Information Technology: Homeland Security Needs to Improve Entry Exit System Expenditure Planning
Released: 2003-06-09T00:00:00

Letter

Background

Securing our nation’s borders is a formidable task. The United States shares over 7,500 miles of land border with Canada and Mexico, and it has approximately 95,000 miles of shoreline and navigable waterways to protect. All people and goods that legally enter the United States must come through one of about 300 land, air, or sea ports of entry and must undergo what is referred to as “primary inspection.” In fiscal year 2002, INS reported that over 440 million persons passed through primary inspections; approximately 81 percent of these inspections were at land ports of entry (see table 1).

Following primary inspection, some persons seeking admission into the United States go through a more detailed, secondary inspection before they can be admitted. In fiscal year 2002, INS reported that about 8 million of the approximately 279 million foreign nationals entering the United States were admitted through secondary inspections (see table 2). INS reported that 738,396 were denied admission.

Overview of the Border Security Process

As we previously reported, our nation’s current border security process for controlling the entry and exit of individuals generally consists of four primary functions: (1) issuing visas, (2) controlling entry, (3) managing stays, and (4) controlling exit. Figure 1 depicts these functions, each of which is described below.

The visa issuance process begins with the Department of State, which issues immigrant and nonimmigrant visas to foreign nationals at more than 200 diplomatic consular posts in approximately 180 countries. Officials at these consular posts review visa applications, sometimes interviewing applicants, before issuing a visa. As part of their review of visa applications, the officials run the applicant’s name through one of the State Department’s watch lists, the Consular Lookout and Support System (CLASS), and its Consular Consolidated Database (CCD). If an application is approved, a visa is issued; if an application is rejected, the rejection is recorded in CLASS, and the person’s name is electronically forwarded to the Interagency Border Inspection System (IBIS). The State Department reports that the majority of visa applications are for nonimmigrant travel. Canadian citizens and citizens of countries participating in the Visa Waiver Program who travel to the United States on business or pleasure for a period of 90 days or less are examples of two classes of noncitizens that are exempt from these processing requirements. Figure 2 depicts the visa issuance process.

Foreign nationals seeking entry into the United States are screened for admission by INS or U.S. Customs Service inspectors at official air, land, or sea ports of entry. Generally, this screening consists of questioning each traveler regarding his or her identity and purpose of visit. The inspector is to review the person’s travel documents and query IBIS to determine whether there is a “lookout” for the person or vehicle. Once the inspector has the necessary information, an admission decision is made. If additional review is necessary, the person is referred to secondary inspection, where a more detailed review of the travel documents, further questioning, and queries of multiple systems are to occur. Travelers who are deemed inadmissible are detained, and they are subject to enforcement actions as required.

Arriving foreign nationals must also complete a paper Form I-94, which is an arrival/departure record. For each arrival, the inspector is to review the form for accuracy, and if the foreign national is deemed admissible, the inspector annotates the admission classification and stamps the “Admit Until” date on the form. The foreign national is then given the departure portion of the form for proof of status while in the United States. INS keeps the arrival portion for entry into the Non-Immigrant Information System (NIIS) database.

The previously described inspection process may vary, depending on travelers’ nationalities. As of October 2002, the National Security Entry Exit Registration System (NSEERS) program required nonimmigrant foreign nationals over the age of 16 from certain countries to register with INS. At the port of entry, these persons are to be fingerprinted, photographed, and interviewed under oath at the time they apply for entry into the United States. The inspector also annotates the Form I-94 with a Fingerprint Identification Number to show that the person has registered. (App. III provides more information on NSEERS, as well as the Visa Waiver Support System, which according to INS officials, are recently implemented systems that will be integrated into the entry exit system.)

The entry control process also varies by type of port of entry. At air and sea ports of entry, commercial carriers are required to submit passenger and crew manifests before arrival. Manifest data are submitted to the Advance Passenger Information System (APIS) and include (among other things) the person’s full name, date of birth, nationality, and passport number. Using the manifest data, INS inspectors conduct a name check through IBIS before the persons arrive, identifying those who will be subject to secondary inspection.

Land ports of entry differ from air and sea ports of entry in that no requirements for passenger or crew manifests are imposed on commercial carriers. Further, the procedures differ for pedestrians and occupants of vehicles. As a general rule, pedestrians have all travel documents checked, and if IBIS is available, a name search is conducted. (Exceptions to this rule are Canadians, who are not required to have a passport when entering a land port, and Mexicans with a border-crossing card, who are not required to present a Mexican passport or a U.S. visa.) For vehicles, license plates are checked through IBIS, and documents and names of the vehicle’s occupants are checked randomly or when an inspector has reason to be suspicious. Figure 3 depicts the entry control process.

Until recently, foreign nationals admitted into the United States were not actively monitored. However, with the implementation of NSEERS, certain foreign national males over the age of 16 are now required, within 30 days of arrival, to report to an INS office and register, a process that includes providing information consistent with their visas, such as proof of residence and proof of employment. If the foreign national stays in the United States for more than 1 year, he must also report to a designated INS location within 10 days of each registration anniversary. If the foreign national changes his address, school, or employer, he is required to notify INS by mail within 10 days. Those who violate these rules will have their photographs, fingerprints, and other information added to the National Crime Information Center (NCIC) “wants and warrants” list for enforcement purposes. NSEERS violators who are caught by police are transferred to INS custody for removal or criminal prosecution. Figure 4 depicts the stay management process.

At air and sea ports of entry, carriers are responsible for collecting from exiting foreign nationals the departure portions of the Form I-94 and for forwarding them to INS, which in turn sends them to a data entry contractor for manual input into the Non-Immigrant Information System. Carriers are also required to electronically submit to APIS manifest information of passengers leaving the United States from an air or sea port of entry. The departure manifest information is transmitted from APIS to the Arrival Departure Information System (ADIS), which uses name- matching algorithms to match the arrival and departure records and identify persons who have overstayed their authorized visits. At land ports of entry, there is no collection point for the departure portion of the Form I-94. The foreign national is responsible for returning the departure portion, although there is no penalty for not doing so, unless the person is subject to NSEERS requirements. Persons subject to NSEERS must depart the United States from an INS-designated port of entry and report to an INS agent for examination and endorsement of departure. If these persons do not report their exit, they become ineligible to return to the United States. The exit control process is depicted in figure 5.

