DHS and the Stimulus

A small, dilapidated building resembling a roadside gas station sits along the US-Canadian border in Whitetail, Mont.

The exterior paint is peeling from its walls, cracks in the side door permit light and precipitation to enter, tiles in the bathroom floor have been scraped away, the unfinished basement floods and the water from the well is undrinkable.

Yet this building is the official US port of entry for those entering the United States via Route 511 in Montana.

A description of these conditions, along with pictures of the disrepair, appear in a report from the Department of Homeland Security (DHS) titled 30-Day Review of Spending by U.S. Customs and Border Protection [CBP] under the American Recovery and Reinvestment Act for Construction of Land Ports of Entry (http://www.dhs.gov/xlibrary/assets/cbp_30_day_review.pdf).

The report goes on to say that CBP officers trapped at the port in the frequently inclement weather must sleep on the floor and eat emergency rations until someone rescues them.

"There are also evident security issues. The lines of sight are poor, both within the building and along the road viewed from the building. There is virtually no separation inside the building between the officers and the traveling public. The building has no holding facilities; accordingly, when CBP detains someone, one officer monitors the person and the other officer conducts the other business of the port, including inspections."

Homeland Security Secretary Janet Napolitano ordered the 30-day review, which began in September after members of Congress such as Sen. Byron Dorgan (D-ND) criticized DHS spending on such ports of entry under the American Reinvestment and Recovery Act (Public Law 111-5) as a waste of money.

Dorgan was unhappy with the results of the review, which found that CBP’s plans to spend money on ports of entry were justified.

"I just strongly disagree with the decision," Dorgan said in an Oct. 30 statement. "These are small northern border crossings that are averaging five vehicles an hour. To destroy existing facilities and to rebuild them at a cost of $12 million for each port of entry is way out of line."

Dorgan planned to require the Government Accountability Office (GAO) to assess the DHS expenditure plan on US ports of entry and to conduct a cost/benefit analysis of the plan, particularly with regard to 22 land ports of entry that he contends do not require significant investments to upgrade.

DHS does not argue that many of these ports do not receive a lot of traffic on a typical day, but Napolitano’s review and a separate, but concurrent, review by the DHS inspector general found that the spending was justified. Congress allocated $420 million in the Recovery Act for modernization of land ports of entry operated by CBP.

Of the 163 US land ports of entry, CBP operates only 43 of them–39 of which are along the US northern border. Under federal guidelines, the useful life of office buildings is 30 years, and the facilities are much older than that.

Ultimately, however, DHS argued it really has no authority to spend its stimulus money elsewhere. So the department is simply doing what Congress told it to do with its expenditures under the Recovery Act.

"DHS has no discretion to decide not to obligate and expend funds appropriated by Congress," the 30-day review stated. "Under the Impoundment Control Act of 1974, the Executive Branch must obligate funds appropriated by Congress unless the President proposes a rescission. If the President proposes such a rescission, the House of Representatives and Senate have 45 days to approve it, otherwise the funds still must be made available for obligation."

Airport security

DHS didn’t receive a large percentage of stimulus funds when President Barack Obama enacted the Recovery Act nearly a year ago. Out of $787 billion, the Recovery Act gave the department only about $3 billion. Still, CBP is the second largest recipient of Recovery Act funds at DHS, receiving $680 million total for the construction at ports of entry and communications and inspection equipment.

The first and largest recipient of stimulus funding at DHS is the Transportation Security Administration (TSA), which received $1 billion for explosives detection systems and checkpoint screening equipment. As of press time, TSA had obligated more than $575 million of those funds, putting it on the fast track to practically complete its Recovery Act investments early this year.

In spending its stimulus money, TSA identified projects on which it could spend the funds quickly, TSA spokesman Jim Fotenos told Homeland Security Today.

"In awarding Recovery Act funds, TSA prioritizes shovel-ready projects that meet critical security needs and quickly infuse resources into local economies. TSA allocates Recovery Act funds to purchase equipment based on currently set priorities and the recipients’ ability to comply with Recovery Act requirements," Fotenos said in a written statement.

TSA has also purchased screening technology under the Recovery Act from vendors who build their products in the United States, which supports the goal of stimulating the American economy, Fotenos stated.

Much of the screening equipment purchased has the capability to receive upgrades in the future, as well, stressed Ellen Howe, former TSA chief of strategic communications and public affairs.

“They also are deploying AT [advanced technology] X-ray, which will be upgradeable to the liquid algorithms once those are working. That’s a sound strategic decision. You are going to see more money spent on that,” Howe told Homeland Security Today.

TSA continues to maintain a focus on liquids and the threat of liquid explosives because intelligence indicates that threat remains active, said Howe, now a strategic communications executive at Adfero Group in Washington, DC. UK authorities stopped a liquid explosive plot in London in August 2006.

Stimulus funds also boosted new technologies, such as millimeter wave and backscatter X-ray devices, as well as wireless whisper radios for TSA officers, enabling discrete communications, and surveillance systems, assisting against insider threats.

