DHS Reorganization "Generally Positive" for Private Sector, Analyst Says

by Justin Rood, CQ Staff

Technology companies, sensor manufacturers and other businesses stand to gain from Homeland Security Secretary Michael Chertoff's restructuring of his department, an analyst concludes in a new report.
But Chertoff's new push for integration within the Department of Homeland Security (DHS) may lead to higher-stakes, "winner-take-all" contracting competition, as companies vie to provide the department with cross-agency solutions for surveillance, system access, networking, sensors and other new technologies.
The report was released July 22 by the Civitas Group, a Washington-based homeland security investment analysis firm. Civitas is heavy with former government officials, including former Clinton national security adviser Samuel R. Berger; Warren B. Rudman, former New Hampshire Republican senator (1980-93) and chairman of the President's Foreign Intelligence Advisory Board; and Joe M. Allbaugh, former director of the Federal Emergency Management Agency.
In the Civitas report, authors Mark Shaheen and Richard Gordon argue that the changes to DHS announced by Chertoff July 13 were "generally positive" for private businesses.
The big winners from the reorganization, Civitas says, will be technology companies, particularly systems integrators, screening and access-control companies, and makers of databases, backend systems, and analysis and translation software.
In particular, the department's drive to integrate its operations will fuel increased spending on computer, network and access technology.
Civitas also saw promise in Chertoff's creation of a chief medical officer to coordinate bioterror preparedness and response with other government agencies. The new post, the authors said, "signals an intent by the Department to take a more prominent role in this area." Overall, companies and investors focused on bioterror issues should be heartened by the overhaul, the report concludes.
The report notes that Chertoff's changes "flatten" the department's organization chart by stripping away layers of management. However, they warn, such a structure "puts a tremendous burden" on Chertoff and his deputy secretary, Michael Jackson, to directly oversee nearly 30 offices.

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Turf Wars Likely to Erupt Over DHS Reorganization Proposal

by Greta Wodele, National Journal

When Homeland Security Secretary Michael Chertoff announced on July 13 that he would reorganize his troubled department, lawmakers on Capitol Hill gave him high marks. But Chertoff could quickly find his proposal tangled up in House-Senate negotiations over DHS's fiscal 2006 budget and in a tug-of-war between turf-conscious committee chairmen.

The secretary has broad power under the 2002 law creating the department to implement most of his reorganization plans, but he needs congressional approval for a handful of the proposals. He has sent legislative language to the Hill authorizing him to establish a new department-wide policy officer; eliminate the Border and Transportation Security Directorate and the Emergency and Preparedness Directorate; and revise the Federal Emergency Management Agency's responsibilities.

Lawmakers are reviewing Chertoff's legislative language and plan to hold hearings and draft legislation soon, according to House and Senate aides. More than a handful of committees could potentially seek to review the proposals. "Everybody is going to want to get their fingerprints on this," one House Republican aide predicted.

The plan is likely to reignite battles between House and Senate committee chairmen who have been fighting to retain jurisdiction ever since the debate over the department's creation in 2002. These battles flared up again more recently when Congress designated Homeland Security committees in each chamber and passed legislation overhauling the intelligence community. "Unfortunately, it doesn't take that much to create little wars over committee jurisdiction," said Senate Minority Whip Richard Durbin, D-Ill.

Sen. John McCain, R-Ariz., said he hoped that Chertoff's proposal would raise the jurisdictional issue again and thus highlight the lack of coherent congressional oversight over DHS. In its report last summer, the 9/11 commission had called for streamlining congressional jurisdiction over the department. Although the House and Senate finally agreed in January to designate one committee in each chamber with primary jurisdiction over DHS, several other panels also share authority.
The department has been heavily criticized for inefficiencies, bureaucratic squabbles, and misuse of federal dollars since it was created by merging 22 different agencies. Through his reorganization, Chertoff intends to concentrate DHS resources on threats that pose catastrophic consequences. He wants to consolidate and dissolve several offices and to create new positions and programs by October 1.

The day after Chertoff's announcement, the Senate approved its fiscal 2006 Homeland Security appropriations bill. The House passed its version in May. Chertoff's proposal could throw a wrench into budget negotiations to reconcile the two chambers' versions, because the bills include specific -- and disparate -- funding levels for the DHS directorates that are now on the chopping block. "I'm hopeful we can support [the changes], but there may be some we don't," said Senate Appropriations Committee Chairman Thad Cochran, R-Miss.

Meanwhile, the House Homeland Security Committee and the Senate Homeland Security and Governmental Affairs Committee are likely to have first dibs on Chertoff's legislative fixes, but other committee chairmen have begun to lay their claims as well.

Already, Senate Finance Committee Chairman Charles Grassley, R-Iowa, and ranking member Max Baucus, D-Mont., have reminded Chertoff in a letter that late last year, "it was determined that the Senate Finance Committee would preserve the oversight of revenue functions, commercial functions, and commercial operations that are now delegated to Customs and Border Protection and Immigration and Customs Enforcement."

