Hearing of the Senate Homeland Security and Government Affairs Committee- One Year Later: A Progress Report on the SAFE Port Act

Interview

Hearing of the Senate Homeland Security and Government Affairs Committee- One Year Later: A Progress Report on the SAFE Port Act

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SEN. SUSAN M. COLLINS (R-ME): Thank you, Mr. Chairman, and thank you for holding this important hearing today.

Just a year ago, the SAFE Ports Act was signed into law. As the chairman indicated, I was a co-author of this legislation along with the chairman, Senator Murray, Senator Coleman, who did extensive work on this issue as well in his capacity as chairman of the Permanent Subcommittee on Investigations.

This law was the necessary response to our heightened security concerns. As the chairman indicated, about 95 percent of our foreign trade enters the United States through our seaports, including more than 11 million containers a year. Ports are tempting targets for those trying to move explosives, biological and chemical weapons, radiological and nuclear weapons, or even terrorists themselves into our country. In fact, each of these containers has the potential to be the Trojan horse of the 21st century.

An attack on one of our ports could cause tremendous loss of life and damage to critical infrastructure. It could also have a devastating effect on our entire economy, disrupting commodities shipments, material for manufacturers, and products headed to market. The SAFE Port Act addresses these vulnerabilities.

Soon after the act's signing, the Department of Homeland Security begun (sic) implementing its port security enhancements. The act strengthened two important programs: the Customs-Trade Partnership Against Terrorism -- or C-TPAT -- program, and the Container Security Initiative, or CSI.

C-TPAT requires importers to adopt security enhancements in exchange for fewer inspections and, when warranted, prioritized inspections. A recent survey of C-TPAT members demonstrated that after joining the program, they doubled their average expenditures on supply chain security. This is clear evidence that this program is working.

CSI places U.S. Customs inspectors in foreign ports to target high-risk cargo and to ensure that it is inspected before heading to the United States. In the last year, DHS has continued to expand that program strategically and now has inspectors in 58 foreign ports that account for 85 percent of cargo shipped to the United States.

Here on American soil, DHS has also installed more than 1,000 radiation portal monitors at critical seaports and land ports of entry to detect radiation before containers are allowed to enter the domestic supply chain. As required by the act, by the end of the year DHS will scan at least 98 percent of cargo for radiation at our major seaports.

DHS has also established the Secure Freight Initiative to develop and test integrated scanning systems that combine radiation detection equipment and non-intrusive X-rays (sic) machines in seven foreign ports. Three of these ports -- in Honduras, Pakistan and England -- will scan 100 percent of their U.S.-bound cargo, which will allow us to evaluate the technological and other challenges. This will fulfill the law's requirement for pilot projects in three foreign ports.

Beyond that statutory requirement, limited operational testing will take place in four other foreign ports. This testing will provide us with important information to help address the technical and logistical challenges associated with larger and more complex ports.

Until this technology is proven through these pilot projects, I continue to believe that requiring the scanning of all cargo bound for the United States at every foreign port is misguided. It's contrary to the whole risk-based layer system of security that was established by the SAFE Port Act which required a focus on high-risk cargo and implemented a requirement for 100 percent scanning of all cargo designated as high-risk.

The SAFE Port Act also authorized $400 million in port security grants for five years, totaling $2 billion. As we will hear this morning from Captain Jeff Monroe, the director of ports and transportation in Portland, Maine, this funding has already produced significant improvements in the security of our ports. It's important that Congress took this multiyear approach because it will allow our ports to pursue multiyear security projects.

I'm also pleased that DHS met the July deadline for issuing a strategy for enhancing our international supply chain security. The strategy document addresses all aspects of container security, from the packing at a foreign plant to the arrival at a U.S. port to the entrance into the national transportation system to its destination at a retail business or manufacturing plant.

I am, however, concerned and share the concerns of the chairman that there is a key aspect missing from this strategy and that is that it does not detail how the private sector will be involved in responding to and recovering from a port security incident.

Since port terminals and recovery equipment are most -- are almost entirely in the hands of the private sector, I believe this is a significant omission.

Another area where I'm concerned that DHS has not made the progress we would like is in the area of the TWIC card, as the chairman has indicated. It's obviously critical that we know who is gaining access to secure areas of our ports, and many deadlines have been missed with regard to the TWIC program.

