Government Executive - Authors - Jason Peckenpaugh

Foiled by Fences

Jason Peckenpaugh — Wed, 15 Sep 2004 00:00:00 -0400

Homeland Security's border bureaus struggle to blend people, systems and cultures.

By late May, Terry Sourbeer had seen enough. For more than two months, Sourbeer, a manager in a Miami office of the Homeland Security Department's Immigration and Customs Enforcement bureau, had been trying to renew a contract for two photocopiers. But because of pushback from ICE's Dallas procurement office-redo the application; fill out another form-her simple task became a bureaucratic nightmare. After Dallas asked for yet more paperwork, Sourbeer snapped. "That's when I drew the line," she wrote in an exasperated letter to Soraya Correa, ICE's director of procurement. "Not one more ridiculous piece of paper."

For employees at the old Immigration and Naturalization Service regional center in Laguna Niguel, Calif., now part of DHS, the breaking point came last August, when they got wind of a plan to close their office. "We found out from panic-stricken support staff who had been told, unofficially, that they should be looking for other positions," recalls one employee. Some Border Patrol employees were sent to Arizona. INS administrative workers stayed in Laguna Niguel, but were transferred to ICE; then, in late January, some employees were shifted again, this time to the DHS Customs and Border Protection bureau.

Conventional wisdom has it that government reorganizations are painful, chaotic affairs. In fact, for agencies that transferred to Homeland Security intact, such as the Coast Guard and Secret Service, the reorganization has been relatively smooth. Janet Hale, the department's undersecretary for management, can point to several achievements: The department has consolidated 22 human resources systems into seven, opened its books to financial auditors and sharply reduced its reliance on outside agencies for basic services. From parking to procurement, Hale says, Homeland Security is now largely self-sufficient.

But for workers in certain Homeland Security agencies-ICE, CBP and the Citizenship and Immigration Services bureau-the reorganization has brought no shortage of administrative headaches. ICE agents have had their fleet cards, which are used to pay for fuel and vehicle maintenance and repair, declined at the gas pump. CIS has been under a hiring freeze all year. All three agencies are jockeying over funding; the department has determined that CBP and CIS owe ICE $550 million.

Workers have shared their frustrations with reporters and Congress. In June, after hearing from several ICE employees, Rep. Jim Turner of Texas, ranking Democrat on the House Homeland Security Committee, warned the investigative agency was in danger of breaking congressionally set budget limits, a violation of the Anti-Deficiency Act. Underlying problems at the agencies began a year before. Created to bring mission clarity to the government's border security efforts, ICE and CBP were formed in a shotgun marriage of officers from six agencies, including INS and the Customs Service, which brought distinct cultures and administrative traditions with them.

ICE, CBP and CIS received budgets for fiscal 2004 before officials had decided where to put thousands of administrative staff from INS and Customs. Once these workers were divvied up, budget experts had to go back and find the dollars to pay for them-a painstaking process that at times forced agencies to give up funding.

On top of this, the three agencies, with Hale's blessing, have launched an ambitious program to provide administrative support to each other. For example, ICE provides financial services for CIS, while CBP handles fleet management for ICE and CIS. Known as the tri-bureau shared services initiative, the effort is the kind of administrative reform officials hope to expand departmentwide. "At some point, I would assume there would only be one shared service office for all of [Homeland Security]," says Robert Smith, CBP's assistant commissioner for human resources management, who also oversees personnel work for CIS and ICE under the program.

With so much churn, it's no surprise that front-line officers, who just want to be paid on time and occasionally use the photocopier, feel besieged. "If you're one of these guys, what are you going to do?" asks a CIS manager who requested anonymity. "You're not going to blame change. You don't blame the [Bush] administration for poor planning. You'll blame the easiest thing you can: the financial system, or the budget process."

Or, you just blame the INS.

Culture Clash

On March 1, 2003, the Customs Service was disbanded; INS was abolished by Congress in the 2002 Homeland Security Act. But administratively, both agencies live on. CBP uses Customs' systems, while ICE and CIS inherited many systems from INS. For the 3,500 Customs agents who came to ICE, switching to paper-intensive INS systems seemed like a giant step backwards. "I came from an agency that accounted for every penny . . . and everything was integrated and automated," states a form letter circulated by veteran Customs agents in ICE. "Now, I have six different passwords, everything is paper . . . and automation has not been invented evidently."

ICE officials dispute this characterization. They note that Customs used an old mainframe financial system, which is still in use at CBP, while INS had an off-the-shelf application, known as the Federal Financial Management System. ICE chose to use that system because it could easily be upgraded, according to a July 9 letter from ICE Assistant Secretary Michael Garcia to Turner.

But the Customs critique contains kernels of truth. INS never integrated the financial system with its procurement system, meaning workers had to manually debit FFMS after they made a purchase, a practice followed today at ICE. And because the two systems are not electronically linked, procurements hinge on paper transfers. Sourbeer had her meltdown in the midst of an extended paper war with Dallas, an episode that prompted an intervention from ICE procurement chief Correa. "Our procurement staff should sit down with the operators to help them make any changes that need to be made to a [purchase] order," says Correa. "That's what we're here for."

By tradition, INS administrative centers in Dallas, Laguna Niguel and Burlington, Vt., operated with minimal direction from Washington. Personnel specialists got to know front-line officers, and made their own contacts at the Office of Personnel Management. At Customs, by contrast, authority was centralized in Washington, as it is today in CBP. Specialists shifted to CBP say headquarters now keeps them on a tight leash. "We have a slew of GS-12 staffing personnel here who are reduced to typing up [job] announcements, which are written to a template provided by headquarters," says a worker at one center.

Customs and INS even dismantled themselves differently. When it came time to split Customs, officials simply sent their agents and air and marine officers to ICE. But the overhead dollars tied to these programs stayed at Customs-CBP, which had centralized budgets for human resources, training and other administrative functions. "They forgot to cut out the [firearms] support, the training, the financial services, because all that money went to an assistant commissioner at headquarters who was supposed to provide those services," says the CIS manager. As a result, ICE was underfunded.

