<DOC> [108 Senate Hearings] [From the U.S. Government Printing Office via GPO Access] [DOCID: f:92688.wais] S. Hrg. 108-555 DEPARTMENT OF HOMELAND SECURITY'S BUDGET SUBMISSION FOR FISCAL YEAR 2005 ======================================================================= HEARING before the COMMITTEE ON GOVERNMENTAL AFFAIRS UNITED STATES SENATE ONE HUNDRED EIGHTH CONGRESS SECOND SESSION __________ FEBRUARY 9, 2004 __________ Printed for the use of the Committee on Governmental Affairs U.S. GOVERNMENT PRINTING OFFICE 92-688 WASHINGTON : 2005 _____________________________________________________________________________ For Sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; (202) 512ÿ091800 Fax: (202) 512ÿ092250 Mail: Stop SSOP, Washington, DC 20402ÿ090001 COMMITTEE ON GOVERNMENTAL AFFAIRS SUSAN M. COLLINS, Maine, Chairman TED STEVENS, Alaska JOSEPH I. LIEBERMAN, Connecticut GEORGE V. VOINOVICH, Ohio CARL LEVIN, Michigan NORM COLEMAN, Minnesota DANIEL K. AKAKA, Hawaii ARLEN SPECTER, Pennsylvania RICHARD J. DURBIN, Illinois ROBERT F. BENNETT, Utah THOMAS R. CARPER, Delaware PETER G. FITZGERALD, Illinois MARK DAYTON, Minnesota JOHN E. SUNUNU, New Hampshire FRANK LAUTENBERG, New Jersey RICHARD C. SHELBY, Alabama MARK PRYOR, Arkansas Michael D. Bopp, Staff Director and Chief Counsel Tim Raducha-Grace, Professional Staff Member Joyce A. Rechtschaffen, Minority Staff Director and Counsel Holly A. Idelson, Minority Counsel Amy B. Newhouse, Chief Clerk C O N T E N T S ------ Opening statements: Page Senator Collins.............................................. 1 Senator Lieberman............................................ 3 Senator Levin................................................ 5 Senator Akaka................................................ 15 Senator Durbin............................................... 18 Senator Pryor................................................ 19 Senator Sununu............................................... 28 WITNESS Monday, February 9, 2004 Hon. Tom Ridge, Secretary, U.S. Department of Homeland Security: Testimony.................................................... 20 Prepared Statement........................................... 47 APPENDIX Questions and Responses submitted for the Record for Secretary Ridge from: Senator Sununu............................................... 55 Senator Collins.............................................. 56 Senator Carper............................................... 60 Senator Fitzgerald........................................... 66 Senator Bennett.............................................. 78 Senator Akaka................................................ 95 Senator Lautenberg........................................... 106 Senator Lieberman............................................ 108 Senator Specter.............................................. 146 DEPARTMENT OF HOMELAND SECURITY'S BUDGET SUBMISSION FOR FISCAL YEAR 2005 ---------- MONDAY, FEBRUARY 9, 2004 U.S. Senate, Committee on Governmental Affairs, Washington, DC. The Committee met, pursuant to notice, at 10:02 a.m., in room SD-342, Dirksen Senate Office Building, Hon. Susan M. Collins, Chairman of the Committee, presiding. Present: Senators Collins, Lieberman, Levin, Akaka, Durbin, Pryor, and Sununu. OPENING STATEMENT OF SENATOR COLLINS Chairman Collins. The Committee will come to order. Good morning. I want to begin by welcoming Secretary Ridge here this morning and thank him for making his third appearance before the Committee on Governmental Affairs. I also want to welcome back to the Committee our friend and colleague, the Committee's Ranking Democrat, Senator Joseph Lieberman. Joe, we have missed you greatly in the last few months and we are very glad to have you back. I personally believe that your philosophy resonates with a broad range of politically moderate Americans (which would of made you a formidable force in the general election). For that reason, I am really glad to have you back. It is a great pleasure to again have you back at my side. Senator Lieberman. Thank you very much. Chairman Collins. It has been nearly 2\1/2\ years since an unconscionable act of war was committed against the United States. The American people responded to the attacks of September 11 with courage, courage that was evident that horrible day in the heroic actions of the passengers on Flight 93, in the firefighters and police officers at Ground Zero, and in the Pentagon employees who led their co-workers to safety through fire, smoke, and rubble. That courage is also evident today in the men and women of our Armed Forces who are serving on the front lines in the war on terrorism and in the ordinary Americans across the country who carry on normal, productive lives, refusing to be terrorized by terrorism. The Federal Government responded by recognizing that this was a different kind of war with a different kind of enemy. We saw that this enemy used as a weapon the freedom and openness that Americans cherish but that it despises. We realize that our efforts to defend our Nation against this unconventional enemy were hampered by a lack of a unified strategy. To revisit a phrase that was used so often in the aftermath of September 11, we were not connecting the dots. Turf battles, communication gaps, and interagency rivalries could no longer be tolerated. The stakes are simply too high. The Department of Homeland Security whose budget we review here today is the single greatest manifestation of our efforts to create that unified strategy, to connect those dots, to coordinate an urgent new mission. This Committee played a key role in creating the Department. Indeed, we marked up and reported the authorizing legislation. Having created the Department, we have also endeavored to help it succeed. We have confirmed eight highly talented and dedicated individuals, most notably the Secretary, who are leading the Department. We have conducted hearings and investigations on a wide range of homeland security issues, from the President's plan to better coordinate intelligence analysts and sharing, to unraveling the tangles of international terrorism financing, to protecting American agriculture from sabotage, to securing our vulnerable seaports. We have approved bills to reform the Department's multi-billion dollar State grant program, to provide cutting-edge technology to first responders, to help the Department attract the talented individuals it needs with sought-after skills, and to ensure accountability within DHS's financial system. The Department is now nearing the completion of its first year. Therefore, this budget is the first that can be reviewed in the context of actual performance and accomplishments. This Committee is its first stop on Capitol Hill. Indeed, the Secretary told me that he anticipates testifying some six times on the administration's budget. I am pleased to note that under Secretary Ridge's dedicated leadership there have been many significant accomplishments. The melding of 22 Federal agencies with more than 170,000 employees has occurred with some of the resistance that we expected, but without the widespread turf battles that many predicted. The level of cooperation and coordination within this new Department, although certainly not perfect, is a vast improvement over the previous ad hoc structure. The initial focus on airport security has been expanded to include other vulnerabilities such as seaport security. Our first responders--the local and State emergency personnel on the front lines--are getting more funding, training, and guidance than ever before to carry out their vital missions. Of course, there are some concerns. While our first responders have received more resources, the administration's budget includes a considerable cut in the basic State Homeland Security Grant Program. In addition, our States, communities, and first responders need a streamlined grant process that includes greater flexibility in how they can use Federal resources. While resource capabilities have improved, prevention lags. Advanced counterterrorism technologies have yet to reach the front lines in most cases. While the addition of personnel at our ports of entry have brought us greater security at our borders, many smaller border communities in my State face new restrictions that have tremendously disrupted their day-to-day lives. And while our urban areas are receiving unprecedented Federal assistance, the concerns and vulnerabilities of our small cities, small towns, and small States must not be overlooked. Perhaps more than any other area this one gets shortchanged in the administration's budget. As the Department pursues programs to make our country more secure it is inevitable that a tension will arise between security and privacy. Americans treasure their civil liberties and expect their government to protect them wherever possible. Where privacy must be compromised in order to prevent terrorism, the government has an obligation to tell the American people clearly what information it is gathering and why it is necessary. I am concerned about revelations that two airlines turned over passenger information to government agencies without any public notice or privacy safeguards. We simply cannot gain security if we lose trust. As the Department of Homeland Security develops its new passenger prescreening program, CAPS- II, it must be open and forthright with the American people so that we can determine whether the added security is worth the privacy costs. Programs such as this one must be crafted with care to minimize the impact on personal privacy and must be subject to close Congressional scrutiny. I know that the Department shares that goal. The Department of Homeland Security's budget that we are examining today makes substantial investments in areas that are critical to our Nation's safety. I cannot say that I agree with each and every detail of the budget, particularly in the area of grants to States, communities and first responders, the Coast Guard, and port security. But I want to commend the Secretary for making tough choices in a lean budget year. I also want to recognize that when one looks at the President's budget overall that homeland security has clearly been made a top priority. The war on terrorism is a different kind of war. We are proceeding to blaze a path in uncharted territory, making mistakes, getting a little lost, but then finding our way and making significant progress. I appreciate the difficulty of the mission assigned to the Department and I know that its leadership is committed to accomplishing that urgent mission without sacrificing the freedom and the openness our enemy seeks to destroy. Senator Lieberman. OPENING STATEMENT OF SENATOR LIEBERMAN Senator Lieberman. Thank you, Madam Chairman. May I say thank you first, for your characteristically gracious welcome. It is good to be back. I consider myself very fortunate to have had the opportunity I have had over the last year to be a presidential candidate and to take an extraordinary journey around this country. I learned a lot, including about the public's concern about homeland security, and I hope that will enable me to contribute even more constructively, hopefully, to these debates. I cannot think of a better place to begin my reentry full- time to the Senate than at this Committee with you and my colleagues, or a better place than with you, Mr. Secretary, on this particular topic which is so critical to all that we are committed to doing here. I thank you very much again, Madam Chairman, for the good work you have been doing and for your very kind welcome back. The fact is that we do meet here today with fresh evidence of the urgent need to secure our homeland. Last week information gathered by intelligence services prompted the cancellation of several international flights to the United States. Deadly ricin was discovered in this building, right here in this building in Senator Frist's office. Obviously, we do not yet know the full implications of these incidents but we clearly do know more than enough to conclude that our Nation faces an array of threats from terrorists bent on doing terrible damage to us, and that we are still too vulnerable to their evil intentions. A number of independent, nonpartisan expert commissions have sounded the alarm about our lack of adequate preparedness, and I am sure we are all concerned about the critical vulnerabilities that have yet to be adequately addressed. Mr. Secretary, I believe that you have been given insufficient resources to do the job the Homeland Security Act requires you to do. The administration's fiscal year 2005 budget, which includes a stunning 30 percent cut government- wide for first responders, is the latest alarming evidence of shortchanging the homeland side of the war against terrorism. Our government and our Nation are still dangerously unprepared, as our former colleague Warren Rudman has said, to face the ongoing and very real threats of terrorism. We need far more funded and focused leadership to secure our domestic defenses and to fulfill the promise, the full promise, of the Homeland Security Act. Have we made any progress in securing our homeland in the last year? Of course we have, and it is significant. We are surely safer now with the Department of Homeland Security than we were without it. We are certainly more aware of the threats we face and we now have a focal point for planning, implementing, and assessing our homeland security efforts. We have improved airport and airline security. We have begun to look more critically at the millions of containers that enter our ports from abroad, including pushing the borders back to help secure containers before they reach American shores. We have begun to consolidate homeland defense work under one roof, and that is the agencies involved in homeland defense at the borders and elsewhere. And in science and technology we are starting to bring a new research and development agency to counter terrorists' threats into existence, although it still faces bureaucratic and funding constraints. But we are clearly not as safe as we hoped we would be by now, more than 2 years after September 11 and a year after the Department was created. We are still without a strategy, an overall strategy as the Gilmore Commission pointed out, that sets priorities and deadlines for homeland security efforts and clearly allocates responsibilities among Federal agencies, State and local governments, and the private sector. The Homeland Security Act called for a robust intelligence fusion center within the Department of Homeland Security, but the administration created a separate threat center that I fear is without a clear home and stable funding and which does not truly break down the turf barriers among intelligence agencies. The Homeland Security Act was intended to bring new leadership to transportation and port security, critical infrastructure protection, and bioterrorism preparedness. Yet the Federal effort in each of these areas remains incomplete and in some cases confused. The Homeland Security Act was meant to provide adequate support to State and local governments and first responders. Here, too, the promise has not yet been kept as our vital State and local partners struggle to find the resources and guidance they need from the Federal Government. Senator Collins has mentioned the three areas that I want to focus on myself and any concerned about shortchanging in the budget proposal of the administration, and that is to say, support for first responders, support for the preparedness, response, and prevention of bioterrorist acts, and port and container security, particularly the underfunding of the Coast Guard. So I would say that we have a long way to go yet before we fulfill the promise we made to the American people, in those dark days following the September 11 terrorist attacks, to adequately secure our homeland. But I do want to stress that in my opinion these debates and discussions, even disagreements we have, are not and ought not to become partisan. They are disagreements of policy and priorities and in some cases of funding, in many cases of funding allocations. The fact is that we ought to aspire to achieve the same standard of non- partisanship in matters of homeland security that at our best we have achieved in matters of international security. I certainly return to the Senate full-time with a commitment, Mr. Secretary, to work with you on that. The fact is that--with the creation of the Department and the appointment of Governor Ridge as Secretary--we have something very important, a new reality, which is an authorized and accountable