Likewise, a spokesman for House Energy and Commerce Committee Chairman Joe Barton, R-Texas, said that his panel is "intent on looking at any legislative language needed for this reorganization." Last year, Barton fought adamantly against creating the permanent House Homeland Security Committee and for retaining his committee's power over cyber-security issues at DHS. The Barton aide added that Energy and Commerce is "definitely going to keep a watchful eye over cyber-security."

Chertoff needs Congress to help him dissolve the Border and Transportation Security Directorate, which oversees the customs and immigration enforcement agencies as well as the Transportation Security Administration and its federal screeners. Chertoff also wants to break up the Information Analysis and Infrastructure Protection wing, which has fought a losing battle with the FBI and CIA over the last two years for power over intelligence matters. Chertoff said the DHS assistant secretary for information analysis would become his chief intelligence officer, and that he would promote the department's cyber-security czar to an assistant secretary position.

The secretary faces some criticism for what he is not revamping. Democrats on the House Homeland Security Committee have issued a report complaining that Chertoff's reorganization proposal "failed to address the inability of TSA to serve as both an aviation security agency and a surface transportation security agency."

Republicans have also bashed the beleaguered TSA; and although Chertoff has not taken steps to overhaul the agency, Congress could deliver legislative reforms in the near future. Rep. Christopher Cox, R-Calif., who currently chairs the House Homeland Security Committee but has been nominated to head the Securities and Exchange Commission, has said that his committee will draft legislative reforms for TSA this year.

New DHS Policy Shop Will Tackle Border Security, Illegal Immigration

by Chris Strohm

Homeland Security Secretary Michael Chertoff said Monday that the department's newly proposed policy office would develop a comprehensive strategy for improving the nation's border security and addressing illegal immigration.

Chertoff proposed creating a departmentwide policy directorate, headed by an undersecretary, as part of several organizational changes announced two weeks ago. Since then, Chertoff has said the department is mapping out changes across the nation's border and immigration system, and plans to hire a program manager to execute more reforms in the coming months.

"Obviously we know there's a huge issue with the border," Chertoff told government officials Monday during a keynote speech at the Excellence in Government conference in Washington, which is co-sponsored by Government Executive. "The appropriate way to address this, I think, is strategic."

"Our philosophy with respect to the border -- and with respect to other things, as well -- is we want to look at the whole system," he said. "We want to analyze it strategically. We want to make sure that when we're adjusting in one area, we are taking account of that throughout the entire system. And it's that kind of capability that we're looking to develop in the department with this unified policy and planning function."

Chertoff equated changes in border security to building a pipeline. If more illegal aliens are apprehended, for example, more detention beds and faster adjudication processes are needed.
"When you look at the problem of illegal migration, it is not really a question of how many boots you have on the ground at the border," he said. "It's how those boots interact with your technology and your infrastructure to give you the maximum efficiency in terms of intercepting and deterring illegal border crossings."

"It's like when you make a pipeline," he added. "If you expand one part of the pipeline, you better make sure the whole pipeline is scaled up; otherwise, you get a bottleneck and you break the pipeline."

Some critics, however, say the Bush administration and DHS are not doing enough to address border security gaps, even with the proposed changes.

T.J. Bonner, president of the National Border Patrol Council - which represents 10,000 Border Patrol employees - called the reorganization plan "little more than a bureaucratic reshuffling and perpetuation of failed policies that needlessly compromise homeland security."
Bonner said an effective program is needed to sanction employers who hire illegal immigrants.
Michael Cutler, who worked at the former Immigration and Naturalization Service for 30 years, said the reorganization plan falls short because it does not merge the Customs and Border Protection bureau and Immigration and Customs Enforcement. The border security system should be viewed as a tripod, he said, with enforcement at ports of entry, between ports of entry, and in the interior of the country integrated and seamless.

"I was very disappointed to see that they have not merged CBP and ICE. That to me is a major concern," Cutler told Government Executive. "We're supposed to all be working for a common goal, and a two-legged tripod falls over."

Under the proposed restructuring, ICE and CBP would be stand-alone agencies that report directly to Chertoff rather than an undersecretary.

Some lawmakers also have been skeptical about how the proposed reorganization would improve border security.

"It appears to me that you're going in exactly the opposite direction by moving CBP and ICE out from under a common directorate ... and have them reporting to you directly," Sen. Susan Collins, R-Maine, told Chertoff during a recent hearing. Collins heads the Senate Homeland Security and Governmental Affairs Committee.

"If anything, you're further separating the entities," she said. "We know that a lot of law enforcement officials believe that it would be better instead to bring them together."
Sen. Tom Coburn, R-Okla., asked Chertoff to better define the department's priorities.
"I want to make sure you understand that the consensus in the country, even though we have to have some immigration reform, is to secure our borders, northern and southern," he said. "What is the priority? Is it to change immigration policies, or is it to secure the border? I understand that they all are interdependent, but which is the greatest priority?"

Chertoff told the lawmakers he was "acutely aware of how troubled people are" about border security. "What we're doing now is, we're going to have a program manager who is going to build an entire system, and make sure that all the pieces are properly scaled so that we actually increase efficiency," he said.

"One of the main reasons I am arguing for a policy and a planning director is to give us the people who can take these policies and now really literally grind out the instructions very specifically about how we get there," he said. "I'm convinced we can do it."