Other back-office systems weren't compatible. "Customs' IT infrastructure was very different from our IT infrastructure," says an INS veteran now with ICE. "You've got to bust through firewalls, your Web browsers have to be integrated. It's been an immense challenge. When the planners of DHS laid out the plan, I'm not sure how deeply they dug on these issues."

In the summer of 2003, these challenges were dropped in the laps of managers at the three agencies and in Hale's office. Their response is a road map to future management reforms at Homeland Security.

Sharing Services

The tri-bureau shared services plan began taking shape in July 2003, when Hale's office convened meetings with managers from the three agencies. The idea of shared services was popular within Hale's inner circle. Greg Rothwell, the department's chief procurement officer, helped run the Internal Revenue Service's shared services system, and Congress endorsed the approach as well.

Shared services helped solve an immediate problem; it gave the department a way to support three agencies-ICE, CBP and CIS-with the administrative staff from two-Customs and INS. But it came at a time when the agencies already were trying to hash out organizational details muddied by the 2004 budget allocations. As Garcia wrote Turner, the 2004 budget "does not accurately reflect where certain functions or services ultimately resided within the department."

Details of the budget problem remain murky. In late March, The Wall Street Journal reported that ICE and CBP had imposed a hiring freeze due to a potential $1.2 billion budget shortfall. But department officials dispute that figure. "It was never even close to that amount," says an official in Hale's office. What's clear is the budget exercise became a cleaver to finish the job of splitting INS and Customs.

With budgets at stake, no issue was too small for the bargaining table. CBP locked horns with ICE's detention and removal office over who should pay for meals given to travelers detained at airports. Andrew Maner, Homeland Security's chief financial officer, helped resolve the most intractable disputes, including ICE's bid to reclaim $550 million from CBP and CIS, a months-long battle ICE eventually won. "Sure, everyone thought they deserved more money. That's human nature," says the official in Hale's office. "We had to click through item by item and make decisions."

Meanwhile, the three agencies were brokering shared services arrangements, which entailed more swapping of personnel. When CBP took over human re-sources management for ICE and CIS, it absorbed personnel staffers in Laguna Niguel, Dallas and Burlington. Staffers at the old INS administrative centers were regrouped along functional lines, answerable to Washington (CBP's Smith now directs a battalion of 600 workers scattered across 30 locations).

At the centers, the restructuring led to surreal episodes. In Laguna Niguel, INS personnel specialists and training staff had worked side by side for years. Now, personnel staff answer to CBP, while trainers work for ICE. They still share the same coffee pot, but they work for different agencies. When Laguna Niguel's personnel staff shifted to CBP in January, the office's contract janitors questioned whether they should continue to clean CBP cubicles, as their contract was with ICE.

And despite their CBP affiliations, these employees also handle personnel work for ICE; that is the whole point of shared services. But it requires some cultural adjustments. As a CBP worker sees it, "I have to keep two different time sheets to track time that I spend per day on ICE versus CBP work. I try to make things bearable for the timekeeper, who I fear will have a stroke every time and attendance day."

ICE, CBP and CIS employees first learned of shared services in an e-mail sent Sept. 10, 2003; some assumed it was a workforce reduction scheme, despite assurances to the contrary from headquarters. A number of officials now regret that employees were not told more. "The field was kept in the dark on a lot of things taking place here at headquarters," says an ICE official.

Difficulties aside, officials agree shared services makes good business sense. Smith's 600 workers provide personnel support for 75,000 employees at the three agencies. "That's a fantastic servicing ratio," he says. Shared services also became a vehicle to support new Homeland Security units. ICE provides financial services for the department's headquarters, as well as to CIS and itself.

Hale's office wants the agencies to share more services; officials are studying whether one agency could provide budget support for the others. And there is talk of extending reforms to other agencies in the department under plans variously known as "organizational integration," "functional integration," or "tri-bureau grande," as some wits refer to it. These proposals raise difficult organizational questions and have sparked an intense debate inside the department. The discussion was touched off by Homeland Security Secretary Tom Ridge in a memorandum to senior officials on Sept. 12, 2003: "We cannot wait to develop plans to implement the most critical organizational task: to consolidate support functions in each of the separate units into integrated, departmentwide systems."

The Great Debate

Following Ridge's memo, Hale moved quickly to flesh out the details of how administrative consolidation could work. Several officials say she proposed giving her office direct authority over agencies' administrative support shops. Practically speaking, the department's chief information officer would gain operational control over the information technology offices.

Hale's proposal addresses a concern raised by many in Congress, as well as the department's inspector general: the weakness of the CIO, chief procurement officer and other management "chiefs" within the Homeland Security hierarchy. "The CIO has no authority over the more senior component directors that he is supposed to be overseeing in terms of IT," concluded the inspector general in an Aug. 3 report. Currently, the CIO has to use "informal channels" to get things done, including relying on personal contacts within the agencies, the report found.

The House Homeland Security Committee has weighed elevating the CIO and other chiefs in the department so they report directly to the deputy secretary, an idea that would eliminate Hale's job. In an interview, Hale defends her position, saying the department needs a senior official solely focused on management. "It's easy for me to see day in and day out the organizational efficiencies that come about, because I'm not off at a National Security Council briefing trying to figure out the bad guys," she says. "I'm sitting at the conference table with the CFO, CIO, saying, 'Have you guys all coordinated this?' " Asked about the department's plans for administrative consolidation, Hale says, "We are looking at lots of options, but I don't want to talk about internal deliberations."

Some agency officials resist the idea of giving Hale's office control over their administrative staff and possibly ceding their administrative budgets. "It's a hugely controversial topic here," says a senior homeland security official. "Can you imagine an agency head that didn't have any control over the hiring process for his agency?" But others like the idea. The department's CIO Council has crafted a plan to centralize IT services under the chief information officer, according to the IG report. The report had kind words for Hale's plan, saying it would "help eliminate existing organizational stovepipes and help build a department culture that is vital to the long-term health of the agency."