Ten ports were supposed to be online by July of this year. That deadline obviously has not been met, and the first enrollment center for TWIC cards has only been opened today in Wilmington, Delaware. Although DHS has announced that 12 enrollment centers will be operational this year, the department will almost certainly miss the January 2008 deadline for TWIC implementation at another 40 ports.

This also raises some very practical questions for those serving in the Merchant Marine, for those working at our ports, as far as how they're going to be able to comply with the mandates in the law requiring their enrollment if DHS does not yet have the infrastructure up and running.

Nevertheless, I certainly agree with the GAO, with the chairman and with other experts that the department has made significant progress in improving security at our nation's seaports and at foreign ports as well.

Thank you, Mr. Chairman.

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SEN. COLLINS: Thank you.

Secretary Baker, I want to follow up on the issues with the TWIC card.

In his testimony later this morning, Captain Monroe, the director of ports for Portland, Maine, will make the point that the aviation system was able to clear and credential hundreds of thousands of workers in a relatively short time. And that was the point that was made to me by a group of airport directors from around the country.

Now it appears that we're going to choose separate systems for aviation versus our ports, and six years after the attacks on our country, in contrast to the aviation system, we still don't have the TWIC card in place.

Why not look at piggybacking on to the system that has been used successfully by our airports? And why not have one system so that individuals don't have to get multiple credentials?

MR. BAKER: I think those are fair observations and we have looked at the possibility and I think will look, if we run into trouble again, at the possibility of changing our approach.

Now, our general belief in this circumstance has been that, first, the number of the -- the amount of cross-traffic between the airports and ports has been relatively limited. The port problem turns out to be much more complicated in many respects than the airport problem, because in most cases airport workers work at one airport, whereas with ports you have truck drivers in particular, and sometimes longshoremen who will move from port to port, who will do work at different ports and who need to be credentialed to what amount to very decentralized systems, so that one port doesn't have to have an infrastructure connection to another port.

But we need to be able to credential people in ways that allow them to be admitted to one port relatively easily if they happen to move from another.

That has accounted for some of the differences in approach and, I have to say, some of the complexity of the credentialing task; that, plus the fact that we are doing a fairly elaborate set of biometrics in an environment that is less controlled and more hostile -- there's more humidity and more salt in the air at our ports, and we're trying to get more people through with many fewer of whom are white-collar workers than in an airport context.

I think those account for the differences. That isn't to say that in the long run we wouldn't want to bring the programs closer together, or if we have bad luck with the program which we currently believe is on track, we would go back and look at it.

But at this point we have a rollout strategy, we have a set of technology standards, people are enrolling and building the cards. I think it would set us back if we tried to switch gears again.

SEN. COLLINS: I'm very concerned not only about the homeland security aspects of dangerous materials coming into this country but also about the impact on consumers.

All of us are very aware of the recalls of dangerous toys from China, other products that have made the news recently, and it seems to me that the Department of Homeland Security has an important role to play in protecting consumers from dangerous products as well as protecting all citizens from possible terrorist attacks.

For more than a year, the department had stated its intention to issue a rule that would require importers to provide additional information before products are loaded onto vessels overseas. And DHS already uses some of that information as part of its automated targeting system. But one of the pieces of information that would be required under the proposed rule is the manufacturer's name and address.

And I'm concerned about the vulnerability posed by the delay in requiring that information, not only because of its impact for helping you to target high-risk cargo, but also because it would allow Customs and Border Protection to target untested manufacturers who may be shipping potentially dangerous consumer products, including children's toys.

It would allow CBP to do additional safety screening if it knew that it was dealing with either unknown manufacturers that are not trusted yet or those with a history of violations. Could you tell the committee when you expect that this rule, which is referred to as the Advanced Trade Data Element Rule, which will require more information about the manufacturer, will be published?

MR. BAKER: Thank you, Senator. Let me start by saying I completely agree with you about the importance of this rule. It's a valuable part of our effort to push our borders out and to try to catch suspect cargo before it gets close to our ports. And having this kind of information -- some of which we get now, but which we're not guaranteed to get -- having that information in a way we can count on is an enormously valuable part of our strategy.

