same information 

again. 

Before I move on from Port Security Grants, I would like to express our gratitude 

to Congress for authorizing $400 million per year in port security grants for the 

coming fiscal years through 2011 in the SAFE Port Act. This is the funding level 

supported by the American Association of Port Authorities and its ports. 

While I may have a few suggestions for improving the Port Security Grant Program, I must state that DHS has been a good partner with the Port of Houston. 

We look forward to working with 

Congress and the DHS to make changes in the program that will improve the 

overall safety and security of ports. 

Ship Channel Security District 

Several years ago, in a series of meetings with the Department of Homeland Security arranged with assistance of Congressman Gene Green, DHS officials detailed 

the need for a regional approach to security to reduce security risks along the Houston Ship Channel. From those meetings, a new public-private group was created 

that included Harris County, the Port of Houston Authority, the cities along the 

Channel as well as the private petrochemical, chemical and refinery facilities along 

the Houston Ship Channel, including members of the East Harris County Manufacturers’ Association. 

The public-private group, called the Port Strategic Security Council (PSSC), recognized that the best security for the region would be achieved by a system-wide, layered security approach along with the employment of modern technology and techniques of each individual facility. The PSSC, working with experts in port security, 

developed a list of projects, regional in focus, to systematically improve security 

along the Houston Ship Channel. Harris County has sponsored the PSSC’s Homeland Security Department Port Security Grants utilizing $31 million in federal 

grants for PSSC projects to increase maritime domain awareness, improve interoperability, provide patrol boats and reduce the risk of a terror attack. 

The PSSC soon recognized that a mechanism was needed to allow the county, the 

private facilities, the port authority and others to equitably pay for the local share 

of the grants and the operation and maintenance of these new security projects. The 

public-private partners of the PSSC decided the best method to collect these funds 

could be modeled after assessments collected by state-created municipal management districts. 

This year, the Texas Legislature authorized the creation of the Ship Channel Security District. The Department of Homeland Security showed an interest in the legislation as it moved through the process. U.S. Department of Homeland Security 

79 

Secretary Michael Chertoff even sent a letter to the Texas Legislature generally 

supporting the concept of the security district. 

The district will be a public-private partnership with the board primarily made 

up of representatives from private industry. This board will determine the amount 

and methodology to assess the facilities along the Houston Ship Channel. 

Let me point out that the private companies along the channel, and you would 

recognize their names if I listed some of them, supported legislation that would assess their businesses to pay for improved security infrastructure for the Houston 

Ship Channel. Instead of waiting for the government to do it, they have stepped up 

as good corporate citizens to meet the challenge head on. This is another in a long 

series of examples where federal, state, and local governments, the port authority 

and the private sector have come together to benefit the Port of Houston. 

We have several more hurdles to clear before the district is created. Those include 

getting more than half of the companies in the proposed district and property owners of more than half the appraised property value of facilities in the proposed district to sign a petition asking for Harris County to create the district. 

Once established, this district could be the public-private model for port security 

nationwide. I would invite the Subcommittee to visit Houston to see first-hand 

Houston’s cooperative spirit in action. 

Requiring 100% Container Scanning at Overseas Ports 

I would like to briefly discuss the 100 percent container scanning provision in the 

SAFE Port Act. 

First, the Port of Houston Authority joins many other U.S. ports in supporting 

the federal government’s layered security approach and urges adequate resources be 

provided for federal agencies to continue to carry out and improve their security programs. 

The layered, risk-based screening, scanning and inspection policy of cargo containers and the ‘‘pushing of the border oversees’’ to inspect cargo before it is loaded 

onto U.S.-bound ships has worked well for U.S. ports as well as our foreign partners. 

The SAFE Port Act requires the DHS to start a pilot program to scan all containers in four selected foreign ports to more fully evaluate the effectiveness and 

practicality of this new technology. 

I strongly believe that pilot ports are important and the information gleaned from 

them should be used to help craft any new system. Quick implementation of 100 

percent scanning, without incorporating the lessons from the pilot projects, could be 

both costly and play havoc with our maritime transportation system. 

Reciprocity in Scanning 

This would be especially true for the Port of Houston Authority, which is one of 

the few U.S. container ports with balanced import and export container trade. Our 

strong manufacturing sector in Houston, especially in the petrochemical and machinery sectors, provides us the opportunity to ship many American-made products 

worldwide. There is great concern that if the US requires foreign ports to perform 

100 % scanning of all containers destined for the US, foreign governments could require the same from U.S. ports through reciprocity. The Port authority does not 

have the space nor does CBP have the personnel to scan all export containers from 

the Port of Houston Authority. 

I would encourage this committee to review the findings of the pilot projects and 

study carefully the full ramifications of 100 percent scanning in foreign ports. 

C–TPAT, CSI and other aspects of the security of the International Supply Chain 

The Department’s existing programs, many of which were codified in the SAFE 

Port Act, have been models for enhancing the security of the international supply 

chain. In 2006, prior to passage of the Act, the Port of Houston Authority signed 

an Agreement with U.S. Customs and Border Patrol to become a partner with CBP 

in the Customs Trade—Partners Against Terrorism (CT–PAT) program. 

Another successful program codified in the SAFE Port Act is the Container Security Initiative. This program identifies containers that pose a security risk before 

they are loaded in foreign ports. The port authority supports this program as it provides a voluntary, incentive-based layer of security and enhancement to our port security here in the United States. 

Customs and Border Protection Staffing 

The Port of Houston and the Houston Airport System had a significant issue a 

few years ago where the two entities had to share CBP officers. In the morning, the 

officers were at the port inspecting cargo, but in the afternoons, they were at the 

airports assisting in processing passengers coming from foreign countries. 

80 

This was not an acceptable use of manpower for either the airport or the seaport. 

Congress rightly came to the rescue by adding new positions for CBP officers over 

the next six years. Texas Senator Kay Bailey Hutchison even added another 275 

CBP officers to the amount approved by the House. I urge you to fund these positions. We can have all of the technology and rules to protect the ports laid out in 

this law, but if we do not have people to man those positions, it will not do much 

good. 

Conclusion 

I appreciate the opportunity to express my thoughts on the SAFE Ports Act of 

2006 on its one-year anniversary. I believe this was a good piece of legislation that 

can be improved with a few adjustments. I am available for any questions you may 

have. 

Thank you. 

Ms. SANCHEZ. I thank all the witnesses for their testimony. 

I will remind each member that he or she will have 5 minutes 

to question the panel, and I will recognize myself for questions. I 

would like to start with Mr. McLaughlin. 

In the earlier panel, we had Ms.μFanguy testify that there were 

only 70 denials on HAZMAT. You mentioned 5,500. 

Mr. MCLAUGHLIN. She said 70? I think she must have misspoke. 

The number I had was 5,500, and I met with TSA recently and 

they said 5,500. 

Ms. SANCHEZ. Okay. My question for you is, you mentioned some 

of the problems that your membership has with the TWIC process, 

including loss of privacy. Can you sort of just give us an indication 

of what that means to them? 

Mr. MCLAUGHLIN. Well, I think that this committee held a hearing on the HAZMAT truck drivers, and one of the issues that was 

brought forward were some of the truck drivers were not applying 

because of that issue. They may have something in their past that 

is not a disqualifying offense, but they don’t want somebody else 

to look at it, and therein lies—and I get calls from individuals that 

may have a background and it does not—those crimes do not fall 

into these categories, but they are still concerned. And they are 

concerned about the loss of privacy, they are concerned about 

where this information is going, who is looking at it, where it is 

being stored, all those questions that I get. 

And there is just a concern out there that they are the ones that 

are losing their privacy, and you may have a longshoreman that 

does have a criminal background that comes to work every day 

with a big American flag on the back of his truck. And so you are 

saying that this person is a risk to the United States. And so the 

connection between a criminal background and a terrorism security 

risk, which is what MTSA—it is really difficult to look at the two 

and to make a determination, I think. 

And, furthermore, we have taken a lot of, particularly in L.A.- 

Long Beach, a lot of young people recently that have come into the 

union that were from tough neighborhoods; and I worry about so 

easily taking away their livelihoods. Because they have a good job 

and a good chance to build a future with this union and with this 

job, and it should not be taken lightly. 

It is a good job for women as well. I don’t know if you knew this, 

but probably about 25 percent of the longshore workers in L.A.- 

Long Beach are women. So it is a good job for both men and 

women. 

81 

Ms. SANCHEZ. Thank you for clarifying that and putting that on 

the record. Because I think that these are jobs that pay well over 

the long run and people do get a second start in many cases towards working things out and providing for their families. We 

wanted to get that on the record. 

Mr. Blanchet, according to your written testimony, a TWIC can 

be forged within 48 hours. What steps do you think TSA should be 

taking to prevent this from occurring? And should the readers be 

rolled out at the same time that the cards are? 

Mr. BLANCHET. That is correct. The readers should already have 

been established. The system that is going to be in place is going 

to be status quo to the system you have today; and that is, go 

through the gate and show a driver’s license. A majority of the 

trucks that enter the gates today are not physically examined by 

the guard. And what I mean by that, the guard is supposed to take 

the driver’s license, look at the picture, and try to match it with 

the driver. That is not being done. 

If you have a TWIC, you will have the same cosmetic issue as 

the driver’s license. So until you have the biometric reader to read 

the information from the fingerprints to the face, to the card, you 

are not going to have anything which is secure. Homeland Security 

should be Homeland Scary. 

Ms. SANCHEZ. Thank you. 

I yield back. I will give 5 minutes to the ranking member. 

Mr. SOUDER. I will try not to use my 5 minutes. 

I had a question for Mr. McLaughlin first. Does the union get notified when someone is turned down? If they are a member—you 

said a lot of people get letters. They don’t know how to do that? 

Mr. MCLAUGHLIN. We haven’t gotten any letters so far, but we 

don’t have the rollout until mid-November. But, as far as I know, 

the union does not get notification that the individual is disqualified. 

Mr. SOUDER. That will be something interesting to pursue. Because that would be another fallback protection for individuals. I 

mean, we want to keep people who are high risk out. I am a hardliner on that question. 

The question is, however, if folks are misidentified and we are 

having confusion at the grass roots and don’t understand it, I 

would think that would be one additional union benefit, would be 

if the union also knew whether one of the members had been 

turned down. 

Mr. MCLAUGHLIN. I will have to think about that, because I don’t 

know an individual who would want the union to know what it is 

they got. 

But I think one thing the union can do is educate them, expect 

within a certain amount of days you are going to get your card or 

please go to the union so we can help you. That is something that 

we are talking about doing now. 

Mr. SOUDER. One of the things is I would assume that the union 

would know they were turned down because they will no longer be 

able to keep their job. So, to some degree, privacy—being turned 

down, if you can’t show up to work is kind of non—you may not 

know the reason, and that is a legitimate concern with privacy 

laws. 

82 

Mr. MCLAUGHLIN. No. Because you are going to have the rollout, 

but the compliant date may be a year from now. So it may be up 

the road. So they may lose their window of opportunity to apply for 

a waiver. So they may lose that window of opportunity but still be 

allowed to work because the port is not compliant with TWIC card. 

Mr. SOUDER. Mr. Koch and Ms. Alexander, in the 10 plus 2 initiative, which I take it you have serious concerns about because of 

it is being done in a room where you are not able to input and then 

all of a sudden it is there, I don’t understand why things aren’t 

floated and worked in a more cooperative way. But are there specific elements of the data that you are afraid of that aren’t going 

to be necessarily important for targeting but you feel put additional 

paperwork? Where are your major concerns there? 

Mr. KOCH. At this point, Congressman, we are not sure we have 

any concerns. We think the strategy is sound. We think the 10 plus 

2 data elements that CBP has identified makes sense. 

And, frankly, we commend CBP. They have been very open. They 

have reached out to the trade community, carriers, brokers, forwarders, importers for a year to get input and feedback. So I would 

expect that this proposed rulemaking, when it comes out, should 

surprise very few people. 

Obviously, we need to wait and see what is in the NPRM, but 

our expectation is that it will be exactly as they have advertised 

and an important supplement and improvement to the risk targeting system that they presently use. 

Mr. SOUDER. Do you agree with that, Ms. Alexander? You mentioned a closed room. 

Ms. ALEXANDER. Well, the closed room I was talking about more 

for the GTX issue. On the 10 plus 2, there are various elements 

that have been requested that we do not collect data on right now 

or that we do not have ready access to. So what our big concern 

is that when this rolls out we will have time to establish the new 

processes within our company to be able to collect that data. That 

is our big concern. We assume that might take 1 year, 1–1/2 years 

to be able to collect all that data in the proper process. 

Mr. SOUDER. Madam Chairwoman, I will yield back. 

Ms. SANCHEZ. The members present have agreed to each ask one 

question so we can get through this process and close off this hearing so we can go over and vote since we have a vote on the floor. 

At this time, I will acknowledge Mr. Green for his question. 

Mr. GREEN. Thank you, Madam Chair. 

And I want to thank all of the persons who are here to testify 

today, especially Mr. Battles. He happens to be from Houston, 

Texas, where we happen to have our port. I, along with Congressman Gene Green, had an opportunity to tour the port. We were impressed—I was—with the coordination center, the communications 

abilities that you have; and, also, I was impressed to find out that 

you have a public-private partnership called the Ship Channel Security District. And I would just ask if you would enlighten us as 

to how this public-private initiative is functioning. 

Mr. BATTLES. Thank you, Congressman Green. 

As we move forward in port security, what has happened is we 

first started looking at the individual security facilities. We have 

moved on now to a regional basis. Because each facility is interVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00086 Fmt 6633 Sfmt 6601 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
83 

related with the facility next to us, so the challenge became how 

do we have projects that include various facilities over a regional 

basis in addressing such issues as on-water security interoperability. 

So we formed a partnership between Harris County and the Port 

Authority and the private sector, mostly the chemical plants that 

align the Houston Ship Channel; and we moved forward and we 

applied for security grants in both rounds five and six and were 

awarded, combined, about just under $30 million. The challenge 

has been now that, once we have those funds, where do you get the 

operational and the maintenance funds to be able to operate those 

projects? 

For example, one of the projects was on the water police capabilities for security on the water. Operating those boats becomes very 

expensive. So this past legislative session in Austin we had legislation passed that allowed us to form a security district. This is a 

self-taxing district where the members in the geographic boundaries of the security district come together, vote. They have to have 

50 percent of their members vote for it, and then they will move 

forward and establish an equitable relationship to tax themselves 

to pay for O&M and also to move forward on providing the seed 

money that is necessary, the matching money for funds. 

It also provides the vehicle to be able to evaluate projects on a 

much greater regional basis for the holistic good of the community, 

not only for business—I mean, not only for prevention and response 

but also now new focus on business continuity and on business continuing. 