When discussing reorganization, DHS officials often use business metaphors; Hale says it is like managing a corporate merger, a divestiture, an acquisition, and a startup, all at once. The private sector parallel might explain why the department's reforms have hit some bumps. In the late 1990s, consumer goods giant Procter & Gamble spent eight months designing a shared services system before attempting to launch it. But Homeland Security officials say they didn't have that kind of time. "We never had the luxury to do that kind of planning," says the CIS manager. "We had no choice but to do this now."

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Catch and Release

Jason Peckenpaugh — Sun, 01 Aug 2004 00:00:00 -0400

Short on funds, the Homeland Security Department has begun releasing illegal immigrants in the United States rather than detaining them.

For the last 18 months, the Homeland Security Department's Immigration and Customs Enforcement agency has held 22,000 to 23,000 illegal immigrants in its detention system, despite being funded to detain only 19,444. The now-defunct Immigration and Naturalization Service, one of ICE's predecessor agencies, was long accustomed to mismatches between detention resources and illegal immigrant apprehensions. In that tradition, ICE detention managers have stretched their budgets to detain as many illegal immigrants as possible, a priority of the Border Patrol and ICE criminal investigators, who apprehend them. But in early June, ICE's overtaxed detention system began to crack. The agency quietly began releasing illegal immigrants from federal and local detention centers, because it no longer could afford to detain them.

"Currently we are exceeding the level our resources can support nationwide," wrote Victor Cerda, ICE's acting director of detention and removals, in a June 10 memorandum to regional detention officials. "Discretion and financial constraints shall be considered when deciding whether to accept nonmandatory aliens for detention." Certain illegal immigrants must be detained by law, those charged with aggravated felonies, for example. Cerda's directive affects how ICE treats those charged with lesser offenses, such as simple assault. They are detained at ICE's discretion; generally, about 15 percent of all aliens in the detention system are "nonmandatory" detainees, according to Anthony Tangeman, a former director of detention and removals at ICE.

The release policy has led the agency to curtail enforcement, says an agent in ICE's New Orleans district, which encompasses Alabama, Arkansas, Louisiana, Mississippi and Tennesee. But Russ Knocke, an ICE spokesman, denies any let-up in investigations. "We continue to aggressively and proactively enforce immigration laws," he says.

In the field, Cerda's order was accompanied by tight quotas on the number of immigrants to be held. In Tennessee and Arkansas, ICE officials were told to cut their detainee population to 50 by July 1 , according to an internal e-mail from James Mounce, an ICE detention official in Memphis, Tenn., obtained by Government Executive. To meet the quota, managers planned to deport as many immigrants as possible. "In order to stay below that limit and try to keep as many beds free as possible, we will probably [deport] aliens twice per week," wrote Mounce in the e-mail dated June 21.

Other illegal immigrants also are being let go. In ICE's Philadelphia district, which includes Pennsylvania, Delaware and West Virginia, officials released 77 detainees during the last week in June, according to Thomas Hogan, warden at Pennsylvania's York County Prison, which houses some ICE detainees. In the New Orleans district, officials are releasing many aliens who are not required by law to be held.

Nationwide, the number of ICE detainees is dropping. On June 25, ICE had 21,610 illegal immigrants in its detention system, down from nearly 23,000 on June 14, according to Knocke. The ICE spokesman stressed that officials still are detaining immigrants who pose a threat to the community, and may not trim the detainee population to the 19,444 level. "It might not necessarily mean getting down to that hard number," he says. "It might mean we find other ways to manage within budget."

Homeland Security officials describe the releases as prudent management. "They've been running at 22,000, 23,000 every day, so that is tens of millions of dollars more than they are funded for," says a senior Homeland Security official. "You need to start managing those numbers down." Some detainees are released with orders to appear at immigration court hearings, and some are being monitored through alternative detention programs, says Knocke. For example, Behavioral Interventions Inc., a Boulder, Colo.-based contractor, is using home visits and other techniques to keep tabs on illegal immigrants in eight cities.

But the releases have angered some ICE personnel, who have had to let go illegal immigrants they believe should be detained. "Many of these aliens have extensive criminal histories," says an agent in the New Orleans district. And ICE's maneuver came as a surprise to members of Congress, who question why the cash-strapped agency didn't ask for more money before it started releasing immigrants. "If the [fiscal 2004] budget does not adequately cover the needs of the detention and enforcement programs, it is imperative that Congress be informed of the situation," wrote Sens. Jeff Sessions, R-Ala., Chuck Grassley, R-Iowa, and James Inhofe, R-Okla., in a June 30 letter to Michael Garcia, assistant secretary for ICE.

Left unclear is why ICE had to release any illegal immigrants at all. It has faced an overflowing detention system before-the agency ended fiscal 2003 holding thousands more than it was budgeted for-but officials diverted funds from other programs to pay for the excess, says David Venturella, a former ICE detention official.

This year, ICE apparently has no extra funds to tap. In his June 10 memo, Cerda ordered subordinates to "manage within your allocated budget resources," and to "not exceed your monthly allocations." ICE also has been bedeviled by accounting problems that have left officials wondering just how much money they have to work with, says a former Homeland Security official who spoke on condition of anonymity. "You never knew what was going to pop up in terms of the accounting data," says the official. "A lot of times you didn't know what to believe."

Venturella says ICE and the Border Patrol should prioritize arrests to stem the flow of illegal immigrants. When it was part of INS, the Border Patrol routinely launched enforcement initiatives without checking to see whether detention and removal officials had enough space to house those apprehended. "There was never any integration of the strategy, never any integration of the enforcement priorities," says Venturella. "Everyone developed their budgets independent of each other."

The problem has persisted at Homeland Security, says Venturella. In its first year, ICE has unveiled a raft of enforcement initiatives such as Operation ICE Storm, an effort to crack down on immigrant smuggling and violent crime in the Phoenix area. Venturella thinks these operations are well-intentioned, but says they amount to an "unfunded mandate" on the detention system, which has had no budget increases for two years.

One of Venturella's long-standing goals was to give detention and removal a seat at the table when operations are being planned. Last fall, Homeland Security officials appeared close to doing just that. Staffers circulated a draft memorandum from Asa Hutchinson, undersecretary for border and transportation security, directing ICE and another DHS bureau, Customs and Border Protection, which includes the Border Patrol, to coordinate initiatives with detention officials.