Congress Has Specified Entry Exit System Capabilities in Legislation

Legislation defines the capabilities that the entry exit system is to have. The “pre-9/11” laws defining these capabilities are the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 (IIRIRA), the Immigration and Naturalization Service Data Management Improvement Act of 2000, and the Visa Waiver Permanent Program Act. The “post- 9/11” laws are the USA PATRIOT Act, the Aviation and Transportation Security Act, and the Enhanced Border Security and Visa Entry Reform Act of 2002.

Among other things, Section 110 of IIRIRA directed the Attorney General to develop an automated entry exit control system to collect records of departure from every alien leaving the United States and match it with the alien’s record of arrival. It also required that the system provide on-line searching procedures to identify each lawfully admitted nonimmigrant who remains in the United States beyond his or her authorized period.

The Immigration and Naturalization Service Data Management Improvement Act amended Section 110 of IIRIRA by replacing it in its entirety. This act, among other things, requires that the entry exit system integrate arrival and departure information on aliens required under IIRIRA and contained in Department of Justice (including INS) and State Department databases. Further, the act specifies that the system be implemented at all airports and seaports by December 31, 2003; the 50 busiest land ports by December 31, 2004; and all remaining ports no later than December 31, 2005.

The Visa Waiver Permanent Program Act, among other things, requires the Attorney General, no later than October 1, 2001, to develop and implement at airports and seaports a fully automated system to control entry and exit of aliens who enter the United States under the Visa Waiver Program. The act also requires that, by October 1, 2002, inspectors at the ports of entry have access to any State Department or INS photograph and information on whether the alien has been determined to be ineligible to be admitted to the United States or receive a visa. Further, the act requires that visa waiver applicants be checked against lookout (i.e., watch list) systems, and that by October 1, 2007, aliens applying for a visa waiver have a machine-readable passport.

Since September 11, 2001, three additional laws address, among other things, an alien entry exit control system. The USA PATRIOT Act mandates that this system be capable of interfacing with other law enforcement agencies, and that it use biometric technology and tamper- resistant documents. The Aviation and Transportation Security Act requires air carriers to electronically transmit manifest information for all international flight passengers and crew members before landing at a U.S. airport. The Enhanced Border Security and Visa Entry Reform Act further requires the use of biometrics in travel documents by October 26, 2004; it expands the passenger arrival manifest requirement in the Aviation and Transportation Security Act to sea carriers and to air and sea departures; and it requires compliance for both no later than January 1, 2003. Appendix IV provides more information on the legislatively mandated capabilities for an entry exit system.

Overview of the President’s Homeland Security Strategy and Department of Homeland Security

In July 2002, the administration issued a national strategy for homeland security. This strategy, among other things, aligns and focuses homeland security functions into six mission areas, one of which is border and transportation security. To better address the issues of border and transportation security, the strategy identifies several initiatives, including creating “smart borders” to provide greater security, including the development and deployment of the statutorily mandated entry exit system; and ensuring accountability in border and transportation security by consolidating the current border and transportation security agencies under a new department of homeland security.

In November 2002, the Congress passed and the President signed the Homeland Security Act of 2002, which established this new Department of Homeland Security (DHS) to provide greater accountability over critical homeland security missions and unity of purpose among the agencies responsible for them.

The administration’s national strategy also proposed having a single entity to manage who and what enters the United States. Under the new department, this single entity is the Border and Transportation Security Directorate. Before this, responsibility and accountability for border security were vested primarily with INS, which was part of the Justice Department; the Customs Service, which was part of the Department of the Treasury; the Transportation Security Administration (TSA), which was part of the Department of Transportation; and the Bureau of Consular Affairs, which is part of the State Department. Effective March 1, 2003, DHS merged within its Border and Transportation Security Directorate three of these four agencies—INS, Customs, and TSA. The goal in doing so is to better manage and coordinate port of entry activities, lead efforts to create a border of the future, and secure our nation’s transportation systems. Also, the Secretary of Homeland Security has the authority to issue regulations regarding the issuance of visas. The regulations will be implemented through the State Department. (See fig. 6 for a partial organization chart of the Border and Transportation Security Directorate.)

Brief Description of the Entry Exit Program

The entry exit program was established to integrate the people, processes, and technologies needed to satisfy the legislative mandates. The program includes each of the four border security process functions: issuing visas, controlling entry, managing stays, and controlling exit. Additionally, the program is intended to cover the people responsible for implementing the process, the technology to support the process, and the physical infrastructure (e.g., vehicle and pedestrian traffic lanes and facilities) needed to support the process.

For fiscal year 2002, the conference report for the first supplemental appropriations act recommended that INS use $13.3 million in appropriations for the development of an automated entry exit system. The Congress prohibited INS from obligating these funds for the system until the agency submitted to the Appropriations Committees an expenditure plan (1) that meets the capital planning and investment control review requirements established by OMB, including Circular A-11, part 3; (2) that complies with the acquisition rules, requirements, and guidelines and systems acquisition management practices of the federal government; and (3) that is reviewed by GAO.

On November 15, 2002, INS submitted to its Senate and House Appropriations Subcommittees a one-page plan for spending the $13.3 million for the entry exit system. In summary, the plan allocated the $13.3 million to 10 areas, the largest area being contract support for program management activities ($5.6 million). Other major areas included the design, development, and deployment of the Visa Waiver Permanent Program Act Support System ($2.1 million); the assessment of facilities at every port of entry along the Mexican and Canadian borders ($1.4 million); and the development of standards for biometrics identifiers ($2.1 million). Table 3 summarizes INS’s entry exit system expenditure plan.

In fiscal year 2003, Justice requested $380 million for the entry exit program—$362 million in new funding and $18 million provided in fiscal year 2003 base resources. According to INS officials, $334 million of this amount will be used for facility improvements. In conjunction with the Consolidated Appropriations Resolution, 2003, the conference report recommended $362 million for the entry exit program in fiscal year 2003 funds.

In March 2002, INS chartered an Entry Exit Program Team consisting of representatives from INS, Customs, TSA, and the Bureau of Consular Affairs, with INS serving as the program lead; the team reports to an interagency board comprising senior leadership from these four agencies. The team is responsible for managing program resources (i.e., budgetary planning, formulation, execution, and control); reporting to the Congress and other key stakeholders, as necessary; and managing the acquisition, including defining and establishing program management controls, developing program plans and baselines, and managing all aspects of the entry exit system life cycle.