Ms. SANCHEZ. Thank you, Mr. Green. 

I will now recognize Mr. McCaul for his question. 

Mr. MCCAUL. I thank you, Madam Chair. 

I had a specific question. I will be brief, given the time constraints. 

Mr. KOCH AND MR. Battles, the 100 percent screening restriction 

or the provision that was put in the 9/11 bill, I was one of the conferees. We had a very healthy debate over this whole issue. But I 

am concerned about how it works in the real world as a practical 

matter, and if I could raise just a couple points that I heard that 

I think raise some concerns. 

One is, who does the screening and in what foreign country are 

you doing the screening? Will China, for instance, allow us to do 

with screening with Customs or does China want to contract? Or 

you mentioned Dubai Ports. How feasible is this by 2012? 

And then, secondly, if the reciprocity requirement is placed on 

the United States to inspect all of our exports, do we have the capability and the resources to do that, in your judgment? 

Mr. KOCH. I think the questions you have raised are some of the 

same questions we have raised. We don’t know how this would 

work in reality. We don’t know that the governments abroad know 

how this is supposed to work in reality. The port operators abroad 

do know not how this is going to work in reality. There are simply 

too many fundamental issues that have not been raised or tackled 

or addressed either by the Congress in passing this or by DHS trying to digest what this means at the present time. 

84 

To some extent, a lot of people look at this and say, well, because 

the effective date is 2012, maybe we don’t have to worry about it. 

I don’t think that is the way other governments and the port community is looking at this. The United States is a leader on maritime security and port security issues, and it is important for the 

government to speak clearly so that we understand what the rules 

are going to be going forward. 

As to resources, if we had to inspect 100 percent of our outbound 

containers similarly to what is talked about for inbound, there are 

not the resources to do it. As Mr. Battles said, the Port of Houston 

couldn’t do it. It would be a severe problem for American exporters. 

The vision of a 100 percent container inspection is certainly an attractive vision, but I think a lot of work needs to be put into this 

to confront what are real-world problems that up to this point have 

not been addressed. 

Mr. MCCAUL. I think it is an attractive vision, but I think we are 

going to have to work hard with you to determine we are going to 

do this. 

Mr. Battles, just real quickly. 

Mr. BATTLES. Yes, I concur. It is a huge challenge. And what we 

are trying to bring to light is a rationalization of let’s not get lost 

on the methodology of how we are going to achieve our goal. Let’s 

achieve our goal and use all of the resources that we have available 

to us, not necessarily get hung up on one particular issue where 

we want to have every container inspected overseas. 

I think if we have a multitude of programs that layered on top 

of each other we will be able to achieve the goal of secure and safe 

ports but at the same time not put handcuffs on commerce and 

slow commerce down. 

Mr. MCCAUL. Thank you, Madam Chair. 

Ms. SANCHEZ. Ms.μJackson Lee, you are recognized for one question. We have a vote on the floor with less than 5 minutes to go. 

Ms. JACKSON LEE. Let me spend time saying to Mr. Battles we 

thank you for your presence here today and to acknowledge my 

concern about some of the issues that you have raised. 

We thank the witnesses for their presence. 

Let me indicate to both unions that you will find very a very 

strong advocate for training. We will respond to your concern about 

the FBI list that may be inaccurate and, as well, we will respond 

to your concern about the communication process. That is very, 

very important; and I look forward to working with you specifically 

on that. 

Mr. Battle, I would like you to comment on the lack of the reader, which I don’t think most people understand that you are going 

to be in this program and you don’t have a tested reader of the program for the TWIC card. And as you answer that, the question is 

embellished by the fact of you telling us how your unions in the 

Houston port are going to be involved in this security process. 

Thank you for your presence here and the great work of the port 

that I have enjoyed working with. 

Mr. BATTLES. As far as the reader is concerned, our concern is 

basically, number one, that we have a reader that works. It is 

going to be very, very challenging to be able to process the longshoremen as they are standing in front of the turnstyle to go to 

85 

work every day. We don’t want to hold them up. We have to come 

up with an efficient product. 

If you look at the specifications as required in FIPS 201, it calls 

for a contact reader. And our concern is that in a marine environment, a contact reader will not last very long, that it will get 

misreads and it will slow down the process. So we are trying to 

move forward on a contactless reader that will incorporate the biometric requirement that the TWIC card is going to have. 

As far as working with the union, we have always had a very 

strong working relationship with the union. The concern about a 

longshoreman being denied a TWIC card is a very, very serious 

issue. Denying a man or woman their livelihood should not be in 

any way taken so easily. So we are dedicated to work with the 

union, find solutions for it. But we have found that with proper 

processes and having the ability to appeal it that we hopefully feel 

that we will have a fair and equitable rollout of the TWIC card. 

Ms. SANCHEZ. I thank the witnesses for their valuable testimony 

and the members for their questions. And the members of the subcommittee may have additional questions for the witnesses, and we 

will ask you to respond quickly to those questions. 

Hearing no further business, this subcommittee stands adjourned. 

.[Whereupon, at 4:37 p.m., the subcommittee was adjourned.] 

(87) 

Appendix A: Executive Summary of C–TPAT 

Partners Cost-Benefit Survey Prepared by the 

University of Virginia for U.S. Customs and Border 

Protection 

II Executive Summary 

C–TPAT Survey 

• Of the 6,000 C–TPAT certified companies that were sent an invitation to participate in the survey, a total of 1,756 completed the survey (29.3%). Of the 1,756 

responses received, 54.3% were received from importers, 20.6% from carriers, 17.8 

% from service providers, and 7.3% from foreign manufacturers. The percentage of 

responses received by enrollment sector closely mirrors the size of each enrollment 

sector relative to total program membership 

• The Center for Survey Research (CSR) at the University of Virginia conducted 

the 2007 C–TPAT Benefit Cost Survey from January to April 2007. 

C–TPAT Partners Profile 

• Nearly three-quarters of these businesses are privately owned (74.0%), while 

another quarter are publicly owned (24.0%). The participating companies have been 

C–TPAT certified for 2.6 years on average. 

• Six out of ten (62.1%) companies that participated in the C–TPAT survey indicated that their company’s headquarters were located in the United States. The remaining companies reported that their headquarters were located in Canada 

(25.0%), in Mexico (3.2%), or in other countries (9.7%). 

• Of the 953 importers who responded to the survey, 64% have been validated. 

Of the validated importers, 21.7% were classified as Tier 3, receiving the maximum 

level of benefits provided under the program. 

Prior to joining C–TPAT 

• Prior to joining C–TPAT, survey respondents in more than half (54.8%) of the 

businesses surveyed did not know about the protection programs or initiatives their 

companies have put in place. In addition, nearly half of the businesses (46.6%) did 

not have a formal system in place for assessing and managing supply risk. 

• Slightly more than one-third (35.7%) of businesses had a formal system in place 

for assessing and managing supply chain risk. Furthermore, about 4 out of 10 businesses had no formal supply chain continuity and contingency plans. 

• However, because of their participation in previous Customs and Border Protection programs, or due to their company’s risk management processes, half (50.3%) 

of the businesses had implemented most or nearly all the C–TPAT program criteria 

prior to applying for membership. 

Motivations for Joining C–TPAT 

• For all businesses, ‘‘reducing the time and cost of getting cargo released by 

CBP’’ is the most important potential benefit, followed by ‘‘reduced time and cost 

in CBP secondary cargo inspection lines.’’ Of all the potential benefits presented to 

businesses, ‘‘reducing insurance rates’’ was the lowest rated item. 

• According to Importers, the most important motivation for them to join C–TPAT 

is to ‘‘to reduce the disruptions to the supply chain’’. For non-importers, 62% indicated that their principle reason for joining the program was that their business 

partners required them to be C–TPAT certified. 

Potential C–TPAT Implementation and Maintenance Costs 

• Of all the potential C–TPAT implementation costs, ‘‘improving or implementing 

physical security costs (doors, windows, electronic access, cameras, fences, gates, 

lighting, etc.)’’ received the most mentions. It was also the highest among all the 

potential implementation costs with an average of $38,471. 

88 

• Of all the maintenance cost items, ‘‘maintaining physical security’’ and ‘‘maintaining in-house education, training, and awareness’’ received the most mentions by 

all the businesses. 

• With respect to the average amount of money spent, ‘‘maintaining the use of 

security personnel’’ ($40,441) and ‘‘salaries and expenses of personnel’’ ($28,454) 

were the highest costs to maintain the C–TPAT program. 

• The results of the survey also indicated that the ease of implementing the C– 

TPAT program criteria was found across all business types. Overall, 59.3% of Importers, 59.1% of Carriers, 62.0% of service providers, and 59.2% of manufacturers 

found that it was somewhat or very easy to implement the C–TPAT program criteria. 

• During the last full year before they joined C–TPAT, Importers’ total annual expenditures on supply chain security averaged an amount of $35,006. The estimated 

annual expenditures on supply chain averaged $66,353 in 2005 and were projected 

to be $77,997 and $69,905 in 2006 and 2007. 

• For Non-Importers, total annual expenditures on supply chain security follow 

a similar pattern as that of Importers, with the total annual expenditures on supply 

chain security averaging $57,406 prior to joining C–TPAT. However, the 2007 projected expenditures ($100,025) were higher than the 2006 projected expenditures 

($61,964). 

Benefits of C–TPAT Participation 

• Almost one-third (32.6%) of businesses said that the benefits outweighed the 

costs, while nearly one-quarter (24.2%) of businesses said that the C–TPAT benefits 

and the affiliated costs were about the same. 

• For all businesses, the major impacts of their C–TPAT participation have been 

in the field of workforce security, time to release cargo by CBP, time in CBP inspection lines, and predictability in moving goods. 

• More than one third (35.4%) of Importers reported that their participation in 

C–TPAT has decreased their number of U.S. Customs and Border Protection (CBP) 

inspections. In a follow-up question, these importers indicated that their number of 

CBP inspections decreased by more than half (51.7%). 

• Importers that have been C–TPAT certified for a period of more than 3 years 

were more likely to say that their number of inspections have decreased (42.8%) because of the C–TPAT participation than were those Importers which have been C– 

TPAT certified for a period of 2 to 3 years (33.8%) or less than 2 years (27.1%). 

• Importers said that their participation in C–TPAT has increased their supply 

chain visibility and nearly one quarter (24.3%) indicated that their participation in 

C–TPAT has increased their ability to predict lead-time. Nearly 3 out 10 Importers 

(28.9%) reported that their participation in C–TPAT has decreased the disruptions 

in their supply chain. 

• Of highway carriers, 41.5% reported that their participation in C–TPAT has decreased their wait times at the borders, while 44.4% said their wait times at the 

borders have stayed the same. 

• More than two-thirds (68.7%) of non-Importers said that their number of customers has stayed the same, while 17.0% have reported that their participation in 

C–TPAT has increased their number of customers. About the same proportion of 

non-Importers (17.4%) also indicated their participation in C–TPAT has increased 

their sales revenues. 

• Overall, since becoming C–TPAT certified, non-Importers who reported an increase in customers have gained 35.2% new customers. Non-Importers who reported 

an increase in sales indicated that their company’s sales have increased by 24.1%. 

C–TPAT Impact on Risk Management 

• The vast majority (81.3%) of businesses that had a formal system in place for 

assessing and managing supply risk agreed or somewhat agreed that their businesses’ ability to assess and manage supply risk has been strengthened as a result 

of joining C–TPAT. 

• Three quarters (75.2%) of businesses that had formal supply continuity and contingency plans before joining C–TPAT reported that their supply continuity and contingency plans have been strengthened as a result of joining C–TPAT. 

C–TPAT Supply Chain Security Conferences 

• Nearly thirty percent of businesses (29.3%) said they have participated in Supply Chain Security conferences. The vast majority of the conferences’ participants 

(98.4%) reported that the conferences were valuable, with 37.2 percent rating them 

as extremely valuable and 42.2 percent rating them as valuable. About half (50.2%) 

of the businesses would like to have these C–TPAT Supply Chain Security conferences presented once a year. 

89 

• Nine out of ten (92.6%) businesses have contacted the C–TPAT program personnel and 81.5% of these businesses said that they have not experienced difficulties 

in obtaining responses to their questions or concerns. In addition, 83.8% of these 

businesses indicated that C–TPAT responses to their questions or concerns were 

provided in a timely fashion. 

• Businesses also had a positive evaluation of their Supply Chain Security Specialist (SCSS). An overwhelming majority (98.3%) of businesses reported that their 

Supply Chain Security Specialist was very knowledgeable (54.1%), knowledgeable 

(34.4%), or somewhat knowledgeable (9.8%). Interestingly, this appreciation of the 

knowledge of the Supply Chain Security Specialist was across all businesses regardless of their type, size, or the number of years they have been C–TPAT certified. 

Overall C–TPAT Evaluation 

• More than half (56.8%) of businesses indicated that C–TPAT benefits outweighed the costs (32.6%) or the benefits and the costs were are about the same 

(24.2%). Slightly more than one quarter (26.4%) reported that it was too early to 

compare the benefits and the costs. 

• While more than one-third (38.4%) of businesses indicated that their management was concerned about the potential impact on cost when their companies were 

considering joining C–TPAT, the vast majority of businesses indicated they have 

never considered leaving the C–TPAT program (91.5%) and that they would definitely (78.1%) or probably (18.1%) stay in the program. 

(91) 

Appendix B: Additional Questions and Responses 

QUESTIONS FROM THE HONORABLE BENNIE G. THOMPSON, CHAIRMAN, COMMITTEE ON

HOMELAND SECURITY

RESPONSES FROM STEPHEN L. CALDWELL


11080.8.eps
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11080.9.eps
93 


11080.10.eps
94 


11080.11.eps
95 

QUESTIONS FROM THE HONORABLE BENNIE G. THOMPSON, CHAIRMAN, COMMITTEE ON

HOMELAND SECURITY

RESPONSES FROM MAURINE FANGUY

Question 1.: According to Mr. Battles, TSA underestimated the TWIC numbers 

at the Port of Houston by 320,000. Similar problems occurred at the Ports of New 

York and New Jersey and Savannah). Who came up with the original numbers 

and how much did you pay them? 