"Planning of any such operation must include involvement of ICE [Detention and Removal] at the earliest stages of planning to ensure proper coordination and consideration of the available detention bed resources," states the draft memo. But the directive never was sent. "Had that memo been issued, again, it would have mitigated the impact of the reduction exercise they're going through right now," says Venturella. Sources say Hutchinson likely will issue the planning directive in some form. "You've got to coordinate the whole process, from apprehension to removal," says the senior homeland security official.

In the meantime, ICE investigators have taken a first stab at coordinating operations with their detention colleagues. In a June 24 memorandum, Marcy Forman, acting director of ICE investigations, told her special agents in charge to contact detention officials "during the earliest possible stage of planning for an operation," to let them know how much detention space will be needed.

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The Challenger: What would Kerry do?

Jason Peckenpaugh — Fri, 02 Jul 2004 00:00:00 -0400

In 1971, John Kerry burst onto the national stage as a long-haired Vietnam veteran at a Senate Foreign Relations Committee hearing, blasting politicians who, he said, had "attempted to disown us and the sacrifice we made for this country." In the late 1970s, as an assistant district attorney in Middlesex County, Mass., he rolled up his sleeves as a manager, quadrupling the number of lawyers in his office and snaring millions of dollars in Justice Department grants. As a U.S. senator, Kerry has focused on governmental wrongdoing, leading one of the first investigations into the Iran-contra affair, in the late 1980s.

Still, as he girds for battle with George W. Bush, the first president to hold an MBA, relatively little is known about Kerry's philosophy of government, or his views on management. Ten months into his presidential campaign, Kerry has yet to articulate a vision regarding the role of the federal government, or lay out a comprehensive plan for managing the federal bureaucracy.

This may be partly by design. Instead of unveiling a single government reform plan, Kerry aides say the Massachusetts Democrat has woven management reforms into his overall platform. "It's a thread that goes into other policy announcements made during the course of the campaign," says Robert Gordon, Kerry's domestic policy director. In an April speech on reducing the budget deficit, Kerry proposed cutting 100,000 federal contractors and putting a lid on agencies' travel budgets. He tucked a pledge to slash "out-of-control administrative costs" at federal agencies into an August 2003 speech on job creation. It may take a little scrounging to find Kerry's government reform plan, but his supporters say it's there.

Kerry aides hint that more reforms are in the works. In early June, the campaign began recruiting management experts to staff a Reinventing Government and Management Reform advisory group, one of several outside panels advising the campaign. The group, which held its first meeting June 15, is led by Paul Weinstein, a domestic policy veteran of the Clinton White House; he helped draft Clinton's 1993 executive order calling on agencies to cut 100,000 federal jobs. Weinstein says the advisers will craft management proposals that are consistent with Kerry's views. "We'll also look at those ideas that have been put forward so far and try to put some more meat on them," he says.

More meat would please government reform experts, who say Kerry's initial ideas don't add up to much of a management agenda. "It's not really a plan in any sense," says Donald Kettl, a public administration expert at the University of Wisconsin. "It's a loosely cobbled collection of ideas." Paul C. Light, a professor at New York University, says Kerry has "some distance to go to put together an integrated management agenda that might address some of the big problems that the federal government faces today." Even some Clinton-era management veterans are underwhelmed by Kerry's plans. "That's pretty thin soup," says Bob Stone, who helped run Vice President Al Gore's reinventing government effort. "I'm sure the Kerry camp will have some better ideas."

But in an election expected to turn on the Bush administration's Iraq policy, terrorism and economic issues, some ob-servers say federal management, never a top concern of most voters, is unlikely to garner much attention. "Reinventing government in that context is not only a 'B' issue, but it's a 'C' or 'D' issue in terms of political attention," says Peter Kant, a Kerry fund-raiser who served in the Agriculture Department under Clinton. Asked if Kerry would give a speech on government reform, Jason Furman, a Kerry economic staffer, says, "There's not one being planned right now. I think it's more likely that you'll see bits and pieces of it here and there."

With no obvious constituency for government reform, presidential candidates face little outside pressure to unveil a management agenda. As Kettl notes, "There are probably only 20 to 30 of us who expect a management plan." Gore and Bush both rolled out plans in 2000, but some observers attribute that to the management-savvy staffers on their campaign staffs. Gore's domestic policy director was Elaine Kamarck, the architect of his reinventing government initiative, while Bush had management whiz Stephen Goldsmith, a former mayor of Indianapolis, to churn out reform ideas. In April 2000, Kamarck and Goldsmith even held a genteel debate on government reform. The Kerry campaign has no such management expert in a senior policy job.

In presidential campaigns, management proposals also have symbolic value; they are a metaphor for how a candidate views government. In 1992, Bill Clinton sat down with the editorial board of USA Today to discuss government reform, an issue that helped burnish his credentials as a moderate New Democrat, says Stone. Some Democrats think Bush stole the government reform issue from Gore in 2000 by eschewing anti-government rhetoric and talking about how electronic government and faith-based groups could improve the delivery of government services.

"I actually believe that one of the reasons Gore lost was because he ran away from this issue and he presented a meta-theme of big government, where Bush presented a meta-theme of a smaller, more efficient government," says Robert Atkinson, vice president of the Progressive Policy Institute, a New Democrat think tank. Atkinson, a member of the Kerry management advisory group, says Kerry should lay out his vision of government in the 21st century. "He needs to convince the public that they can trust him to not simply be an old big-government style liberal that wants to simply shore up the bureaucracy."

A large-scale reform plan also could help Kerry pick a political fight with Bush over management issues. "I think you can argue [Bush] has mismanaged a number of agencies," says Light, who sees the Bush management plan as "basically an outsourcing agenda and not much else." Veterans of reinventing government such as Weinstein and Kant dismiss Bush's management initiative as an under-the-radar, poorly funded effort with few concrete achievements. "I think we have the advantage," says Weinstein. "Bush hasn't rolled out much of anything on government reform and reinvention."