As currently envisioned, the program will be placed organizationally within DHS’s Bureau of Immigration and Customs Enforcement, which is part of the department’s Border and Transportation Security Directorate (see fig. 6), previously mentioned. With the transition to the new department, the program manager also stated that the program’s governance and management structure is undergoing change.

As previously noted, the entry exit system is one of three parts of the whole entry exit program—the technologies—the other two parts being people and processes. As planned, the system is to provide automated support in identifying and preventing unlawful persons from entering the United States, as well as managing the stay and exit of those lawfully admitted. To do this, plans indicate that the system is to share vital border control information so as to alert border officials of national security threats. It is also to help coordinate the enforcement of immigration laws for alien overstays.

DHS’s Bureau of Immigration and Customs Enforcement plans to acquire the entry exit system through a two-phase competitive acquisition process. The first phase is referred to as a pilot demonstration. In this phase, two or more contractors are to be awarded contracts to develop and pilot test system solutions. Following an evaluation of each pilot system, a contract is to be awarded to the winning contractor for full-scale development and implementation of the entry exit system. According to the entry exit program manager, INS has developed costs and milestones for the system acquisition. However, INS did not respond to our requests for this information, citing the sensitive nature of the information as its reason.

Fiscal Year 2002 Expenditure Plan Partially Satisfied Legislative Mandate

The Congress limited INS’s ability to obligate fiscal year 2002 appropriated funds for the entry exit system until INS submitted to the Appropriations Committees an expenditure plan (1) that meets the capital planning and investment control review requirements established by OMB, including Circular A-11, part 3; (2) that complies with the acquisition rules, requirements, and guidelines and systems acquisition management practices of the federal government; and (3) that is reviewed by us.

INS submitted an expenditure plan to its Senate and House Appropriations Subcommittees on November 15, 2002. This plan and related documentation partially satisfied the first condition and generally satisfied the second condition, and we have satisfied the third with this report. According to the entry exit program manager, INS’s efforts to satisfy the two conditions are a by-product of its policies and practices for acquiring information technology (IT) systems, which it is following, and which are aligned with federal capital planning and acquisition requirements and guidance.

However, INS has obligated at least part of the $13.3 million recommended for the entry exit system before submitting the plan. Since then, INS officials told us that they have de-obligated over $6.6 million that they had obligated after August 2, 2002, and reclassified those obligations to other available sources of base “Enforcement and Border Affairs” fiscal year 2002 funding.

INS Satisfied Most, but Not All, of OMB’s Capital Planning and Investment Control Review Requirements

OMB’s IT capital planning and investment control review policies are intended to help agencies achieve performance goals and objectives with minimal risk, lowest life cycle costs, and greatest benefits to the agency’s business. OMB requires, among other things, that agencies establish a process that defines how the agency (1) selects projects included in its IT portfolio; (2) controls these projects to achieve the intended cost, schedule, and performance outcomes; and (3) evaluates IT projects’ performance to maintain a positive return on investment. OMB also requires that agencies (1) develop a system acquisition strategy; (2) conduct an alternatives analysis that, among other things, addresses replaced systems savings and a savings recovery schedule; (3) comply with agencies’ enterprise architectures in developing and acquiring IT systems; and (4) use a performance-based management system to monitor progress against established project performance goals. Additionally, OMB requires that IT projects (1) ensure that a system security plan is developed and implemented, so that appropriate controls are defined, established, and continually assessed for effectiveness, and (2) perform a system privacy impact assessment, so that relevant privacy issues and needs are understood and appropriately addressed early and continuously in the system life cycle.

While the expenditure plan does not explicitly address OMB’s requirements, related INS documents and plans satisfy most, but not all, of the requirements. For example, INS has established a capital planning and investment control process that defines how INS selects, controls, and evaluates its IT projects. This process describes (1) controls used to create the IT portfolio; (2) procedures for measuring projects against their costs, schedule, and benefits; and (3) measures used to determine the IT projects’ actual return on investment. The process also identifies several decision points for review and approval. For example, approval by INS’s Investment Approval Board of the business case (cost/benefit analysis, risk analysis, and alternatives analysis) is required before the project team defines system requirements. INS has not yet developed a business case for the entry exit program.

Further, INS has developed an entry exit system acquisition strategy. Under this strategy, INS intends to acquire the system in two phases. In the first phase, it plans to award contracts to multiple vendors to develop prototype versions of the system and to demonstrate their capabilities against requirements, on a pilot basis, at a simulated port of entry. In the second phase, INS plans to award a contract to develop, integrate, and implement an operational entry exit system. Additionally, it has developed an alternatives analysis, and, according to the entry exit program manager, INS’s fiscal year 2004 Exhibit 300 for the entry exit program addresses the potential savings associated with replacing existing systems and a schedule for achieving those savings. In addition, preliminary planning documents indicate that INS plans to comply with its enterprise architecture, and that it intends to apply earned value management standards and techniques to monitor and control costs and to measure progress against established performance goals.

However, INS has yet to develop a security plan and privacy impact assessment for the entry exit system, both of which are important to understanding system requirements and ensuring that the proper safeguards are in place to protect system data and resources. According to INS officials, the agency has not developed a security plan and privacy impact assessment because it is too early in the system development life cycle to do so. This is not consistent with system acquisition best practices and federal guidance, which advocate understanding and defining security and privacy requirements both early and continuously in a system’s life cycle. Until these important requirements are satisfied, the basis for further entry exit system definition and acquisition will be limited, thereby introducing the risk that security and privacy will not be effectively and efficiently addressed.

INS Generally Satisfied Key Federal Acquisition Rules, Requirements, and Guidelines and Systems Acquisition Management Practices

Federal acquisition rules, requirements, guidelines, and management practices provide an acquisition management framework that is based on the use of rigorous and disciplined processes for planning, managing, and controlling the acquisition of IT resources. These acquisition management processes are also embodied in published best practices models, such as the Software Acquisition Capability Maturity Model® developed by Carnegie Mellon University’s Software Engineering Institute (SEI). SEI’s model explicitly defines acquisition process management controls that are recognized hallmarks of successful organizations and that, if implemented effectively, can greatly increase the chances of acquiring software-intensive systems that provide promised capabilities on time and within budget. Key processes include the following: Acquisition planning. Ensures that reasonable planning for the acquisition is conducted and that all aspects of the total acquisition effort are included in these plans.