member of the President's Cabinet, with whom Members of Congress and the public can discuss these critical matters. I look forward to doing so with you today and in the months ahead, Mr. Secretary, with the aim of achieving the goals that I know we have. I know that you agree with all of us that we have no more urgent priority in fulfilling our constitutional responsibilities to provide for the common defense and ensure domestic tranquility than to secure our homeland and the American people from terrorist attacks. Thank you very much. Chairman Collins. Thank you, Senator. Senator Sununu. Senator Sununu. Thank you, Madam Chair. I will defer to the Secretary and submit any formal testimony to the record. Chairman Collins. Thank you. Senator Levin OPENING STATEMENT OF SENATOR LEVIN Senator Levin. Madam Chairman, I will be very brief. First let me join you in welcoming back Senator Lieberman. In addition to supporting your comments, let me say that it was really in this room that Senator Lieberman was one of the key legislative creators of the Homeland Security Department. His initiative led to the very creation of the Department which Secretary Ridge leads and you literally would not be here today but for the fact that Senator Lieberman and a few others, but mainly Senator Lieberman, took the lead in creating a critically important department and in pulling together all of the departments, or most of them that are involved in protecting our homeland. I also want to thank you, Secretary Ridge, for your visit to Michigan. You visited a community which is one of those smaller towns, or smaller cities perhaps more accurately, and one of our counties which fit into the category which our Chairman talked about. Our grant programs do not adequately address the vulnerabilities that some of those communities at least have, particularly the one in Port Huron and St. Clair County that you visited. We are very appreciative of that visit. It made a great difference to them and I think will have an impact on the design overall of programs as you go along. I also am deeply concerned about the cuts in the programs. There is an $800 million proposed cut in this budget for the Office of Domestic Preparedness. Further, our principal first responder program, the State Homeland Security Grant Program will be cut by almost $1 billion. That is deeply troubling. The Firefighter Assistance Grant Program is proposed for a 33 percent cut from the fiscal 2004 levels. I do not think that is anywhere near acceptable given the needs and the commitments which we made to our firefighters after September 11. We also have to address the significant border problems that we have in this country, including the containers that come in and, Mr. Secretary, I know you are familiar with those nationwide and you saw firsthand the existence of those issues in my home State of Michigan. I want to just focus quickly on two other issues. One is the need that we have, and Senator Lieberman mentioned this, to define the roles of our intelligence organizations, ones that analyze our intelligence. We have a number of entities that are involved in the analysis of intelligence. We have the Terrorist Threat Integration Center, we have a Counterterrorism Center at the CIA, we have the Department of Homeland Security's Information Analysis and Infrastructure Protection Directorate, we have one in the FBI. Senator Collins and I wrote Director Mueller, you Secretary Ridge, the Director of the Terrorist Threat Integration Center at the CIA Mr. Brennan, and the head of the CIA Mr. Tenet about these four entities that exist that relate and are supposed to be putting together in one place the information that we have relative to terrorist threats. We cannot divide, diffuse, confuse the responsibility of our key counterterrorism agencies. It has got to be located in one place. We have a whole commission now, the September 11 commission, that is looking at the failures of intelligence analysis prior to September 11. Senator Collins and I have asked in this October 30 letter again, this is now a year after the first request that we made, for a statement as to what are the responsibilities of those four agencies, to avoid any overlap, any confusion, any kind of uncertainty as to who has the principal responsibility for analyzing terrorist threats, the intelligence relating to terrorists threats. We have to eliminate those turf barriers that exist that Senator Lieberman referred to. We have still not received a response to that October 30 letter. You were only one of the addressees and I would ask again that you accomplish that with your colleagues in the CIA and at the FBI. I would ask that the balance of my statement, Madam Chairman, be placed in the record. [The prepared opening statement of Senator Levin with attachments follows:] PREPARED OPENING STATEMENT OF SENATOR LEVIN Thank you very much Madam Chairman. I join you in welcoming Secretary Ridge once again to testify before this Committee and want to thank the Secretary for taking the time a few weeks ago to travel to Michigan and see first hand some of the unique homeland security challenges facing St. Clair County and Port Huron. I commend the Secretary for his commitment to strengthening our homeland security efforts and improving the programs that fund our domestic preparedness and response capabilities, protect our borders and ports and improve our transportation security. Maintaining an adequate level of funding for first responders is critical to protecting our country from a terrorist attack and ensuring that we are able to adequately respond should such an attack occur. I am concerned about how this budget treats those on the front lines of our battle against terrorism, our first responders. Under this proposed budget for Fiscal Year 2005, the Office for Domestic Preparedness (ODP), which administers grant programs to assist State and local first responders, will receive $800 million less than it receive din FY04. One of the biggest ODP grant programs, the State Homeland Security Grant Program, will be cut by $1 billion. We cannot shortchange our first responders by cutting this vital funding and I will work with my colleagues to restore it. While I am disappointed by these funding levels, I am pleased that the Department of Homeland Security appears to be moving away from the current small state funding formula. For example, using the .75 percent base for State Homeland Security Grant Program grants in FY 2004, Texas will received $4.04 per capita, whereas Wyoming will receive $28.72 per capita. The result is that while Texas has 42 times the population of Wyoming, it receives approximately one seventh of what Wyoming receives per capita. The consequence of the current .75 percent formula is that states with smaller populations receive far more, per capita, than more populated states, regardless of vulnerability of infrastructure or threat. I am also concerned that this budget provides no funds for grants to enhance interoperability, even though ti remains one of the top priorities of our first responders, and cuts funding for the Emergency Management Performance Grant (EMPG) program by $10 million. Further, under this proposed budget, funding for the Firefighter Assistance Grant program is cut by $250 million, or 33 percent, from FY04 levels. This grant program was created by Congress in order to meet the basic, critical needs of the firefighting community. Thousands of firefighting personnel in Michigan and throughout the country rely on the Assistance to Firefighters Grant Program for the training, firefighting equipment, protective gear, and prevention programs that keep our citizens safe. Some of our fire departments in Michigan have to work with old and inefficient equipment such as corroding fire trucks with mechanical problems, and old water tanks unable to maintain necessary pressure levels to fight fires. Under the Administration's proposal, funding may not be available to these fire departments for their basic firefighting needs. The DHS budget proposal notes that allocating grant funds within the Department will be coordinated with relevant preparedness programs in the Department of Justice. However, that Department has also cut funding for our first responders. The President's budget proposes massive cuts to local law enforcement programs that, if enacted, would severely compromise the safety of communities around the country. Not only are cops on the beat essential for maintaining community safety, but they are the first line of defense against potential terrorist attacks. The President's budget proposes a more than $650 million cut in funding for the COPS program, including a 100 percent cut in the COPS hiring program that helps local law enforcement meet demands for additional officers. On top of the COPS cuts, the President's budget eliminates funding for the local law enforcement block grant program (FY 2004 $235 million) and the Byrne grant program (FY 2004 $674 million). All of these programs provide vital funding to our first responders and it puzzles me as to why they would be diminished at a time when we are at an increased threat level. Another issue that we need to address is our border protection. Southeast Michigan is home to five international border crossings. More than 40 percent of all U.S./Canada trade passes through Michigan/ Ontario borders. The Ambassador Bridge is the busiest commercial crossing in North America and the Detroit-Windsor Tunnel is the busiest passenger vehicle tunnel on the northern border. The bridge facilitates approximately 25 percent of all trade between the U.S. and Canada. In 2003, there were over 3 million vehicle traffic crossings at the Ambassador Bridge--total value of goods ranging from $120-$130 billion. It is a most critical instrument in facilitating the U.S./Canadian Trade Agreement. Unnecessary and lengthy delays have seriously impacted our economic stability on both sides of the bridge. Effective and secure functioning at this border crossing must be a priority consideration for this committee. We have seen improved and more secure commercial traffic flow at the Ambassador Bridge with the increased numbers of inspectors at our northern borders and with the implementation of NEXUS and FAST, two advanced technology and effective pre-screening programs. While border staffing levels have increased at our northern border crossings, increased border security requirements will add to longer processing times and additional staffing is needed. Our economy, which is increasingly dependent on just in time delivery, cannot afford delays at our borders. Reverse inspections is a critical component of securing our port and bridge. Vehicles should not be allowed to enter the bridge without having cleared cargo inspections reducing potential for a terrorist act which would destroy the bridge and severely impact the economy of both the U.S. and Canada. The Legislation which calls for a pilot program on reverse inspections was passed in 2003, however it has not yet been put in place. If the Administration is serious about homeland security, it should implement reverse inspection without delay. I am also concerned that the Department of Homeland Security has not yet reported to Congress on the plan for consolidating and co- locating Department of Homeland Security regional offices. Section 706 of the Homeland Security Act requires DHS to submit a consolidation plan to Congress no later than one year after the enactment of the Act (which was November 25, 2003). These decisions by DHS will impact my home state of Michigan because we are asking DHS to consider locating a first responder training facility, as well as a regional headquarters for DHS, in Michigan. As the Secretary is aware, two Michigan National Guard facilities, the Alpena Combat Readiness Training Center (CRTC) and Camp Grayling, are ideally suited to serve together as a training center for first responders. These state-of-the-art facilities currently train members of the active duty military, National Guard and first responders. Annually thousands of individuals from throughout the nation train at Alpena CRTC and Camp Grayling. For decades these sites have worked to expand their capacity and hone their training techniques. These investments have led to the creation of world class training facilities that would be ideally suited for training DHS staff and first responders from throughout the nation. In addition, Selfridge Air National Guard Base is being considered as a regional headquarters for DHS. This world class facility which currently is home to all five branches of our nation's military as well as FAA and Customs officials, would be ideally suited for such a purpose. I would urge the Department to complete this plan as soon as possible, and clarify its intent about working with Congress on these matters, so that we can begin to plan where these regional training centers will be located. I would also like to briefly discuss the intelligence analysis mechanisms and strategies that exist within the Department of Homeland Security and outside of it. We all agree that intelligence is crucial to our national security. As we have seen, intelligence decisions can alter our country's political course. Because of that, it is absolutely essential for us to do everything in our power to ensure that our intelligence is credible. Over the last two years, many of us have been asking questions about the Administration's intelligence gathering capabilities and responsibilities. We have not received satisfactory answers to those questions. As I see it, part of the problem stems from the fact that our intelligence analysis has multiple branches, including the Terrorist Threat Integration Center (TTIC), the CIA's Counter Terrorism Center (CTC) and the Department of Homeland Security's Information Analysis and Infrastructure Protection Directorate. Although I have been asking for over a year, the Administration has yet to define how these three intelligence entities are duplicating one another or complementing one another. It is the responsibility of our current Administration to define the roles of the intelligence organizations. If the Administration cannot define the purposes of these entities, how can the people working at these agencies understand communication protocol and agency purpose and mission? Why should we feel safe when the employees and agencies tasked with gathering and disseminating intelligence are not entirely sure what they should be doing and to whom they should be talking? Chairman Collins and I wrote to the CIA last year asking for a comprehensive description of these three entitles. The explanation we received was completely unsatisfactory, so we wrote again to the DHS, CIA, and TTIC and requested an answer by November of last year. We are still waiting for a response. I would like to submit the correspondence pertaining to this subject into the record. I look forward to discussing all of these issues in greater detail. I have outlined the general issues that I hope you will address. I realize that there are a lot of challenges facing the Department, however providing our first responders with the training and equipment they need must remain one of our highest priorities. I look forward to working with you and your staff on these very important issues. [GRAPHIC] [TIFF OMITTED] T2688.001 [GRAPHIC] [TIFF OMITTED] T2688.002 [GRAPHIC] [TIFF OMITTED] T2688.003 [GRAPHIC] [TIFF OMITTED] T2688.004 [GRAPHIC] [TIFF OMITTED] T2688.005 [GRAPHIC] [TIFF OMITTED] T2688.006 Chairman Collins. Thank you, Senator. Senator Akaka. OPENING STATEMENT OF SENATOR AKAKA Senator Akaka. Thank you very much, Madam Chairman. Secretary Ridge, it is a real pleasure to have you before us today. There was never any doubt in my mind as to how hard it would be to create a new agency, but I want you to know that I saw you as the right person for the job. Secretary Ridge. Thank you, Senator Senator Akaka. I have a longer statement, Madam Chairman, and I ask that it be made part of the record. Chairman Collins. Without objection. [The prepared opening statement of Senator Akaka follows:] PREPARED OPENING STATEMENT OF SENATOR AKAKA Thank you Madam Chairman. Secretary Ridge, it is a pleasure to have you before us once again. There was never any doubt as to how hard it would be to create a new agency, but I saw you as the right person for this job. Today you may hear me focus on the problems of this new department, on my perception that the glass is less than half full, but I want you to know that I still believe that you are the right man for this difficult task. When