Security clearance challenges defy easy fixes

Some problems just won't go away.

Back in 1981, congressional investigators took a long, hard look at the government's program for processing security clearances for Defense Department and military contractor personnel who needed access to classified information. The investigators' bottom line: "Processing delays -- some averaging 220 days -- are costly and could weaken national security." The troubled program, they estimated, could cost taxpayers a tidy $920 million in the next fiscal year.

Fast-forward to a new century in which the United States is battling terrorist networks and seeking to guard against an array of global threats. A six-member federal advisory task force of officials, including Defense Department and industry executives, recently put together a report analyzing how long it takes the government to process clearances for contracting personnel. The bottom line: The program, after all these years, remains deeply flawed. Some defense-contractor employees wait nearly a year to get top-secret clearance.

Meanwhile, the Government Accountability Office, which is still keeping a critical eye on the clearance program after more than three decades of bad report cards, presented its most recent findings to a Senate Homeland Security and Governmental Affairs subcommittee in May. Derek Stewart, a veteran GAO investigator, got straight to the point. "I will tell you right up front," he said, "that the results of our study are disturbing." Indeed they are, and for the GAO it is pretty much deja vu all over again.

The report laid it out: an inexperienced workforce, bureaucratic bungling and inefficiency, too much paper-pushing, and too little technology. It was all there -- the perfect prescription for a Washington government fiasco.

The GAO noted, as it has so many times before, that clearance delays could damage national security by keeping vital personnel from working on important classified military projects and by increasing costs to taxpayers. The watchdog agency was also troubled, it said, by the poor quality of the background investigations used to grant or deny security clearances. In a sampling of cases, the GAO found that investigators failed to conduct complete inquiries or resolve questionable activities in the backgrounds of applicants for top-secret clearances.

Stewart, recently retired, said in an interview with National Journal, "Our report documented that the quality of the investigations isn't worth a damn."

Government reviewers of the clearance program have been sounding that alarm for more than 30 years. The GAO has issued nearly 70 reports on the subject since 1974, and the Defense Department's Office of the Inspector General has issued 14 reports over the past decade.

The IG's latest assessment, released last year, was especially damning. Investigators found that some Defense agencies could not rely on the department's personnel computer system for "accurate and complete" data on military and civilian workers who required security clearances. In some instances, the inspector general's office later told Congress, the computer system "contained incomplete or inaccurate data on military and civilian employees, including multiple personnel with the same Social Security number."

As senior security, military, and intelligence officials worry about potential fallout -- spies or terrorists slipping through the clearance screen -- government executives responsible for overseeing the program are struggling to come up with a fix.

Clay Johnson, the deputy director for management at the Office of Management and Budget, has assured Congress that officials are heading in the right direction. Testifying before the same Senate Homeland Security subcommittee in May, Johnson said that the government had made "significant progress" in cutting the average time to process clearances. But he also acknowledged, "We are still not granting security clearances as quickly as desired." The Bush administration was developing a plan to radically reform the system, Johnson said: "More automated, more use of commercial databases, more custom investigations."

Separately, Kathy Dillaman, the associate director of the Federal Investigative Services Division at the Office of Personnel Management, which does most of the background investigations for the Pentagon and other government agencies, denied that her agency does sloppy work. She acknowledged that not all of her staff -- 2,200 government agents plus some 7,000 workers from the private sector -- are experienced and "fully trained."

But, Dillaman said, "Nothing [is] more important to me than the quality of the work we do.... Quality first." She said that her investigators had "closed a lot" of cases in the past year. "If you are starting the [clearance] process now," she said, "we are getting it done."

Contractors who work on sensitive government projects fume at the long delays. Getting their employees through the clearance process is essential to fulfilling their classified contracts for weapons, intelligence, and technology systems, so it's no wonder they've been pressing Congress and the executive branch in recent years to fix the problems. More than 800,000 industry personnel, working for 12,000 defense contractors, hold security clearances.

Doug Wagoner, speaking on behalf of an industry group called the Security Clearance Reform Coalition, put it this way to National Journal: "We are living in a more dangerous world, and, in responding to the war effort and 9/11, there are a lot of new initiatives and programs, and those programs take more people that have to be cleared. When they are not, the mission is delayed."