Fotenos and Howe also both insisted that TSA’s deployment of its screening technology was risk-based, despite a recent report from GAO that suggested TSA’s strategic plan for deploying checkpoint technologies is not risk-based. (Aviation Security: DHS and TSA Have Researched, Developed, and Begun Deploying Passenger Checkpoint Screening Technologies, but Continue to Face Challenges, http://www.gao.gov/new.items/d10128.pdf).

“However, the strategic plan and its underlying strategy do not reflect some of the key risk management principles set forth in DHS’ National Infrastructure Protection Plan (NIPP), such as conducting a risk assessment based on the three elements of risk—threat, vulnerability and consequence—and developing a cost-benefit analysis and performance measures,” the GAO report stated.

“The decisions are risk-based and threat-based. TSA bases its technology deployments on risk-based security. The whole agency is driven by intelligence,” objected Howe. “I don’t think the people who write those reports have access to the same level of intel briefings that TSA is using when they are making their decisions.”

Howe has one criticism for TSA’s stimulus spending, however. With all of the needs that had been identified prior to the stimulus, she expected TSA to spend the money faster. When it comes to in-line baggage screening equipment, for example, “There has been a queue forming ever since they started installing those systems in 2001,” she said, adding, “I would have expected to see more money move out the door by now.”

Grant funds

Behind TSA and CBP, the third largest recipient of stimulus funds was the Federal Emergency Management Agency (FEMA), which received $610 million for various grant programs, as well as $5 million for disaster loans.

The Recovery Act provided $150 million for port security grants, waiving the match requirements usually required from state and local governments for those funds. The act also eliminated matching requirements for Staffing Adequate Fire and Emergency Response (SAFER) grants for firefighters in fiscal 2009-2010.

While federal grants are a very small source of money for states, waiving match requirements is very helpful in speeding funds to projects that are ready to go, Matthew Bettenhausen, secretary of the California Emergency Management Agency, told Homeland Security Today.

Whenever the secretary of DHS has the power to waive non-federal match requirements for any grant programs, she should do so, given the current economic environment, Bettenhausen contended. States once thought they would be able to meet those matches in future years, but now they cannot due to the tough recessions they have gone through.

“Our situation in California is that the governor went to the people of California with his propositions to build infrastructure and included $100 million in there for our ports with the bonds. Our ports were going to use that bond funding to do the match. Well, we’re now in a fiscal crisis. The bonds are being held up, so the match isn’t there, so those investments aren’t being done,” Bettenhausen explained.

“If we want to talk about stimulus, those are shovel-ready projects that are now being held up just because of the match requirements. So if you really want to start seeing the money flowing into the economy, waive those matches,” he stated.

The need for waiving match requirements is particularly great in grant programs like those for interoperable communications, Bettenhausen noted. Police and fire departments in California completed planning for interoperable communications and applied for grants, but the state’s budget crunch forced them to make tough decisions that they didn’t anticipate.

“So do we buy or improve equipment that we know that we need vs. do we lay off another officer when crime is going up because theeconomy is deteriorating and, thereby, diminish public safety?” Bettenhausen asked rhetorically.

“Difficult decisions are going to have to be made about continuing projects just because of the credit crunch. There should be no reason for that. They should waive the match,” he stated. “It doesn’t require any cost to the federal government to do this.”


Ultimately, DHS found itself in the same boat as other federal agencies, according to Deidre Lee, executive vice president of the Professional Services Council, the national association of the government professional and technical services industry. Congress gave them a mandate to spend additional appropriations faster, but without additional procurement personnel or capacity to support it.

“It takes some time before the money actually comes to the agency, before they know how much money they will actually have and before they know what programs are going to be approved,” said Lee.

So while there has been an expectation for very quick contracting with very clear parameters, the money can move to the federal agencies only so quickly. Then, once they have it, they in turn have a limited time to spend it and move it into the economy.

“When you look across the board at other government agencies, most government agencies have a very full plate. They have a lot of money that they need to execute per good business arrangements with their normal everyday annual appropriation,” Lee explained.

“Most people are sized to accommodate that as a challenge. Then you add an additional amount of money with additional reporting requirements with additional transparency requirements and with nuances in it and the workforces weren’t increased. So I don’t think it’s shocking at all that there were challenges, and I don’t think it’s unique to DHS,” she added.

In Lee’s view, DHS and other federal agencies were faced with spending stimulus money on projects that were “shovel ready.” But they also faced the challenge of balancing those with projects that were high priorities. “DHS undoubtedly looked at the programs that made the intent of the stimulus and the highest priorities they could execute in a timely fashion,” she observed.

All federal agencies have had to strike a balance between projects that are imminent and those that are important over the long term in order to use their stimulus funds. DHS chose to resolve that dilemma by putting money into CBP’s ports of entry where there was a clear priority, an obvious need and plans already drawn up.

As a result, the CBP officers manning the station at Whitetail, Mont., someday soon may be able to sleep on cots, eat some decent food and take a drink of potable water from time to time—as long as Sen. Dorgan doesn’t object.

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