Solicitation. Ensures that a request for proposal that delineates a project’s requirements is prepared and, consistent with relevant solicitation laws and regulations, that a contractor is selected that can most cost-effectively satisfy these requirements.

Requirements development and management. Establishes and maintains a common and unambiguous definition of software requirements among the acquisition team, the system users, and the development contractor.

Project management. Provides for management of the activities within the project office and supporting contractors to ensure a timely, efficient, and cost-effective acquisition.

Contract tracking and oversight. Ensures that the development contractor performs according to the terms of the contract; needed contract changes are identified, negotiated, and incorporated into the contract; and contractor performance issues are identified early, when they are easier to address.

Evaluation. Determines whether the acquired products and services satisfy contract requirements before acceptance.

Within these key processes, SEI identifies practices that are needed to effectively execute each process. Among others, these practices include (1) having a written policy, (2) assigning responsibility for the acquisition, (3) developing and adhering to a plan, (4) performing management review activities, and (5) measuring the status of key activities and using these measurements to make decisions.

INS plans generally satisfy SEI’s acquisition processes and practices. For example, INS’s governing acquisition policy and supporting procedures for acquiring and implementing the entry exit system are provided by INS’s Systems Development Life Cycle, its Information Technology Investment Management process, and the Federal Acquisition Regulation, which our analysis shows are generally consistent with SEI’s acquisition model. (See app. I for a description of our analysis.) Further, responsibility for acquiring and implementing the entry exit system was assigned to INS (and now to DHS’s Bureau of Immigration and Customs Enforcement). INS has developed an acquisition plan that outlines its approach and strategy for acquiring the entry exit system. Additionally, INS has issued a request for information to solicit input from development contractors on the capabilities of their respective commercial products and services to assist in developing system requirements, and it has developed procedures and criteria for evaluating contractor proposals and selecting a contractor to develop the entry exit system. Further, through its Information Technology Investment Management process, INS plans to measure the status and progress of acquisition activities and use this information for investment decision-making.

According to the entry exit program manager, INS has made a commitment to following rigorous and disciplined processes and practices in acquiring the entry exit system because this is what its governing policy and procedures require. If implemented effectively, such processes and practices can minimize the acquisition and deployment risks associated with the entry exit system.

GAO Reviewed Expenditure Plan

On December 19, 2002, we received a copy of the initial expenditure plan that INS submitted to the Congress, and on January 17, 2003, INS provided us with most of the supporting acquisition management documentation we requested. We reviewed the plan and documentation, and the results of our review are provided in this report.

Expenditure Plan Submitted to the Congress after Funds Were Obligated

In addition to requiring the expenditure plan to satisfy the above three conditions, the Congress also limited INS’s ability to obligate funds for the entry exit system until INS submitted the plan to the Appropriations Committees. However, INS obligated entry exit system funding before submitting the plan. Specifically, as part of a January 6, 2003, briefing on planned fiscal year 2003 entry exit spending, INS reported to its House Appropriations Subcommittee that, as of September 30, 2002, it had obligated approximately $9.8 million of the $13.3 million recommended for the entry exit system to perform tasks described in its expenditure plan. Since then, INS officials told us that they have de-obligated over $6.6 million that they had obligated after August 2, 2002, and reclassified those obligations to other available sources of base “Enforcement and Border Affairs” fiscal year 2002 funding.

Other Observations: Planned Entry Exit Capabilities Are Aligned with Legislation, but Future Expenditure Plans Need to Be Improved

Recent legislation has defined the capabilities that the entry exit system is to provide, and INS’s preliminary plans show that it intends for the system to provide these capabilities. However, INS’s first entry exit system expenditure plan does not adequately disclose material information about the system. Without sufficiently detailed information on system plans and progress, the Congress will be impeded in its efforts to oversee the system and constrained in its ability to provide timely guidance and release of funding.

Preliminary Plans Provide for Implementing System Capabilities Cited in Legislation

As discussed in the Background section of this report, various laws have defined the types of capabilities that the entry exit system is to provide. (See app. IV for a more detailed summary of the legislation.) For example, the system must, among other things, (1) collect and match alien arrival and departure data electronically; (2) be accessible to the border management community, including consular officers, federal inspection agents, and law enforcement and intelligence agencies responsible for the identification and investigation of foreign nationals; and (3) support machine-readable, tamper-resistant documents containing biometric identifiers at U.S. ports of entry.

Initial INS plans for the entry exit system are generally aligned with these legislatively directed system capabilities. For example, the operational capabilities for the planned system include, among other things, (1) electronically recording and matching arrivals and departures for the purpose of identifying visa overstays; (2) interoperating with other entities involved in border management, including law enforcement and intelligence agencies; and (3) implementing a biometric standard on all travel documents issued on or after October 26, 2004. Table 4 provides a list of the high-level operational requirements defined in preliminary system plans, and table 5 provides a detailed comparison to the key legislative requirements.

Description of requirement Record pertinent information before the arrival of persons to the United States, such as visas and immigration petitions and applications. Record the arrival and departure of aliens; record changes in a visitor’s status; identify those persons who have remained in the United States beyond their authorized period; and enable the reporting of overstay statistics to Congress. Facilitate identification of lawfully admitted non-U.S. citizens. Enable the biometric standard selected by the National Institute for Standards and Technology and consistent with the International Civil Aviation Organization’s standards. Include the biometric standard on all travel documents issued on or after October 26, 2004. Develop a unified workflow that integrates the activities of all agencies supporting border management. Be interoperable with other entities as appropriate, including law enforcement and intelligence agencies. Provide access to, exchange, and integrate alien arrival and departure information that is in an electronic format in the databases of the Departments of Justice and State. Develop a capability to exchange information between existing and future systems among border management agencies (within the requirement of the law) regardless of what agency owns the system. Notify appropriate authorities as required. Provide improved decision support to inspectors, adjudicators, consular officers, and other appropriate personnel, including access to fully integrated lookout information, comprehensive travel document information (including immediate access to nonimmigrant visa and immigrant visa data), and alien overstay alerts.