By early June, several signs suggested that a more robust Kerry management agenda was under development. Kamarck declined to comment in detail for this article, saying only that the Kerry campaign had asked her to "help figure out some new [reinvention] things to do." Kant, another informal management adviser to the campaign, stressed that some veterans of the Clinton effort "are clearly involved in the Kerry team." Even if Kerry decides not to unveil a broad management reform agenda, how-ever, he already has made a raft of campaign promises that, if implemented, would have a major effect on federal operations.

The Kerry Agenda

Dismantling the Bush management agenda tops Kerry's list of priorities. The Democratic standard-bearer has sharply criticized the Bush administration's effort to let contractors bid on work performed by federal employees. Gordon says Kerry would end Bush's competitive sourcing initiative, which forced more than 30,000 federal workers to compete for their jobs in fiscal 2003.

Kerry himself has publicly spoken out against efforts to outsource federal operations. "I can promise you that, under a Kerry administration, there will be no privatization of air traffic control," he wrote in a March 1 letter to the National Air Traffic Controllers Association, which promptly endorsed him.

In another rollback of Bush policy, Kerry would grant collective bargaining rights to workers at the Transportation Security Administration and possibly others at the Homeland Security Department, according to Gordon. The Democratic candidate also opposes a Bush proposal to give civilian federal workers a lower pay raise than their counterparts in the uniformed military, Gordon says.

"It would totally reverse the decline in the VA health care system," says former Georgia Sen. Max Cleland, a Kerry supporter. With a price tag of up to $209 billion over 10 years, according to Congressional Budget Office estimates, it also would rank as one of Kerry's costliest proposals.

Kerry plans to revive a Clinton-era ethics pledge for his political appointees. "In my first 100 days, we will reinstate the five-year ban on lobbying so that government officials cannot cash in by peddling influence," he said in a Jan. 5 speech in Des Moines, Iowa. Kerry said he would halt the Bush practice of awarding cash bonuses to high-performing political appointees, and has pledged to cut the overall number of political appointees in government.

A Kerry administration would try to steer federal contracts away from companies that incorporate in Bermuda to avoid paying U.S. taxes. Furman says firms that move offshore would not be barred from receiving federal contracts, but would be put at a disadvantage. Only a handful of sizable federal contractors are based in Bermuda, including Accenture Ltd. and Tyco International Ltd.

Like many presidential candidates, Kerry has promised to shrink the size of government. But he is the first to pledge to do it by downsizing the contractor workforce instead of the civil service. "The number of contractors, the way the government is operating, is set to grow enormously, and Sen. Kerry is proposing a modest down payment on reducing government by paring that back by 100,000," says Furman. Asked if Kerry had ruled out cutting civil service jobs, Gordon says, "I wouldn't say ruled out, but [the contractor reduction] is the proposal he has right now."

Kerry's contractor cut has been panned by industry organizations. Management experts say it would be difficult to implement without hiring new civil servants-after all, agencies often turn to contractors because they don't have enough federal workers to handle their workload. But NYU professor Light credits Kerry for acknowledging that the contractor workforce needs management attention. "Republicans don't talk that way at all," he says. The University of Wisconsin's Kettl says the proposal could be a first step toward "getting a better handle on contractors."

While Kerry has not endorsed these ideas, most of his management reforms unveiled to date are, like Weinstein's proposals, primarily aimed at cutting the budget deficit, not changing the way agencies are run. "It's the war-on-waste rhetoric of the Reagan years," says Light.

Kerry's veterans proposals represent a "gut-level commitment," says Cleland. But government reform rarely evokes such feelings, meaning the details of Kerry's management plan likely will come down to a back-and-forth between advisers and interest groups-a prospect that worries some Democrats.

Reinvention Redux

To hear some Kerry advisers talk about it, the Bush presidency is an interregnum between the old era of reinventing government under Clinton and the new one that will be ushered in if Kerry is elected. But despite the number of Clinton hands in Kerry's circle of advisers, few of his announced reforms bear the reinvention imprint. In fact, they seem to be crafted to appeal to traditional Democratic interest groups rather than reform-minded management experts. Federal unions, for example, were delighted by Kerry's pledge to cut contractors. "That's a relatively easy reform politically, given Democratic constituencies," admits the Progressive Policy Institute's Atkinson.

But the contractor cut runs counter to a key reinvention theme: that agencies should hire contractors where necessary and appropriate, but not just swap federal employees for contract workers. "If there's any real substantive insight that was supposed to come out of the 1990s, it was that we're supposed to hire contractors, not contract employees," says Steven Schooner, a former Clinton procurement official. Schooner predicts contractors would fight Kerry's plan to use the procurement system to punish contractors that move offshore. "I think you would have open warfare on your hands, but you could try," he says.

Some Clinton veterans aren't concerned that Kerry hasn't offered a detailed management reform agenda at this point in the campaign. "Having too many details can be a problem, because the details may reflect ad hoc lobbying by interest groups or responses to news headlines," says Steven Kelman, an academic who headed the Office of Federal Procurement Policy in the Clinton administration. Kelman, who says he favors bipartisan reforms, adds, "Once a party is in government, ideas can be vetted more broadly."

If Kerry is elected, his management advisers will face the same political challenge that confronted Clinton: how to craft reforms that appease both the liberal, union-dominated wing of the party, and New Democrats who would gladly sacrifice federal jobs if it helped government take on new missions. "One way or another, [federal unions] are going to have fewer members," says Atkinson. "You might as well do it in a way that preserves the efficiency of government."

Atkinson estimates the government could eliminate up to 370,000 federal positions by boosting productivity and automating some jobs. He also has proposed replacing the Commerce and Labor departments with two quasi-governmental corporations led by CEOs. "Most federal bureaucracies are too slow, hidebound, inflexible and rule-driven to be effective agents for change," he has written.

But others say unions and congressional Democrats would resist a return to the unfinished business of the reinvention revolution. "Kelman and Kamarck are kidding themselves if they think they can just pick up where they left off," says a union observer.