the Department of Homeland Security (DHS) was created, we knew it would take time to meld so many previously independent or otherwise affiliated agencies, bureaus, and offices into a single unit. But, all of us were also aware of the importance of quickly ensuring that these newly merged component parts operate as one cohesive and effective system to protect our country. The urgency of achieving that end-state has not diminished and, in fact, becomes more acute with each passing day. And yet, Mr. Secretary, the Committee hears that DHS coordination and operation efficiency is hampered by functional and cultural differences, and it appears to me that the administration's budget proposal fails to provide sufficient funds to implement critical functions of the Department. The President's budget calls for $47.4 billion for the Department, of which 32 percent is for non-homeland security activities. While the main mission of the Department is to fight and deter attacks against the nation, the legacy agencies transferred to DHS have many non- homeland security missions that Americans rely upon and which remain integral to the agencies' functional capabilities. We must make sure that these non-homeland security missions and functions are not short- changed. For example, items identified as non-homeland security programs include first responder grants, disaster mitigation, firefighter grants, the disaster assistance direct loan program, mitigation grants, flood map modernization, the radiological emergency preparedness program, and emergency management performance grants. From the President's budget, it appears that the designation of a program as either homeland security or non-homeland security is critical to the amount of funding a program receives. Yet, it is unclear why or how the Department designated some as security-related and others not. I am also concerned about the level of support being provided to the states. For example, states are facing critical challenges in making communications interoperable, yet SAFECOM, which provides public safety agencies the guidance to achieve interoperable communications, does not have a specific funding level in the budget. States face funding shortfalls to secure seaports, yet the budget does not include funding for port security grants. The proposed budget cuts funding for non-intrusive detection technology, technical assistance with emergency response planning, and first responder training. In addition, in some areas, budget reductions seem to be responsible for delaying critical preparedness programs. For example, there are a series of goals under Emergency Preparedness and Response that list FY 2009 as their target completion date. These include requiring that all state, tribal, and county jurisdictions complete self-assessments of their ability to recover from terrorist attacks or other disasters. These assessments should not take so long to complete, but the National Emergency Management Baseline Capability Assessment Program has been cut by $227 million. The President's budget request falls short of protecting homeland security for all states. Formula grant funding, which protects smaller states, has been reduced in the budget request by 59 percent. The President's request eliminates minimum funding levels established by Congress to protect smaller states. Instead, the budget request requires that formula based grants be allocated according to population, critical infrastructure, and other factors determined by the Secretary. This proposal threatens to harm all states by structurally changing homeland security grant funding according to a yet to be determined formula. Critical to the integration and smooth functioning of the Department is the new human resources system, which is currently being developed. DHS, along with the Department of Defense, is part of the most massive transformation of government since 1947. I am concerned that this is occurring without sufficient funding to maintain these new personnel systems and without rationalizing agency missions to personnel needs. In the 1990s, agency staffing was cut without giving sufficient consideration to what employees do. The present administration is cutting agency budgets without knowing what agencies do, forcing these agencies to do more with less, and imposing rigid performance rules without credible transparent and accountable systems in place. We must ensure that agencies have the funding necessary to manage their workforce effectively--including funding for overall management training, bonuses, and other recruitment and retention programs, such as student loan repayment programs. As I review the President's budget submission, I am disturbed by what appears to be a trend in cuts to human capital and management functions. The Department is requesting $133.5 million for a new human resource system, declaring it to be an investment in human capital, while at the same time making cuts in human captial areas that are essential to the long term security of our nation. For example, the Science and Technology Directorate has cut its FY05 funding for university and fellowship programs by $38.8 million. This could lead to a less prepared future work force if fewer new people are being trained and recruited through these programs. It is important that DHS remain committed to developing and maintaining the most innovative and skilled technical staff possible. The United States should lead the world in the development of technology and science applications to thwart terrorism both domestically and internationally. I am concerned that budget cuts to a program, like the university and fellowship programs, may undermine our ability to recruit and train new Federal workers in these critical areas. The Department may be robbing Peter to pay Paul. An example is in the Information Analysis and Infrastructure Protection Directorate where a net increase in the number of intelligence analysts has been accomplished by reducing the number of policy and program professional staff by eleven. Perhaps this is a change in name only, but my concern is that a large reduction in policy and program analysts could led to the development of technical programs that are not well-coordinated or well-thought out. DHS should be mindful of the effect of cutting a disproportionate number of policy and program professional staff. I am concerned that these actions could lead to the development of technical programs that are not well-coordinated or to the failure to develop needed programs. Steps should be taken to ensure that the loss of these positions in the Information Analysis and Infrastructure Protection Directorate does not interfere with the very important mission of assessing threats and providing coordinated recommendations for a response. There also needs to be significant funding for some of the critical management functions, including the internal oversight mechanisms, such as the Inspector General, the Privacy Officer, and the Civil Rights and Civil Liberties Office, that were put in place by the Congress to ensure that we do not erode our liberties and freedoms when fighting terrorism. Moreover, the Secretary's office contains the responsibility under the Chief Information Officer to develop a comprehensive data management plan essential for first responders. But, to date, the Department has been unable to acquire the geospatial data, such as critical infrastructure, street mapping, first responder locations, and government facilities, necessary to build a repository of information which could be shared throughout the Department and with state and local governments. Failure to achieve this common information database hampers prevention and planning for emergency response and recovery operations. Last week the Senate had to close its offices because of a poison attack. Fortunately no one was injured. However, the attack illustrated the continuing vulnerability of our society to such dangers and should be a wake-up call to all of us that time is not on our side. It sometimes appears to me that more attention and more money is being devoted to developing a new personnel system in the Department of Homeland Security than to providing grants to states and developing the technologies that first responders will soon need against threats they cannot anticipate. Madam Chairman thank you again for holding this hearing and thank you, Mr. Secretary, for being here. I look forward to your testimony and responses to our questions. Senator Akaka. I will just say now that when the Department of Homeland Security was created we knew it would take time to meld so many previously independent or otherwise affiliated agencies, bureaus, and offices into a single unit. But we were also aware of the importance of quickly ensuring that these newly merged component parts operate as one cohesive and effective system to protect our country. The urgency of achieving that end state has not diminished, and in fact becomes more acute with each passing day. Yet, Mr. Secretary, the Committee hears that DHS coordination and operation efficiency is hampered by functional and cultural differences and it appears to me that the administration budget proposal fails to provide sufficient funds to implement critical functions of the Department. The President's budget calls for $47.4 billion for the Department of which 32 percent is for Non-Homeland security activities. While the main mission of the Department is to fight and deter attacks against the Nation, the legacy agencies transferred to DHS have many non-homeland security missions that Americans rely upon which remain integral to the agency's functional capabilities. We must make sure that these non- homeland security missions and functions are not shortchanged. From the President's budget it appears that the designation of a program as either homeland security or non-homeland security is critical to the amount of funding a program receives. Yet it is unclear why or how the Department designated some as security-related and others as not. I am also concerned about the level of support being provided to the States. For example, States are facing critical challenges in making communications interoperable, yet SAFECOM, which provides public safety agencies the guidance to achieve interoperable communications does not have a specific funding level in the budget. States funding shortfalls to secure seaports, yet the budget does not include funding for port security grants. Formula grant funding, which protects smaller States such as Hawaii and Maine, has been reduced in the budget request by 59 percent. The President's request eliminates minimum funding levels established by Congress to protect smaller States. This proposal threatens to harm all States by structurally changing homeland security grant funding according to a yet to be determined formula. Critical to the integration and smooth functioning of the Department is a new human resources system which is near completion. DHS along with the Department of Defense is part of the most massive transformation of government since 1947. I am concerned that this is occurring without sufficient funding to maintain these new personnel systems and without rationalizing agency missions to personnel needs. We must ensure that agencies have the funding necessary to manage their workforce effectively, including funding for overall management training, bonuses, and other recruitment and retention programs such as student loan repayment programs. As I review the President's budget submission, I am disturbed by what appears to be a trend in cuts to human capital and management functions. The department is requesting $133.5 million for a new human resource system, declaring it to be an investment in human capital while at the same time making cuts in human capital areas that are essential to the long-term security of our Nation. For example, the Science and Technology Directorate has cut its fiscal year 2005 funding for university and fellowship programs by $38.8 million. This could lead to a less prepared future workforce if fewer new people are being trained and recruited to these programs. It is important that DHS remain committed to developing and maintaining the most innovative and skilled technical staff possible. The United States should lead the world in the development of technology and science applications to thwart terrorism both domestically and internationally. I am concerned that budget cuts to a program like the university and fellowship programs may undermine our ability to recruit and train new Federal workers in these critical areas. Madam Chairman, thank you again for this hearing and thank you, Mr. Secretary, for being here. Chairman Collins. Thank you, Senator. Senator Durbin. OPENING STATEMENT OF SENATOR DURBIN Senator Durbin. Thanks, Madam Chairman. Secretary Ridge, thank you for being here. From the announcement of your appointment to this day I continue to believe that you were the very best choice for this important position to defend America. I thank you for your public service and I thank you for your friendship. Mr. Secretary, having said that, this administration's speeches say that we are in a pitched battle in a war on terrorism, but the budget that has been submitted suggests that major military operations in this war on terrorism are winding down exactly when we need them the most. You have heard from my colleagues and I would like to make the same point which I think really goes to the heart of this issue. I am concerned this budget shortchanges our first line of defense, America's first responders in counties, cities, and communities. The budget calls for a 41 percent cut, nearly $1 billion for State and local grants in the Office of Domestic Preparedness. FIRE Act grants are cut by 33 percent, from $746 million appropriated for this year down to $500 million for fiscal year 2005. State and local training, exercises, and technical assistance funds face a projected 44 percent cut. While we appear to call for enhanced urban area security initiative funding, this budget reflects an 18 percent overall cut from the current year. I know that it is not your bailiwick but in the same budget the President virtually eliminates the COPS program, a 91 percent cut from fiscal year 2003 funding level, and 85 percent cut from fiscal year 2004 funding level. In Illinois, during fiscal year 2003, COPS grants provided funding for 123 full- time police officers. A cut of 91 percent would be 111 fewer police officers patrolling Illinois' neighborhoods and schools. Mr. Secretary, how can we win this war on terrorism with fewer soldiers, fewer brave men and women who are truly our first line of defense? Our political speeches will not save us. Our political promises will not protect us. We need to put our money where our security will be, on the front line. We cannot afford a hollow army in our war on terrorism. Second, I have focused on one issue more than any other in this whole area and it has been the interoperability of our computers, our information technology. Starting September 11 and to this very moment I have tried to make this my issue because I believe it passionately, that unless and until the technology can communicate and the people are willing to share, we will not be as strong as we should be in our defense in the war on terrorism. I asked for a Manhattan Project in the creation of your department. The administration opposed it. They said it is unnecessary. I thought that we had an opportunity to do something unique, to bring together all of the agencies dealing with the defense and security of our Nation into one common effort, one stronger effort. In June of last year your CIO Steve Cooper announced that, and I quote from an article published in Computerworld, ``Steve Cooper, who is CIO at the U.S. Department of Homeland Security must untangle the mess of disparate networks' data standards of the 22 Federal agencies that merged to form the DHS. He said last week''--and this was in June of last year--``that a unified IT infrastructure will be completed within 18 to 24 months.'' Mr. Secretary, we have to do better. You have the responsibility more than any other member of the cabinet to bring this together. I am concerned, too, when the President announces the creation by executive order of two new terrorist threat information gathering and analysis agencies, the Terrorist Threat Integration Center, not under your leadership, but under the CIA, and the Terrorist Screening Center, now part of the FBI. I am afraid that this will continue to perpetuate rivalries. It builds the stovepipes even