Hearing of the Immigration Subcommittee of the House Judiciary Committee - USCIS Fee Increase Rule

REP. ZOE LOFGREN (D-CA): Since we have sufficient members here to begin our hearing, the subcommittee will come to order. I'd like to welcome the Immigration Subcommittee members, our witnesses, and members of the public to the subcommittee's hearing on the immigration fee increase rule and House Joint Resolution 47, a resolution that would render the recent immigration fee increase rule by the U.S. Citizenship and Immigration Services null and void and require the agency to issue a new rule to modify its fees.

Our subcommittee held its first hearing on the 2007 fee increase rule on February 14th when the rule was initially proposed. At that time, I had many questions about the methodology used to calculate the new fees, including how and if actual costs were accurately calculated and whether those actual costs included financial mistakes made by the agency and whether USCIS has properly prepared a plan for technology transformation, a cost that was used to justify the increase in fees.

Every answer I received to questions I had at that time led to even more questions and concerns about the rule. So for the last seven months, my staff and I have engaged USCIS and outside experts to understand the rule and its methodology, and I'm still concerned. As a result, I've introduced H.J.Res. 47 to render the fee rule null and void and require the agency to issue a new rule to modify its fees.

The subcommittee has sought detail on how the technology transformation will work, but that's the basic of how to define success and how to measure that success. After seven months, we have not received information sufficient to assure that the money spent on technology will result in a system that is sufficient, scalable, secure, and interoperable.

I'm hopeful that today we will get some answers, and I would now recognize our distinguished ranking minority member, Senator Steve King, for his opening statement.

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REP. LOFGREN: Thank you. As neither Chairman Conyers or Ranking Member Smith are present, we will invite them either to submit their statements for the record or to deliver their statements if they arrive later during the hearing. And mindful of our time constraints, other members are invited to submit their opening statements in the record.

I'm pleased to introduce our first panel this morning. We have two panels of witnesses, and seated on the first panel, I am pleased to welcome back Deputy Director of U.S. Citizenship and Immigration Services, Jonathan Scharfen. Prior to assuming his post at USCIS, Mr. Scharfen served for 25 years in the U.S. Marine Corps, retiring in 2003 at the rank of colonel.

Mr. Scharfen is no stranger to the House of Representatives, however, for he served as both chief counsel and deputy staff director to the House International Relations committee following his military service. Mr. Scharfen received his B.A. from the University of Virginia, his J.D. from the University of Notre Dame, and his LLM from the University of San Diego.

Next, I'm pleased to welcome back Rendell Jones, the Chief Financial Office of USCIS. Responsible for the budget accounting and financial planning of the agency, Mr. Jones became USCIS' first CFO in March of 2006. Prior to his appointment, he served as the Deputy Budget Director of the Department of Homeland Security.

His tenure with the federal government, however, began at the Department of Justice in 1996 as a Presidential Management Intern. Mr. Jones later worked as a management analyst in the Civil Rights Division and also served as one of the department's congressional appropriations officers. He earned a bachelor's in finance, cum laude, from Virginia Commonwealth University and a master's in public administration from North Carolina State University.

And finally, we would like to welcome Michael Aytes back to the subcommittee. Mr. Aytes is the Associate Director of Domestic Operations at USCIS. Mr. Aytes began his career with the federal government's immigration agencies in 1977 after graduating with a bachelor's degree from the University of Missouri.

After then, INS hired him as an immigration inspector in Chicago. He quickly rose through the ranks, and in 1990 became the first assistant commissioner for service center operations, charged with managing all of the INS' service centers.

Mr. Aytes played a critical role in the information and customer service division as a transition into USCIS in 2003, and he's served as an associate director since October of 2005.

As I think you all know, we have five minutes for opening statements, and the lights will alert you with the yellow flash when you have one minute to go. Your full statements will be submitted as part of the record, and when your time is about to expire, we do ask that you summarize. And without objection, the chair will recess the committee as necessary when we are interrupted by votes. And we invite you, Mr. Scharfen, to begin.

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REP. LOFGREN: Thank you, Mr. Scharfen. I think I may have confused matters when I introduced both Mr. Jones and Mr. Aytes and then addressed you in the plural as to testimony because Mr. Jones are here as resources to answer questions and have relied on Mr. Scharfen to make the agency's testimony.