Response: The Transportation Security Administration (TSA) Office of Finance 

and Administration led the effort to develop the original population estimates, with 

contractor support from International Business Machines Corporation (IBM). The 

estimated cost for this support is $48,000. In developing this estimate, TSA consulted with the following government and industry authorities: United States (US) 

Department of Transportation/US Maritime Administration, Army Corps of Engineers (Waterborne Commerce), Journal of Commerce, American Association of Port 

Authorities, Bureau of Transportation Statistics, A. Strauss-Wieder Inc., Martin Associates, Economic Research Associates, International Longshoremen’s Association, 

International Longshore and Warehouse Union, United States Maritime Alliance, 

Pacific Maritime Association, American Waterways Operators, Maersk, WalleniusWilhemsen, American Trucking Association, Owner-Operator Independent Drivers 

Association, International Brotherhood of Teamsters (Port Division), US Census (Vehicle Information), University of Michigan, University of Minnesota, California State 

University at Long Beach, University of Central Florida, American Shipbuilding Association, Shipbuilders Council of America, Cruise Industry News, International 

Council of Cruise Lines, Minerals Management Service, National Ocean Industries 


11080.12.eps
96 

Association, Independent Petroleum Association of America, American Petroleum 

Institute, and the National Petrochemical and Refiners Association. 

TSA is continually working with the United States Coast Guard and industry 

stakeholders to gather additional data on the maritime population. However, there 

is sufficient flexibility and capacity in the system to accommodate unforeseen fluctuations in the population. 

Question 2.: The TWIC was supposed to be the one card that provided uniformity 

and consistency. What steps has TSA taken to pre-empt state access cards 

like those issued in Florida? 

Response: Under the final rule published on January 25, 2007, States are not 

preempted from instituting their own background checks or badging systems in addition to the Transportation Worker Identification Credential. We note that a State 

may be the proprietor of ports or port facilities, and, as the proprietor, is free to 

set standards for who may enter onto their facilities, as does any other proprietor. 

In addition, States may have set standards for reasons other than guarding against 

the threat of terrorism, such as to combat drug smuggling or organized crime. As 

such they are not regulating in the areas that DHS is regulating. 

Question 3.: TSA contractors have already lost two computers containing personal information. Are you confident that TSA has taken the proper steps to 

secure the TWIC computers? 

Response: Transportation Security Administration (TSA) takes data security 

very seriously. TSA and its contractors are committed to maintaining the privacy 

of personal information and take many precautions to protect it. The Transportation 

Worker Identification Credential (TWIC) system incorporates a 256-bit Advanced 

Encryption Standard for whole disk encryption on all enrollment workstations, 

encryption of the enrollment package during transmission through a virtual private 

network, and encryption of the data in the TWIC system, which is located at a secure government facility. This standard is a National Institute of Standards and 

Technology standard that is approved by the National Security Agency for the 

transmission of Top Secret information and reflects Federal Information Processing 

Standard 197. TSA recognizes that data security is an ongoing process, and will continue to monitor our systems and practices to enhance the security of personal information. 

Question 4.: We have been told repeatedly that TSA has failed to notify and educate port stakeholders about TWIC. What steps are you going to take to fix this 

problem? 

Response: The Transportation Worker Identification Credential (TWIC) Stakeholder Communications Committee is comprised of approximately 35 industry and 

labor representatives and has held 6 meetings to date. These meetings are well attended, useful information is presented and distributed to the membership and valuable feedback is received from the membership. To illustrate the effectiveness of 

this committee, membership requests continue to be received from stakeholders interested in participating. We are very pleased with the workings of this committee, 

the two way flow of information it fosters, and participation from industry. 

Additionally, as cited in recent Government Accountability Office (GAO) testimony 

(October 31, 2007 to the Committee on Homeland Security, House of Representatives), the Transportation Security Administration (TSA) has taken steps to address 

previous GAO recommendations regarding improving communications and coordination with maritime stakeholders, including posting frequently asked questions, participating in numerous conferences and briefings, conducting outreach with maritime facility operators and port authorities, and disseminating informational bulletins and fliers. The testimony states that stakeholders from the Ports of Wilmington, Delaware, Los Angeles, California and the Maritime Exchange of the Delaware River and Bay Authority, with whom GAO spoke in October 2007, stated that 

TSA and its enrollment contractor have placed a greater emphasis on communicating and coordinating with stakeholders and on correcting past problems. An official from the Port of Wilmington stated that, thus far, communication, coordination, and outreach by TSA and its enrollment contractor have been excellent and 

far better than during TWIC testing. 

Question 5.: When is TSA going to implement the reader pilot? 

Response: Vendors are currently developing contactless readers to operate with 

the Transportation Worker Identification Credential. After independently testing 

the readers for compliance with the specification, we plan to deploy readers at test 

sites early in calendar year 2008 and begin gathering test data. Delivery of the final 

pilot test report is scheduled for December 2008. The test will extend through 2008 

97 

to achieve all test objectives. However, the test is structured to provide data early 

in the pilot and throughout the test. 

Question: The SAFE Port Act required a pilot program on the TWIC readers. 

The Department has decided to fund this program through the Port Security Grant 

program, although this was not required in the law. The pilot participants recently 

sent Mr. Chertoff a letter asking him to waive the 25% cost-share requirement for 

the pilots since all other TWIC pilots were fully funded by the government and he 

has the authority under MTSA to waive the cost-share. What is Mr. Chertoff’s position on waiving the 25% cost-share on TWIC reader pilots? 

Response: Currently DHS is reviewing the wavier request for the TWIC readers 

and a decision will be made in the near future. 

Question 7.: The Port Security Grant program is already providing funds for 

TWIC implementation. A key problem in determining costs are some policy 

decisions that DHS has yet to make. Three key ones are: (1) will all facilities be required to have use TWIC card reader; (2) At what MARSEC level 

and rates will facilities be required to have biometric checks, and (3) Will 

facilities be required to conduct PIN verifications and at what MARSEC 

levels? What is DHS’ timeframe for making some of these policy decisions 

in light of the funding from the Port Security Grant program? 

Response: The specific policy decisions discussed in the question will be promulgated in a notice and comment rulemaking addressing Transportation Worker Identification Credential (TWIC) reader requirements for regulated vessels and facilities. 

The policy decision will be proposed in a Notice of Proposed Rulemaking, which will 

give regulated industry an indication of Department of Homeland Security (DHS) 

direction. However, decisions will not be finalized in a rule until a public comment 

period and TWIC pilot test of the business processes, technology, and impacts is 

completed. DHS intends to address these policy decisions by the SAFE Port Act 

deadline of April, 2009. 

Regarding TWIC funding from the Port Security Grant program, approved applicants have up to 30 months from the grant award date to obligate their funds, providing sufficient time to implement TWIC reader projects given regulatory requirements. 

QUESTIONS FROM THE HONORABLE BENNIE G. THOMPSON, CHAIRMAN, COMMITTEE ON

HOMELAND SECURITY

RESPONSES FROM VAYL OXFORD

Question 1.: Section 121 of the SAFE Port Act states that DHS will produce a 

strategy for deployment of domestic radiation detection and imaging systems. When 

radiation portal monitors were first employed at ports, their installation was slowed 

by a failure of DHS/DOE and their contractors to work up front with ports to make 

sure the operating procedures and footprints would be complementary to port operations. 

(Director Oxford, DNDO) Please explain if and how you included ports in the development of the strategy on domestic radiation detection and imaging systems required under Section 121 of the SAFE Port Act. 

Response: CBP and DNDO have continued to work directly with all affected 

stakeholders to ensure that current business models are not negatively impacted by 

deployments of radiation portal monitor (RPM) or non-intrusive inspection (NII) 

equipment at field locations. Additionally, as a general practice, CBP and DNDO 

work with the port authority and other affected stakeholders to proactively schedule 

construction to coincide with any other activities at the port. This helps prevent 

scheduling delays and expedites the deployment process overall. 

Question 2.: (Director Oxford, DNDO) How are the Departments of Homeland Security and Energy and their vendors working with ports to ensure 

that the next generation of scanning technology will be complementary to 

port operations, including those being tested overseas as part of the Secure 

Freight Initiative? 

Response: Due to sovereignty concerns, CSI cannot set standards in a foreign 

country for the purchase and deployment of NII systems. However, it is recommended that host nation counterparts purchase NII systems that follow the 

guidelines of the World Customs Organization (WCO) Customs Compendium, Container Scanning Equipment, Guidelines to Members on Administrative Considerations of Purchase and Operation. Moreover, this language has been included in all 

Declarations of Principles signed from May 2005 and beyond. It should be noted 

that as a requirement for participating in CSI, foreign governments must purchase 

98 

their own NII equipment and that equipment must either meet or exceed the capability of NII equipment used by CBP domestically. 

CBP, DOE, and DNDO continue to work with terminal/port operators to determine if NII and radiation detection equipment deployments are impacting trade and 

the flow of cargo at foreign ports. DHS and DOE also routinely meet with Secure 

Freight Initiative (SFI) partners to discuss SFI deployments and their effects on the 

flow of cargo. As discussions with stakeholders continue, these metrics will be expanded, readjusted, and supplemented. 

Prior to deploying NII or radiation detection equipment, a complete site survey 

is conducted at the proposed site. During this survey port /terminal operators and 

other affected stakeholders are encouraged to participate and provide input. All 

stakeholders are given the opportunity to provide input into final designs. Deployment activities do not commence until all stakeholder concerns and input have been 

addressed and satisfied. 

Question 3.: (Director Oxford, DNDO) The SAFE Port act also states that Department shall publish technical capability standards and recommend standard operating procedures for the use of non-intrusive imaging and radiation detection 

equipment in the U.S. Can you give us the status of that requirement and 

how have you involved ports? 

Response: In accordance with Section 121 (f) of the SAFE Port Act, DNDO, in 

collaboration with the National Institute of Standards and Technology (NIST), shall 

publish technical capability standards for the use of NII and radiation detection 

equipment in the United States. Because Section 121 (f) requires such standards to 

take into account relevant standards and procedures utilized by other Federal department or agencies as well as those developed by international bodies, NIST is 

presently conducting a study of the detection capabilities required by existing national and international consensus standards for radiological and nuclear detection. 

NIST is scheduled to complete this study of the current standards baseline and provide DNDO a written report by the end of January 2008. NIST will then assist 

DNDO in convening an inter-agency working group of radiological, nuclear, and NII 

detection experts to develop threat-based government unique technical capability 

standards. DNDO plans to involve ports through CBP participation in this interagency working group. 

Question 4.: (Director Oxford, DNDO) One concern is that Department has spent 

a lot of time and energy on the detection side, but not as much on remediation when 

an alarm goes off. Often the suspect container is taken to an off-site location, sometimes through a busy neighborhood, or it sits on the port without any protection or 

shield. Can you give yourself a grade on your reaction to an alarm both in 

terms of immediate protection of the port and response if a problem was 

real? 

Response: The U.S. Department of Homeland Security has indeed focused significant attention upon the detection challenge because this is technically the more difficult element. But the Department recognizes that establishing and maintaining a 

systematic, comprehensive screening, interdiction and response capability requires 

that: 

• The domestic program must be integrated with the Container Security or Secure Freight Initiatives elements which provide for intelligence collection, advanced 

screening, and timely notification. 

• All points of potential entry must be covered using comprehensive, layered enforcement measures implemented by trained, qualified personnel. 

• State-of-the-art equipment that is capable of detecting small quantities of threat 

material must be provided and used correctly. 

• Detection equipment that is deployed is always accompanied by training on 

technical adjudication of alarms and associated response protocols. 

• Systematic, effective measures must be in place to identify and secure threat 

materials. 

• Appropriate and timely notifications must be made using an established system 

to allow effective command decisions and responses. 

• The system must be probed and evaluated to assure continued readiness. 

The Department has established U.S. Customs and Border Protection (CBP), 

along with the U.S. Coast Guard and the Transportation and Safety Administration 

(TSA), as the three agencies within DHS responsible for operational activities. These 

agencies integrate their interdiction activities, and work closely with other key 

agencies such as the Federal Bureau of Investigation on intelligence and the Federal 

Emergency Management Agency on emergency response. 

Inspection and interdiction at ports of entry falls under the primary jurisdiction 

of the CBP. CBP has the immediate lead on reaction to an alarm both in terms of 

99 

immediate protection of the port and initial response if a problem were real (i.e., 

if a nuclear or radiological device or materials were to enter a U.S. port). It is probable that CBP will identify the conveyance/container with the threat material as 

high risk before arrival (i.e., at the point of embarkation or while offshore). If so, 

it may be screened or imaged at the port of embarkation through cooperative programs with CBP (e.g., Container Security or Secure Freight Initiatives) or while on 

shipboard by the Coast Guard. 

For threat materials not identified and interdicted offshore, the next line of defense is detection in America’s ports. All high-risk containers/conveyances are physically examined or scanned using imaging equipment and all are scanned for radiological materials using radiation detection equipment such as a radiation portal 

monitor (RPM) or the radiation isotope identification device (RIID). Scanning is 

done as early in the process as reasonable, in some cases on the dock shortly after 

the container is grounded, but is always done before the container leaves the port 

of entry. 

When a CBP Officer identifies potential threat materials in a conveyance or container using radiation detection equipment, the officer contacts Laboratories and 

Scientific Services (LSS) via the National Law Enforcement Communications Center 

(NLECC). In the majority of cases, LSS has immediate access to the same data 

which the field CBP Officer sees by use of the Port Radiation Inspection, Detection 

and Evaluation (PRIDE) system; otherwise, the data is transferred electronically to 

LSS. 

CBP has initial tactical responsibility in responding to potential threats at a port 

of entry. CBP will immediately isolate the container in an on-port secondary hold 

area, following the guidance of the CBP Standard Operating Procedure (SOP) for 

that port of entry. The container and area are secured; other conveyances are moved 

away from the isolated conveyance and additional conveyances/persons are not allowed to approach. 

LSS provides recommendations on further diagnosis to confirm the existence of 

a threat. Measures may include additional imaging, additional spectra acquisition 

or other responses appropriate to the specific characteristics of the potential threat. 

If LSS determines that there is potential threat material, they will contact the 

DNDO’s Secondary Reachback team, comprised of national laboratory scientists, for 

additional expert advice and verification of threat. If appropriate, LSS scientists are 

dispatched from the regional office or a Radiological Assistance Program (RAP) 

team, comprised of regionally located national laboratory experts, may also be dispatched to the port to assist in confirming the diagnosis and to provide recommendations on remediation. 

Upon reaching a consensus of a threat being present, LSS notifies the CBP Situation Room (SR) of the event, which escalates the event to appropriate DHS managers and entities (e.g., upper CBP managers, the CBP Office of Anti-Terrorism, the 

Domestic Nuclear Detection Office (DNDO) Joint Analysis Center (JAC), etc.). The 

SR and the JAC will notify the DHS National Operations Center (NOC) of the incident. Tactical command is elevated. The NOC activates the Federal Bureau of Investigation (FBI). Tactical command is transferred to the FBI once FBI Agents arrive at the port. 