higher. The obvious question is, are you losing the turf battle within your own administration to bring this information technology together? Our confidence in our intelligence community has been shaken by the litany of inaccuracies and misleading statements leading up to the invasion of Iraq. We are now in the midst of a review called by the President of the United States, a commission to investigate what went wrong in most of the substantial intelligence failures in modern history in the United States. We cannot allow the same thing to happen when it comes to our domestic security. You, more than any other person, have that responsibility to gather together these resources and forces to make certain that our intelligence makes America safer. I am looking forward to your testimony on the efforts that you are making. Thank you, Madam Chairman. Chairman Collins. Thank you. Senator Pryor. OPENING STATEMENT OF SENATOR PRYOR Senator Pryor. Thank you, Madam Chairman. I just want to again welcome Secretary Ridge to this Committee. Appreciate your public service and all that you have done in homeland security. My colleagues have covered some of the ground I wanted to cover, but Madam Chairman, I just want to thank you and also welcome Senator Lieberman back. He has been such a leader with regard to homeland security and it is so great to have you back here and have your mind on this. I look forward to hearing your thoughts as we progress in this hearing today. Thank you, Madam Chairman. Chairman Collins. Thank you. Mr. Secretary, we are pleased to have you here and we look forward to hearing your statement. You may proceed. TESTIMONY OF HON. TOM RIDGE,\1\ SECRETARY, U.S. DEPARTMENT OF HOMELAND SECURITY Secretary Ridge. Thank you. Madam Chairman, Senator Lieberman, and Members of the Committee, I am grateful for the opportunity to appear before you today and present the President's budget and priorities for the Department of Homeland Security in the coming year. --------------------------------------------------------------------------- \1\ The prepared statement of Secretary Ridge appears in the Appendix on page 47. --------------------------------------------------------------------------- Before the tragic events of September 11, no single government entity had homeland security as its primary charge. With the creation of the Department of Homeland Security, and this Committee was there at its birth, that charge was given to us, 22 agencies, 180,000 employees brought together to pursue a single mission. That mission, to secure our Nation and citizens from the threats of terrorism and natural disaster, is one that does not change or lessen in importance with the passing of time. As several Senators have commented, the recent ricin scare serves as a difficult reminder that terrorism is a threat that we must confront each and every day with the same commitment and the same sense of urgency we all remember from the day our Nation was attacked 2 years ago. Now as we prepare to celebrate our one-year anniversary as a Department, it is the steadfast support of this Congress and the resources you have provided that have made it possible for us to not only carry out a vigorous and ambitious slate of security initiatives, but also to say and to join with you as you have commented today, to say with confidence that Americans are indeed safer today. I am also mindful of the fact that we still have more work to do. In a short time we have strengthened airline security, increased vigilance at our borders and ports, forged unprecedented partnerships across the private sector, State and local governments, improved information sharing, launched robust efforts to engage citizens in preparation efforts, and distributed funds and resources for our dedicated first responders. Of course, there is still more we can do and there is still more we must do. The President's budget request for the Department in fiscal year 2005 includes $40.2 billion in new resources, a 10 percent increase above the current year's level. This increase in funding will provide the resources we need to expand and improve existing projects and programs as well as build new barriers to terrorists who wish us harm. Let me touch briefly on a couple of areas where specific increases in our resources will help us continue to make progress at our borders, in our skies, on our waterways, and throughout the Nation. To further strengthen our border and port security, this budget includes a $411 million increase for Customs and Border Protection, Immigration and Customs Enforcement, and Coast Guard. This funding will support such innovative initiatives as the recently launched US-VISIT. This program is now operational at 115 airports and 14 seaports across the country to help ensure that our borders remain open to legitimate travel but closed to terrorists. That program has been very successful utilizing biometric technology to process more than 1 million legitimate passengers since the beginning of the year, and since the program began, we have matched 104 potential entrants against criminal watch lists. With additional funding of $340 million this year, we will continue to expand US-VISIT to include land borders and additional seaports. However, we also recognize that potential enemies will not always arrive at a Customs checkpoint. That is why we have more than $64 million to enhance monitoring efforts along the border and between the ports. We have also requested an increase of $186 million to better enforce our immigration policies. We are also pushing our perimeter security outward, making sure that our borders are the last line of defense, not the first. The Container Security Initiative, for example, focuses on prescreening cargo before it even reaches our ports, and for that matter before it is even loaded onto the ships. This budget includes $25 million in additional funding to enhance our presence at existing ports and to begin the final phase of the Container Security Initiative, especially in high-risk areas around the world. Also the Coast Guard's budget will increase by 8 percent which includes funding for the continuation of the Integrated Deepwater System, and important new resources of more than $100 million to implement the Maritime Transportation Security Act. One of the greatest areas of concern since September 11, of course, has been aviation security, and thus continues to be an area of high priority for Congress and for the administration and for this country. It is also a high priority within the budget with an increase of 20 percent this year. The Transportation Security Administration will receive an additional $890 million to continue to improve the quality and efficiency of the screening process. Also, considerable funds will be available to continue the research and deployment of air cargo screening technology as well as accelerate the development of technologies that can counter the threat of portable anti-aircraft missiles. While we have seen the havoc possible when aircraft are used as weapons, we have yet to experience the full impact, and I emphasize the full impact of a bioterror attack, and may we never have to do so. But we must be prepared. It is in that spirit that Secretary Tommy Thompson and I announced a $274 million biosurveillance program initiative designed to protect the Nation against bioterrorism and to strengthen the public health infrastructure. The initiative will enhance ongoing surveillance programs for human health, hospitals, vaccines, food supply, State and local preparedness, and environmental monitoring and integrate them into one comprehensive system. In addition, one of our primary responsibilities is to gather intelligence and share information with the private sector and State and local officials as we work to secure the vast critical infrastructure upon which our economy and our way of life depends. That is why Information Analysis and Infrastructure Protection will receive in excess of $800 million in this budget, an increase in funding that will enable us to carry out this important task. Finally, as I have said many times in the past, for the homeland to be secure, the hometown must be secure. That is why we continue to funnel resources to our State and local partners as well as to ensure that those who serve on the front lines of the new war, our firefighters, police, and medical personnel have everything they need. With that in mind, the total first responder funding in this budget adds another $3.5 billion to the more than $8 billion we have made available since March 1 of last year. These are just some of our budget priorities over the coming year. Priorities that reflect the vast nature of our mission, whether safeguarding America from terrorist attack or providing aid in the face of natural disaster, our charge never changes and our course must never alter. To protect the people we serve is the greatest call of any government, and through the work of many, from those in Congress who allocate the resources to the governors and the mayors to those who work to fill gaps in their State and city security, and to a citizen who makes a preparedness kit, that call is being answered and embraced by the entire Nation. I would like to thank this Committee and Members for their continued support of the Department's mission and our goal to make America stronger, safer, and better prepared every single day. I look forward to continuing to build this Department as we work together to secure a stronger and safer America. Thank you. Chairman Collins. Thank you, Mr. Secretary. We will now begin a round of 7-minute questions and answers. Mr. Secretary, as a former governor you appreciate perhaps better than most people that State and local governments-- regardless of their size--are incurring additional costs in this new era of homeland security. For example, according to the Portland, Maine police chief the city of Portland spends an additional $5,000 each week in extra police costs alone whenever the national terrorism alert increases to Code Orange. We have also recently seen in Maine a threat to the Casco Bay Bridge, which closed down the bridge, diverted Coast Guard, police, and fire resources, to deal with that threat. So regardless of the population of a State, every State has homeland security vulnerabilities and needs. In previous testimony before this Committee and also the Appropriations Committee you indicated your recognition that every State needs a minimum amount of homeland security funding. Is that still your position? Secretary Ridge. Madam Chairman, I still believe that as we take a look at the ODP funding that is to be directed to the States and local governments, which also gives the Secretary, it gives me the flexibility to allocate more than just on population, that even under those circumstances there should be a minimum allocated to individual States because there is still basic support of infrastructure that they need to build and sustain in order to create a national response capability. Chairman Collins. This Committee held a hearing last year on the threat posed by agroterrorism, and I think that is another example where rural America faces a threat that is very difficult to deal with and is going to require increased coordination. That is another example of why we have to recognize that population does not automatically translate into vulnerabilities. Would you agree with that? Secretary Ridge. I would, Madam Chairman. One of the opportunities we have for the first time in the history of the Department, and I think for that matter for the first time since the country responded to September 11, is to build that infrastructure and allocate those monies according to strategic plans that governors have submitted. As part of the requirement that we imposed on our partners at the State level, we asked the governors of the States and the territories to submit strategic security plans to us. They were all due by January 31 of this year so we could take a look at what they perceive to be the threats, their vulnerabilities, their critical infrastructure. Your point is well taken. So we could make a determination not based exclusively on population as to how these dollars should be allocated, and I look forward to working with this Committee, and Congress frankly, to appropriately use the flexibility that the language gives the Secretary to target these resources consistent with the State plans that we are getting from our colleagues in State Government. Chairman Collins. I appreciate that assurance. As you know, the administration's budget does not appear to maintain the minimum for every State. It does give you some discretion and I have great faith in your exercise of that discretion. I also hope you will be Secretary forever. But in the event that does not happen, I am going to be working with my colleagues to clarify the language in the budget. With regard to first responders, let me also commend you on your recent reorganization within the Department to streamline the homeland security grant process. Both Senator Levin and I have worked with you to try to have a single number, one-stop shopping if you will, for communities to be able to find out more easily what funds are available. I do have two concerns however. One, as I mentioned and several of us did in our opening statements, the funding for the State homeland security grant program is cut by nearly $2 billion compared to what was appropriated last year. And second, I am still hearing complaints that the money is slow to get to first responders and to get to communities. I personally have concluded the Department is not at fault but that the States have not been as efficient in passing on the money as they should be. Could you comment on both of those issues, first of all the cut in the budget, and second, how can we ensure that the money is reaching those on the front lines as quickly as possible? Secretary Ridge. First of all, to put it in context, Madam Chairman, if just the dollars we have requested this year are appropriated by Congress, the amount of money to our first responders and State and local governments since fiscal year 2001 will be about $15 billion. So as we took a look at what we have been able to do with regard to first responders and other needs within this country, the allocation of those resources were made part of the budget that I submitted to OMB. As you well recall, last year we submitted a request for assistance to the fire companies at $500 million and Congress raised it. We did shift considerable resources from the State funding formula to the Urban Area Security Initiative because I think it is generally understood and, I think generally preferred, that as much of these dollars be distributed based on threat and risk. Having said that, you and I also have had the conversation that we still need a certain amount going to the individual States to build up their own capacity to respond to the unpredictable nature of terrorism itself. But the bulk of dollars we believe should be distributed according to threat and risk. Now with the maturity and growth within the Department of the Information Analysis and Infrastructure Protection unit, with the strategic plans that are being developed by the States, and interaction between the Federal Government, the State Government and local governments I believe we can better target these resources. Chairman Collins. Finally, I want you to address the Coast Guard budget. Senator Lieberman and I wrote to OMB last fall to urge that the Deepwater Program, which is a very comprehensive program to upgrade the Coast Guard's assets since it has so many aging cutters and aircraft. We had proposed funding deepwater over a 10-year period, which in the long run would actually save money for the Federal Government, significant money, as well as allow the Coast Guard to upgrade its fleet far more quickly. This budget does include a commendable increase in the Coast Guard budget but it still funds the Deepwater Program over 22 years. Could you comment on what you think is the appropriate time for rebuilding the Coast Guard? We are concerned, given the Coast Guard's traditional missions and its vital homeland security missions that too many of its aircraft and cutters are being sidelined because of maintenance and aging problems. Secretary Ridge. Madam Chairman, first of all I think given the fiscal and security environment, the increase to the Coast Guard, nearly an 8 percent increase, again as we set priorities within the Department is precisely where we think we need to be. If the fiscal environment changes, security environment