So we will begin our questioning now, and I would first like, without objection, put in the record the letter sent by myself and Chairman David Price to the General Accounting Office requesting a review of the methodology that forms the basis of the fee measure.

I have a number of questions. I guess I would just like to note, and I think other members may pursue this more, that if you look at 1991 what the fee was for citizenship, for example, and what the fee is today, there's been a 750 percent increase in the fee. And I'm hard pressed to think of anything else in America that's gone up 750 percent in that timeframe. Even health care, I don't think, has gone up that much.

So I do have -- certainly, I don't object to having a fee system. I think that has served this system and our nation of immigrants well. The question is whether the magnitude of the increase is justified and whether this generation of fiancés are paying for the accumulated neglected technology for the last several decades, which is really why we've the GAO to take a look at this.

This is also an opportunity for us to take a look at what you're doing with the money, and it's of great interest to me, as I think you know. Recently, the General Accountability Office did a report on your transformation program, and there were many findings. There was concern expressed about the enterprise architecture and whether there was sufficient guides and constraints in the transformation plan with that enterprise architecture and alignment process.

And I am wondering where the agency is in the development of its enterprise architecture for transformation. How close are we to having this component identified? And I further have a concern that as we -- you need to have your enterprise architecture in place, or else you end up with willy-nilly acquisition of technology that doesn't work well, doesn't interoperate, doesn't serve the mission of the agency.

And I've recently learned that CIS is working on a whole new system, apparently a relatively new one, on fraud detection and national security. Obviously, we want fraud detection, but I am concerned that if that is a disintegrated -- or I don't mean disintegrating, but not an integrated computer architecture plan, it's not going to be interoperable.

It will not work well, not only with CIS but with the other agencies that we must connect with. So I'm wondering, Mr. Scharfen, if you can address these questions or your team.

MR. SCHARFEN: Yes, ma'am. Thank you very much. I'll start in reverse order, if I may, please --

REP. LOFGREN: Certainly.

MR. SCHARFEN: -- regarding, I believe the data system that you're referring to is it the FDNS-DS System.

REP. LOFGREN: That's correct.

MR. SCHARFEN: And I agree that going forward, the transformation system should incorporate all of the different systems, computer technology systems or business systems that we have in our organization, and that is our intention to do that. In fact, we have met with this committee's staff and do, in large part, some of the interaction with the committee staff and with you, ma'am, and some of the professors out on the West Coast with whom we had the benefit of meeting.

We have increased our efforts to ensure that our transformation program is all-inclusive and does include these types of systems, such as the FDNS-DS system.

REP. LOFGREN: Could I interrupt just briefly? And I thank you for that report, and just for the benefit of the other members, Stanford University, at my request, did volunteer their Computer Science Department and School of Business as a free advisor to the agency and minority staff and majority staff.

And staff from the agency did go out and get the benefit of their thinking on the computer issues, particularly, and we do acknowledge and thank Stanford for that donation, and if you could continue, Mr. Scharfen.

MR. SCHARFEN: And part of that discussion did cover the Federal Enterprise Architecture and where we were on that and whether or not we were sufficiently along in identifying the different models that make up that architecture.

One of them is -- or I guess there are five all together. You have the performance reference model, and then the business service data, and the technology piece is hooked to that. We have a relatively new chief information officer who is, I think, an expert just on this architecture type issues. He is also very good and experienced with the large contracting issues.

And what we've done, in terms of trying to better identify the performance reference models or the performance criteria, is that the CIO has got an effort that within the next four -- about four months, roughly, to better identify some of those performance reference metrics and then be able to feed those in to our ongoing transformation contracting. So that it will be -- and it's been noted, we will try to integrate that going forward with that transformation contracting effort.

That said, the GAO report, I would point out that we found the report, in general, encouraging in that, especially on the part of our improved planning. And that we had received, I guess, they looked at nine criteria.

REP. LOFGREN: I don't disagree, but we always look for what needs to improve. We don't need to spend our time patting ourselves on the back.