System Acquisition Commitments and Progress Need to Be Addressed in Future Expenditure Plans

The legislative requirement to submit an expenditure plan for the entry exit system to the Appropriations Committees is intended to provide lawmakers with a sufficient understanding of the system acquisition to permit effective oversight and to allow for informed decision-making about the use of appropriated funds. For this to occur, however, our prior experience in working with the Congress and other agencies in developing and implementing expenditure plans shows that these plans need to disclose a sufficient level and scope of information for the Congress to understand what system capabilities and benefits are to be delivered, by when, and at what cost, and what progress is being made against the commitments that were made in prior expenditure plans. Further, our experience shows that the plans should disclose how the acquisition will be managed to provide reasonable assurance that system capability, benefit, schedule, and cost commitments will be met. In effect, the expenditure plans can be viewed as contractual arrangements with the committees. Such treatment is consistent with expenditure planning precedents set with the Internal Revenue Service and the former U.S. Customs Service on their respective system modernization programs.

INS’s first expenditure plan does not contain the level and scope of information needed for the Congress to understand its plans and commitments relative to system capabilities, benefits, schedules, and costs. More specifically, this first plan only identifies general “areas of expenditure” and associated funding amounts (see table 6 for the verbatim text of the plan as submitted). According to INS officials, this is because the expenditure plan was developed on the basis of Justice Department guidance, which did not require more detailed information. However, they said that future plans will include more detailed and complete information on system capabilities, benefits, schedules, and costs, but they did not provide supporting documentation or specific details. Without this level of detail, the Congress will be denied the information needed to allow it to oversee plans and progress on the system.

Conclusions

The immense importance of the entry exit system to the security of our nation’s borders is undeniable, as is the need to acquire and implement this system effectively and efficiently. This criticality is a major reason that the Congress placed limitations on the use of entry exit system funding until the Congress has been assured, through the submission of a high- quality plan, that the system is being managed effectively.

INS partially met the legislative conditions that the Congress placed on its use of fiscal year 2002 entry exit system funding. However, it is important that DHS promptly address certain capital planning and investment control issues—security and privacy—and that the Congress be given the opportunity to exercise its intended level of expenditure plan oversight before funds are obligated. It is equally important that future expenditure plans disclose sufficient information to permit meaningful congressional understanding and oversight of the system. While this lack of detail is a material limitation in the first plan, it will become even more problematic in the future: as the magnitude and complexity of the entry exit system acquisition increases in fiscal year 2003 and beyond, so will the importance of creating plans with the appropriate level and scope of information.

Of particular significance going forward will be how effectively DHS implements the system investment and acquisition controls provided for in the first plan and related documentation. Therefore, it is important that future plans disclose project information of sufficient level and scope about (1) what system capabilities and benefits are to be delivered, by when, and at what cost; (2) how well DHS is progressing against the commitments that it made in prior expenditure plans; and (3) how the acquisition is being managed to provide reasonable assurance that the system capability, benefit, schedule, and cost commitments will be met. This approach to expenditure planning for congressional oversight has worked successfully with other federal agencies and the Congress.

Recommendations for Executive Action

To help ensure the effective management and acquisition of the entry exit system, we recommend that the Secretary of Homeland Security, through whatever entry exit program governance structure is established, direct the entry exit program manager to ensure that planned investment and acquisition management controls, including the development of a business case, are fully implemented in accordance with recognized best practices and relevant federal requirements and guidance. At a minimum, we recommend that the Secretary’s direction include having the entry exit program manager immediately develop and begin implementing a system security plan. At the same time, we recommend that the Secretary have the program manager perform a privacy impact analysis and use the results of this analysis in near-term and subsequent system acquisition decision- making. Further, in light of INS’s recent transition to the new department and potential changes to system investment and acquisition controls provided for in the first plan, we recommend that controls in the areas of acquisition planning, solicitation, requirements management, project management, contract tracking and oversight, and evaluation be implemented in accordance with SEI guidance.

Additionally, we recommend that the Secretary ensure that future expenditure plans (1) be provided to the department’s Senate and House Appropriations Subcommittees in advance of entry exit system funds being obligated and (2) fully disclose what entry exit system capabilities and benefits are to be delivered, by when, and at what cost, and how it intends to manage the acquisition to provide reasonable assurance that these system capability, benefit, schedule, and cost commitments will be met.

Agency Comments and Our Evaluation

In written comments on a draft of our report signed by DHS’s Assistant Secretary, Bureau of Immigration and Customs Enforcement (reprinted in app. II, along with our responses), the department did not explicitly agree or disagree with our conclusions and recommendations. However, the department described actions that it plans to take that are consistent with our recommendations, including developing and implementing a system security plan, developing system management controls, providing future expenditure plans to the Appropriations Subcommittees before obligating any funds, and specifying system capabilities and benefits in future plans. We support these planned actions.

The department provided other principal comments. First, it stated that we failed to consider that the lack of specific detail in the fiscal year 2002 expenditure plan is attributable to a number of pending policy decisions. Second, it stated that it had addressed the development of a system security plan and privacy impact assessment and provided a draft document entitled Technical Architecture and Security Requirements that it said addressed these issues. Third, it commented that we concluded that the entry exit program office is in compliance with INS’s ITIM, and therefore the entry exit system is in compliance with OMB requirements. Fourth, it said we failed to consider and incorporate information regarding its obligation of supplemental appropriations.

We do not agree with these four comments. First, as we state in this report, the legislative requirement to develop an expenditure plan is intended to provide lawmakers with a sufficient understanding of the system acquisition to permit effective oversight and informed decision- making about the use of appropriated funds. For this to occur, the plan needs to disclose a sufficient level and scope of information for the Congress to understand what system capabilities and benefits are to be delivered, by when, and at what cost. The plan also needs to disclose what progress is being made against the commitments that were made in prior expenditure plans, as well as how the acquisition will be managed to provide reasonable assurance that system capability, benefit, schedule, and cost commitments will be met. To the extent that this information was not known because of pending policy issues, these issues should have been explained and a timetable for addressing them included in the plan. Notwithstanding these undecided policy matters, the plan could have provided more detailed information. For example, it could have addressed how the acquisition was to be managed.