potentially changes, there may be some alterations to that. But again, we are quite aware of the fact that we have cutters that need repair and that their maintenance costs continue to increase because of the age of some of this equipment. But we are quite comfortable, given the nearly $500 million that we requested the Congress to appropriate, that we will continue to maintain the same level of service in both the homeland security and the non-homeland security areas. We also asked you for additional revenue for Rescue 21, which is a part of the international distress system. In this program, additional money for maritime safety and security teams, which you give. You give us another $100 million to assist us in dealing with the challenges of developing a maritime transportation strategy and to do the inspection of ports as well as vessels. So again, in the fiscal environment, in the security environment, we have asked for more. You have given us more and we will continue to maintain the same level of service both in homeland and non-homeland functions. Chairman Collins. Thank you. Senator Lieberman. Senator Lieberman. Thanks, Madam Chairman. Mr. Secretary, let me just follow up, because Senator Collins and I do share this concern about port security and the funding of the Coast Guard. If I read this budget proposal of the administration correctly, with regard to the modernization of the Coast Guard fleet we are on a schedule where it will take 22 years to achieve that modernization. In the midst of the extraordinary increase in responsibilities that the Coast Guard has taken on ably with regard to homeland security, how can we justify not putting more into their fleet more quickly? To wait 22 years for them to achieve the level of modernization that they say they need, and which I believe they do need, seems much too long and really unrealistic and unacceptable. Secretary Ridge. Senator, the Congress has supported the levels that the administration has requested, and as you know, the Coast Guard is probably as effective an agency for taking every single cent that they get and maximizing its use. As we took a look at our strategic needs with regard to homeland security as well as fiscal concerns that legitimately should be imposed on all of government including the Department of Homeland Security, the balancing of the fiscal and security environment, we requested more money, additional funds for rescue, a little bit more money for the Deepwater Program, a few more additional dollars to implement the Maritime Transportation Security Act, and for fiscal year 2005 believe that is the appropriate balance. At sometime in the future, depending on circumstances, if there is an opportunity to significantly increase or accelerate the modernization of the fleet--but we are not going to do anything to jeopardize the safety of those who operate the fleet or to minimize or denigrate our mission--we believe these dollars substantially will get us through 2005, maintaining and in some areas increasing the capacity we have to provide Coast Guard services to support homeland security function but also increasing the capacity to deal with the non-homeland security requirements as well. Senator Lieberman. I hope that we in Congress, again on a bipartisan basis, can put more money into this Deepwater Program of the Coast Guard to modernize their fleet. Some of us on the Committee serve on the Armed Services Committee as well and while the amount of money put into this fleet modernization program for the Coast Guard is not insignificant, it truly does pale in comparison to the billions of dollars we are putting into other programs through the Department of Defense. I do think we have got to start to look at Coast Guard capital needs in the same way we do the services, so I hope we can turn that around here. I want to go now to bioterrorism. I noted that on January 29, as you mentioned, Secretary Thompson and yourself held a press conference announcing this $274 million program to improve our Nation's bioterrorism surveillance capabilities. I believe that is critically important and I applaud you for that. As a matter of fact, in one of the hearings that I was privileged to chair of this Committee shortly after September 11, this need was focused on. But I am concerned as I look at the budget details that it appears that a lot of the funding for this surveillance program that you have announced comes from cannibalizing existing bioterrorism programs, and the most unacceptable act of cannibalization to me is the cut, the $105 million cut, in bioterrorism preparedness grants to State and local health departments, which again are our first line of defense, first responders. The administration is also cutting another $39 million in grants which were to have developed hospital surge capacity to respond to a bioterrorism attack. Those are the very programs that the Health and Human Services official in charge of terrorism preparedness had said should be increased. Indeed one public health official said that the administration's budget proposals on bioterrorism were like, ``laying off firefighters while investing in new hoses and ladders.'' So obviously I want to ask you who in the administration sets these priorities? Good move on bioterrorism surveillance but wrong place to get the money, by cutting these two other critically important programs. Secretary Ridge. First of all, Senator, I think if my recollection is correct a year or two ago the Congress acted quite aggressively and quite generously with bioterrorism grants to State and local governments. I do not recall the figure but I think it was an excess of $1.2 billion or $1.3 billion. And there have been subsequent grants. Again, as you try to set priorities in terms of what the country needs to build a national response capacity, it was clearly the consensus view of Secretary Thompson and myself that we both had a responsibility to develop a comprehensive national system to make ourselves aware as early as possible about the presence of a biological agent. Now this, I think that dramatically improves the public health care system because regardless of whether the pathogen or that agent is brought to us by a terrorist or by Mother Nature, early detection is the best and most effective means of dealing with it. So again, respectfully disagreeing with the notion that anything has been cannibalized, there are still quite a few dollars out there in the pipeline, some of which have not even been drawn down, to my knowledge. But the best thing we can do for the public health community generally is to develop a system where we can detect these bioagents as early as possible and then using, if necessary, the strategic national stockpile or any of the other local or State means of responding to it, that will frankly make us not only safer but I think it makes us healthier as a country. It is an investment that I think in the long run is a good investment to combat terrorism, but it is also a huge strategic investment in public health as well. Senator Lieberman. I hope to continue our work to make sure we fund all sides. As you know, I have been concerned about the coordination and consolidation of the 12 different terrorism watch lists, and I am critical of the administration for taking so long to bring them together. I gather that they have now been consolidated. But we have heard stories, maybe fact, I ask you to respond to, that the terrorism watch list was not used, the consolidated list, during the recent Orange alert, and in that case, for instance, each flight manifest had to be checked with each terrorist watch list by the operations center at the Department of Homeland Security, which was time-consuming, labor intensive, and obviously risk prone. I wonder if you could respond both to the status of the consolidation of the terrorism watch lists and to why it was not used during the Orange alert, if the information I received is accurate that it was not? Secretary Ridge. Senator, the terrorist screening center is the place under the management of the FBI but leadership from TSA where we are consolidating the 12 watch lists. The physical consolidation or technological consolidation of all watch lists in one place will continue to take several months. So right now in the Terrorist Screening Center, as we are integrating the watch list, we literally have a very labor-intensive but still very important enhancement to domestic security, a labor- intensive process where when we call upon the Terrorist Screening Center to identify a name, we have individuals in front of a screen running over the individual names. So we have access to and are using the database, but it is very labor- intensive. I believe our goal is to get the names aggregated into a single database by midsummer. Senator Lieberman. So that has not happened yet? In other words, it is not---- Secretary Ridge. It is something that they are working on 24/7, Senator. Over the years, in order to get a particular name on a particular database, there were different thresholds of information that were required, or a different perspective depending on the agency as to whether or not the name should go on the database. Ultimately, I think we need to segregate those lists and prioritize those lists. But that integration challenge is one that we began back in December, and they are working on that piece every day. Having said that, we have access to that information and literally have had several hundred contacts, even with State and local law enforcement agents who are beginning to use the database. Again it was labor intensive but during the most recent occasion when we had to raise the threat alert, we were able to access the Terrorist Screening Center. The operations center did it, but it is very labor intensive. We believe that by midsummer or the end of summer it should be completely integrated. Senator Lieberman. I am sorry, my time is up, but did I understand correctly that is why each flight manifest would have had to have been checked against the terrorism watch lists, because it was still being put together in one database? Secretary Ridge. That is why it was so cumbersome. That is why it was so time-consuming. It is not that we ignored the reality. This is information we need to have access to and use. But right now it is still a very cumbersome and time-consuming process. Senator Lieberman. Thanks, Mr. Secretary. Thanks, Madam Chairman. Chairman Collins. Thank you. Senator Sununu. OPENING STATEMENT OF SENATOR SUNUNU Senator Sununu. Mr. Secretary, your budget includes $61 million in the Science and Technology Directorate to deal with the threat of shoulder-fired or portable anti-aircraft missiles you mentioned in your testimony. Could you provide more detail about the status of that program and how the additional money will be used? Secretary Ridge. Actually we have already used some of the money that Congress appropriate to us in the 2004 budget. We have had a request for proposal out. Several companies bid. We have awarded a couple contracts to companies to go through that first phase of research that they need to see if we can come up with a countermeasure, a satisfactory countermeasure, to be applied to commercial aviation. There is a misnomer that we could simply take the countermeasures that we deploy on military aircraft and just attach them to passenger aircraft. That just will not work, for a variety of reasons. So the 2005 request is not to initiate the research. That has begun, and we anticipate that we will need those dollars to take us perhaps even to prototyping. So again, it is just a follow on to research that we have already commenced with regard to countermeasures. Senator Sununu. Is the funding available through your budget, the $61 million, sufficient to keep it on track to meet current milestones? Secretary Ridge. We believe it is. Plus you have given us-- again, the Science and Technology unit within Homeland Security has been in receipt of hundreds of millions of dollars from the Congress. And there is enough flexibility if we needed more or if we needed it sooner, we would be able to transfer dollars in. But we anticipate that that would be the cost for the next level of research, perhaps even prototyping. Senator Sununu. You talked a little bit about the US-VISIT program in your testimony. Has that technology initiative resulted in greater problems or bottlenecks? Has it reduced the bottlenecks? What kind of impact has it had on the human resources that you can deploy to deal with immigration or movement at ports of entry? Secretary Ridge. Senator, as you are well aware, the Congress of the United States literally for years and years had requested that, not only this administration but previous administrations develop a system where we can monitor people who come across our borders and then be able to confirm their departure once their visa expired. Congress was very generous in the 2003 budget and gave us several hundred million really to affect that. We added the requirement of a biometric identifier, feeling that while we could use just information to confirm arrivals and departures, we would be a lot better off if we were able to identify the individual who actually had the visa or the passport. To that end, we have the US-VISIT system which is basically a system based on two biometrics. One is facial recognition. The other are two finger scans. We have that deployed at 115 airports and I think 14 seaports. The consular offices around the country will have similar technology available to them all, and there is in excess of 200 of them, by October of this year so that when individuals get their visa, they will have their photograph and their finger scans taken there. When they come to our port of entry, we will be able to confirm the identity of the visa holder, ensuring that the individual that got the visa is the one that is offering it for entry into the United States. As you know, we are required by the Congress to come up with a system to deal with entry across the 50 largest land borders by the end of this year, and we are presently working on the technology that will enable us to affect that outcome as well. To date we have screened over 1 million people. We have turned away in excess of 100 at the border because of information we picked up, particularly from NCIC, the criminal watch list. As we go about integrating the terrorist screening center and the other databases that we have, this information will ultimately be available and tied into the US-VISIT system as well. Senator Sununu. In addition to the biometric technology, what are you doing on document verification, the ability to detect fraudulent passports, green cards or other immigration documentation? Secretary Ridge. First of all, the Congress has said that there is a requirement for entry by October of this year for there to be machine-readable passports prepared for our use at a port of entry. Continuing discussions with regard to the standards that should be applied to those kinds of documents are part of our conversations we are having with the European Union and elsewhere. I think one of the biggest challenges that we have, not just as a country, because the threat of terrorism and the notion that we need to ensure commercial shipping, commercial air travel, and it is a worldwide challenge that we have, is coming up with acceptable international standards based on biometrics. We are not quite there yet. For commercial aviation, the international commercial aviation organization, their only standard is a facial scan. I think, in talking to a lot of our colleagues around the world, while that is good technology, we do need to build some redundancy into that system. So we will be working with, again, colleagues in international aviation as well as governments around the world to see if they can come up with acceptable international standards. So that work continues. We have not reached a satisfactory international standard yet as far as I am concerned. Senator Sununu. Do you right now have the flexibility you need to continue to expand coverage to new ports of entry as our demographics change, as our economy changes and grows? Do you, within DHS, have the ability to bring new ports of entry into the system and to provide coverage in those expanded areas? Secretary Ridge. Frankly, just upgrading the personnel and equipment at existing ports of entry has been one of the primary tasks of the new Department, and I believe we have done that fairly well. When we go about talking, particularly with our colleagues in Canada and Mexico about creating new ports of entry so