MR. SCHARFEN: Fair enough. The performance measures was one of the ones that they said we were falling short on, and so that's what we've done, to answer your question, ma'am. The CIO is pursuing that portion of the performance reference models and also on the human capital. We have incorporated the human capital officer more in the transformation planning efforts, which is another shortcoming the GAO identified.

REP. LOFGREN: I can see that my time is expired.

Perhaps working with the minority, we can find a time where we can have even a workshop type of meeting with the CIO and delve into more on the computer plans not limited by the five-minute rule. And at this point, I would yield to the Ranking Member, Mr. King, for his five minutes of questioning.

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REP. LOFGREN: The gentleman's time has expired. And I know Mr. Scharfen wants to answer, but we have a vote. And I think --

REP. GUTIERREZ: (Off mike.)

REP. LOFGREN: No, that's all right. We'll recess and come back, and Mr. Scharfen may want to add something in answer to your question after he thinks about it while we're voting. So we're in recess until after this vote.

(Recess.)

Under the rules, we can proceed with two members. Ordinarily, we would wait for the ranking member, but because we took an hour to vote, I'm going to ask -- I'm sure Steve is on his way over, at least introduce the next panel, invite Mr. Scharfen to say -- we left -- is there anything further you wanted to add?

MR. SCHARFEN: No, ma'am, other than to say to Mr. Gutierrez, I understand your points very well, and as the Marines say, sir, I hear you loud and clear. And I will take that back and put that into our deliberative process, sir.

REP. GUTIERREZ: (Off mike.)

MR. SCHARFEN: Yes, sir.

REP. LOFGREN: Thank you. And I had hoped we'd have time for a second round, but given how long it has taken, I think we'll move to the second panel in hopes that Steve is on his way. And so thank you very much. We will reserve -- Mr. King has arrived. We reserve the right to have additional questions submitted in the next five legislative days, and we ask -- the committee will forward them to you if we receive them from members and ask that you respond as promptly as you can in that situation.

MR. SCHARFEN: Yes ma'am, thank you for the opportunity to testify.

REP. LOFGREN: Thank you very much. Thank you. We will now ask our second panel to come forward. And we have coming forward, Arturo Vargas, the Executive Director of the National Association of Latino Elected and Appointed Officials, NALEO, and the NALEO's Educational Fund.

Before joining NALEO, Mr. Vargas served as the Vice President for Community Education and Public Policy of MALDEF, the Mexican American Legal Defense and Education Fund. Mr. Vargas also worked as a senior education policy analyst at the National Council of La Raza, prior to his work at MALDEF.

He served on several community boards in his home of Los Angeles, including those of the United Way and Community Technology Foundation of California. He holds both his masters and bachelors degrees from my alma mater, Stanford University.

Next, I am pleased to welcome Bill Yates, an executive consultant with Border Management Strategies, an immigration and border security consulting firm. Mr. Yates began his career as a special agent with the INS in Newark, New Jersey. And after 31 years of service to the federal government's immigration agencies, he retired from the USCIS in 2005 as its Chief of Domestic Operations.

The recipient of several awards from the USCIS for his distinguished service, Mr. Yates also received the American Immigration Law Foundation's Public Service Award last year. He earned his bachelors degree in Asian Studies from Seaton Hall University. And I would note that over these many years, Bill was always a source of information and reliable information to me, and I appreciate his being here today.

And finally, I'd like to extend a warm welcome Rhadames Rivera, the Vice President of 1199, the Service Employees International Union United Health Care East. Mr. Rivera has served as vice president of the union, based in New York City since 2000.

And prior to working with SEIU, Mr. Rivera coordinated housing and organized the networks for the Urban Homesteading Assistance Board in New York; taught as a training director and researcher in several schools in Santa Domingo, Dominican Republic; and worked as a counselor and job development specialist at the Cardinal Cushing Center in Boston.

He studied at Cornell University's School of Labor Relations Leadership Institute as well as the Northeast Broadcasting School in Boston, and earned his degree in social work from the University of Puerto Rico.

Each of your full statements will be made part of the official record of this hearing, but we would ask you to summarize in five minutes your oral testimony. And when that yellow light goes on, on the table, it means there's only one minute to go, and then we will move on to questions.