When Clinton was pressured by unions and New Democrats, his solution was to give something to both factions. He coupled extensive downsizing-his administration cut 430,000 federal jobs from 1993 to 2000-with labor-management partnership councils, which gave unions a voice in agency decisions. In retrospect, critics have said Clinton's downsizing left agencies short of valuable talent and may have contributed to a federal "human capital crisis." But downsizing also allowed Clinton to expand government in some areas. In 1993, he backed legislation to put 100,000 new police officers on the streets. Officials said they would pay for the new cops by eliminating 100,000 federal jobs. The legislation's sponsor? John Kerry.

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ICE releasing illegal aliens on nationwide basis

Jason Peckenpaugh — Fri, 02 Jul 2004 00:00:00 -0400

Government Executive.

The releases are designed to cut the number of illegal aliens in ICE's detention system, which is budgeted to hold 19,444 detainees, but has housed thousands more for most of the fiscal year. "Currently we are exceeding the level our resources can support nationwide," wrote Victor Cerda, ICE's acting director of detention and removals, in a June 10 memorandum to regional detention officials.

To ease the strain on the system, Cerda told ICE managers to lower the number of aliens coming into the detention system, while releasing others now being held in federal and local jails. "Discretion and financial constraints shall be considered when deciding whether to accept nonmandatory aliens for detention," he wrote.

Because certain illegal aliens must be detained by law-including those charged with aggravated felonies-Cerda's directive affects how ICE treats aliens charged with lesser offenses, such as simple assault. These aliens are detained at ICE's discretion; generally, about 15 percent of all aliens in the detention system are "nonmandatory" detainees, according to Anthony Tangeman, a former director of detention and removals at ICE.

In ICE's New Orleans district, which encompasses Arkansas, Alabama, Louisiana, Tennessee and Mississippi, officials are releasing aliens that are not required to be held by law. Aliens are let go with orders to appear at deportation hearings.

Illegal aliens are being released in other regions as well. In ICE's Philadelphia district, which includes Pennsylvania, West Virginia and Delaware, officials released 77 aliens last week, according to Thomas Hogan, warden at Pennsylvania's York County Prison, which houses several ICE detainees.

Nationwide, the number of ICE detainees is dropping. On June 25, ICE had 21,610 illegal aliens in its detention system, down from nearly 23,000 on June 14, according to Russ Knocke, an ICE spokesman. Knocke said ICE may not trim its detainee population to the 19,444 level. "It might not necessarily mean getting down to that hard number," he said. "It might mean we find other ways to manage within budget."

Homeland Security Department officials describe Cerda's directive as a sensible approach to help ICE stay within its budget limits. "This is routine management," said one official. Knocke said ICE still is detaining aliens that pose a threat to the community, and added that some of those let go are being monitored by electronic ankle bracelets and other alternatives to detention.

But the releases have raised eyebrows in Congress, and angered some agents. "It's sad because the people affected are in the local immigrant community," said an ICE agent in the New Orleans district. Jim Turner, D-Texas, ranking member of the House Select Committee on Homeland Security, mentioned the releases in a June 25 letter to Homeland Security Secretary Tom Ridge.

ICE has dealt with an overflowing detention system before-the agency ended fiscal 2003 holding more aliens than it was budgeted for, but officials diverted funds from other programs to pay for the excess. By shelving other projects, ICE freed up enough funds to avoid any releases last year, said David Venturella, a former ICE detention official.

The demand for detention space is up because of a surge in immigration related arrests, the result of programs such as the Arizona Border Control Initiative, a $10 million federal effort to crack down on alien smuggling along the Arizona-Mexico border. But as ICE and the Border Patrol have stepped up enforcement, they have put more aliens into a detention system that has had a static budget for two years. "There's a lot of pressure on the [detention] program from apprehending agencies to detain people," said former ICE official Tangeman.

Venturella said the Border Patrol and ICE's Office of Investigations need to prioritize arrests to stem the flow of new aliens into the system. "They control the intake, Detention and Removals does not," he said.

In a June 24 memorandum, Marcy Forman, acting director of ICE investigations, told ICE special-agents-in-charge to contact detention officials "during the earliest possible stage of planning for an operation," to let them know how much detention space they will need.

But Venturella said this guidance was inadequate. "When a [special-agent-in-charge] reads this, they say 'I guess I can still do operations, all I need to do is let [Detention] know,' " he said. "You should not initiate any new operation unless there are detention resources in place to support it."

Some ICE agents said they are curtailing enforcement. "We're laying off a lot of our lower-level jail cases," said the ICE agent in the New Orleans district. But Knocke denied any let-up in ICE investigations. "We continue to aggressively and proactively enforce immigration laws," he said.

On Wednesday, ICE agents arrested 14 criminal aliens in Graham and Burlington, N.C., who are eligible for deportation because of previous criminal convictions, according to an ICE news release.

Other officials said ICE is still arresting the same number of illegal aliens, but is increasing the use of bonds and other detention alternatives to ensure that aliens that are not detained will still show up at their immigration court hearings.

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The Challenger

Jason Peckenpaugh — Thu, 01 Jul 2004 00:00:00 -0400

Understanding John Kerry's vision for managing the federal bureaucracy requires some reading between the lines.

This month in Boston, the Democratic Party will nominate a presidential candidate who has spent a career defending, protesting and investigating the government he now seeks to lead.

In presidential campaigns, management proposals also have symbolic value; they are a metaphor for how a candidate views government. In 1992, Bill Clinton sat down with the editorial board of USA Today to discuss government reform, an issue that helped burnish his credentials as a moderate New Democrat, says Stone. Some Democrats think Bush stole the government reform issue from Gore in 2000 by eschewing anti-government rhetoric and talking about how electronic government and faith-based groups could improve the delivery of government services.

Even if Kerry decides not to unveil a broad management reform agenda, how-ever, he already has made a raft of campaign promises that, if implemented, would have a major effect on federal operations.

The Kerry Agenda

Kerry also has pledged to add 40,000 active-duty troops to the Army, reversing a Bush policy against troop increases. And he has backed increases in veterans bene-fits that would dramatically increase the size and scope of operations at the Veterans Affairs Department. For example, he has pledged to remove veterans health care from the discretionary budget process, making it a mandatory entitlement like Social Security. "It would totally reverse the decline in the VA health care system," says former Georgia Sen. Max Cleland, a Kerry supporter. With a price tag of up to $209 billion over 10 years, according to Congressional Budget Office estimates, it also would rank as one of Kerry's costliest proposals.