A Finger-Snap Away

The security clearance system, created during the Cold War, has grown into a gigantic enterprise. According to officials, some 3.2 million people in and out of government have been cleared for access to classified information at either the "confidential," "secret," or "top-secret" level. The Defense Department is, by far, the biggest stakeholder. Apart from the 800,000 contractor personnel, Defense has issued clearances for 1.7 million of its own military and civilian employees. According to the Pentagon, 284,000 clearance requests for Defense and contractor personnel are now in the pipeline; about 135,000 have been pending for more than 90 days.

The importance of security clearances, especially in the Defense Department, can't be overstated. They affect everything from troop deployments to training to recruitment of service members and other personnel. Generally, people who need clearances include intelligence operatives and officials, analysts, uniformed military members, senior Defense civilians, scientists, and many others.

In some cases, cleared personnel have access to secrets relating to critical programs involving weapons systems, information technology, and anti-terrorist and foreign-espionage operations. Many of the military and civilian personnel now deployed in Iraq and Afghanistan hold clearances, giving them access, for example, to highly sensitive information on terrorists and insurgent groups.

Working through the clearance process end to end -- from the time an application is filed, a background investigation is undertaken, and a clearance is granted or denied -- sounds like pretty mundane stuff. But all agree that the work of vetting those who might be granted access to highly secret government information is vital to national security.

With another terrorist act on U.S. soil perhaps only a finger-snap away, senior military, intelligence, and security officials say that although they favor speeding up the process, they also want to make certain that background investigations are even more thorough than before. In the real world, they said, it's plausible that a terrorist could make it through the clearance process and gain access to secret U.S. plans and military facilities.

"I think the environment that we are operating in now has significantly changed," Greg Torres, director of security at the Pentagon, said in an interview.

Espionage, of course, remains a major threat, as is evident from statistics supplied by Defense Department researchers: 129 Americans, while holding security clearances, have spied against the United States since the late 1940s. And technological advances, the researchers say, have made the country even more vulnerable.

Two years ago, the Defense Personnel Security Research Center reported that government employees and contractors have "an unprecedented level of access to classified and proprietary information" and can easily steal information. A storage device about the size of a key, the report said, can hold as much as "two gigabytes of data -- the equivalent of a pickup truck filled with books." The report pointedly noted that "improved personnel security screening can reduce the number of potential espionage offenders."

The ramifications of someone with a clearance taking a wrong turn were hammered home only last month. Leandro Aragoncillo, a former marine who worked under Vice Presidents Cheney and Gore and later served as an FBI intelligence analyst, was sentenced on July 18 to 10 years in federal prison for transferring classified information to the Philippines in a plot to topple that country's government.

Aragoncillo admitted removing classified information from the Office of the Vice President between October 2000 and February 2002. The information included, the Justice Department said, top-secret documents "related to terrorist threats to U.S. government interests in the Philippines."

Cost is another issue. No one has precise figures, but the GAO's findings, other government reports, and surveys by defense contractors underscore that clearance delays likely cost taxpayers billions of dollars annually. In a report to the Defense Department and the director of Central Intelligence in 1994, the U.S. Joint Security Commission said that the cost "directly attributable to delays in the investigative process in fiscal 1994 could be as high as several billion dollars."

When asked about the cost issue, spokesmen for the defense industry describe the problem as "lost labor" -- that is, the time that contractor personnel spend sitting on the bench waiting for a clearance. Contractors say they pass those costs along to the Defense Department as administrative overhead on contracts.

Lawmakers in recent years turned their attention to the problem after influential constituents -- defense contractors -- began trudging up to Capitol Hill to howl about the difficulties of obtaining clearances for employees and contract personnel.

Rep. Tom Davis, R-Va., the ranking member on the House Oversight and Government Reform Committee, took the lead in pressing for reforms. When Congress wrote the Intelligence Reform and Terrorism Prevention Act of 2004, Davis included provisions requiring executive branch officials to speed up the clearance process. Officials said they are close to meeting those goals, but Davis isn't convinced.

"I just don't think they have an understanding of the problem," Davis said in an interview. "They are always saying, 'We are going to do better,' but they don't." When it comes to bringing technology to bear on the problem, he is quite blunt: "They don't know what they are doing."