we can deal with the enhanced security that we want at our borders and the facilitation of commerce, that will require a significant capital investment from all of the governments. One of the things we are reviewing with our friends in Canada and Mexico, if there were to be infrastructure improvements along the border, where would they be? How much would they cost? And frankly, who would absorb the cost? Senator Sununu. I am speaking specifically, and I was not clear in the question, on seaports, airports, points of cargo, and passenger entry and exit in the domestic United States that could be receiving passengers and cargo from all over the world. Secretary Ridge. Yes, again whether it is aviation security or commercial shipping security, the decision has been made, and I think Congress generally embraces it, that you never want to rely on a single means of security. That you need to layer in your security measures. You never want the opportunity for there to be a single point of failure. So to that end, when it comes to commercial shipping, as you know, we began with a container security initiative. There is a targeting program based on the 24-hour requirement to provide those manifests. We board 100 percent of the high interest vessels. We have non-intrusive inspection technology both at ports abroad and in the United States. So we layer in multiple preventive measures both in aviation and in port security. I hope that answers your question. Senator Sununu. It does in part. What I am getting at is the fact that reluctance or inability or lack of flexibility to distribute additional personnel can effectively prevent a seaport or an airport from growing to accept passenger transit, new immigration. There are some specific samples that I will be happy to share with your staff. Secretary Ridge. Thank you, Senator. Senator Sununu. Thank you very much, Madam Chairman. Chairman Collins. Thank you. Senator Levin. Senator Levin. Thank you, Madam Chairman. I want to start by asking you about the allocation system for homeland security grants. Two major programs here are the State Homeland Security Grant Program and the Urban Area Security Initiative when it comes to first responder grants. It strikes me that those allocations to those first responders, to the greatest degree possible, at least logically, ought to be based on vulnerabilities and threats. Every State has vulnerabilities, but there are great variations between States and localities on those vulnerabilities. So my first question to you is, is it the administration's position that we should legislate formulas for allocating those monies that go to the States and local governments and for any State minimums? Or should that be left to the Department to adopt criteria that we would then be able to look at which would be transparent, but nonetheless would be basically departmentally determined rather than legislatively determined? Secretary Ridge. I believe, Senator, it would be our preference as embodied in the language for both of those grant programs, that the flexibility be given to the Department. Understanding the political reality of whether or not it can be accomplished remains to be seen, but we would certainly want to address, obviously in a transparent way, the establishment of that criteria if it was to be done internally within Homeland Security. Senator Levin. So that your position is that you would rather not have them legislatively prescribed? Secretary Ridge. That is correct, Senator. As both of the pools of ODP dollars suggest, we do want to take into consideration population. But we also need to take into consideration the critical infrastructure. We need to take into consideration threats and vulnerabilities. It is pretty difficult to come up with a mathematical formula that can deal specifically with that assessment. It is for that reason, particularly with regard to the State and local dollars through the Office for Domestic Preparedness that we have suggested for the first time in 2005, and I have said in response to Senator Collins' question that a minimum of those dollars go out to every State, but that we take a look at the State plans that have been submitted, we take advantage of the work that the States and our Department has done in identifying critical infrastructure. Port Huron was an extraordinary example where we had a small community that had critical infrastructure around it and in it and yet I do not believe they qualified, either place, for any additional dollars. So if we had that flexibility vested in the Department I think we could address the concerns of some of those communities easier. Senator Levin. Is it the administration's position that the minimum should be set by the Department or by Congress? Secretary Ridge. I think it would be, again, our preference that once we take a look at the state-wide plans and see what common threads and needs are there, that we would set it. But again, we welcome the notion that the Congress would work with us in order to set that criteria internally. Senator Levin. I would like to go back to reverse inspections. We have been urging a system of reverse inspections where the inspection of people and cargo be done on the other side of the bridges and tunnels because it is too late once that bridge or tunnel is damaged or destroyed to inspect the cargo. We have legislated that there be at least a couple of efforts made at testing reverse inspections. What is the status of that pilot program? Secretary Ridge. Senator, the Smart Border Accord we have with Canada across the board has been successfully and almost completely implemented. There are still one or two areas of disagreement and reverse inspection is one of them. But with the change in administration, we have not lost our focus on that issue and our desire to convince our Canadian allies it would serve our mutual interest for both security and commerce to locate areas on either side where the inspections could take place before these vehicles move through tunnels or across bridges. Senator Levin. Can you, for the record, give us the status of those pilot programs which we legislated in 2003? Secretary Ridge. Yes, sir. Senator Levin. On the intelligence analysis coordination question and the letter which I referred to which went to four different people including yourself about the question of how do these various entities that are analyzing threats relate to each other. I guess the real question is this, we have a Department of Homeland Security, we have an FBI, we have a CIA. Internally to those we have Terrorist Threat Integration Center. In your Department we have an Information Analysis and Infrastructure Protection Directorate. We have a counterterrorism division in the FBI. And we have a CIA counterterrorist center as well as the TTIC or Terrorist Threat Integration Center. Who has the primary responsibility for analyzing foreign intelligence, No. 1? No. 2, is that laid out in writing? And No. 3, can we get an answer to our letter--Senator Collins' and my letter? Secretary Ridge. Senator, you have been very patient. You have asked me about this before. Senator Levin. Uncharacteristic of me, by the way, I want you to know. Secretary Ridge. You have been very patient with this Secretary, and I am grateful for that because I am mindful of the date that was at the top of the letter. Having served as a former Member of Congress all I can say is I am mindful of the date, and I know it is several months later. First of all, you ought to know that there is a coordinated response that is being prepared. The Department of Homeland Security has offered its views, and it is my understanding that response should be coming to you shortly, within the next couple of weeks. Senator Levin. I just had one additional question here, but I will pass to it. Thank you. Chairman Collins. Thank you. Senator Akaka. Senator Akaka. Thank you very much, Madam Chairman. Mr. Secretary, I have some questions concerning the human resource system. You have requested $102.5 million for a new human resource system. As there are no final regulations in place detailing the new system, what assumptions did you make in requesting this amount? What information or precedent did you rely upon to determine that the request was sufficient to implement the system? Secretary Ridge. First of all, Senator, you should know that the regulations are near completion and we would anticipate the publication within the next several weeks. As you know, that kicks in a 30-day comment period and certain discussions with the men and women and their representatives from organized labor ensue after those regulations are promulgated. The $100-plus million you refer to is a request based upon our desire to develop a performance-based pay system. It is also predicated on the notion that it is going to take some time in order to develop this system and to train managers, on the system, and how to apply it effectively. So the request for those dollars is basically to design the system, train management within the Department to utilize it appropriately and effectively, and then to begin a pilot program beginning toward the end of the year in fiscal year 2005. One of the challenges we have, and it came up in our discussions with representatives from organized labor, of which we have had several discussions as we have developed the system, is that there is really no prototype within government. We have never been down that path before. We have been down that path in the private sector. But it is something that the administration feels strongly about. I certainly do. I would like to have a performance-based system. But we need to design one, and we need to train people to use it effectively. There are some legitimate concerns that were raised by the representatives of the men and women that work in the Department of Homeland Security, and we thought one of the best ways to address some of their concerns was to make sure that we implemented the approach over a period of time, not just through the initial regulation. Because it would not have been satisfactory to them, we would not have designed a satisfactory system. It is not the way to go about implementing a broad-based system. So that is the reason for the additional dollars. Senator Akaka. Does the $31 million earmarked for training extend beyond training managers for the implementation of a new pay-for-performance system? Secretary Ridge. I am sorry, I did not quite understand, Senator. Senator Akaka. Does the $31 million earmarked for training extend beyond training managers for the implementation of a new pay-for-performance system? Secretary Ridge. I think it is not just managers that have to understand the system, but I think the employees have a right to understand what is expected of them and how their performance would be recognized and rewarded. So again, primarily the training is for those who would use the system, but I think there is a broader, department-wide educational campaign that has to be undertaken once we design the system. Senator Akaka. Forty-two million, Mr. Secretary, has been earmarked for the design and implementation of the new human resources system and for the administration and staffing of the new labor management and appeal process. My question is, does the funding for the new human resource system include funding for the Department's recruitment and retention efforts including the use of student loan repayment? Secretary Ridge. I think within the Department's personnel budget there are adequate and standard resources we would use to recruit and retain people. But, Senator, it does not include any loan repayment mechanism. Senator Akaka. Under a pay-for-performance system, you have requested $2.5 million. How many employees will this cover? Within this amount can you provide the anticipated pay increase good performers will receive? And what information did you rely upon in making this request? Secretary Ridge. Senator, I believe we are looking at a small pool of employees in order to test the system for almost a year, and the additional $2.5 million was to be allocated for that purpose and, frankly, to make up for any differences that we might experience, any losses we might experience so that there will be adequate money for a pay-for-performance protocol. Again, we tried to lay this out, Senator, over the next couple of years, because it has not been done in government successfully to date. I am not sure it has been tried successfully. I know there has always been an interest in getting it done. But it is going to take us a couple years to design, train, educate, prototype, and then apply. Senator Akaka. I wanted to ask before my time is up, of the $300 million requested for the human capital fund to meet your pay-for-performance goals, how much do you anticipate using? Secretary Ridge. Senator, most of those dollars are to effect the change within the system, and it is difficult--we think we will need it all. Senator Akaka. Finally, information technology funding calls for $226 million. I understand that the Bureau of Immigration and Customs Enforcement has had some trouble consolidating its IT systems to perform such functions as travel, budget, and case tracking. Will this $226 million help BICE with this issue? If not, are other funding sources being made available to BICE to streamline and consolidate its IT system? Secretary Ridge. Senator, your question highlights one of the major technology challenges that the Department has, because as you know, some of the pieces of Homeland Security came out of legacy departments such as Commerce and Justice, and some of their information, the data that they use is integrated into their systems. So to divest this data and bring it into a consolidated system with the Department is going to take time. That applies to Immigration and Customs Enforcement. It applies to Citizenship and Immigration Services. It applies to several other units within the Department. Again, those dollars will help us, basically from a technological point of view, pull that information, pull those databases out of the legacy agencies so we can consolidate it into the Department of Homeland Security. Senator Akaka. Thank you. Madam Chairman, my time has expired. Chairman Collins. Thank you. Senator Durbin. Senator Durbin. Mr. Secretary, I am a member of the Senate Intelligence Committee, and the experience we are going through now because of Dr. Kay's report is causing us to really take an assessment as to whether or not our intelligence gathering leading to the invasion of Iraq failed. The precipitate event, I suppose, was Dr. Kay's report. Fortunately, and I give you credit, the President and the administration, we have not had a sequel to September 11, 2001. God forbid that should ever occur, we will all be gathering in earnest in emergency to determine where we failed, what we could have done better. I would like to address one or two areas that continue to trouble me. I made reference to them in my opening remarks. I do not know how we can make America safer if our computers do not speak the same language, if they are not communicating with one another, and if we disperse responsibility among different bureaucracies. I felt and I think others did as well, that your arrival and your commitment to this personally, the development of a new agency meant that a new day would dawn. But the information that we have received suggests that the bureaucratic battles continue. Some things are very difficult for me to understand. In your last appropriation bill I asked for a report when it came to information technology by December 15. It is almost 2 months beyond that. I would commend you to note that is part of your appropriation, to give us a report on watch lists and coordination of information technology. But let me get right down to the bottom line, if I can. It looks to me like you are losing the turf battle within this administration. I think your legislative mandate is so imminently clear, and I will read it from the bill. To access, receive, and analyze law enforcement information, intelligence information, other information of agencies of Federal Government, to integrate such information in order to identify and assess the nature and scope of the terrorist threats to America. I thought that put you in the driver's seat. Now let us take a look at the watch list issue. The watch list, for some reason, has been delegated to the FBI. In an answer to a question from, I believe it was Senator Lieberman, you said that you expected their effort to be fully operational by midsummer for watch list integration. When the TSC was