The idea of cutting contractors came from domestic policy adviser Weinstein, Kerry aides say. In a February study for the Progressive Policy Institute, Weinstein proposed eliminating 150,000 contractors, a move he said could save $67 billion over 10 years. Weinstein's paper also includes several other ideas he says would wring savings out of the bureaucracy: Charge federal workers for parking ($1.29 billion), halt the acquisition of new federal office space ($4 billion), and slash 10 percent of federal jobs outside the Defense and Homeland Security departments ($39 billion). While Kerry has not endorsed these ideas, most of his management reforms unveiled to date are, like Weinstein's proposals, primarily aimed at cutting the budget deficit, not changing the way agencies are run. "It's the war-on-waste rhetoric of the Reagan years," says Light.

Reinvention Redux

Atkinson estimates the government could eliminate 370,000 positions by boosting productivity and automating some jobs. He also has proposed replacing the Commerce and Labor departments with two quasi-governmental corporations led by CEOs. "Most federal bureaucracies are too slow, hidebound, inflexible and rule-driven to be effective agents for change," he has written.

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DHS agency to keep its name

Jason Peckenpaugh — Fri, 25 Jun 2004 00:00:00 -0400

The announcement puts an end to a months-long effort by ICE officials to change the name to U.S. Investigations and Criminal Enforcement, a title they felt more aptly described the range of missions carried out by the agency, which is the investigative arm of the Homeland Security Department. The recommended new name received favorable reviews from senior homeland security officials, including Asa Hutchinson, the department's undersecretary for border and transportation security, but ultimately was not adopted.

"While hopeful that our name could be changed to more accurately reflect the scope of our mission and the diversity of our law enforcement authorities, I feel it is more important at this time to move forward," Garcia told employees in an e-mail.

The assistant secretary cited the need to issue ICE badges and credentials to agency personnel, and the length of time that had passed since the name change was proposed, as reasons for his decision. Because ICE's name has been in flux, ICE agents still carry badges from their former agencies, such as the Customs Service and Immigration and Naturalization Service.

Some ICE employees say the name change was scuttled by the FBI, which did not want ICE to use the word "investigations" in its title. "Every agent feels that way," said one ICE agent. A former Homeland Security official who asked to remain anonymous backed this view, saying the issue was discussed by FBI Director Robert Mueller and Homeland Security Secretary Tom Ridge. "There were some meetings on it at very high levels involving Secretary Ridge and Director Mueller, and the bottom line is the FBI won out," said the former official.

Asked if the FBI thwarted the name change, Russ Knocke, an ICE spokesman, would not comment. An FBI spokesman also declined to comment. Time Magazine first reported the FBI's opposition to ICE's proposed name.

Garcia has said that he believed the new name would have helped develop an identity for ICE, which has more than 20,000 employees and a variety of missions, including protection of the airspace over Washington, D.C., and detainment and removal of illegal aliens. The Federal Air Marshals also belong to ICE. "Garcia's thought was to get away from the Immigration moniker and the Customs moniker, and build something new," said the former official.

Senior ICE officials initially were optimistic that the change would be accepted. "While we have a few important hurdles to clear, there is now a good chance that a name change to Investigations and Customs Enforcement will become a reality before too long," wrote John Clark, director of ICE's Office of Investigations, in a Dec. 15 e-mail to ICE special-agents-in-charge. "The very fact that this recommendation has risen relatively quickly through DHS is encouraging."

But the plan stalled when it reached the Office of Management and Budget, and other agencies, including the FBI, were asked to comment, sources said.

ICE spokesman Knocke would not say which officials outside ICE supported or opposed the name change. "There was consideration given to a potential name change, but it was simply that, it was consideration," he said. Knocke said the issuance of credentials now is a "prudent business decision" that will make it easier for ICE personnel to conduct investigations and detain illegal aliens.

In his statement, Garcia stressed that the decision to stick with ICE's current name does not reflect a change in mission. "Please be assured that this in no way represents a change in our role within the Department," he said. "You remain homeland security agents and officers with the broadest of investigative and enforcement authorities."

ICE plans to hand out new badges before the close of the fiscal year (Sept. 30), Knocke said.

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ICE budget woes may force release of some aliens

Jason Peckenpaugh — Tue, 22 Jun 2004 00:00:00 -0400

Government Executive.

The decision, which affects aliens held in Tennessee, Alabama, Arkansas, Louisiana, and Mississippi, was made by regional ICE managers in response to an agency budget directive issued last week, according to ICE spokesman Russ Knocke.

In an internal e-mail dated June 15, James Mounce, an ICE detention official in Memphis, Tenn., said budget shortfalls forced the new procedures. "Over the past month-plus, [Detention and Removal] has, as have all the [offices] in ICE, been dealing with budgetary problems," he wrote colleagues. "Here it is in a nutshell . . . We are BROKE."

Knocke said Mounce's characterization was "unfortunate" and "inaccurate." He stressed that the new detention policy was set by officials in ICE's New Orleans district, which encompasses the five states, and may not apply to other regions of the country. "My impression is that New Orleans is a somewhat unique circumstance," he said.

Under the new district policy, aliens charged with misdemeanors, such as simple assault, are being released with orders to appear at deportation hearings. Illegal immigrants that by law must be detained-including aliens charged with aggravated felonies and those who have received final deportation orders-are still being held in federal or local jails.

"They raised the bar for detention," said an ICE agent in the New Orleans district, who spoke on condition of anonymity for fear of retribution. "We used to have the discretion; as long as the alien was illegally in the United States and they committed a misdemeanor or a felony, we could detain them."

The shift in detention policy is the latest indication of how possible budget and accounting troubles could be affecting operations at ICE, a Homeland Security Department agency charged with detaining and removing illegal aliens, among other missions. Last week, Rep. Jim Turner, D-Texas, said ICE was in danger of violating laws against overspending its budget. Told of Mounce's e-mail, Turner said in a statement that he "continues to be alarmed that ICE's financial management system may be impacting the ability of agents to keep our communities safe."