At the same time, it is a new regulatory burden on importers and shippers and it requires them to make changes in their information technology systems and to get the information to us. And so, as I said at the start, it's important for us to do our diplomacy and to make sure that we're -- we've persuaded people that this is a reasonable requirement. We have been working with the trade for some time and I think that generally the trade has acknowledged that all of the security measures that we're working on now, this is probably the least expensive and the most valuable to us.

And we have -- we currently expect to get that rule to the Office of Management and Budget within two weeks. That's our target. It is one of our top 10 priority regulations to get done in the next year, because of its value for a screening program that will allow us to do 100 percent screening in an effective way.

SEN. COLLINS: Thank you.

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SEN. COLLINS: Thank you.

Secretary Baker, one of the most important provisions of the SAFE Port Act required the department to develop protocols and a plan for restarting our ports in the event of an incident. We know from the West Coast dock strike of a few years back -- which was an event that was both peaceful and anticipated -- that the closure of ports can have enormous economic consequences. And if there were an attack on one of our ports, most likely for a time all ports would be shut down, and that's why we felt so strongly that we needed to have the department engage in this plan.

And the department has done so, but, as I referred to in my opening statement, the private sector entities have come to us to express concerns that there is not sufficient detail in the plan about the role that would be played by port authorities, by first responders, by those in the private sector which, after all, own most of the emergency equipment as well as control our ports.

What is the department doing, having made a good first step in this area, to fill in the gaps and come up with a strategy that will ensure that we have a safe, logical, planned procedure for reopening our ports in the event of an attack?

MR. BAKER: That's an excellent question, and we're quite aware of the concern on the part of the trade about this.

A couple of basic principles, I think, have governed what we have done so far and we are at work on some more detailed documents that will give some further guidance.

First, we don't want to do what the private trade should do. We are not going to be telling people well, you know, go to this port, go to that port, in most circumstances. They have dispatchers who are much more capable of making those judgments than the government.

The second principle I would say is that we have got to be flexible about our plan, and here I think there's some inevitable frustration on the part of the trade. They would like nothing better than a guarantee that says within three days if you're not the port that's attacked and you meet certain criteria, we'll let you in without any change in procedures.

The difficulty with that is that we don't know what kind of attack we're going to be recovering from, and if it's a simple explosion in a container, that's a different sort of attack than a nuclear weapon found in a container or a biological weapon. So we can't know for sure how we will reconstitute trade until we know what we're reconstituting from, so we can't give them guarantees.

We do think that -- and this is what we're working on now -- that a critical element is for everyone in the trade to know what the communication chain is going to look like, that we will be reaching out and getting information from them about what they're experiencing as they try to make deliveries, and to give them all the guidance that we can to make sure that everyone gets news as quickly as possible about what we can say. If we can say certain ports are open and we're accepting cargo in those ports, then everyone should get that information quickly. If we're restricting certain kinds of cargo or cargo from certain destinations, then we need to get that information out.

So what we'll be building as a resumption of trade protocol will focus on the communications lines and some basic principles of the sort that I've been talking about. I hope that will make the trade more comfortable, but I think there's probably an inevitable divergence because the trade would like guarantees that we can't responsibly give to them.

SEN. COLLINS: Thank you.

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SEN. COLLINS: Thank you, Mr. Chairman.

Captain, to follow up on the funding issue that the chairman just raised, he and I have had to fight so hard to secure funding for port security grants. The administration, as you know, year after year has proposed folding port security grants into a general homeland security grant program, whereas we've advocated for dedicated funding. Could you speak to the importance of being able to rely on dedicated funding for port security grants?

And also, on the importance of having multiyear funding, it seems to me from seeing the projects that you under way in Portland that many of them are multiyear projects that are going to require additional investments. But if you could comment on those two issues.

MR. MONROE: Well, homogeneous funding programs are very difficult because one of the things that happens is you begin to lose the expertise necessary to properly evaluate what's necessary. You know, I would find it particularly difficult if I had to go up against aviation funding because the needs are very, very different. There's no question about that.

We've been able to use our multilevel funding and our multiyear funding to really step out not only with our new facilities and put in surveillance and all of the access control and all the other things that we've needed, but we're one of the first ports now to start looking at TSA-style screening for cruise line passengers and the international ferry.

So that multiyear funding is very critical because one of the things that it's changing over the course of time are the regulations and the assessments. And as new intelligence becomes available, we begin to look at new threats. So I think the reality is is this is very specific. Right now, we have a great evaluation program on the maritime side, on the aviation side. There's not a very good system in place for the surface transportation, and they're really groping around trying to figure out what they need to do.

