Homeland Insecurity

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On the Watch List

The more Homeland Security cedes control, the less institutional knowledge it has to determine whether contractors are performing up to snuff, critics say. For instance, 60% of the people who participated in the development of the acquisition plan for SBInet were contractors, according to a February, 2007, memo to the House Committee on Oversight & Government Reform. SBInet is currently on OMB's Management Watch List, a tally of poorly-planned projects. "There is a danger that the department may become so dependent on contractors that it simply has no in-house ability to evaluate the solutions its contractors propose or to develop options on its own accord," Senator Joseph Lieberman, an Independent from Connecticut, said during an Oct. 17 Congressional hearing on Homeland Security contracting.

Among underperforming IT projects replete with contractors is Secure Flight Program, an effort to improve how TSA screens airline passengers against a no-fly list, according to a September, 2007, GAO report. The project will cost $53 million in fiscal 2008.

Under the current system, the TSA compiles names of suspected terrorists from a larger watch list generated by the multiagency Terrorist Screening Center. The transportation agency then distributes the list to airlines electronically in a way critics say can easily end up in the wrong hands. What's more, airlines have different means for looking up names, so there's no consistent method for determining which people should remain off airplanes.

Privacy Fears

Secure Flight, first announced in August, 2004, is designed to remedy some of those shortcomings. However, it too has been plagued by technology glitches and missed key performance milestones, according to the GAO. Privacy advocates say the program surreptitiously gathers and stores personal passenger information, enabling the government to create dossiers without travelers' knowledge. They also fault the government for not keeping that information sufficiently under digital lock and key, a reflection of longstanding and widely publicized cybersecurity failings (BusinessWeek.com, 3/17/06) within Homeland Security.

The first iteration of Secure Flight was suspended in 2006. In August, 2007, Homeland Security said it would revive the program and conduct operational tests later this year using data from airlines that volunteer to participate. Lockheed Martin (LMT) had oversight of Secure Flight through 2005; the contract has since been awarded to IBM (IBM), which declined to comment for this article.

A TSA spokesperson says that agency has significantly upgraded Secure Flight to weave security and privacy considerations into all aspects of the program. TSA will collect the minimum amount of personal information necessary to conduct effective watch-list making, the spokesperson says.

Funding Without Accountability

Most worrisome for many watchdogs is the government's tendency to issue contracts without full and open competition. Without that, Homeland Security may not be getting the most competitive price, the most innovative technology, or the best contractor for a job. In fiscal 2007, about 44% of an estimated $11 billion in contracts awarded weren't available for competition, according to the department. That's up from 34.7% of contracts in 2003.

Danielle Brian, executive director of Project on Government Oversight (POGO), a nonprofit government watchdog group, says part of the reason the department is awarding big contracts to fewer players is that the workforce dedicated to overseeing contracts is dwindling. "It's a pot of gold, and Homeland Security is providing an almost endless stream of funding with little accountability," Brian says.

Homeland Security estimates about 35% of its IT workforce will be eligible for retirement between 2005 and 2010, according to a GAO report. The report also noted that in light of the continued growth in demand for experienced IT professionals and the high turnover rate, the department faces a significant risk of critical skill shortages, which could impede its mission.

A Nudge from Legislators

Efforts to redress those shortages and get underperforming projects back on track are under way. Homeland Security has taken several steps to strengthen its acquisition process and is providing training that has resulted in certification of more than 230 program managers since December, 2006, a 53% increase. Thomas Essig, acting chief procurement officer, is in the midst of an effort to "develop a superior acquisition workforce that not only puts the right contracts in place, but that also effectively manages the performance of its contractors," says spokesman Orluskie.

The department also is getting a nudge from such legislators as California's Waxman. Last year he sponsored a report outlining waste, abuse, and mismanagement of Homeland Security contracts and held a hearing in February, 2007. He also sponsored the Accountability in Contracting Act, which among other things, would limit the length of noncompetitive contracts. The bill has been passed by the House and is awaiting Senate action.

Those efforts need to reap rewards quickly lest security gaps put the nation at risk, say reform advocates. "By now, the Department of Homeland Security shouldn't be doing its procurement on auto-pilot anymore," says Charles Tiefer, professor of law at the University of Baltimore School of Law. "It should take the controls. It should plan. It should [require competition for contracts], and it's not doing that."

King is a writer for BusinessWeek.com in San Francisco .