established it was supposed to be operational by December 1. I also want to say, not taking anything away from Bob Mueller and the fine people at the FBI, there are some questions as to whether or not this was the right place to put this watch list effort. Here we have the Inspector General's report of December of last year talking about the FBI and the FBI's efforts to improve sharing of intelligence. Listen to what the Inspector General of the Department of Justice said: ``The process for disseminating intelligence was ad hoc and communicated orally from manager to staff. One CIA detailee at FBI characterized the informal process as disorganized, noting that information does not flow smoothly within the FBI, let alone externally. In the 8 months the CIA detailee had been at the FBI, the detailee had not received a single CIA intelligence report. The detailee said, `information goes into a black hole when it comes into this building.' That is the most frightening thing I can think of, 2\1/2\ years after September 11, that we are still dealing with this. Where the President is creating by executive order agencies that compete with your legislative responsibility, agencies which frankly I think should be integrated under DHS, but instead we find in other parts of the Federal Government.'' Are we making progress? It looks like you are wading through a sea of molasses here trying to get to change and reform. I believe in you. I have from the beginning and I still do. I do not like what I am seeing. I would ask for your comment. Secretary Ridge. Senator, hopefully I can allay some concerns, perhaps not to your complete satisfaction but let me do my best. First of all, the Congress has directed that our Information Analysis and Infrastructure Protection unit be supplied with adequate resources to map the threat against the vulnerability, and then the responsibility of the Department is to do something about it. What you should know is that part of the fusion operation that we do in the information analysis department and unit within Homeland Security is to take information from--we have access to the information generated by the entire intelligence community. The decision to raise the threat level over the holidays was because of the partnership and the access to information generated by the broader intelligence community, in this instance particularly by the CIA, but also other sources. We believe that the Terrorist Threat Integration Center and the Terrorist Screening Centers add value to our effort to fuse all information from sources, whether it is horizontal across the Federal Government, whether it is vertical up from the State and locals. We are partners in the Terrorist Screening Center. We have analysts in the Terrorist Threat Integration Center. We have access to give and to make requirements on any of the information-gathering agencies in the intelligence community so that if we get a report we are empowered by Congress to go back to that agency and ask for additional information. So, within Homeland Security our information analysis unit is designed by the direction of Congress to fuse information from all sources, internationally, we get some information from time to time, from our own intelligence community, and from the State and locals, and that is precisely what we are doing. Senator Durbin. Let me ask you, I only have a few seconds left and this is such a broad question and, frankly, I do not know if you will have an opportunity to give the complete answer you would like to give, and maybe you would like to reflect on it. As you step back, as we all step back and look at the intelligence community in America and what happened before the invasion of Iraq, where we have the director of the CIA making a speech saying in defense of his agency, we are being mischaracterized. We gave good information based on what we knew. Now that you have to deal with intelligence, decide on alerts, decide what is truly a threat to this country, do you feel that there are fundamental weaknesses within our intelligence community which need to be addressed, beyond the partisanship here, Democrats and Republicans, that we need to address as a Nation, as you reflect on what happened prior to the invasion of Iraq? Secretary Ridge. Senator, I appreciate the way the question was asked, because we all have an interest in making sure that when information becomes available, regardless of the source, that is relevant to Federal action, whether it is Homeland Security, the Department of Defense, whatever, that it is actionable, that it be shared immediately so action can be taken. I think one of the big challenges that we have as a government, and I think for that matter as a society is to understand completely how difficult information gathering and analysis is in the context of combating terrorism. We from time to time apply, I think Cold War standards of certainty to information that are not necessarily applicable to the kinds of information we can glean from multiple sources that help us combat international terrorism. There is no country, there is not necessarily a central point where we can get the information. Unlike the Cold War, we do not necessarily have satellites identifying for us troop movements, and ship movements. It is much more difficult to get human intelligence inserted into an organization like al Qaeda. So the challenges we have, is to do exactly what you want us to do, get as much information as we can, analyze it as quickly as we possibly can. But even in that analysis there is as much art as there is science. There is probably not a day that does not go by, certainly not a week that does not go by, that we just took a look at a threat or a series of threats to the United States without considering a lot of other factors, without considering those factors you might be inclined to raise the threat level. We are very judicious about it. We will only do it when we think it is credible and corroborated. It is the notion of identifying what sources are credible, given the unique challenge of gathering intelligence in this war against global terrorism, and the unique challenge we have to corroborate that information that makes it so difficult for all of us to understand what precisely is going on. I have enormous admiration for anyone, regardless of the administration, Republican or Democrat, who has taken upon themselves as life's work to gather and analyze information and then reach conclusions that you need to act on it in one way or the other. We are getting better at it. We are getting smarter every single day. To your point, Senator, you have raised this question with me before with regard to the integration of technology. I would like to either come up or have Steve Cooper come up and sit down and show you what we are doing internally. I know you have questioned the 18 to 24 months. I appreciate the milestones that were set and the date certain within the calendar, but some things will get done only when--they just take time to do and I would like to come up and show you the way ahead in regards to the technology integration within the Department. Senator Durbin. Thank you, Mr. Secretary. Thank you, Madam Chairman. Chairman Collins. Senator Pryor. Senator Pryor. Thank you, Madam Chairman. Again, thank you for being here this morning, Secretary Ridge. I appreciate the task you have ahead of you. You may recall, during your confirmation process that I pretty much gave you a challenge to look at this new agency, the Department of Homeland Security, and try to make it into a model agency, try to make it one that really was the best that the Federal Government had to offer in terms of efficiency and effectiveness and teamwork. Understanding that you inherited a lot of people from other agencies and other existing institutions, and also you brought in--some are absolutely a new creation. So I would like to hear your comments on how you think the agency is running, and how it is doing in this challenge that I have laid out, and other Members of the Committee have laid out, to be a model Federal Government agency. I would just like to hear your comments, and then if you could even grade yourself on the job you have done up to this point. Secretary Ridge. If you give anybody the opportunity to make up the test, take the test, grade the test, I would tell you it is easy. It is easier. If it only were that easy. Senator one of the most significant challenges with this whole enterprise is that basically with the direction, and support of Congress, I might add, we are dealing with an organization that has within it a couple of startups, a few mergers, and an acquisition or two as well as a divestiture, to put it in private sector terms. So we have got a lot of things going on. One of the biggest challenges has been to maintain the focus day to day at the borders, at the airports, with the ports, to maintain that operational effectiveness and actually improve it at the same time we are integrating personnel systems, information systems, fiscal systems, procurement systems. I would tell you that my sense is that we have accelerated that process rather dramatically the past 3 or 4 months. The acceleration initially was slow simply because putting together a leadership team requiring background checks, Senate confirmation took a while, and very appropriately; it should. But now that we have got the leadership team in place, the vision is clear, the mission is clear, our performance goals have been articulated and that from day one on March 1 we started doing things differently at our ports of entry. Where you had at one time three agencies, three different Federal employees wearing three different uniforms and three different chains of command, immediately we consolidated that so they were all working with one chain of command and in the future--they have now and in the future are going to be cross- trained to do all of those tasks. So then we have more people to do more things at ports of entry which means when we have a surge need, that there are more people coming into the airport, people coming into the border, and we can put more people in order to meet the surge. You will see innovations like this throughout. The US-VISIT system is something that Congress had mandated we get done. No one thought we could get it done, but we were able to achieve it. Working on the human resource management system, it is a real challenge. Congress gave us the opportunity to do it, but we want to do it right, so we spent a lot of time--we have had several meetings around the country talking to employees. We certainly talked to their leadership. That rule will be promulgated probably by the end of this month. You have given us the resources to make dramatic changes at the airports. We have leaned forward to begin the process of protecting America and address our concern about port security in ports around the world. As we speak today, we have inspectors at Shanghai and Hong Kong and Rotterdam and elsewhere who begin that targeting process, who begin inspecting the cargo. Sometimes it is a physical inspection. Sometimes it is where they open it. Other times it is with non- intrusive technology. So while we try to make operational improvements, we have also tried to pull our resources together to begin the process of integrating all the enabling management functions. You will get a more complete report card on or about March 1. I think we have made great progress but I will be the first one to admit in terms of operational efficiency we have done well. We are going to do better. In terms of integrating some of the enabling management personnel that we have and functions that we have, we have done well. We are going to do better. But I think the pace has accelerated considerably the last 3 or 4 months. You notice I avoid giving myself a grade. It would be too self-serving. Senator Pryor. I did notice that. Secretary Ridge. I wish I could have done that in college. Senator Pryor. I am not going to press on that. I must tell you that my background as being Arkansas's Attorney General I am very connected to the law enforcement community in my State and when I talk to folks in the law enforcement community, mayors, people, firefighters, etc., one complaint I still hear is the slowness of money coming out of the Federal Government down to the local level to first responders. In fact today there is a story on Fox News online about that and they quote a number of people that are out and around the country doing different things, and that is still a complaint. So I have heard that in my offices. It sounds like nationally people are hearing that, and I would like to hear your response on that. Secretary Ridge. We are hearing it as well, Senator. First of all, let me assure you that the dollars that you appropriated to the Department in 2002, 2003, and 2004, particularly the 2002 and 2003 dollars, they are ready to be drawn down. We have done our job. You told us to get it ready for distribution within 45 days and we were ready. Having said that, looking at our partners, and they are our partners at the State and local level, we know that depending on the State there are different reasons for the delay. We are going to take it upon ourselves with our partners to try to break the logjam and then come up with a standard means of distribution so that neither you nor your colleagues on the Committee or other Members of Congress, and more importantly, the first responders will ever say again it is taking too long to get those dollars to us. Clearly they are right. We have $8 billion to $9 billion to be distributed. Some have not been distributed from 2002 yet. We still have almost half from 2003, if not more, let alone the 2004 dollars. So there is a problem there. We are ready to make the distribution. So we are going to go back and take a look at the States that have done a good job of distributing the funds and see what practices they employ, and then sit down--frankly, I am going to sit down with the governors when they come to town in a couple weeks to talk about the distribution problem because we all want those dollars, once appropriated, to get out to where the governors and the mayors and the first responders have prioritized their needs. The sooner, the better. Senator Pryor. Madam Chairman, let me ask one follow-up question on that, if I may. I have been looking at the President's budget and I know that you have sat in that chair right there over the last 12 months and you have reiterated time and again the importance of having local law enforcement on board. You just mentioned again it is teamwork, you are partners, etc. But how can we expect preparedness at the local level when in the President's budget we are cutting the dollars available to local law enforcement agencies and first responders by about $800 million? Secretary Ridge. I think, first of all, I want to try to put again into context, every year we are going to make an assessment as to what the priorities of the Department of Homeland Security are. I believe the level of funding requested by the President this year is fairly close to the level of funding the President requested last year and then Congress added several hundred million dollars to that request. You will note that we have maintained the same level of funding, knowing full well that if we get this level as requested that there would have been nearly $15 billion out to the States and to the locals since 2001, and most of that in the past 3 years. Our focus, as we maintain the same level of funding we requested last year as this year is to not only worry about inputs but outcomes. We take a look at 2005 as being a critical year as we take a look at the homeland security strategies submitted by the States, taking a look at their needs so we can better distribute the dollars. I think Congress will hold the Department accountable for where the dollars have gone. We accept that responsibility. We maintain the same strong level of funding, $3.5 billion, but this year for purposes of the budget a little more money for the Coast Guard, more money for biosurveillance, more money for the human resource plan, were priorities that were funded. And again, maintaining a $3.5 billion fund for first responders was considered appropriate under the fiscal and security circumstances with which we operate. Senator Pryor. Thank you, Madam Chairman. Chairman Collins. Thank you. Mr. Secretary, we are going to do a very brief final round of questions of only 3 minutes each in the attempt to get you out of here as near to 12 noon as possible. We appreciate your time this morning. In my