If warranted and in consultation with the FBI, various emergency measures can 

be put into effect or Port Emergency Preparedness Plan can be activated and/or 

Continuity of Operations Plans can be implemented, providing for notifications following contact procedures such that local emergency response authorities can initiate appropriate measures such as port closure, evacuation and stabilization. 

With over 195,000,000 conveyances screened and 1,100,000 alarms resolved, DHS 

has proven operational experience which has provided feedback to refine the current 

system. The system is routinely tested. ‘Red teams’ challenge it by attempting to 

smuggle threat materials. Large scale drills, such as the recent TOPOFF4 exercise 

held in October of 2007 in Portland, test the effectiveness of the command and control systems for a radiological emergency. Based on the results of the various tests 

and exercise the Department judges that substantial measures are in place, and 

that continued efforts are appropriately focused on deploying detection equipment, 

on improving detection technology, and on continuing to train and test to refine the 

command and control structure. 

As to assigning a grade, protection against use of weapons of mass destruction 

by terrorists on American soil has only one acceptable grade, A+. Although a great 

deal has been accomplished and the risk dramatically reduced, much remains to be 

accomplished. The Department continues to strive to attain the disciplined, comprehensive, systematic command and control structure needed to assure America is 

protected. 

100 

QUESTIONS FROM THE HONORABLE BENNIE G. THOMPSON, CHAIRMAN, COMMITTEE ON

HOMELAND SECURITY

RESPONSES FROM CAPTAIN FRANCIS STURM

Question 1.: What is the status of Coast Guard’s progress monitoring compliance of facility security plans? What deficiencies have been found and 

what do they say about the status of our maritime security? 

Are there enough facility inspectors and are they trained well enough to 

conduct facility inspections? Are there still going to be enough with the 

more stringent requirements under the SAFE Port Act-two inspections a 

year including one unannounced inspection? 

Response: To date for 2007, the Coast Guard has performed in excess of 9,000 

compliance checks of regulated facilities, thereby meeting the SAFE Port Act mandates. This number includes scheduled annual inspections and unannounced spot 

checks. Deficiencies generally relate to facility access control, monitoring and training. 

Yes, the Coast Guard has the personnel resources in place needed to meet SAFE 

Port Act requirements. Additional funding provided in the 2007 DHS Appropriations 

Act allowed the Coast Guard to deploy an additional 39 facility inspectors to the 

field. The Coast Guard is also reviewing its training program for the inspector qualification to efficacy with position responsibilities. 

Question 2.: Information sharing at the ports is a large undertaking, as well as 

an expensive undertaking. Given limited resources available, what are the 

next steps and should these be prioritized to ensure information is shared 

quickly and effectively, while also meeting concerns regarding rights of 

privacy and proprietary information? 

Response: The Coast Guard is committed to sharing information in ports and 

views this functionality as a critical issue. To this end, beyond structural initiatives 

such as Area Maritime Security Committees, we have developed the web-based 

Homeport portal (http://Homeport.uscg.mil). 

Homeport currently meets numerous Coast Guard needs for making information 

available via the internet. Homeport is the only CG Internet System certified for 

Sensitive But Unclassified (SBU) information, including Sensitive Security Information (SSI) as directed by 49 CFR 1520. Its functionality consists of four major areas 

(categories) of communication needs. The first is static web pages for all Coast 

Guard Sector commands and all components/departments at each Sector, similar to 

www.uscg.mil, as well as a web presence for numerous Headquarters Offices and 

Headquarters Units responsible for accomplishing a variety of Marine Safety and 

Security missions. This information is available to anyone with Internet access and 

does not require a Homeport user account for access. 

Second, Homeport provides a web presence for providing information targeted for 

specific users or groups of users based on their role in both the public and private 

sectors of the global maritime industry and interests within each Sector Command’s 

Area of Responsibilities (AOR). A Homeport user account is needed for access to this 

type of information. Requests for Homeport user accounts are reviewed and vetted 

locally at each Coast Guard Sector Command. The primary audience for this type 

of information is the Area Maritime Security Committees (AMSC), which are headed 

by the USCG Sector Commanders under their role as the Federal Maritime Security 

Coordinator (FMSC) for their AMSC. Other groups of users include a variety of both 

safety and security related committees, with members from both the public and private sectors. 

Third, Homeport provides a collaboration feature in the form of Collaboration 

Communities that are organized by specific functional areas and types of content. 

Access to each Collaboration Community is controlled by the owner of that community. While , a Homeport user account is not needed to gain access, the Community 

owner has the ability to determine who has access to the information and can also 

set the access level (no-access, read-only, read-publish). 

Finally, the Alert Warning System (AWS) application enables the Coast Guard to 

rapidly and reliably transmit targeted messages in bulk to maritime security partners and stakeholders. The system leverages the Homeport account management 

system to centralize user accounts and minimize account management requirements. AWS is the Coast Guard’s official system for disseminating alerts, threat 

warnings, and other critical information to key partners and stakeholders primarily 

in support of maritime security related activities. It provides an efficient means of 

meeting the requirements of Title 33, Code of Federal Regulations (CFR), Subchapter H (requires Captains of the Port (COTP) to communicate MARSEC level 

changes through local Broadcast Notice to Mariners, and electronic means, if availVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00104 Fmt 6601 Sfmt 6621 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
101 

able, or as detailed in the Area Maritime Security Plan). AWS is a powerful communications tool capable of supporting and authorized for use to support a broad range 

of Coast Guard missions beyond maritime security such as hurricane preparedness 

and response, natural disasters and other critical and non-critical events necessitating timely port-wide notification. 

Question 3.: Granting security clearances to those with a need to know is a longstanding issue. Does a ship operator or chemical plant manager having a 

clearance or not having a clearance really affect our nation’s ability to use 

intelligence and tell port stakeholders to increase their security? 

Response: The need for such individuals to possess security clearances (i.e. Secret, Top Secret etc) would only become necessary if the information to be released 

was classified. In exigent circumstances, the Federal Maritime Security Coordinator 

(FMSC) may need to provide direction or share information with targeted industry 

stakeholders to prevent or mitigate threats. 

The FMSC is not restricted from notifying port stakeholders of a need to increase 

their facility or vessel’s security due to an individual not having a security clearance. If the Maritime Security (MARSEC) level of a port is raised, the change in 

MARSEC can be announced publicly. The specific security measures implemented 

by the facility or vessel operator would be dependent upon the approved vessel or 

facility security plan in place at that time. 

However, if the FMSC has specific, targeted intelligence or is requiring a specific 

security procedure to be implemented (i.e. increase passenger screenings to 50%) 

then that information would only be released on a need to know basis. In accordance 

with Transportation Security Administration (TSA) rules, the individual to whom 

the FMSC is disclosing Sensitive Security Information would need to have completed a ‘‘Non-Disclosure Agreement’’ prior to the information being released. 

Question 4.: What will the Coast Guard having interagency operational 

centers do to increase our nation’s security that isn’t already occurring at 

our ports? What specific gaps in port security will these centers address? 

Response: While there is currently a great deal of coordination and interaction 

between the Coast Guard and our port partners through the various Area Committees and Area Maritime Security Committees, the level of visibility and ability to 

monitor the wide range of port activities must be improved to elevate the level of 

maritime domain awareness in seaports. Interagency Operations Center (IOC) capability will address these gaps by establishing integrated operational protocols and 

business practices, and facilitating greater information-sharing among state, local 

and Federal port partners. The robust information-sharing, increased maritime domain awareness and operational coordination capability provided by IOCs will allow 

more effective all-hazards preparedness and response through efficient allocation 

and coordination of resources across the entire spectrum of port partner capabilities. 

Question 5.: While Operation SeaHawk in Charleston is one of the most advanced of interagency operations centers, the Department of Justice does not have 

plans to continue funding it. What are the plans for the future of Operation 

SeaHawk 

Response: The Department of Homeland Security and the Department of Justice 

are working on transition options including identification of resource requirements, 

port partner participation and a projected timeline. Although no specific transition 

details have been developed at this time, the Department of Justice is not requesting funding for Seahawk. However, sufficient funds remain from the original appropriation of $27 million to continue the project through FY 2009. 

Question 6: Per Section 108 of the Safe Port Act, the Secretary was directed to 

establish interagency operational centers for port security within three years of enactment of the Act. What progress has been made towards identifying relevant capabilities and solutions, many of which exist today within industry, to meet this requirement? 

Response: The Coast Guard has partnered with DHS Science and Technology 

(S&T) to conduct several pilots designed to inform operating requirements development and identify commercially-available technologies that will close critical capability gaps in Command and Control (C2), Information Management (IM) and Situational Awareness (SA). Pilot programs currently underway include the Visualization 

Tools pilot which is contracted to Mariner Group and installed in Sector Miami; 

Automated Scene Understanding (ASU) which is contracted to BAE Systems and installed at Sector Hampton Roads; and the Hawkeye System which is contracted to 

Northrop Grumman and installed in six Coast Guard Sector Command Centers. 

102 

Question 7.: While additional funding has yet to be provided for joint operation 

centers, it is important for the U.S. Coast Guard to work closely with ports to design 

these centers in a way that is compatible with port authority operation centers. 

How does Coast Guard plan to coordinate and evaluate the design and 

operational requirements of these design centers once funding is made 

available? 

Response: The Coast Guard has a close working relationship with our port partners through the Area Maritime Security Committee (AMSC). Using input from the 

AMSC and informed by daily interactions with other port authorities, the Coast 

Guard will identify functional requirements, and through the Coast Guard’s Facilities Design and Construction Center (FDCC), will develop design specifications that 

meet the unique needs of each port. 

Question 8.: Given available resources, to what extent will CG perform inspections at each ISPS regulated facility? How will the Coast Guard determine which facilities are inspected? 

Response: The Maritime Transportation Security Act of 2002 (MTSA) required 

the Secretary to ‘‘assess the effectiveness of the antiterrorism measures maintained. . .at a foreign port [that trades with the United States].’’ To implement this 

requirement, the Coast Guard has created the International Port Security Program. 

Because it is not practical to visit every facility of every country that trades with 

the United States, the program is designed to evaluate the country’s implementation 

of the International Ship and Port Facility Security (ISPS) Code by visiting a representative sample of large, medium, and small ISPS-Code regulated facilities that 

reflect trading patterns of the country with the U.S. Government. The size of the 

sample varies with the country’s size, results of the first assessment conducted, and 

risk factors such as the presence or absence of good governance indicators. In drafting the list of facilities to be visited, the Coast Guard places an emphasis on visiting 

those facilities that have direct trade with the U.S. Government. 

Question 9.: Does the Coast Guard have enough fully trained and experienced personnel to effectively complete visits to facilities in approximately 

150 countries by March 2008? 

Response: Yes. The FY 2007 Department of Homeland Security Appropriations 

Act funded an additional 32 billets for the International Port Security (IPS) Program. The IPS Program is incorporating additional training opportunities for these 

new personnel to help bridge the initial training and experience gap. The increase 

in personnel will allow the IPS Program to complete visits to all of the United 

States’ trading partners (approximately 150 countries) by March 2008. 

Question 10.: Based on visiting countries (in most cases) only once every 

two years, how confident is the Coast Guard that facilities in ISPS-signatories are maintaining compliance with ISPS? 

Response: In addition to the formal country visits, the International Port Security (IPS) Program’s International Port Security Liaison Officers (IPSLOs) make annual visits to the countries in their respective portfolios and serve as the point of 

contact to maintain a continuous dialogue on port security issues. The IPS Program 

also culls information from other sources and continues to seek out additional information to provide an awareness of the International Ship and Port Facility Security 

(ISPS) Code implementation at facilities in ISPS Code signatory countries. These 

additional actions to monitor and engage with countries outside of the formal country visits equip the IPS Program to evaluate whether countries are maintaining 

compliance with the ISPS Code. 

Question 11.: What are Coast Guard personnel finding during visits to facilities in other countries? 

Response: Most countries and ports are eager to showcase their port security 

practices and International Ship and Port Facility Security (ISPS) Code implementation. In many countries, the Coast Guard finds physical security is usually adequate. The most frequent areas of major non-compliance observed are access control 

measures, drills and exercises, and training programs. Additionally, maintaining 

compliance with the ISPS Code can be a challenge for some countries due to associated implementation expenses or not having an adequate auditing capability at the 

national level. 

Question 12.: What has Coast Guard determined will be the impact of rotation length for International Port Security Program personnel, given the 

training and experience needed for effective observations of facility security during country visits 

103 

Response: There is no particularly unique challenge being faced beyond training 

issues that affect the Coast Guard in general during the normal rotation process. 

There are sufficient program personnel to accommodate regular rotations while 

maintaining appropriate competency levels. Additionally, the International Port Security Program has increased the number of its civil service personnel to maintain 

continuity and experience during military rotations. 

Question 13.: Has the Coast Guard established the Port Security Training 

and Exercise Programs required by the SAFE Port Act? It is our understanding that port workers still lack the necessary training. 

Response: The Coast Guard sponsors the Area Maritime Security Training and 

Exercise Program, and assists the Transportation Security Agency (TSA) with their 

port security exercise program. In 2006, the CG and TSA collectively sponsored 53 

port security exercises. 

The Coast Guard is also supporting the Federal Emergency Management Agency 

(FEMA) National Preparedness Directorate’s National Integration Center (formerly 

known as the Office of Grants and Training Division), through training and exercise 

integration, to implement additional SAFE Port Act training requirements. Notably, 

the Office of Grants and Training has awarded a $6.18 million Cooperative grant 

to Florida State University to develop courses meeting Maritime Transportation Security Act (MTSA) of 2002 requirements, and covering the eight port security-related topics required under the SAFE Port Act. 

Additionally, the Coast Guard is currently working on a regulatory project that 

would propose to revise the security training regulations for facility personnel to ensure all training is measured against a standard of competence, including the topics 

required under the SAFE Port Act. The Coast Guard is also working with the Maritime Administration to revise the existing model courses for facility personnel in 

order to meet the requirements in Section 109 of the MTSA and SAFE Port Act. 

Question 14.: What steps has the Coast Guard taken to ensure that port 

workers are active participants in the Area Maritime Security Exercises? 

Response: All of the Area Maritime Security Exercises include members of the 

Area Maritime Security Committee (AMSC), which typically include the security officers from private industry. These security officers participate in the planning of 

exercises, which increases awareness and participation, and take the lessonslearned from the exercises back to educate their respective organizations. Additionally, the exercise sponsor sends out letters of invitation to the port community to 

further enhance participation. 

Question 15.: Please provide us with information on the number of live 

port security exercises as opposed to tabletop port security exercises conducted every year. 