But the reality is that I think if you try to put it all into one place like the administration says, you're going to lose an enormous amount of good evaluation capability. And then it's just going to become a matter of competition, and needs may not be meet in that circumstance.

SEN. COLLINS: Thank you. I certainly agree with that assessment.

Mr. Caldwell, you stated in your testimony that 100 percent scanning could actually reduce security rather than enhance it. And since I agree with that assessment, I was very happy to hear you say that for the record. Do you believe that -- is it fair to say by requiring 100 percent scanning, regardless of the impact on trade, regardless of costs, regardless of the risk of the cargo at hand, is inconsistent with basic risk management principles?

MR. CALDWELL: I would agree with that. If I could, just give an example --

SEN. COLLINS: Yes, thank you.

MR. CALDWELL: (Aside.

) Can we get the board back up that Assistant Secretary Baker had?

Because you've got three things on there that are valuable. I think you have the NII, which is the imagery screen. You have the radiation screen as well. And then what I'm not sure but may be on there is maybe the ATS score. So these are three very important things.

But, you know, from his description, it sounds like you need to have a person at the National Targeting Center, you know, look at that. And so how many thousands of people are we going to need, either overseas or here, to look at that? So well -- I just don't know what kind resource level would be needed to make these 100 percent scanning images useful. I mean, if you're just taking the scans and storing them, you're not improving security.

SEN. COLLINS: And isn't that what is happening in Hong Kong? We hear a lot about the Hong Kong project, but in fact, unless there's been a change recently, it's my understanding that while images are being captured, no one's looking at the images. And if no one's reviewing the results of the scan, you're no further ahead. And in fact, it may produce a false sense of security to have the scan done, but if no one's analyzing the results, it -- there really is no progress.

MR. CALDWELL: I was in Hong Kong and I got the demonstration, but I can't say I audited it, so I don't know. But it was pretty impressive how they're trying to combine these different technologies. But again, what I don't know is what was being done with those images.

I think one of the most promising areas, and again, Assistant Secretary Baker brought this up, is some of the potential improvements in software. What if you could have a software program that would say, okay, based on the manifest and this type of item, it should have this kind of radiation signature, and it should have this kind of density, and then it combines all those things in some kind of algorithm to say this seems within the normal deviations and don't worry about it. And at that point, it's not too different than ATS.

SEN. COLLINS: Right. That's essentially a targeted system because it's taking --

MR. CALDWELL: Correct, and then identifies the one that then you go take -- give extra scrutiny for.

SEN. COLLINS: Exactly.

MR. CALDWELL: And that may be where they're going in the long run, but I'm just not sure. As I said, while we've talked about SFI being up for, you know, some estimates -- some people have said it almost a year now or -- it's been up running -- I mean, again, fully operational only for three days now. So we need to be careful of that. And when we're in Honduras or we're in Pusan recently -- not recently, but say six to 12 months ago -- they were just kind of laying the plans to install these. And a lot of these questions hadn't been worked out in terms of who's going to own the images, who's going to do what with them, how do you store them, who's paying for it.

SEN. COLLINS: Thank you.

Mr. Lloyd, just one final question for you. It's my understanding that there is talk of transitioning the project that you've described from the Department of Justice to the Department of Homeland Security. And indeed, I think that it was housed in the Department of Homeland -- at the Department of Justice to start with because it was an earmark. And it's a good example of an earmark that's produced very valuable information and a pilot that we may want to replicate elsewhere. But do you have concerns about the transition from DOJ to DHS?

MR. LLOYD: Thank you, Senator. It was actually started, obviously, as a special pilot project before the creation of DHS. And what we have seen is that it has been a wonderful program, and it has done, I think, the type of things that needed to be done in terms of bringing varying agencies together into a unified command at a port.

Our concern would be that you would in a transition, obviously, lose some of the effectiveness of that unified command, that you would lose the presence of the state and local partners who we think are very valuable. But ultimately, I think that's something that DHS would have to evaluate as to which components program-wise of SeaHawk they would want to keep, replicate around the country or move to a different model. But what we've found right now is that all of our participating components find all of those programs that we're currently operating there to be very useful in terms of augmenting their missions.

SEN. COLLINS: Thank you.

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