And once again, let me apologize for our lengthy departure. The House took longer than we thought it would to cast three votes, but sometimes that is the nature of the House. So if we can begin with you, Mr. Vargas, welcome and thank you.

ARTURO VARGAS: (Off mike.)

REP. LOFGREN: We need your microphone on there, little button. There you go.

MR. VARGAS: Thank you, chairman.

REP. LOFGREN: Thanks.

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REP. LOFGREN: Thank you. The gentleman's time has expired. Given the time, I'm going to be very brief and I think perhaps submit some of my questions in writing.

I would just note that I have been complaining about the lack of technology in this agency for several decades. And Mr. Yates knows that, because he's heard me complain. And actually, I complained about it before I was ever a member of Congress. It's been a tremendous frustration to me, and I think it's really -- we're still creating paper files in the agency. It's absurd.

On the other hand, I can't help but note that over the years, we have allocated -- we've done a variety of things. We've allocated tax funds to improve the technology, and we never got it. We did a premium processing fee for well healed applicants. I mean, they were happy to pay the additional fee, and yet they didn't get what they paid for. And I actually think that's illegal. I mean, you're not allowed to make a profit off of the applicants. And those fees were diverted. I mean, we took their money, and they didn't get what they paid for. And I note, on the fee structure, for example the FBI fee structure right now, the FBI, as I understand it, is charging the agency an average of $10.

For the most extreme case, the cost is $22, but the agency is charging the applicants $80, so that's a little profit setter for the agency, and I question even the legality of that. And it's not so much the -- for the well healed applicants, I don't have a concern. If you're earning a good salary and you can pay, you should pay the fee. And the companies certainly that are filing for scientists and engineers are happy. They're not complaining about it. They're happy to pay the fees.

But for your average working family, this is a very high amount. And we have had hearings in this room where every member of this committee has said we want people to become Americans. We've differed sometimes in our approaches on how best to help, you know, the immigrant community become thoroughly part of the fabric of the United States.

But really, there's no disagreement that we want immigrants to become completely part of the fabric of American society. And an important element of that is to help people become American citizens. We want immigrants to become American citizens.

And it just seems to me counterproductive, since we all believe that, to then put a financial barrier for people who are working and not getting a lot of money. And so I guess the one question I'll ask before we close, maybe to Mr. Rivera and Mr. Vargas in particular, because you're doing hands-on work with people in that category and helping them. We have a fee waiver thing in place. The agency expanded the bid after our hearing and further discussions. Is that going to help at all or help enough with the group of people that you are working with filing for citizenship? And if not, what adjustments should be made on that waiver provision so that the person working in the nursing home helping the baby boomer's parents can actually afford to become an American with us? What should that -- can I ask you that? Or if you don't know now, you could get back to me.

MR. RIVERA: Definitely, I mean, placing all the burden on the fees paid is very difficult.

REP. LOFGREN: Right.

MR. RIVERA: So in the agency, we think that essentially Congress needs to allocate some money to fund this process.

REP. LOFGREN: Right.

MR. RIVERA: And there are a significant amount of services that are provided, that are sustained by the fees paid by immigrant workers that should be allocated to something else, like the refugee program to be allocated to something else, the costs of the administration of this agency to be allocated in something else. There are a tremendous amount of ways that it can be moved out of the fees paid to somebody else.

REP. LOFGREN: Mr. Vargas.

MR. VARGAS: If I can reply, I will certainly answer in more detail in writing, chairwoman. But we do know that applicants largely are unaware of the availability of the fee waiver. But I'd also like to advise you that my organization actually runs a load fund, where we make interest fee loans to individuals so they could help pay for --

REP. LOFGREN: That is really admirable. That is terrific.

MR. VARGAS: And our default rate is less than 5 percent.

REP. LOFGREN: That makes me very proud to be sitting here talking to you. My time has expired, and all the time has expired. I do thank you for your patience, for your willingness to be here to share your expertise. We will have five legislative days to ask additional questions in writing. And if we do that, we would ask that you answer as promptly as you're able to. And again, we thank you very much for your participation, and this hearing is now adjourned.

MR. VARGAS: Thank you.

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