Response: The table below outlines the number of live port security exercises as 

compared with tabletop port security exercises in recent fiscal years: 

Fiscal Year Tabletop Live Exercise Credit given 

for real world operation 

FY 2005 34 18 0 

FY 2006 44 13 4 

FY 2007 37 8 3 

TOTAL 115 39 7 

* Notes: Tabletop category includes Tabletop and Functional (Command Post) exercises. Source of data is the Coast Guard’s Congressional Biannual Report on Port 

Security Exercises. 

Question 16.: Recently, the Department changed the way funds are distributed 

for Tier I and Tier II ports. While the Committee understands the interest in regional collaboration, explain why much of the financial oversight and paperwork requirements for distribution of these funds was moved from the Department to the 

fiduciary agent. What are the advantages and disadvantages of a fiduciary 

agent for this program and will it continue in the future? 

104 

Response: The oversight and paperwork requirements have not been moved from 

the Department to the Fiduciary Agent (FA). The oversight and paperwork requirements of the FA are the same as any grant award recipient. The difference is that 

the FA represents the interest of the entire port area, through the Area Maritime 

Security Committee, rather than an individual entity’s interest. 

In order to support strategic, regional port-wide risk management and business 

continuity planning processes and then have funds applied against the highest priority requirements based on the plan, the Department opted to award Port Security 

Grant Program funds to a FA to provide funding to a single point of contact for the 

grant award. The process allows for individual entities in a port area to cooperate 

with each other for funding rather than compete against each other. 

The choice of the FA was left up to the Area Maritime Security Committee and 

had to be verified by the Coast Guard. 

Question 17.: FEMA’s guidance on grants is that they cannot benefit a federal 

agency. Many ports would like to share their camera feeds with Coast Guard. Can 

ports share their information gained through equipment purchased 

through the Port Security Grant program with Coast Guard on an ongoing 

basis in order to promote interoperative communications? What limits are 

placed on this cooperation? 

Response: The guidance stipulates that ‘‘projects in which federal agencies are 

the primary beneficiary or that enhance federal property’’ are ineligible for award 

consideration. Another federal agency cannot be the recipient of another federal 

agency’s grants, since this would be an augmentation of appropriations by the receiving agency. However, information sharing and interoperable communications are 

allowable with equipment purchased through the Port Security Grant Programs. 

Question 18.: The largest port security costs to ports in the coming years relates 

to personnel costs and operation and maintenance of equipment, much of which was 

installed with the help of the Port Security Grant program. The Maritime Transportation Security Act allows grants to pay for operations and maintenance. Will the 

Department allow for projects that relate to the operation and maintenance costs of already installed equipment? What are the limitations? What 

about replacement equipment? 

Response: The Port Security Grant Program guidance allows for limited operations and maintenance costs, specifically the cost of acquisition, operation, and 

maintenance of security equipment or facilities to be used for security monitoring 

and recording, security gates and fencing, marine barriers for designated security 

zones, security-related lighting systems remote surveillance, concealed video systems, security vessels, and other security-related infrastructure or equipment that 

contributes to the overall security of passengers, cargo, or crewmembers. In addition, routine maintenance costs for security monitoring, such as the cost of tapes 

for recording, are allowable. However, business operations and maintenance costs, 

such as personnel costs and items generally characterized as indirect or ‘‘overhead’’ 

costs, are unallowable. 

(While personnel costs are allowable under MTSA, subsequent congressional actions—FY 2007 DHS Appropriations Act - have specifically excluded personnel costs 

as allowable.) 

Question 19.: Given the uncertainties of whether a man-made or natural 

disaster might strike next, what should be the current focus of efforts to 

ensure ports are prepared to respond and recover from a terrorist attack 

or natural disaster? 

Response: Ports should be preparing for both man-made and natural disasters. 

To prepare for both types of events the Port Security Grant Program has evolved 

from a program primarily focused on the security of individual facilities within 

ports, to a port-wide risk management/mitigation and continuity-of-operations/resumption-of-trade program that is fully integrated into the broader regional planning construct, which forms the core of the Urban Area Security Initiative, as well 

as applicable statewide initiatives. 

Question 20.: The Department recently conducted TOPOFF IV in Portland, including some maritime venues. What is being learned from recently conducted 

exercises at our ports, and how can one be sure these lessons are incorporated in planning and response efforts? 

Response: Results of the Coast Guard’s Port Security Exercises have been reported to Congress biannually since October 2005. The latest report was signed and 

forwarded on July 26, 2007. The report outlines the following themes: 

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• The linkage and coordination of Area Maritime Security Plans (AMSP) to 

other relevant plans, along with updating plans with current information, continues to challenge efficient AMSPs implementation. 

• The need for improved interoperable communications and situational awareness tools. 

• Some lack of familiarity with the National Incident Management (NIMS)/ Incident Command System (ICS), AMSPs, and the associated roles and responsibilities of port partners. 

In May 2006, the Coast Guard implemented the Remedial Action Management 

Program (RAMP) as a module in the Coast Guard Contingency Preparedness System (CPS). This program established procedures and processes for identifying, validating, assigning remediation responsibilities and monitoring the remediation of 

challenges identified during exercises. Additionally, results of the Biannual Port Security Report have been forwarded to the Coast Guard’s AMSP program manager 

for review and consideration by its AMSP working group during AMSP revisions. 

Question 21.: What has Coast Guard determined will be the impact of reducing the rotation length for facility inspectors, given the training and experience needed for effective facility oversight? What information was this 

assessment based on? 

Response: The Coast Guard anticipates no impact from the change in rotation 

length. There are currently 389 qualified facility security inspectors in billets and 

more than 80 members with the qualification but not working in inspector positions 

who can be rotated into units as other members are rotated out. Additionally, the 

training for the facility security inspector qualification is being refined and will be 

provided to more members, further increasing the pool of qualified individuals to be 

rotated through the security inspector positions. 

Question 22.: To what degree is the Coast Guard confident that resources 

would be available to handle heightened MARSEC level requirements if the 

level were raised for (a) a single sector, (b) several sectors, or (c) nationwide? 

Response: The Coast Guard is confident that resources would be available to 

handle heightened MARSEC level requirements whether the level is raised for a 

single Sector, several Sectors, or nationwide. The Coast Guard’s confidence is based 

on the combination of several measures and/or provisions that are already in place 

within the Operation Neptune Shield (ONS) Operations Order (OPORD), which promulgates Coast Guard-wide guidance and standards for conducting maritime security and response operations. 

It is important to note that from the Coast Guard’s planning perspective; only 

MARSEC 1 is expected to be sustained indefinitely. The Coast Guard has always 

envisioned that elevated MARSEC levels (2 and 3) would be sustained for relatively 

short periods of time (the specific sustainment requirements contained in the ONS 

OPORD are classified), and that MARSEC 3 would be focused on one or a few specific Sectors or geographic areas (MARSEC 3 is set only when an attack is deemed 

imminent or has already occurred). 

In responding to a maritime security threat, the Coast Guard employs threatbased, risk-managed principles, matching protective/preventative efforts to the 

threat’s nature (i.e., attack method, target, etc.). By using these principles, the 

Coast Guard implements MARSEC level increases that are focused on a single or 

few Sectors or, if nationwide, only on the targeted type of maritime critical infrastructure and key resources (e.g., maritime mass transit—ferries or vessels carrying 

Certain Dangerous Cargoes). The Coast Guard leverages the support of other government agencies and ensures that maritime industry stakeholders have increased 

their security efforts in accordance with their Coast Guard-approved facility and 

vessel security plans. Coast Guard Sector Commanders carrying out the operational 

security measures dictated by increased MARSEC levels may request additional resources, i.e., deployable specialized forces, from the Deployable Operations Group 

via their Area Commander. Boarding teams, vessel escort assets, and other resources may be dispatched from Maritime Safety and Security Teams or at the high 

end level from the Maritime Security Response Team. Finally, when MARSEC 2 or 

3 is imposed, the ONS OPORD pre-authorizes Area Commanders to temporarily adjust the level of effort in other Coast Guard missions, as necessary in order to make 

additional resources available to the Ports, Waterways, and Coastal Security missions. 

Question 23.: With the supplemental funding to the USCG providing for 

additional facility inspectors, will the USCG have enough fully trained and 

experienced inspectors for effective facility oversight? 

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Response: Yes, the Coast Guard has sufficient personnel with the necessary 

qualifications to exercise effective oversight of the regulated facilities in the United 

States. We currently have 389 facility security inspectors in place to meet the compliance check requirements with an approximately 80 more to rotate into those billets as others rotate out. During calendar year 2007, the complement of facility security inspectors performed in excess of 9,000 compliance checks, including both annual inspections and spot checks, of our approximately 3,200 regulated maritime facilities. 

Question 24.: Given available resources, to what extent will Coast Guard 

perform 2 inspections (at least 1 unannounced) at each MTSA-regulated facility? If resources do not allow CG to perform unannounced inspections 

at all facilities, how will CG determine which facilities to inspect? 

Response: The Coast Guard currently has 389 facility security inspectors in place 

and has performed in excess of 9,000 facility inspections, both announced annual 

exams and unannounced spot checks, of our 3,200 regulated facilities during calendar year 2007. As such, there has been no need to make determinations of which 

maritime facilities to leave out of the inspection cycle. 

Question 25.: Based on one announced annual exam and one unannounced spot check, how confident is the US Coast Guard that MTSA-regulated facilities are maintaining compliance with MTSA? 

What are Coast Guard facility inspectors finding during facility inspections? 

Are Coast Guard facility inspectors finding greater non-compliance during unannounced vs. announced inspections? If so, why aren’t all inspections unannounced? 

Response: The Coast Guard is confident that U.S. maritime facilities are maintaining substantial compliance with the regulations and their approved Facility Security Plans based on one announced annual exam and one unannounced spot check 

each year. 

Inspectors are finding the majority of non-compliance issues center on access control, monitoring, and training of facility personnel. In general, these tend to be easily corrected. 

The Coast Guard finds more instances of non-compliance through the announced 

annual exam than through unannounced spot checks. The reason being the annual 

exam is much more thorough, covering all facets of the Facility Security Plan, and 

provides greater opportunity to closely review records, etc. The unannounced spot 

check, while useful, is more limited in scope and intensity. 

Question 26.: When is the Coast Guard going to finalize the International 

Seafarer Identification regulation? This regulation was originally required 

five years ago and I do not understand why it has taken so long for the Department to complete it. 

Response: Prior to the enactment of the SAFE Port Act of 2006, Coast Guard 

action on the rulemaking project to implement crewmember ID requirements of 46 

USC 70111(a)(b) was suspended awaiting the results of the Tripartite Advisory 

Panel on International Labor Standards (TAPILS) consideration of the International 

Labor Organi section 110 of the SAFE Port Act independently of whether the United 

States Government zation ‘‘Seafarers Identify Document Convention’’ (ILO 185) as 

well as a decision on whether the United States Government would ratify the Convention. The Coast Guard is now proceeding with a rulemaking titled ‘‘Crewmember 

Identification Documents’’ to fulfill the requirements of section 110 of the SAFE Port 

Act independently of whether the United States Government ultimately ratifies ILO 

185, and will complete it as expeditiously as possible. 

QUESTIONS FROM THE HONORABLE BENNIE G. THOMPSON, CHAIRMAN, COMMITTEE

ON HOMELAND SECURITY

RESPONSES FROM THOMAS WINKOWSKI

Question 1.: One of the primary goals of the Safe Port Act is the improvement 

of risk targeting for maritime cargo containers inbound to U.S. ports from overseas 

locations. Sec 203 of the Act provides the authority for enhancing data for risk targeting to provide this layer of security to address the maritime cargo security vulnerability that we continue to face as a Nation. I understand that the Department 

is has been developing an initiative for the past year known as 10+2 which will 

meet this requirement. 

What is the status of the initiative? 

When is it going to be finalized? 

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Why has it taken over a year to develop? 

Response: The Security Filing (10+2) Notice of Proposed Rule Making (NPRM) 

was published in the Federal Register on January 2,2008, at 73 FR 90. The 60-day 

public comment period for the proposed rule ends on March 3,2008. During this 

comment period, any and all interested parties are invited to submit comments on 

the proposal. CBP will consider all comments received during the comment period 

in development of the Final Rule. The Final Rule is subject to review by the Office 

of Management and Budget and must be approved by the Secretary, DHS. 

CBP worked in close concert with the trade community, and the Commercial Operations Advisory Committee (COAC) in particular, to develop the current targeting 

enhancement proposal known as the ‘‘10+2’’ initiative. While preliminary discussions had been ongoing prior to enactment of the SAFE Port Act in October 2006, 

CBP commenced its formal discussions with COAC in November 2006, and completed the consultation process in February 2007. This joint effort produced over 30 

recommendations for consideration as it refined the initial ‘‘10+2’’ proposal that 

forms the basis for the draft Notice of Proposed Rule-Making (NPRM). 

The ability of CBP and the trade community to produce such an important proposal in a short time is a tribute to the cooperative relationship between the agency 

and its stakeholders. It is especially remarkable, given the complexity of the issues 

under consideration and the variety of interests (carriers, customs brokers, freight 

forwarders, and importers) represented. 

Question 2.: I also understand that the Department has developed a Global 

Trade Exchange (GTX) initiative to provide deeper risk assessment on containers for 

importers who volunteer to share data on inbound maritime cargo containers. 

What is the status of GTX? 

What role has industry played in developing this new initiative? It’s my 

understanding that Department has deliberately limited industry input 

and that industry representatives do not support it. 

Response: On December 11,2007, CBP issued a Request for Quotation (RFQ) soliciting bid proposals from the vendor/contractor community for the development 

and implementation of the Global Trade Exchange (GTX). Specifically, the RFQ outlined the requirements for the development of a privately operated, self-sustaining 

trade information system that will collect commercial transaction data not currently 

available to CBP from parties in the supply chain who have contracted or provided 

services for the of international shipments. The system, furthermore, will allow government and trade community participants to input and access trade data through 

an information broker. When combined with existing CBP tools, GTX will allow CBP 

to identify and target suspect shipments/transactions well in advance of a shipment’s entry into a supply chain. 

Vendor proposals (due by January 22,2008) have been received by CBP and are 

currently under review by a Technical Evaluation Working Group. The review process will be completed within the next 30 to 45 days. Advancement of GTX will be 

based on the review results and recommendations produced by the Technical Evaluation Working Group. 

It is important to note that the issuance of the is the first step in a process that 

will culminate in the implementation of a GTX pilot program specifically designed 

to test the GTX concept, establish requirements, and identify issues. Therefore, we 

believe that GTX should be viewed as a developmental process through which CBP, 

private sector vendors, and the trade community will develop an advanced, forwardthinking cargo data warehouse. 