Second, the draft document that the department provided with its comments does not satisfy relevant federal guidance governing a security plan and a privacy impact assessment. While the document acknowledges the need to develop the plan and conduct the assessment, and the document describes high-level security requirements, it does not include, for example, rules of behavior for individuals who access the system and the consequences for violating those rules; methods for identifying, appropriately limiting, and controlling interconnections with other systems; and procedures for periodically reviewing the effectiveness of security controls. Similarly, the document does not include an assessment of the privacy implications of personal information to be collected and maintained by the system.

Third, while we state in this report that INS’s ITIM process generally satisfies OMB’s requirement to establish a process that defines how the agency selects, controls, and evaluates its IT projects, we do not state that the program office is in full compliance with the ITIM process, and that therefore the entry exit system is in compliance with OMB requirements. Rather, we conclude that, in going forward, it is important that INS focus on implementing the investment management controls provided for the plan and related documentation. Accordingly, we recommend that DHS fully implement planned investment management controls in accordance with relevant federal requirements and guidance.

Fourth, we did not include in our draft report the information that the department provided regarding its obligation of the supplemental appropriations because the department provided this information to us in a letter dated April 7, 2003. We sent our draft report to the department for comment on April 3, 2003, before we received the department’s letter. We have since modified this report, as appropriate, to incorporate the information in the April 7, 2003, letter.

The department also provided additional technical comments, which we have incorporated as appropriate into this report.

We are sending copies of this report to interested congressional committees. We are also sending copies to the Secretary of Homeland Security, the Director of the Office of Management and Budget, and the Secretary of State. We will also send copies to others upon request. In addition, copies will be available at no charge on our Web site at www.gao.gov.

Should you or your offices have questions on matters discussed in this report, please contact me at (202) 512-3439. I can also be reached by E-mail at hiter@gao.gov. An additional GAO contact and staff acknowledgments are listed in appendix V.

Appendix I: Objectives, Scope, and Methodology

The Congress limited the ability of the Immigration and Naturalization Service (INS) to obligate funds for the entry exit system until INS submitted an expenditure plan (1) that meets the capital planning and investment control review requirements established by the Office of Management and Budget (OMB), including Circular A-11, part 3; (2) that complies with the acquisition rules, requirements, and guidelines and systems acquisition management practices of the federal government; and (3) that is reviewed by us. To satisfy our legislative mandate, our objectives were to review INS’s expenditure plan to (1) determine whether the plan satisfied the legislative conditions and (2) provide observations about the expenditure plan and INS’s management of the entry exit system. Our review focused not only on the plan, but also on related system documentation and plans.

To determine whether INS’s expenditure plan satisfied the legislative conditions, we first identified and analyzed relevant federal guidance, such as OMB’s investment control review requirements and guidelines and the Federal Acquisition Regulation (FAR). We then reviewed INS’s expenditure plan and related documentation, such as entry exit planning documents (i.e., concept paper, concept of operations, business case, cost- effectiveness study, and feasibility study); visa waiver support system functional requirements, system design, and interface control documents; and the concept of operations for the National Security Entry Exit Registration System (NSEERS). We also interviewed the entry exit program team program manager and other INS and Department of Justice officials to determine what INS is doing to satisfy the legislative conditions. To specifically address the legislative conditions, we did the following: To determine whether INS’s expenditure plan met OMB’s capital planning and investment control review requirements, we reviewed entry exit planning documents and INS’s procedures for managing information technology (IT) investments. We then compared the planning documents with OMB requirements to identify whether any variances existed. We discussed reasons for variances with the entry exit program manager.

To determine whether INS’s plan complies with federal acquisition rules, requirements, and guidelines and systems acquisition management practices, we reviewed INS’s policies and procedures for governing system acquisition efforts, such as its System Development Life Cycle and IT investment management guidelines. We then identified and reviewed the acquisition management best practices model developed by the Software Engineering Institute (SEI), which many federal agencies have adopted as a benchmarking tool for acquiring software-intensive systems in a manner that comports with federal acquisition rules, requirements, and guidelines. Next, we compared the primary components of INS’s System Development Life Cycle and its investment management procedures with the components of SEI’s model to determine whether any variances existed. The components addressed in SEI’s model were acquisition planning, solicitation, requirements development and management, project management, contract tracking and oversight, and evaluation. Because the entry exit program manager stated that INS was following the requirements of the FAR in acquiring the entry exit system, we also compared selected sections of the FAR (e.g., acquisition planning, and contract negotiation and administration) with SEI’s model. Our comparative analysis focused on whether key components of the SEI model were provided for in the policies and procedures that INS was following or intended to follow; it did not include evaluating the quality of INS’s policies and procedures.

To identify observations about the expenditure plan and INS’s management of the entry exit system, we first identified system capabilities mandated in the applicable legislation. Next, we identified and reviewed the entry exit system’s planned operational requirements and mapped the planned requirements to the legislatively mandated system capabilities to identify any variances. We also compared INS’s expenditure plan with those of two other agencies that have been required to submit expenditure plans to the Congress (the Internal Revenue Service and the U.S. Customs Service). We interviewed INS officials about plans for providing information regarding the system’s benefits, schedules, and costs in future expenditure plans.

The scope of our work was based on INS’s policies and procedures before the transition to the Department of Homeland Security.

We conducted our work at INS headquarters in Washington, D.C., from September 2002 through March 2003 in accordance with generally accepted government auditing standards.

Appendix II: Comments from the Department of Homeland Security

The following are GAO’s comments on the Department of Homeland Security’s letter dated May 7, 2003.