remaining few minutes I want to bring up two problems that my home State has experienced. I bring them up not only to bring them to your personal attention in the hope of securing a commitment that your staff will work with us to resolve them, but also because I believe they illustrate some of the broader issues that the Department is confronting as it seeks to strengthen our homeland security. The first involves a community in far northern Maine, in northwestern Maine, that has a very difficult situation because the houses are on the American side of the border and all the services that this community uses are on the Canadian side of the border. So to go to church, to avail themselves of medical care, and to go to the grocery store, these American citizens need to cross over to the Canadian side. Prior to the tightening of security, the Department had a program called the Form One program that allowed these citizens to get certified by our government, if you will, and to be able to cross at will. So to go to Catholic mass on Sundays, for example, was a very easy undertaking. Now, however, there is a gate at that border which is unmanned on Sundays, and the result is that these citizens are essentially locked in on the American side of the border. They would have to travel over 100 miles through woods roads in order to cross at a different border crossing. This creates a real hardship for their lives, and it has also led to some of the citizens in frustration crossing illegally and then fines being imposed on them. It is just a very difficult situation given that all the services are on the Canadian side. I would note, the Canadians still have a system that allows these citizens to enter Canada without any problem whatsoever. The problem is they cannot get back. They cannot cross back over to their homes on the American side. The Department in response to my request did institute some limited Saturday hours which were helpful, but that has not solved the problem on Sundays or evenings, and it is a real problem. There are not a lot of people involved but it has completely changed their lives, and it illustrates the problems between free flow of people and commerce who are not going to do our country any harm versus the need to have tighter control over our borders. The second incident involves a recent sweep by Immigration and Border Patrol officials in Portland, Maine. This sweep resulted in 10 arrests, and obviously we want the Department to vigorously enforce our immigration laws. There were some people who were there illegally and there were those who were there on expired visas. But we also had many serious complaints from community leaders that the way in which this sweep was conducted created a great deal of fear among immigrants who are here legally. The agents went to a homeless shelter, they targeted Latino, Asian, and African restaurants, which then experienced a dramatic drop in business throughout this period. It just seems to me that there has to be a better way for the Department to pursue its very important responsibilities and to make sure that people are not here illegally. I do feel strongly about that. But to work more with the community involved to make sure that these sweeps are conducted in a way that is respectful of people and do not target small businesses in a way that ends up hurting their business. So I would ask that you work with me and the Department work with me on those two issues. Neither of them are easy issues and I think both of them illustrate the challenges and the problems that we face in this new September 11 world. Secretary Ridge. Senator, it would be a pleasure to work with you on both of those. They are illustrative of the challenges, not just the Department or your particular community face, but the entire country, and that is the balance between aggressive enforcement of the law, be it for law enforcement purposes or counterterrorism, anti-terrorism purposes and a dramatic change in how we have historically done business. I suspect that community that has been affected adversely by the gate across what had heretofore been just a normal path of entry and exit is probably mirrored across the entire northern border. So I think, obviously, we would be pleased to work with you on that. It is that balance between security and convenience and commerce that sometimes needs to be applied on ad hoc cases, one at a time. So obviously we will be pleased to work with you on that. I would say, hopefully, if men, women, and children are in this country legally they have nothing to fear and should not fear. We need to maintain ourselves as that open, welcoming country that we have been for 200 years. How they conducted business on that particular day or days I am not familiar, whether or not notice was given to the local communities, whether or not they engaged local law enforcement to assist them, I cannot answer that question. But I suspect if we put some of my folks down with yours we will be able to get to the answers. We do not want to discourage the Border Patrol from doing their job. We also want to encourage them to do it in a way that is consistent with the standards of service of the Border Patrol and that is respecting the rights of individuals, be they legal or illegal, and the rights of the community. So again, it is obviously a situation that you and I have to explore and if there is a need for a remedy or a change in approach, then I would be pleased to discuss it with you. Chairman Collins. Thank you very much, Mr. Secretary. Senator Lieberman. Senator Lieberman. Thank you, Madam Chairman. Mr. Secretary, this last round I would like to give you three questions and you can answer them to the extent that time allows, although I hope they lend themselves to rather brief answers. The first is on the question of interoperability. As we know, on September 11 there is some substantial reason to believe that some of those first responders we lost at the Trade Center certainly were lost because of a failure to communicate with their colleagues, brothers and sisters in law enforcement. This capacity to communicate with one another is lagging in most parts of the country today. I saw one cost estimate that said it could cost $18 billion to create real interoperable communications. The President's budget this year appears to cut the minimal funding that was targeted to interoperability in the past budgets through FEMA and the Department of Justice. So my question is, what role the administration sees in making interoperability a reality among local law enforcement? Second, we talked before about the terrorism watch list. My initial thought--and I am not alone in this dream here--was that we would eventually have a coordinated watch list that would, using your terms, not only be horizontal but vertical and that any local police officer stopping somebody for a traffic violation, just as they punch into the crime information system now, would be able to punch in similarly to a terrorism watch list, and might apprehend somebody who was on that list. I wanted to ask you whether you share that goal and how we are doing in achieving it. Then the final, on the TSA--again, we cannot do everything right away but with the enemies that we have who are going to strike at our vulnerabilities, I think one of our roles here is to be persistent in pressuring each other to limit and close those vulnerabilities. In the TSA budget, which now looks to be over $5 billion, I find only $24 million assigned to what I would call non-aviation modes like rail, bus, trucks, etc. What is the priority that you can place or you think the budget should place on the non-aviation transportation modes which themselves, unfortunately, might be vulnerable targets for terrorists? Secretary Ridge. Madam Chairman, if I could have a few extra minutes to respond, as I think I would like to answer the Senator's questions. Chairman Collins. Absolutely. Secretary Ridge. First of all, Senator, the whole question of interoperability, communications, is very much at the heart of equipping our first responders to do the best job they possibly can at the time of an incident. Their primary job is to save lives, and until we come up with an interoperable communication system, we will not be able to maximize their personal effort. To that end, SAFECOM, that acronym has been used in a couple different places, but safe communications, there are three pilot projects, there are several pilot projects out right now and that is one of the areas that the science and technology unit is examining for the purpose of determining the standards we need in order to create such a system. I would tell you that as an eligible drawdown on some of these dollars from the Office for Domestic Preparedness there is technology on the market that basically can be used to secure basic information from different sources on different frequencies, translate it, and then ship it out. That is only a temporary measure. So first, we have pilots working. Second, there is some technology on the market that can assist with this. It is not the final answer. And third, the whole notion of standards is part of the Science and Technology's mission. With regard to vertical information sharing, the notion that once we have the watch list integrated into one database, and we will be there, and I believe, by the end of the summer, rather than individuals sitting in front of screens looking at their individual watch lists, the notion that it should be shared with the State and locals is one that we all embrace. Senator you should know that most of the inquiries to date to the terrorist screening center have been from State and local law enforcement. Again, it just shows you what a powerful tool information is when you get it in the hands of people who can take action with it. So again, we are going to do better at the integration and we are looking for ways within the Department of Homeland Security on how we can better share that information via the Internet and elsewhere with State and locals under other circumstances as well. So that process is moving along rather swiftly and I think effectively. Senator Lieberman. Can I stop you? I apologize. In other words, what you said, the No. 1 customer, if you will, or the source of questions to the terrorism watch list now, are from State and local law enforcement? Secretary Ridge. Not the No. 1, but the first couple inquiries we had within---- Senator Lieberman. They picked somebody up and they wondered whether there was something to worry about? Secretary Ridge. Correct. Now ultimately that integrated database will be connected into the airports, the TSA, and the ports of entry. But that is precisely what happened. They are anxious to help, Senator. You know that. Senator Lieberman. They sure are. Secretary Ridge. These State and local folks, 650,000 strong, they want to help. And one of the best things we can do to enlist their support is to get them the information they can act on. Third, Congress has provided, you are right, the bulk of the funding for TSA as it relates to aviation security. But separate and apart from that, when it comes to other forms of transportation, shipping, you have got the Coast Guard, and as we take a look at rail and trucking, etc., you have given us quite a few dollars in the infrastructure protection budget to take a look at technologies that can apply to improving security. It is part of our responsibility as well to work with the agencies that also oversee these other modes of transportation, the Federal Highway Administration and the like, to work on improving safety and adding more security to those venues as well. Senator Lieberman. Thanks, Mr. Secretary. Obviously we have come a long way and we have got a long way to go and we are going to get there quickest if we go there together, so I look forward to it. Thanks, Madam Chairman. Secretary Ridge. Thank you, Senator. Chairman Collins. Thank you. Senator Akaka. Senator Akaka. Thank you very much, Madam Chairman. I have three quick questions. One that follows up on the Chairman's concern on immigration. I understand that BICE is reorganizing the special agent in charge of field office structure. My question is, how does the budget request cover this reorganization? My second question has to do with cuts in science and technology in the university and fellowship programs within Science and Technology Directorate, a cut of $38.8 million. My question is, why were these programs cut? Because I feel such programs certainly develops the innovative and skilled technical staff that we need. Finally, on geospatial information databases. I have long had an interest in using geospatial information to enhance our response to disasters. A comprehensive and layered national defense database of geospatial information could be an essential element in developing a comprehensive response to any disaster. Indeed, such information was useful in response to the September 11 disaster in New York. My question is, does the Department have a strategy for acquiring such a capability? If so, what is the timeframe for its development? Secretary Ridge. First of all, Senator, with regard to seeking additional dollars to reorganize the Bureau of Immigration and Customs Enforcement, we think the Congress has been generous in supporting the basic function of BICE. You gave us an increase this year and as far as we are concerned, it is our responsibility to reorganize it, to make it as efficient as possible and we should not be knocking on your door to get additional money to do it. You have already been pretty generous. Second, the science and technology question that you asked, I did not hear, Senator, the specific reduction in funding that you were concerned about. I know it was in S&T but I did not quite pick that up. Could you kindly repeat that? Senator Akaka. Yes. The budget proposes a cut of $38.8 million in the university and fellowship programs within the Science and Technology Directorate. My question, why were these programs cut and what do you think about whether it affects the Department's ability to develop and maintain the most innovative and skilled technical staff possible? Secretary Ridge. Senator, as you know we have begun both a program to identify and work with centers of excellence--those are academic institutions around the country--and the scholars and fellows program. Again, as we took a look internally as to what we thought our priorities should be for fiscal year 2005 we thought we could maintain the existing program with regard to scholars and fellows and maintain the existing number of centers for academic excellence, but for the fiscal year 2005 there were other higher priorities and chose to fund those. But make no mistake about it, over the long term, scholars and fellows for the science and technology unit will continue to be a significant priority. It is just not the highest priority this year. In the academic centers of excellence which to date, Senator, have ended up being grants given to universities that consolidate their applications, the first one was given out West but actually involved five universities all around the country. So again, in 2005, set priorities, we will maintain the existing fellows and scholars program. We will maintain--I think we are going to have four to six academic centers of excellence. But the priorities for 2005 said, maintain and grow them later. Senator Akaka. My final question was on geospatial information database and asking for a timeframe for its development. Secretary Ridge. Senator, I know that in discussing the geospatial component of both our operations center and talking with people in FEMA about it and others that there is significant interest within the Department. I cannot speak specifically whether or not it has been reduced to a strategy, and I would welcome the opportunity to address that by virtue of a letter to you here in the next week or so. Senator Akaka. Thank you very much, Madam Chairman. Chairman Collins. Thank you, Senator. Mr. Secretary, thank you not only for appearing this morning but for the outstanding leadership that you have given the Department during its first year in operation. We very much appreciate your leadership and your dedication to public service. Secretary Ridge. Thank you, Senator. Thank you very much. Chairman Collins. This hearing record will remain open for 15 days for the submission of additional materials. I want to thank my staff and the Minority staff for their hard work in putting together this hearing which is now adjourned. Thank you. 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