Question 3.: How has CBP fostered cooperation with international organizations and foreign governments to maximize the benefit of the CSI program? 

How has CBP worked with international organizations and foreign governments implementing CSI related initiatives regarding global security 

standards and practices to improve maritime and container security? 

Response: CBP has utilized the CSI annual Global Targeting Conference and the 

activity of the World Customs Organization’s Framework of Standards to maximize 

the benefits of the CSI Program. 

The annual CSI Global Targeting Conference held in Washington, DC, sponsored 

by CBP, brings together several hundred customs representatives from over 30 

countries that participate in the CSI program to discuss ‘‘best practices’’ and the development of significant security protocols used in their respective countries and the 

deployment of large scale imaging devices. For, this year’s conference, which was 

held in August 2007, CBP hosted 200 foreign customs and embassy officials as well 

as officials the Department of Energy, Department of State and Department of 

Homeland Security (including United States Coast Guard, CBP Representatives and 

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Immigration and Customs Enforcement stationed in over 25 countries). During the 

conference, CBP Senior officials met with 34 Directors Delegates to discuss key 

issues and program concerns and identify opportunities for continued improvement. 

Because of these two forums, the utilization and capacity of non-intrusive inspection (NII) equipment has increased globally. 

CBP’s Office of International Affairs and Trade Relations (INATR) has taken a 

leading role in improving cargo security through the creation of the World Customs 

Organization (WCO) SAFE Framework of Standards. Guided by the SAFE Framework, CBP works with foreign governments to improve risk management procedures, increase use of intrusive inspection (NII) equipment, and encourage countries 

to exchange advance electronic information. This international cooperation ensures 

the security of cargo at every link in the supply chain, the SAFE Framework supports the CSI program. Related work has also been carried out with other international organizations such as the International Maritime Organization (IMO), the 

International Organization on Standardization (ISO) and the Organization for Security and Co-operation in Europe (OSCE). 

Through CBP’s Capacity Building Branch within INATR, CBP is providing training and technical assistance to the customs administrations of a number of countries 

that currently participate in CSI, including Brazil, Honduras, the Dominican Republic, and South Africa. This training and technical assistance forms a long-term capacity building program to support implementation of the World Customs Organization Framework of Standards to Secure and Facilitate Global Trade. The standards 

incorporated in the Framework incorporate many of the key elements that support 

CSI, including: the advance electronic presentation of cargo information; the screening of cargo containers using non-intrusive inspection equipment; the use of automated risk management systems; the standardization of targeting criteria to identify high-risk cargo and containers; an emphasis on employee integrity programs; 

and the inspection of cargo in the country of origin, transit and destination. 

CBP’s Training and Assistance Division of INATR currently provides a number 

of assistance and training programs to foreign customs and border security agencies 

to facilitate implementation of port security antiterrorism measures. Through its 

Capacity Building program in support of the World Customs Organization Framework of Standards to Secure and Facilitate Global Trade, CBP provides a long-term 

training and technical assistance program to partner with customs administrations 

that includes an depth assessment of its seaport security practices. 

Question 4.: How does CBP ensure that the number of staff located at CSI 

ports is appropriate and how has it systematically looked for efficiencies 

that may result from moving targeting operations to the U.S. so that resources are not kept at CSI seaports in perpetuity? 

Response: As part of CBP’s evaluation process, CBP conducts annual evaluations 

of its CSI ports, concentrating in part on workload increases or decreases. CBP uses 

these findings to adjust resources at the U.S. National Targeting Center, Cargo 

(NTCC) and at overseas CSI ports, as appropriate. 

CBP has also reviewed General Accountability Office (GAO) reports that have 

identified shortages in human resources at some CSI ports and have agreed with 

and implemented the recommendation to augment CBP personnel at the NTCC to 

perform remote targeting for CSI in high volume ports. 

CBP will also use ‘‘lessons learned’’ from the Secure Freight Initiative (SFI) to determine the feasibility of remote targeting from the NTCC. CBP is considering technological solutions to possibly reduce CSI human resources deployed abroad while 

still ensuring that containers destined for the U.S. are examined for weapons of 

mass destruction. 

Question 5.: How does CBP ensure that all high risk containers identified 

at CSI seaports are inspected and that the inspections processes and equipment are sound and used effectively? 

Response: Host government officials have provided CBP with all relevant information about the equipment used for the inspection of containers. Based on this information, CBP has determined that the equipment used by host governments at 

CSI seaports is equal to or in some instances, more technologically advanced than 

the equipment used by CBP at its domestic ports. CBP officers are fully trained in 

the equipment being used by the host government and in the cases where CBP has 

provided NII equipment to the host government, the host government customs officers have been trained in the use of that equipment. 

Since its inception more than six years ago, the success of the CSI program can 

be attributed largely to the cooperation and collaboration the program fosters between the U.S. and its host government counterparts in examining high-risk containers that are referred to host government for inspection. To date, there has been 

109 

no Weapon of Mass Destruction detected at a CSI port or on U.S. destined containers once they arrive in the U.S. CBP reexamines containers in the U.S. a result 

of its own Compliance Measurement program and sometimes as the result of policies that the local port authorities establish. 

Question 6.: How has CBP ensured that the seaports that it has selected 

for the CSI program—those receiving staff, equipment, and other U.S. resources-provide the greatest benefit for the program, and what are plans 

for managing future program participation, including how ports may be 

phased out of the program and others brought in? 

Response: CBP conducts yearly evaluations of its CSI ports and, as part of that 

evaluation process, reviews the workload and whether it has increased or decreased. 

The evaluation process also examines the CSI team’s interaction with the host government counterparts and how that relationship is working. Since the CSI program 

is essentially a partnership between the U.S. and the host government, effective 

communication is very important to its success. With each evaluation of a CSI port, 

CBP will continue to use these CSI port evaluations and the increase in port efficiency in jointly targeting high-risk containers with host government counterparts 

to determine if any shift of resources to either the NTCC or another CSI port needing additional resources, is required. For those CSI ports that were provided with 

loaner NII equipment, CBP receives daily reports on usage of the NII equipment 

and the usage and downtime is tracked on a daily basis. 

Question 7.: Should CSI be expanded beyond the 58 ports currently 

planned for the program? If so, to what extent is planning underway to account for this, such as redeployment of staff to additional ports? 

Response: The focus is currently on determining the feasibility of 100% scanning 

required by the SAFE Port Act. Therefore, CBP is holding off on future expansion 

of CSI until after the agency reports to Congress in April on the feasibility of 100% 

scanning based on the results of the Secured Freight Initiative (SFI) pilot. 

However, it should be noted that CSI was never intended to cover 100% of maritime cargo destined to the U.S. CBP relies on a risk management approach with 

a continued focus on identifying and inspecting 100 percent of those shipments that 

have been designated as high-risk, and increasing DHS’ ability to scan cargo for the 

presence of nuclear or radiological material. CBP’s goal is to continue to inspect 100 

percent of all high-risk shipments. As part of this risk management strategy, CBP 

uses a multi-layered approach to ensure the integrity of the supply chain from the 

point of stuffing through arrival at a U.S. port of entry. CBP’s multi-layered defense 

includes: 

• 24-Hour Rule: Under this requirement, manifest information must be provided to CBP 24 hours prior to a U.S. destined sea container being loaded onto 

a vessel at a foreign port. 

• Screening and Inspection: CBP screens 100 percent of all cargo before it arrives in the U.S. using intelligence and cutting edge technologies, and inspects 

all high-risk cargo. CBP may deny the loading of high-risk cargo while the vessel is still overseas. 

• CSI: Enables CBP, in working with host government customs services, to examine high-risk maritime containerized cargo at foreign seaports, before they 

are loaded on board vessels destined for the U.S. CSI ports are operational in 

58 ports covering 86 percent of maritime containerized cargo shipped to the U.S. 

• C–TPAT (Customs Trade Partnership Against Terrorism): CBP created a public-private and international partnership businesses know as the Trade Partnership Against Terrorism (C–TPAT),’’ that includes most of the largest U.S. importers. Through C–TPAT, CBP and partner companies are working together to 

improve baseline security standards for supply chain and container security. 

Question 8.: According to GAO, CBP faces difficulties in recruiting qualified staff for CSI and in some instances has deployed personnel overseas 

without the requisite training. How does the agency plan to address these 

challenges? 

Response: As with any expanding program, CBP has had challenges in recruiting 

staff for CSI. However, CBP has followed recommendation lead is in addressing 

these challenges by moving some of the targeting duties to NTCC and establishing 

minimum staffing levels at hard to fill ports, thus not impacting CSI operations of 

screening and targeting high-risk shipments for terrorism. CBP Officers that did not 

receive the requisite formalized training prior to being deployed were placed in a 

location that had a highly experienced officer that provided on-the-job training. This 

lack of formalized training did not have a negative impact on port operations as reported by the CSID team that conducted the port evaluation. It should be noted that 

110 

once the office was fully staffed, those individuals were returned for formalized 

training. 

Question 9.: Legal restrictions in several host countries bar CSI teams from 

viewing examinations conducted by host customs authorities and these containers 

are rarely re-examined upon arrival in the U.S. Does it make sense to have CSI 

teams in such countries when we do not participate in the inspections? 

Response: Of the 32 countries where CSI is operational, there is only one country 

that does not allow CBP personnel inside the x-ray examination vehicle. However, 

this country provides CBP with a copy of the x-ray image and, together with the 

information obtained through our own targeting analysis and information provided 

our host government counterpart, we are able to make a sound determination of 

whether a container poses a risk for terrorism. What is important here is that faceto-face communication goes very far. By having CBP Officers stationed in-country, 

we are able to build and establish clear communication channels that were not in 

existence prior to this initiative. CBP has placed experienced officers that have been 

trained in targeting analysis and image interpretation. If these officers are not comfortable with the examination process, there are protocols in place. The CBP Officer 

can request a ‘‘hold’’ for domestic examination or call the NTCC to issue a ‘‘Do Not 

Load’’ order. 

CSI is now operational in 58 foreign seaports covering approximately 86% of maritime containerized cargo destined to the U.S. The success of this program is attributed to the cooperation and collaboration of our foreign partners. To date, there 

have been no Weapons of Mass Destruction detected at the CSI ports or on containers that have been reexamined when arriving in the U.S. because of own Compliance Measurement program and local port policies. 

Question 10.: Although recommended by GAO and the SAFE Port Act, minimum 

technical operating standards for non-intrusive inspection equipment at CSI ports 

have yet to be established. Without such standards, what assurances does our 

nation have that this equipment is capable of detecting weapons of mass 

destruction within high-risk containers? 

Response: CBP has taken steps of achieving uniform standards through the 

World Customs Organization (WCO). The CSI program has been in operation for 

over five years, and can attribute its largely to the cooperation and collaboration 

that the program fosters between the U.S. and its host government counterparts in 

examining high-risk containers that the U.S. refers to the host government for inspection. To date, there has been no Weapon of Mass Destruction detected at a CSI 

port or on containers that have been reexamined when arriving in the U.S. Reexamination occurs at a U.S. port due to own Compliance Measurement program and as 

a result of local port policies. Additionally, CBP the installation of Non-Intrusive Inspection equipment in 13 CSI ports; all such equipment meets the established 

standard for U.S. deployed NII in at domestic ports. 

Recognizing that a nation’s sovereignty is critical and that CBP is not a standard 

setting agency, we will continue to work with the World Customs Organization 

(WCO) through its Safe Framework of Standards to address a uniform customs 

process and technical standards for equipment to ensure that the examination process of cargo and equipment used as part of the process is one that is uniform 

throughout the world. 

Question 11.: CSI has entered into an arrangement with New Zealand whereby 

containers bound for the U.S. are scanned and the resultant images beamed directly 

to National Targeting Center for review. Does this system constitute a model 

that could be expanded to other countries? 

Response: The New Zealand project is unique in many ways. The similarity with 

CSI partners is that New Zealand must meet the requirements established under 

CSI. The uniqueness is that like the U.S., New Zealand has a national targeting 

center with 24x7 operations. New Zealand also has a 48-hour rule (the U.S. has a 

24-hour rule) that requires shippers to provide all of the data requested by CBP. 

New Zealand is also a trusted partner and the majority of the shipments arriving 

into the U.S. are low-risk for terrorism. Moreover, New Zealand has similar NII 

equipment which, through the use of special software, allows CBP Officers at the 

NTCC to manipulate the image. This software can only interpret Smiths HCV units. 

Along with the software, there is a special key (aka dongles) which allows only certain workstations to view the images. We currently have 3 workstations at the 

NTCC with these special keys. 

Also crucial to this operation is that New Zealand the limited amount of time (20 

minutes) that each country has to respond to the other’s request to determine the 

potential risk of a shipment. This is a mutually agreed upon time limit that was 

111 

established with the objective of ensuring the expeditious movement of low risk 

cargo through the international supply chain. 

This pilot program did not come without challenges. As the file size of the images 

average about 11MB, which is too large for any CBP mail account (images were previously sent via the Office of Information Technology (OIT) had to create a special 

mailbox that is capable of receiving files of this size. 

CBP has also tried to test the same concept with another trusted partner with 

shipments that are low-risk to terrorism. Unlike New Zealand the other trusted 

partner being considered does not have a national targeting center, has no 24 or 

48-hour rule and, does not have NII equipment that will allow the NTCC to manipulate the x-ray image. For this particular NII equipment, CBP is unable to obtain 

a license for the special software that is required to view and manipulate the x-ray 

image. Also, the other trusted partner’s customs service has had difficulty providing 

timely information on specific containers, which has resulted in required information being delayed for 16 hours. With such a delay, often times a container of interest would have already been laden upon the vessel and unavailable for examination. 

Question 12.: Provisions in Sec 216 of the SAFE Port Act call for benefits to participants in the C–TPAT program who demonstrate a sustained commitment to 

cargo container security. Among the criteria for Tier 3 C–TPAT recognition is submission of additional cargo information prior to loading of the container. What does 

CBP plan to do to more fully define the incentives that would encourage 

private sector provision of this data that in turnwould permit more targeted and accurate risk assessment of inbound cargo containers? 

What’s the status of additional benefits for C–TPAT members, especially 

Tier III participants? 

Response: The C–TPAT program continues to evolve with respect to providing 

facilitation benefits to importer partners in return for proof of strong supply chains. 

C–TPAT believes that the current Tiered benefit structure that includes Tier 3 and 

the criteria determine such benefits provides importer partners with appropriate 

benefits for their level of supply chain security. 