Big Kid on the Block

How difficult is it to get a clearance, and how long can it take? Just ask Bryan O'Leary, who has a fair amount of clout as the national security legislative assistant to Sen. Tom Coburn, R-Okla.

O'Leary would seem a sure thing: a former Marine officer and pilot, he held a secret clearance for more than a decade. When he joined Coburn's staff, he needed to upgrade to a top-secret clearance. For 15 months, he waited in vain for his clearance to come through. Finally, out of frustration, Coburn fired off a letter to a senior Bush administration official in May complaining about the "broken system" and the delay on O'Leary's application. A week later, O'Leary finally got his clearance.

Federal law requires O'Leary and other applicants seeking initial clearances or updates to undergo a background investigation into their trustworthiness and reliability. Investigators look for signs of trouble -- family or money problems; drug or alcohol abuse; mental problems; suspicious connections; arrests; or unreported overseas trips.

The idea is to weed out applicants who might be vulnerable and might compromise national security in some way. When investigators complete their report, evaluators at Defense agencies decide, in a process known as adjudication, whether to grant or deny a security clearance.

For just about as long as anyone can remember, the security clearance program has been troubled. During most of the program's history, an obscure Pentagon agency known as the Defense Security Service conducted the background investigations. That agency was a hotbed of intrigue, torn from within by feuding officials, and harshly criticized by the GAO and some in Congress for its failure to fulfill its mission.

Finally, in February 2005, the background investigative function was transferred to the Office of Personnel Management's Federal Investigative Services Division. OPM, which had already been doing some background investigations for Defense and other federal departments and agencies, now has a mighty big job: conducting more than 700,000 clearance investigations annually, most of them defense-related. The agency also conducts "suitability" checks on additional government employees who don't require clearances.

OPM operates a fee-for-service plan under which the Defense Department and other customers pay for each background check. Defense contractors' clearance requests are routed through the Defense Security Service to OPM. Some government agencies, including the FBI and the CIA, do their own background investigations, but OPM handles most of the workload. And as the big kid on the block, the agency has been under intense congressional scrutiny. It has drawn sharp criticism from veteran OPM investigators and military contractor organizations. But it's hardly the only government agency under fire.

A September 2006 report from the Government Accountability Office blasted OPM and defense agencies for their roles in contributing to the long clearance delays. The government watchdog agency said that OPM took too long to investigate applicants and produced poor-quality reports. The GAO cited "an inexperienced workforce" at OPM and a failure to fully use technology as major factors in the delays.

To assess quality, the GAO randomly selected OPM investigations into the backgrounds of 50 industry applicants for top-secret clearances. OPM had "provided incomplete investigative reports" to the Defense Department in 47, or 94 percent, of those cases, according to the GAO. Most of the case files, the GAO said, "were missing documentation required by federal investigative standards," and about half didn't include required documentation on "residence, employment, or education."

In some cases, OPM investigators failed to resolve such serious financial questions as substantial debts linked to applicants, the GAO found. In one case an applicant reported traveling "to an Asian country to visit family" but was unable to identify the family members by name. OPM investigators never resolved the issue. In fact, of the 50 cases, 27 contained "unresolved issues," the GAO reported.

Defense Department evaluators nonetheless approved those applicants for clearances. Defense officials told the GAO that the evaluators had sufficient information to make a judgment call. GAO analysts concluded, however: "The use of incomplete investigations and adjudications in granting top-secret clearance eligibility increases the risk of unauthorized disclosure of classified information."

GAO analysts went on to say that while eliminating delays is important, "the government cannot afford to achieve that goal" at the expense of quality investigations and evaluations. This issue, the agency said, bears directly on "reciprocity" -- the system by which one government agency accepts clearances granted by another. Reciprocity has raised big problems for years. Worried about the adequacy of another agency's assessments, analysts said, some agencies insist on doing their own evaluations before accepting already "cleared" personnel.

The Cost of "Lost Labor"

Congress sought to gain control of the problem by spelling out in the 2004 intelligence act the processing requirements for federal security clearances. By December 2006, according to the law, OPM had to complete investigations for 80 percent of clearance requests -- for government and industry employees -- in 90 days.