GAO Comments

1. We agree that the development of a system security plan and privacy impact assessment of the system is a significant matter. We also acknowledge that on May 6, 2003, the department provided us with a draft document entitled Technical Architecture and Security Requirements. However, we reviewed the document and found that it does not include information consistent with a security plan and privacy impact assessment. The Office of Management and Budget (OMB) and the National Institute of Standards and Technology (NIST) have issued security planning guidance. In general, this guidance calls for developing risk-based security plans that (1) provide an overview of system security requirements, (2) describe the controls in place or planned for meeting requirements, and (3) define responsibilities and expected behavior for all individuals who access the system. The draft document provided by the department acknowledges the need to address but does not include many of these security plan elements, such as rules of behavior for individuals who access the system and the consequences for violating those rules; methods for identifying, appropriately limiting, and controlling interconnections with other systems; and procedures for periodically reviewing the effectiveness of security controls. In addition, it does not, for example, describe the specific controls in place or planned to address requirements or delineate responsibilities and the expected behavior of individuals who access the system. Similarly, the document does not include an assessment of the privacy implications of personal information to be collected and maintained by the entry exit system. 2. We disagree that we failed to consider that the lack of specific detail in the fiscal year 2002 expenditure plan is attributable to a number of policy decisions that are pending. As we state in this report, the legislative requirement to develop an expenditure plan is intended to provide lawmakers with a sufficient understanding of the system acquisition to permit effective oversight and to allow for informed decision-making about the use of appropriated funds. For this to occur, the plan needs to disclose a sufficient level and scope of information for the Congress to understand what system capabilities and benefits are to be delivered, by when, and at what cost, and what progress is being made against the commitments that were made in prior expenditure plans. Further, the plan should disclose how the acquisition will be managed to provide reasonable assurance that system capability, benefit, schedule, and cost commitments will be met. Consequently, pending policy decisions that affect plans for the entry exit program are precisely the kind of detail missing in this expenditure plan that should be disclosed. To the extent that detailed planning information is not known, this should be explained and a timetable for obtaining this information included in the plan. 3. We agree that we concluded in this report that INS’s Information Technology Investment Management (ITIM) process generally satisfies OMB’s requirement to establish a process that defines how the agency (1) selects projects included in its information technology portfolio; (2) controls these projects to achieve the intended cost, schedule, and performance outcomes; and (3) evaluates information technology projects’ performance to maintain a positive return on investment. We do not, however, state that the program office is in full compliance with the ITIM process, and therefore the entry exit system is in compliance with OMB requirements. Further, we concluded that of particular significance going forward will be how effectively the department implements the investment management controls provided for its plan and related documentation. Accordingly, we recommended that the department fully implement planned investment management controls in accordance with relevant federal requirements and guidance. 4. We have modified this report to recognize that an entry exit system business case has yet to be developed, and we have added a recommendation that the department develop a business case as part of implementing planned investment management controls. 5. We do not question the department’s statement, because this was not within the scope of our review. 6. We agree and have modified this report. 7. We sent our draft report to the department on April 3, 2003, which was 4 days before we received the department’s letter dated April 7, 2003. We have since modified this report to reflect the information in the April 7 letter.

Appendix III: Summary of Entry Exit Related Systems

Over the last year, INS has implemented two systems that are intended to provide certain near-term border security capabilities until the entry exit system is acquired and implemented. These two systems are the Visa Waiver Permanent Program Act Support System and the National Security Entry Exit Registration System (NSEERS). According to the entry exit program manager, both systems will be integrated into the entry exit system.

Visa Waiver Permanent Program Act Support System

On October 1, 2002, INS implemented the Visa Waiver Permanent Program Act Support System. This system electronically collects arrival and departure information for all passengers and crew members who are provided a waiver and who arrive and depart U.S. airports and seaports. It modifies two existing systems—Customs’ Advance Passenger Information System (APIS) and INS’s Arrival Departure Information System (ADIS)— in collecting information.

Arrival: Before entering an air or sea port of entry, commercial carriers must electronically submit manifest information (e.g., for each passenger and crew member, the person’s name, address, country of residence, and passport number) to APIS. This information is queried against several databases, including the Interagency Border Inspection System (IBIS) Consolidated Lookout Database and the Datashare Immigrant Visa database. Receiving the manifest data before carriers arrive allows INS to review the data beforehand and identify passengers who will require referral to secondary inspection. The inspector also inputs the “Admit Until” date into IBIS, which establishes the foreign national’s length of stay. Both the manifest data and the approved length of stay are transmitted to ADIS.

Departure: Carriers are also required to electronically submit to APIS manifest information of passengers leaving the United States from an air or sea port. The departure manifest information is transmitted from APIS to ADIS, which uses name-matching algorithms to match the arrival and departure records. The matching results are used to identify persons who have overstayed their authorized visits.

According to the entry exit program manager, INS has been able to match 98 percent of received departure records to arrival records. The program manager also estimated that there are currently 16 million outstanding (i.e., unmatched) arrival records. He also estimated that INS receives about 350,000 arrival records per day.

National Security Entry Exit Registration System

On June 5, 2002, the Attorney General established the NSEERS program to capture information about certain foreign nationals entering, staying in, and exiting the United States. In brief, NSEERS consists of (1) a modified version of an existing INS system used to collect and record enforcement data, the Enforcement Case Tracking System; (2) more deployments of an existing INS biometric capture/analysis system, the Automated Biometric Identification System; and (3) updated business processes/rules covering the registration of certain nonimmigrants. Under the updated business processes/rules, existing registration requirements were changed to require certain nonimmigrant aliens to report to INS upon arrival; approximately 30 days after arrival; every 12 months after arrival; upon certain events (e.g., change of address, employment, or school); and at the time of departure from the United States. Registration requirements also now include photographing and fingerprinting the alien and matching both against criminal and terrorist watch lists. According to INS, NSEERS was deployed to a limited number of sites on September 11, 2002, and became fully operational at 238 INS locations on October 1, 2002.

Appendix IV: Summary of Legislation Regarding Entry Exit System Capabilities

Legislation Illegal Immigration Reform and Immigrant Responsibility Act of 1996 Public Law 104-208 September 30, 1996

Provisions By September 30, 1998, the Attorney General shall develop an automated entry exit control system that— (1) collects a record of departure for every alien departing the United States and matches it with the corresponding arrival record and (2) identifies, through on-line searching procedures, lawfully admitted aliens who overstay their visas. Overstay information identified through the system shall be integrated into appropriate databases of the Immigration and Naturalization Service (INS) and the Department of State, including those used at ports of entry and at consular offices. Notwithstanding any other provision of federal, state, or local law, a federal, state, or local government entity or official may not prohibit or in any way restrict any government entity or official from sending to or receiving from INS information regarding the citizenship or immigration status, lawful or unlawful, of any individual. For the purposes of this section, the term “integrated entry and exit data system” means an electronic system that— (1) provides access to, and integrates, alien arrival and departure data that are (a) authorized or required to be created or collected under law; (b) in an electronic format; and (c) in a database of the Department of Justice or the Department of State, including those created or used at ports of entry and at consular offices; (2) uses available data described above to produce a report of arriving and departing aliens by country of nationality, classification as an immigrant or nonimmigrant, and date of arrival in and departure from the United States; (3) matches an alien’s available arrival data with the alien’s available departure data; (4) identifies, through on-line searching procedures, lawfully admitted nonimmigrants who may have remained in the United States beyond the period authorized by the Attorney General; and (5) otherwise uses available alien arrival and departure data described in paragraph (1) above to permit the Attorney General to make the reports required under 8 U.S.C. section 1365a(e): Number of departure records collected, with an accounting by nationality. Number of departure records that were successfully matched to records of arrival, with an accounting by nationality and classification as an immigrant or nonimmigrant.