As part of its layered enforcement strategy, CBP requires the submission of advanced manifest data for purposes of targeting high risk shipments. The trade benefits from the submission of advanced data in that, if entries are filed timely, the. 

goods can be cleared in advance of arrival as well as allow for more efficient shipping and inventory data. 

C–TPAT will continue to examine the Tier benefit structure in an effort to ensure 

that the program is addressing the needs of its current and future membership as 

well as the needs of CBP. 

As of December 14,2007,232 C–TPAT importer partners were receiving TIER benefits. 

Question 13.: How does CBP assess effectiveness—in terms of outcomebased performance measures—and that the tax resources expended are 

providing the level of security promised by the program? 

Response: C–TPAT has updated its five-year strategic plan and developed several performance indicators, which will be used to measure the effectiveness of the 

program. For example, C–TPAT measures program performance based on SAFE 

Port Act mandated goals such as reviewing newly submitted security profiles within 

90 days, ensuring that initial validations occur within 1 year, and that revalidations 

occur within 3 years. 

The program also measures its success against internal goals such as completing 

a specific number of validations and revalidations each year, as defined by the C– 

TPAT annual plan. The C–TPAT program also ensures that all expenditures, including travel, equipment, and salaries are properly monitored by supervision and adhere to normal budgetary controls. 

The success of the C–TPAT program was validated by recent a study conducted 

on behalf of CBP by the University of Virginia. More than 1,700 member companies 

chose to participate, with over half being U.S. importers and some of the nation’s 

largest retailers. The study demonstrates the effectiveness of C–TPAT in causing 

thousands of companies to give closer scrutiny to the security of the goods they handle and ensuring that their overseas suppliers have implemented sound security 

practices. C–TPAT will undertake future studies of this sort to continue to assess 

the program’s effectiveness. 

Question 14.: After initial validation of the security measures in member 

companies’ security profiles, how are security changes monitored and validated for continued adherence to C–TPAT security requirements? 

112 

Response: C–TPAT utilizes a variety of strategies to monitor compliance with the 

program. As mandated by the SAFE Port Act, all C–TPAT participants must be revalidated within 3 years of their original validation. Due to risk, the C–TPAT program has determined that it is prudent to validate all Mexican Highway Carriers 

on an annual basis. C–TPAT constantly reviews CBP seizure reports and where a 

member is involved in a security breech, C–TPAT immediately undertakes a Post 

Incident Analysis to determine if there was a systemic breakdown in the member’s 

security procedures. Finally, all C–TPAT participants are required to conduct an annual self-assessment in which the member is asked to review, correct update its previously submitted security profile. 

Question 15.: What did it cost to develop the Validation Security Assessment Tool (VSAT), how is CBP using the VSAT in performing foreign supply chain validations, and what benefit is the C–TPAT program deriving 

from using VSAT? What reviews and analysis of VSAT is done by CBP supervisors and management to ensure it is being used right and producing 

results? 

Response: The final cost to develop the Validation Security Assessment Tool 

(VSAT) was included within the original C–TPAT IT operational budget and the 

specific cost is therefore estimated at around $5,000 USD. 

The Supply Chain Security Specialists (SCSS) are required to use the VSAT tool 

as part of the validation visits. The VSAT ensures that validations are uniform by 

using standard questions. The use of the VSAT does not preclude the SCSS from 

asking additional questions during the course of a validation, which allows the 

SCSS to get a complete and detailed snap shot of a company’s overall supply chain 

security. Field Office Supervisors are required to perform random, quarterly audits 

of the VSAT data collected by SCSS to ensure information is complete, timely, and 

accurate. 

C–TPAT will consider ways to systematically analyze VSAT data moving forward. 

Question 16.: What other steps, if any, has CBP taken to reduce the risks 

that C–TPAT shipments that originate in or move through high risk countries will be tampered with on their journey to the U.S.? How would we 

even detect such tampering today? Are Tier 3 shipments from countries 

subject to a higher inspection rate than other Tier 3 shipments? How much 

higher? Is that rate adequate to offset the risk of tampering en route? 

Response: CBP will continue to target and examine shipments based on risk. 

Shipments unknown or less established entities, and from higher risk countries, receive higher scrutiny from CBP. C–TPAT recognizes the complexity of international 

supply chains and requires C–TPAT members to implement security measures 

based upon risk. C–TPAT membership is one of several factors taken into account 

by CBP when determining which shipments will be referred for security inspection. 

C–TPAT’s minimum security criteria require that all C–TPAT partners conduct 

business with enterprises that comply with that criteria resulting in less potential 

for tampering. C–TPAT importer partners commit to strengthen their entire supply 

chains and adopt appropriate security measures based on risk, and cannot exclude 

a particular segment of their supply chain from this commitment. Importers must 

ensure business partners develop security processes and procedures consistent with 

the CTPAT criteria to enhance the integrity of the shipment at point of origin, and 

throughout the supply chain. C–TPAT members periodically review their business 

partners’ processes and facilities. 

One of the requirements for C–TPAT importers and sea carriers is that all containerized cargo must have a high security seal affixed to all loaded containers 

bound for the U.S. All seals used or distributed by the sea carrier must meet or exceed the current PAS 17712 standards for high security seals, and the seal number 

must be on all shipping documents. 

Question 17.: In the past, GAO has identified weaknesses C–TPAT’s in validation process. What efforts has CBP made to correct these deficiencies? Is the 

current validation rocess rigorous enough to meet the intended purpose to 

ensure that companies are actually implementing their supply chain security plans? 

Response: C–TPAT has undertaken a pro-active approach to address potential 

weaknesses in the validation process that may have occurred since first implementation, by ensuring that the validation process is as complete and as rigorous as possible. 

1. As mandated by the SAFE Port Act, all C–TPAT participants must be revalidated within 3 years of their original validation. Due to risk, the C–TPAT program has determined that it is prudent to validate all Mexican Highway CarVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00116 Fmt 6601 Sfmt 6621 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
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riers on an annual basis. Revalidations ensure companies are continuing to assess their supply chain and addressing changing risk factors. 

2. The Validation Security Assessment Tool (VSAT) was specifically designed to 

ensure uniformity in the validation process. The VSAT is required to be used 

by all SCSS that perform a foreign validation visit. The VSAT ensures that validations are uniform by using standard questions; critical security related questions are asked by all SCSS. The use of the VSAT does not preclude the SCSS 

from asking additional questions during the course of a validation, which allows 

the SCSS to get a complete and detailed snap shot of a company’s overall supply 

chain security. Field Office Supervisors are required to perform random, quarterly audits of the VSAT data collected by SCSS to ensure information is complete, timely, and accurate. 

3. Each SCSS receives initial training on the validation process. In addition, C– 

TPAT conducts semi-annual training for all SCSS and includes updated information on the validation process. 

4. In ensuring its continued viability, effectiveness, and relevance, the C–TPAT 

program continues to evolve as the terrorist threat and the nature of global 

trade evolves. C–TPAT implemented new security criteria to most trade sectors 

to ensure companies are compliant with minimum security standards. The impetus for strengthening security ‘‘guidelines’’ into security ‘‘criteria’’ was to provide more detail to C–TPAT members regarding the expectations of the program. The new security criteria were also issued to assist CBP in defining a 

more consistent baseline for minimal program requirements and better-defined 

TPAT benefits. 

All validation reports outline the manner in which the validated company is 

meeting the criteria, or failing to do so. C–TPAT companies that fail to adhere 

to the C–TPAT standards, as defined by the minimum security criteria, are either suspended or removed from the program. 

5. C–TPAT recently issued a new Memorandum of Understanding (MOU) for all 

members. The new MOU addresses the validation process to ensure greater uniformity throughout all validations. 

6. C–TPAT participants are reminded that part of their program membership 

includes the need to perform an annual self-assessment. Participants are asked 

to review, correct update their previously submitted security profile. Failure to 

do so results in suspension or removal from the program. 

Question 18.: Despite the huge volume of Chinese imports entering the U.S. everyday, the Chinese government does not permit CBP to perform validations within 

its borders. How does the agency plan to adapt the C–TPAT program to capture this vital section of the supply chain? 

Response: Congress, through the SAFE Port Act, required C–TPAT to develop 

a third party validation pilot program to assess the feasibility of having non-government entities conduct validations on behalf of the program. As a result of this congressional mandate, CBP implemented a pilot program to use third parties to validate C–TPAT members operating in China. The Commercial Operations Advisory 

Committee officially approved the plan in February of 2007. 

C–TPAT identified 304 importer partners that have 75 percent or more of their 

supply chain in China and which are in Tier 1 status (certified), and invited each 

individually to participate in this pilot program. To date, 14 certified importer partners have elected to participate in the pilot. A third party China validation visit was 

completed in late November. At the conclusion of the pilot on May 1, 2008, C–TPAT 

will prepare a report to Congress, which will include lessons learned. 

In an effort to allow SCSS to conduct validations in China, CBP and the Government of China (GOC) are currently developing a statement of cooperation regarding 

a joint validation pilot. A joint validation project is tentatively scheduled for March 

10—21, 2008. 

Question 19.: Why has CBP not developed the container security device 

required by the SAFE Port Act? I have been briefed by numerous vendors and 

I know that the technology exists. 

What technology has CBP tested to validate its assertion that the technology does 

not exist? 

Response: On December 12,2007, CBP published A ‘‘Request For Information, 

(RFI) Regarding Conveyance Security Devices’’ on the FedBizOppa website. The announcement will be open for a sixty day period (from December 12,2007 to February 

8,2008). The goal of this RFI is to identify currently available Conveyance Security 

Device (CSD) Systems. Once and CSD systems are provided to CBP by the vendor, 

they will be tested to determine whether the technology meets the minimum techVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00117 Fmt 6601 Sfmt 6621 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
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nical requirements outlined in the RFI. The testing will first be conducted in the 

laboratory, followed by operational testing. 

Question 20.: The SAFE Port Act called on the Department to conduct a 

one-year pilot program to assess the risk posed by, and improve the security of, empty containers at U.S. seaports. This pilot has not yet begun. 

When are you planning on starting it? 

Response: The 12-month empty sea container pilot program will commence on 

February 1,2008 and continue through January 31,2009. 

Question 21.: According to Philip Spayd in an August 27,2007 article in the Journal of Commerce regarding the Recovery Plan mandated in the SAFE Port Act: 

‘‘many in the trade community anticipated an operational plan that would clearly 

set out the roles and responsibilities of government officials who would manage a 

trade security incident. What they received was a 128-page plan that would 

receive a high grade as a research project for a graduate school class in 

international logistics, but which lacks any operational grounding.’’ What 

is your response to this critique? 

Response: The 128-page report referenced by Mr. Spayd is the Strategy to Enhance International Supply Chain Security (July 2007)—a strategic document. Operational planning is ongoing between CBP and the U.S. Coast Guard (USCG) to publish the CBP/USCG Joint Protocols for the Expeditious Recovery of Trade (Recovery 

Protocols). This operational-level document would memorialize CBP and USCG roles 

and responsibilities for communicating and coordinating with government agencies 

and the trade community during a Maritime Transportation Security Incident. The 

Recovery Protocols is currently undergoing final review within both agencies. As 

part of the Recovery Protocols, two advisory groups will be formed with members 

of industry, the Carrier Support Group and the Trade Support Group, to ensure 

close coordination occurs on all trade recovery efforts. 

Question 22.: Section 201 of the SAFE Port Act required a Strategic Plan to Enhance the Security of the International Supply Chain. This plan was supposed to 

include protocols for the expeditious resumption of the flow of trade in the event 

of a transportation disruption or a transportation security incident. According to 

GAO, the Department did not achieve success with this plan. Secretary admitted 

this fact at an August 16, 2007 meeting of the Advisory Committee on Commercial 

Operations for U.S. Customs and Border Protection. He told COAC members that 

day that the final product ‘‘not a detailed plan.’’ 

When is the Department going to produce a detailed plan? 

How much money did the Department spend on this less-than-successful 

document? 

Response: The Strategic Plan provides overarching protocols for the 

prioritization of vessels and cargo, identifies incident management practices specific 

to trade resumption in support of the National Response Framework, and describes 

guidance for the redeployment of government resources and personnel. In doing so, 

the strategy recognizes that there exist many different types of incidents which 

might impact the supply chain, but that resumption itself is an ‘‘all hazards’’ requirement. 

The USCG and CBP are part of a joint Senior Guidance Team that is developing 

both tactical protocols for communications with the trade, and agency-specific plans 

for resumption activities. Further, in keeping with the Maritime Transportation and 

Security Act of 2002 (MTSA), the Area Maritime Security Committees are in the 

process of developing resumption annexes to each of the Area Maritime Security 

Plans. These revisions to the area plans are being conducted within the timelines 

of the mandated review and update cycle, with completion scheduled for mid-2009. 

The Department expenses associated with this plan were principally in the area 

of staff resources. A writing team of approximately 30 individuals from across the 

components and agencies worked on the document over the 270 days of its development. Some individuals contributed greater amounts of time, depending upon their 

organizational involvement in the subject matter. At the Department headquarters 

level, the project lead, who conducted the majority of the review, consolidation, and 

drafting work, was a U. S. Coast Guard 0—5 detailee. An estimated 40% of his time 

over the development cycle was devoted to the project. 

Question 23.: It’s my understanding the Customs and Border Protection advised 

the countries on what technology to purchase. How did CBP determine which 

technology to use? 

Response: CBP partners with the Department of Energy (DOE) to provide and 

procure the scanning equipment in most of the ports. DOE, through its Megaports 

Initiative, contributes the radiation detection equipment, optical character recogniVerDate Nov 24 2008 10:16 Nov 05, 2009 Jkt 000000 PO 00000 Frm 00118 Fmt 6601 Sfmt 6621 H:\DOCS\110-HRGS\110-80\48975.TXT HSEC PsN: DIANE
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tion (OCR) technology, and the communications system, as well as training and 

maintenance while CBP is responsible for the Non-Intrusive Imaging (NII) equipment. Both DOE and CBP work with host governments and terminal operators to 

ensure that the best available equipment is used to scan containers for radiation 

and capture images for analysis. Many factors affect what technology will be used 

including container volume, port operations, physical characteristics of the port, 

among other factors. 

Question 24.: CBP is currently testing advanced spectroscopic portals in New 

York. The testing on this testing won’t be completed for several months. Despite this 

fact, the Department of Energy decided to purchase 12 of the portals—several of 

which will be placed in Southampton, England, one of the ports. Why did the US 

government purchase equipment that has not yet been vetted—isn’t this a 

waste of money? 