Adjudications had to be done in 30 days. The Bush administration has told Congress that OPM and the Defense Department are close to meeting those benchmarks on initial clearances and expect to do even better in the coming months.

The administration's analysis, however, did not include processing times for periodic reinvestigations, or updates, of clearance-holders; OPM has 59,000 updates pending in the top-secret category alone. "Reinvestigation timeliness has not been addressed," the administration's Security Clearance Oversight Group told Congress in a report earlier this year, "because the improvement effort focused on individuals for whom initial security clearances are required to perform work."

But a new report by the six-member federal advisory task force addresses the issue of updated investigations and how long it takes to process them. The report, obtained by National Journal, offers the most recent information available on the government's clearance processing program, at least for industry personnel. It shows that during a six-month period ending in March, the government took an average of 335 days to update top-secret clearances for industry applicants. Initial top-secret clearances averaged 276 days. Secret and confidential clearances took an average of 208 days. The analysis was based on 41,277 closed cases.

The report was prepared by the task force created by the National Industrial Security Program Policy Advisory Committee, known as NISPPAC, an advisory panel of officials from OPM, the Defense Department, the CIA, Homeland Security, and other government agencies, as well as industry personnel. J. William Leonard, director of the Information Security Oversight Office at the National Archives and chairman of NISPPAC, described the study as probably the best snapshot yet of how long industry clearances take.

"The report is based on numbers from Defense Department and OPM files," Leonard said. "It shows what industry is actually experiencing."

The numbers did not impress industry spokesmen.

"The NISPPAC report shows that the times are improved, but we are only getting back to where we were 25 years ago," said Trey Hodgkins, a vice president at the Information Technology Association of America, a trade group of more than 330 member companies, including defense contractors. "And there's a really serious problem here," he added. "We are concerned that people with secret and top-secret clearances are not being reinvestigated in a timely fashion. Generally, it is insiders -- people who already have had access to classified information -- where you might have a problem with espionage."

Industry officials have been decrying the clearance mess for years. In 2001, an industry group headed by the Aerospace Industries Association studied the cost of delays at just nine of the 12,000 contractor facilities at which employees are required to have clearances. The study estimated the cost for lost labor at $152 million. If the results of that sample were extrapolated across the board, the study concluded, the total annual cost would reach "billions of dollars."

Hodgkins said that his information-technology trade group is working to update that study to include many more facilities. Because of the processing delays, cleared employees are valuable commodities; contractors compete aggressively for workers who already hold clearances, sometimes paying bonuses of $20,000 or more. A Virginia-based defense contractor, ManTech International, gave away two sleek BMWs as part of its campaign to recruit people who held clearances.

Too Much Political Correctness

Some of OPM's own field agents have complained about inefficiency and bureaucratic bungling. Investigators for the agency, agreeing to speak on a confidential basis to National Journal, said that some clearance applications have languished for many months before OPM even sent them out for investigation. "I got one earlier this year for an applicant," an agent said in an interview, "who had filled out her paperwork 11 months before."

The agents also said that OPM kicks back many cases for "trivial," even "comical" reasons. In an interview, another agent said, "I had a case where a subject was deployed to Iraq with his military unit, and one of the OPM reviewers sent it back and asked, 'Who paid for this trip?' " A third agent described what happened to a fellow investigator last summer: "He got a report back and was told to correct it -- finish a sentence. He forgot to put a period at the end of a sentence."

That's not all. OPM agents said that in the interest of "political correctness," the agency had proscribed them, until recently, from using "organizational affiliations" in their investigative reports. This led to some investigations being delayed because agents had referred to, say, the "Boy Scouts of America," the "American Legion," or the "Roman Catholic Church."

Carolyn Martin, president of the American Federal Contract Investigators Association, a group of OPM and contract investigators, confirmed the agents' accounts. She recalled one case where an investigator was reviewing the activities of someone who "worked for World Christian Bookstore. He got the case back, was told to take the name 'Christian' out." He refused, she said.