Number of aliens who arrived pursuant to a nonimmigrant visa, or the Visa Waiver Program, for whom no matching departure data have been obtained through the system or by other means as of the end of the alien’s authorized period of stay, with an accounting by nationality and arrival date in the United States.

Number of lawfully admitted nonimmigrants identified as visa overstays, with an accounting by nationality.

The Attorney General shall implement the integrated entry exit system at airports and seaports by December 31, 2003. System requirements: include available arrival/departure data, ensure that the arrival/departure data, when collected or created by an immigration officer, are entered into the system and can be accessed by other officers at other air/seaports.

The Attorney General must implement the system at the 50 busiest land border ports of entry by December 31, 2004. System requirements: Same as specified above Arrival/departure data on aliens shall be accessible at other high-traffic land border ports of entry.

The system shall be fully implemented at all remaining ports of entry by December 31, 2005.

Provisions Not later than October 1, 2001, the Attorney General shall develop and implement a fully automated entry exit control system that will collect a record of arrival and departure for every alien who arrives and departs by sea or air at a port of entry in the United States and is provided a waiver. Not later than October 1, 2002, the system shall enable immigration officers conducting inspections at ports of entry to obtain from the system, with respect to aliens seeking a waiver, (1) any photograph of the alien that may be contained in the records of the State Department or INS; and (2) information on whether the alien has ever been determined to be ineligible to receive a visa or be admitted to the United States. The system shall maintain, for a minimum of 10 years, information about each application for admission made by an alien seeking a waiver. On and after October 1, 2007, the alien at the time of application for admission must have a valid unexpired machine-readable passport that satisfies the internationally accepted standard for machine readability. Countries designated to participate before May 1, 2000, shall issue machine-readable passports no later than October 1, 2003. All Visa Waiver Program (VWP) applicants are to be checked against lookout systems. By October 1, 2002, no waiver may be provided to an alien arriving by air or sea at a port of entry on a carrier unless the carrier is electronically transmitting passenger data to the entry exit system. Not less than 1 hour before arrival at port of entry, signatory aircraft transporting VWP aliens must electronically furnish the passenger data required by the Attorney General in regulations. The system shall contain sufficient data to permit the Attorney General to calculate, for each program country and each fiscal year, the portion of nationals of that country who arrive under VWP at air and sea ports of entry but for whom no record of departure exists, expressed as a percentage of the total number of such VWP aliens for the particular country. Focus of system development shall be on (a) utilization of biometric technology and (b) tamper-resistant documents readable at ports of entry. The system must be accessible to (a) all consular officers responsible for visa issuance, (b) all federal inspection agents at all U.S. border inspection points, and (c) all law enforcement and intelligence responsible for investigation or identification of aliens. The entry exit system must be able to interface with law enforcement databases to be used by federal law enforcement to identify and detain individuals who pose a threat to the national security of the United States. (1) Not later than 60 days after the date of enactment, each air carrier and foreign air carrier operating a passenger flight in foreign air transportation to the United States shall provide to the Commissioner of Customs by electronic transmission a passenger and crew manifest containing the following information: The full name of each passenger and crew member. The date of birth and citizenship of each passenger and crew member. The sex of each passenger and crew member. The passport number and country of issuance of each passenger and crew member if required for travel.

The U.S. visa number or resident alien card number of each passenger and crew member, as applicable.

Such other information as the Under Secretary of Transportation for Security, in consultation with the Commissioner of Customs, determines is reasonably necessary to ensure aviation safety.

Carriers may use the advanced passenger information system established under section 431 of the Tariff Act of 1930 (19 U.S.C. 1431) to provide the information required by the preceding sentence.

Provisions (2) Passenger name records—The carriers shall make passenger name record information available to the Customs Service upon request. (3) Transmission of manifest—a passenger and crew manifest required for a flight under paragraph (1) above shall be transmitted to the Customs Service in advance of the aircraft landing in the United States in such manner, time, and form as the Customs Service prescribes. (4) Transmission of manifests to other federal agencies—Upon request, information provided to the Under Secretary or the Customs Service under this subsection may be shared with other federal agencies for the purpose of protecting national security. No later than October 26, 2004, the Secretary of State and the Attorney General shall issue to aliens only machine-readable, tamper-resistant visas and other travel and entry documents that use biometrics. In addition to the requirement for biometric identifiers, name-search capacity and support must also be implemented between 18 months and 4.5 years after the date of enactment. Not later than October 26, 2004, the Attorney General and Secretary of State shall install at all U.S. ports of entry equipment and software to allow biometric comparison and authentication of all U.S. visas and other travel and entry documents issued to aliens. Not later than January 1, 2003, arrival and departure manifests must be electronically provided to appropriate immigration officers for each passenger (including crew members and any other occupants) of air and sea carriers at port of entry. The information to be provided with respect to each person listed on a manifest shall include (1) complete name; (2) date of birth; (3) citizenship; (4) sex; (5) passport number and country of issuance; (6) country of residence; (7) U.S. visa number, date, and place of issuance, where applicable; (8) alien registration number, where applicable; (9) U.S. address while in the United States; and (10) such other information that the Attorney General, in consultation with the Secretaries of State and the Treasury, determines as being necessary for the identification of the persons transported and for the enforcement of the immigration laws and to protect safety and national security.

Appendix V: GAO Contacts and Staff Acknowledgments

GAO Contact

Staff Acknowledgments

In addition to the person named above, other key contributors were Carol Cha, Barbara Collier, Neil Doherty, Ashfaq Huda, Richard Hung, Franklin Jackson, Tammi Nguyen, and Jamelyn Smith.