Response: DOE is confident that Advanced Spectroscopic Portal (ASP) monitors 

will work effectively as a secondary inspection tool. DOE is currently evaluating an 

ASP at the Port of Southampton in the United Kingdom to help better define the 

most effective operational scenarios for secondary inspection. DOE will conduct additional operational evaluations at the Los Alamos National Laboratory in early 

2008. At this time, DOE has no plans to deploy as a primary inspection tool, and 

has made no commitment to purchase any more units at this time. 

DOE believes that the ASP will improve secondary inspections for several reasons. First, the ASP is essentially a larger, stationary version of the handheld Radioactive Isotope Identification Device (RIID) currently used for secondary inspections. In contrast to the RIID, whose effectiveness is affected by the motivation and 

training of the user, the ASP makes the same scan every time. Second, the ASP 

detector array surrounds the cargo container, allowing it to view a radioactive 

source from multiple angles. The larger detector area also achieves statistical accuracy in the spectrum more quickly. Finally, the ASP uses air conditioning for temperature stabilization. The ‘‘gain’’ of Sodium Iodine instruments, which is important 

to accurate identification, is temperature dependent. In contrast, the handheld RIID 

must be recalibrated when the temperature changes. 

Question 25.: The SAFE Port Act required CBP develop an evaluation plan to 

assess the results of the pilot program. What factors should be considered in 

this evaluation plan? 

Response: The SAFE Port Act requires the Department of Homeland Security 

(DHS), in conjunction with the Departments of Energy (DOE) and State (DOS), to 

submit a report to Congress six months after the first three pilot ports became fully 

operational. Southampton, United Kingdom; Qasim, Pakistan; and Cortes, Honduras, became operational on October 12,2007. In April 2008, DHS will submit a 

report to Congress on the lessons in these three ports as well as four additional, 

limited capacity ports: Korea, Hong Kong, Singapore, and Salalah, Oman. As data 

for the report is collected, the metrics for evaluation continues to be refined. Some 

examples of factors to be considered are: the effect on port operations; the reliability 

and performance of the equipment; and lessons learned during the negotiations with 

host governments. 

116 

PANEL II 

QUESTIONS FROM THE HONORABLE BENNIE G. THOMPSON, CHAIRMAN, COMMITTEE ON

HOMELAND SECURITY

RESPONSES FROM MARY K. ALEXANDER

January 3, 2008 

The Honorable Bennie G. Thompson 

Chairman, Homeland Security Committee 

U.S. House of Representatives 

Washington, DC 20515–6480 

Dear Chairman Thompson: 

Thank you for granting me the opportunity to testify at the October 30, 2007 

hearing on the ‘‘SAFE Port Act: Status of Implementation One Year Later.’’ I appreciated the chance to provide the views of the Joint Industry Group (JIG), and I am 

happy to answer the follow-up questions you have posed. For ease of reference, the 

responses offered from JIG are listed directly after each of the questions asked 

below. 

Cargo Security 

1. It is my understanding that the Department has been developing the 10+2 initiative for over a year. What has the Department told you about when it is going to 

be finalized? 

Response: The JIG membership was never given a specific date regarding publication of the ‘‘10+2’’ notice of proposed rulemaking (NPRM), but we were told DHS 

hoped to release it by the end of the year. The NPRM was finally published in the 

January 2, 2008 Federal Register. Industry has until March 3, 2008 to file comments. We do not know how long it will take DHS to finalize the rule after all of 

the comments are received. 

2. According to your written testimony, the Department has developed GTX behind closed doors. Why do you think they have limited industry input? 

Response: We simply do not know why industry input was so limited during the 

development of the RFQ for the Global Trade Exchange (GTX) initiative. DHS was 

extremely inclusive during the development of the ‘‘10+2’’ initiative, and the trade 

community repeatedly expressed our gratitude for this collaboration. We do not understand why a similar course was not followed for GTX. 


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3. Please provide us with information about the concerns you have with 

the GTX initiative. 

Response: Please see Attachment 1, which lists some of our primary concerns 

about GTX. These are comments we submitted to the Department of Homeland Security in August, and yet none of those issues were addressed prior to release of 

the RFQ. 

Customs-Trade Partnership Against Terrorism 

4. What, if any, difference in inspection levels have JIG members experienced as a result of C–TPAT enrollment? 

Response: JIG members have slightly different viewpoints on the inspection levels they have experienced as a result of C–TPAT enrollment. Panasonic, for instance, has seen slightly fewer inspections with C–TPAT enrollment, but as a ‘‘low 

risk’’ customer, exam rates were low before September 11, 2001. As a group, however, our members have not reported significant decreases in inspection levels as a 

result of participating in C–TPAT. The only other tangible benefit has been access 

to FAST lanes for truckers on the northern and southern borders. 

In addition, we have been informed that inspections as a whole have increased 

in the last six years (which would explain why C–TPAT members have not observed 

a noticeable decline in inspection rates), but we have not heard of any significant 

rises in inspection levels for non-C–TPAT members. In any case, it is hard to say 

whether security inspections have increased or decreased as a result of C–PTAT 

membership since many types of examinations exist and numerous factors contribute to the selection process. For instance, there are more contraband-enforcement exams along southern land borders. With this in mind, it is difficult to determine whether shifting inspection rates are related to security issues and C–TPAT 

membership. 

5. In your testimony, you state the benefits being offered to C–TPAT participants 

continue to be elusive. What steps should CBP take to fix this problem? 

Response: CBP should work with the trade community, and specifically its C– 

TPAT partners, to identify additional benefits for C–TPAT participants. Similar to 

how CBP worked with C–TPAT participants in updating the minimum security requirements for each enrollment sector, it should do the same to identify new benefits as well. In terms of specific recommendations, JIG strongly endorses the negotiation of mutual recognition agreements for international security programs such 

as C–TPAT, as well as expanded recognition domestically between various government agencies. Additionally, C–TPAT needs to be seen as a viable, cost-effective program. CBP’s own Cost-Benefit Survey showed that less than one-third of the respondents found benefits of C–TPAT to equal or exceed the costs from the program. 

As security requirements continue to intersect with facilitation issues, CBP must 

work with its C–TPAT partners to develop tangible commercial benefits to C–TPAT 

membership. 

Resumption of Trade 

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Attachment 1: JIG Letter to DHS Voicing Concerns about GTX 

August 2, 2007 

The Honorable Michael Chertoff 

Secretary for Homeland Security 

US Department of Homeland Security 

Washington, DC 20528 

Dear Secretary Chertoff: 

Over the past several years, the trade community has been pleased to be included 

as a partner in discussing, developing, and implementing numerous policies designed to improve homeland security. Including the private sector in policy development has produced programs that have been integrated into business practice without overly adverse effect. 

Today we note our serious reservations about the possible development of a thirdparty data warehouse, or what is referred to as the ‘‘Global Trade Exchange.’’ The 

development of this program, which is a highly complicated concept, will undoubtedly raise a number of issues related to commercial competitiveness and global security. For this reason, the international trade community must be consulted in the 

program’s development before it or a pilot is instituted. 

The Joint Industry Group (JIG) is a coalition of importers, exporters, shippers, 

carriers, customhouse brokers, trade associations, service providers and law firms 

with an active involvement in global commerce. JIG frequently engages Congress 

and the Administration on a variety of international trade-related issues. We work 

particularly closely with Congress to promote international trade policy that reflects 

the needs of both government and the private sector. 

Some of our immediate concerns about the adoption of the Global Exchange concept include: 

• The vast amount of information stored within an enormous data warehouse, 

managed by a private entity, will be difficult to protect. Given the sheer volume 

of the data and complexity of the electronic protocols, there is a significant potential for leaks. The ability of unauthorized parties to surreptitiously obtain information from the system will inevitably result in harm to both homeland security and the competitiveness of US business. 

• International trade is a highly complex area. Companies are constantly 

searching for new business opportunities and markets. Companies are extremely hesitant to share confidential information with outside parties, including foreign governments, because it will almost always be shared with competitors. The inability of companies to protect their own confidential data is a recipe 

for commercial disaster. 

• Sharing confidential business data with foreign governments must be carefully considered, especially since the US will have little or no control over how 

the information will be used or disseminated. At this time, we are unaware of 

any means to ensure that information shared by CBP with a foreign government will be protected or secured against distribution to a business competitor. 

Will extraterritoriality of US law be enforced? Will data be protected through 

the WTO and would action through the WTO be sufficient? This must be addressed. If any foreign government acts in a manner that undermines the integrity of the Global Trade Exchange, the effects on US industry would be disastrous. 

• In addition to the numerous commercial concerns the Global Trade Initiative 

creates, it also establishes security concerns. By trusting a large amount of data 

to the care of the private sector and sharing it with foreign governments, a 

number of uncontrollable elements will be introduced to the system. A breach 

of any of these levels could carry significant consequences for the security of our 

border. 


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• In light of other data-oriented programs already implemented or under development, such as the ‘‘10+2’’ program, we question the necessity of the Global 

Trade Exchange. While we understand the importance of collecting data elements to develop more accurate risk profiles, at what point do the expanded requirements become unnecessary or duplicative? 

• The implementation of the Global Trade Exchange may violate current US 

laws, such as the Trade Secrets Act (18 USC § 1905). 

This proposal has very serious ramifications to the competitiveness of US companies engaged in global trade. Unlike previous rulemaking by DHS, FDA, USDA, 

USCG, and CBP, there does not appear to be a plan for input from the commercial 

stakeholders on the data warehouse concept. We strongly urge you to consult with 

the trade before moving ahead with the proposal. Failure to do so could result in 

the loss of trade stability and a significant erosion of confidence in CBP and DHS. 

Thank you for the opportunity to provide these comments. We remain available 

to you and your staff for any clarification. 

Sincerely yours, 

Mary K. Alexander 

Mary Alexander 

Chair, Joint Industry Group 

CC: Michael Jackson, Deputy Secretary of Homeland Security, DHS 

Stewart Baker, Assistant Secretary for Policy, DHS 

Alfonso Martinez-Fonts, Assistant Secretary for Private Sector, DHS 

W. Ralph Basham, Commissioner, US Customs and Border Protection 

Bennie G. Thompson, Chairman, House of Representatives Committee on 

Homeland Security 

Joseph Lieberman, Chairman, Senate Committee on Homeland Security & 

Governmental Affairs 

Carlos M. Gutierrez, Secretary, US Department of Commerce 

Susan C. Schwab, Ambassador, US Trade Representative 

—————— 

RESPONSES FROM WADE M. BATTLES FOLLOWS: 


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QUESTIONS FROM THE HONORABLE BENNIE G. THOMPSON, CHAIRMAN, COMMITTEE ON

HOMELAND SECURITY

RESPONSES FROM ROBERT F. BLANCHET

Question 1.: As with the TWIC program, TSA has underestimated the annual turnover rate of truckers. Please provide us with more information 

about this turnover and can you explain how TSA came up with such 

flawed numbers? 

Response: The TSA lumps truck drivers in with all port workers. Most port 

workers are represented by one of several port unions and have good, family sustaining jobs with good benefits and pensions. It is not surprising that these workers 

have a relatively low turnover rate. Unionized truck drivers have a turnover rate 

of only 3% per year. 


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But according to figures compiled by the American Trucking Association, the turnover rate for owner-operators (who are not represented by unions) is 120% per year. 

The ATA has never provided figures that break out port drivers fiom other owneroperators, but everyone involved in port (except the ATA which is justifiably feeling 

defensive that their member companies have such an appalling retention of drivers) 

estimates that the figure is HIGHER for port drivers than for the over-all class of 

owner-operators. 

It is easy to see how the TSA came up with such flawed numbers. What is inexcusable is that after we informed them of this problem and their bad numbers some 

18 months ago, they did nothing to correct the numbers or justify them. 

TWIC 

Question 2.: According to your written testimony, a TWIC can be forged with in 

498 hours. What steps should TSA be to prevent this fiom occurring? 

Response: There is no way to keep a TWIC card from being forged to the extent 

that Commercial Drivers Licenses are being forged, a thriving industry in many 

port cities. The only way to foil this is to install the electronic readers concurrent 

to the roll-out of mandatory use of TWIC cards. The problem comes from the system 

of having guards, clerks and other officials take a quick look at the cards of CDL 

holders as the truck rolls through the gates of marine terminals. No electronic readers: No port security. It’s that simple. 

Question 3.: Please tell us more about the appalling security loophole 

that TSA has created which allows credentialed drivers to containers out 

of the port and hand them off to other drivers which are not credentialed. 

Response: Tank haulers and hazardous waste haulers all need endorsements on 

their licenses (with FBI background checks) regardless of where they are working. 

For some reason, TSA only requires port workers and truck drivers who haul containers to have TWIC credentials when they are in a port. Yet the problem of containers possibly carrying into a port is discounted to concern only the driver who 

hauls the container the last few feet through the gate. 

We have talked about this with lower level TSA and Coast Guard officials who 

all see the problem and, if it was up to them, would like to see a requirement that 

anyone hauling an intermodal container of having access to it either at a seaport 

of an off-dock facility, including rail yards and container yards and repair facilities, 

should be required to be TWIC credentialed. We can take you to any port city in 

the United States and show you hundreds, if not thousands, of containers parked 

overnight outside the port gates in streets and off-dock yards waiting to be brought 

into the port or to some inland destination, possibly for transshipment through another port. 

Question 4.: Do think that there are enough enrollment centers and if 

not, what more should TSA do to minimize the impact on port workers? 

Response: It is too early to tell if there are enough enrollment centers. The TSA 

has just begun to open centers at the larger ports with deadlines for applying for 

the TWIC cards still months away. Time will tell. 

Question 5.: How would it be for me to get a fake TWIC card? 

Response: We will check to see if the underground ‘‘document industry’’ has 

begun providing these yet or if they are waiting until closer to the time when the 

TWIC card is mandatory. 

Question 6.: The State of Florida has a requirement for a State access card. This 

seems duplicative to me as I thought the TWIC program was to create uniformity 

throughout the system. Should the federal TWIC program pre-empt the state 

program and if so, why? 

Response: The idea of a Florida State access card was to avoid having port truck 

drivers pay for purchasing ID cards at each of the Florida ports. Under the TWIC 

system, individual ports as well as states are allowed to have a parallel credential 

system. We believe this is partly a hidden tax for truck drivers and partly a gift 

to the low paying motor carriers who employ the drivers who haul containers. 

Here is an example: If a port truck driver in Miami, Florida loses his Port of 

Miami credential he is required to pay $25 for a replacement. But if he doesn’t lose 

it, and simply changes jobs to go to work for a different motor carrier, he is required 

to pay $70 to get a new card. 

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QUESTIONS FROM THE HONORABLE BENNIE G. THOMPSON, CHAIRMAN, COMMITTEE ON

HOMELAND SECURITY

RESPONSES FROM CHRISTOPHER KOCH


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Æ 


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