Last year, after a flood of complaints from field agents, OPM's Federal Investigative Services Division rescinded the policy. In a memo dated October 30, an official informed agents that they could now use "references to a Subject's affiliations" -- for example, "St. John's Roman Catholic Church, ACLU, NRA, Boy Scouts of America, Wicca, American Legion, AFL/CIO, etc."

OPM had previously restricted the use of organizational affiliations because of "privacy concerns," the memo explained. "This policy has had the unintended consequence of limiting potential relevant information from reaching the cognizant adjudicative authorities," wrote Colleen Crowley, chief of the division's operational policy group. "It has also led to frustration among field staff who believe that such a policy restricts their ability to compose accurate and balanced reports."

Dillaman, associate director of the division, bristles at all of the criticism aimed at OPM. She said that officials were dedicated to picking up the pace on investigations and cutting the backlog of older cases, and that OPM had, in fact, made extraordinary progress in the past year.

Dillaman, who was appointed in October 2005, said that some things were out of her control -- citing the time spent waiting for state and local governments and other federal agencies to provide requested information on applicants. In her view, the critics aren't looking at the big picture. She sees improvements; they see a mess.

OPM, she said, is a victim of "death by anecdote" from critics who haul out the well-worn "horror" stories about investigative delays. There are problems and there are no "snap your finger" fixes, she told National Journal. But, she said, "I know the amount of effort that has been put into this. I know the innovation brought into this."

Is Change in the Works?

The administration seems determined to leave an imprint on the clearance program before President Bush's second term ends in January 2009. When OMB's Johnson testified before the Senate subcommittee, he declared, "This is a big priority for the government, and it's a big priority for me personally because this thing can be fixed in the time that I'm going to be here." To that end, Johnson is awaiting a report from a security clearance reform team, led by intelligence and Defense officials, that is exploring ways to create a dramatically new system.

The team's co-chief, John Fitzpatrick, a senior security official in the Office of the Director of National Intelligence, declined in an interview to describe specifics but vowed that proposed changes would be "transformational." He disclosed that his team would send its recommendations to Johnson and top intelligence and military officials later this month.

According to Fitzpatrick, it's high time to move away from past "incremental improvements" in the clearance process and shift to a 21st-century system that will serve the Defense Department, intelligence agencies, and contractors. "Automation is key," he said, adding that the reform team's challenge is to "come up with a vision and the way you can prove it's the right vision."

Henry Dreifus, a well-known information-technology expert and a member of an advisory panel known as the Defense Business Board, favors an automated system that would allow for "continuing monitoring" of the clearance holders' activities, such as financial transactions, arrests, and overseas travel.

In an interview, he compared his proposal to the way credit card companies monitor transactions.

"The credit card company may call you if you have a weird jump in spending on your credit card," Dreifus explained. "They call you to verify that it was really you who made those charges. I am talking about using the very same tools used in the commercial world; and with this system, any unusual spending would be picked up and be immediately flagged." Not only would the government save money, Dreifus said, but "somebody like Aldrich Ames who had unexplained affluence -- this system would have caught him in real time."

At the Defense Department, Robert Andrews, the deputy undersecretary for counterintelligence and security, agreed that the government needs "a modern security clearance program." But he said he was not wild about the idea of a fully automated clearance system, citing both privacy and vulnerability concerns.

"We are being attacked on our systems ... and the more we move to computers," he said, "the more vulnerable we become. They are a mixed blessing." Andrews, though, said he found the plan being developed by the reform team encouraging: "It is sort of like you are in a leaky boat -- the old clearance system -- and you are bailing as fast as you can, and at the same time you are trying to build a new boat that won't leak.... I am enthusiastic over it." He cautioned, however, that any new plan would take time to implement. It won't be the case that "somebody flips a switch and it all goes magic."

Perhaps magic might not be a bad idea, though. Will this most recent plan finally provide the antidote to what ails the clearance program? Recall that in 1999, John Hamre, then the deputy Defense secretary, directed aides to draft a "get-well" plan that he believed might solve the problems within 18 months. That plan relied heavily on a case-management computer system and on private contract agents to do some of the background investigations. It failed.

Meanwhile, the computer system, which cost taxpayers $182 million, was consigned to the dustbin, or "decommissioned," as one Defense official put it, after OPM took over the program two years ago.

Some problems, indeed, just won't go away.