Knocke said the policy switch should be seen in the context of ICE's broader efforts to detain certain illegal immigrants, while using alternatives to detention to keep tabs on others. The agency is budgeted to detain 19,444 illegal immigrants, but typically holds 3,000 additional aliens, he said. As a result, the agency makes daily decisions on how many aliens it can afford to detain, he said. "We will ensure that no one who presents a risk to a community or national security will in fact be released," he added.

Other officials said ICE has to reduce the number of aliens it is holding to comply with its budget limits. "They've been running at 22,000, 23,000 [aliens] every day, so that is tens of millions of dollars more than they are funded for," said a senior Homeland Security official. "You need to start managing those numbers down."

On Monday, ICE began an alternative detention program in eight cities: Baltimore; Portland, Ore.; Miami; St. Paul, Minn.; Denver; Kansas City; San Francisco; and Philadelphia. The program, which is run by a contractor, Behavioral Interventions, Inc. of Boulder Colorado, uses electronic monitoring and home visits to keep tabs on aliens not held in ICE custody. It is designed to monitor 1,600 aliens in the eight cities.

The New Orleans policy already has frustrated some detention officials, who have had to release aliens they believe should be detained. "Many of these aliens have extensive criminal histories," said the ICE agent. The agent fears more operational cutbacks before the end of the fiscal year. "And to think, we still have over three months left in fiscal 2004," he said.

In his June 15 e-mail, Mounce said detention officials would start "reviewing the docket to determine if there are cases eligible for [own recognizance] release." When aliens are released on their own recognizance, they are not required to post bond before leaving federal custody, according to David Jones, a partner with the Memphis law firm Siskind Susser.

It is unclear whether the detention procedures adopted in ICE's New Orleans district are being followed in any of its 21 other detention districts around the country. Another ICE source said other districts have implemented similar procedures to deal with budget shortfalls, but Knocke would not confirm this. Knocke added that the New Orleans district has a relatively high number of aliens that by law must be detained, meaning that officials there may have to release some accused of less serious offenses.

Knocke said last week's budget directive from ICE headquarters was a "routine" effort to emphasize sound budget procedures in the detention branch. The directive, which was communicated to ICE district officials during a phone conference, was to "manage within budget, preserve the integrity of the immigration enforcement system, and under no circumstance release anyone who was a threat to public health and safety," Knocke said.

In his e-mail, Mounce said he had "no idea how long these detention rules will be in effect" in the New Orleans district. Knocke would not speculate on the lifespan of the new rules, but said ICE would "continue managing within the budget that we've been provided by Congress in this fiscal year."

In a related development, the Homeland Security Inspector General has agreed to audit ICE's financial practices, according to Moira Whalen, minority spokesperson for the House Homeland Security Committee. Turner requested the audit in a letter last week.

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Accounting problems bedevil Homeland Security agency, lawmaker says

Jason Peckenpaugh — Wed, 16 Jun 2004 00:00:00 -0400

In a letter to Clark Kent Ervin, the Homeland Security Department's inspector general, Turner said accounting woes have left ICE pilots in the dark on when they would receive new aircraft parts, have caused repeated shutdowns of its travel system, and forced the agency to borrow funds from other Homeland Security agencies to "avoid budget shortfalls."

Turner said ICE may be in danger of violating the Anti-Deficiency Act, which prevents agencies from spending funds in excess of a given appropriation. He asked Ervin to investigate ICE's budget practices.

Dean Boyd, an ICE spokesman, denied Turner's claims. "We strongly reject the suggestion that ICE has violated the Anti-Deficiency Act," he said. Boyd added that there appeared to be "some inaccuracies" in Turner's letter, which he declined to describe.

Turner faulted ICE's financial system, known as the Federal Financial Management System, for many of the problems. The system, a holdover from the defunct Immigration and Naturalization Service, one of ICE's predecessor agencies, is poorly equipped to pay vendors and consolidate financial information, he wrote.

"Staff need to run multiple reports and combine information manually to get a full picture of how much to spend," he wrote.

Turner based his claims on interviews his staff conducted with ICE employees in the agency's Washington headquarters, and in three field offices. "These conversations revealed a severe lack of confidence that the FFMS is providing decision-makers with accurate, useful, and timely information," wrote Turner.

Most of these employees came from the old Customs Service, which used a different financial system, according to Moira Whelan, minority spokeswoman for the House Homeland Security Committee. Some Customs veterans believe their old system, known as the Asset Information Management System, is technically superior to the INS application now used by ICE.

"You could see in 10 seconds exactly what [funds] you had and what had been spent, or obligated," said one veteran Customs employee. "Each office knew exactly, and headquarters knew exactly, and [the] Indianapolis Finance Center knew exactly."

In his letter, Turner questioned why ICE had chosen to use the INS system, noting the General Accounting Office had flagged problems with the system before. "It is puzzling to me that the department would choose to stay with a system that was so widely recognized as inherently flawed," he wrote.

Boyd, the ICE spokesman, said the agency picked the INS system after a detailed review.

"There was a decision to use FFMS after a careful review of the available systems that are out there," he said. "FFMS was ranked pretty highly among the small number of financial management systems that are certified for use by government agencies."

In March, the INS system was certified by the Joint Financial Management Improvement Program, according Jeff Littlehale, a spokesman with Savantage Solutions Inc., a Rockville, Md.-based company that manufacturers the system. An endorsement from JFMIP--a small agency charged with improving financial management throughout government--is the "Good Housekeeping seal of approval" in the federal accounting world, Littlehale said.

He added that Savantage is helping train ICE personnel, including workers from the Customs Service, on how to use the INS system. "People are creatures of habit," he said. "It's amazing how sensitive people are to what they're used to."

Besides housing veteran INS and Customs personnel, ICE also contains the Federal Air Marshals and Federal Protective Service, a unit it inherited from the General Services Administration.

Turner hopes the Inspector General will study whether the financial system played a role in a $1.2 billion budget shortfall that prompted a hiring freeze at ICE and other Homeland Security agencies earlier this year. "This system seems to be omnipresent in these problems, but it was not mentioned as one of the potential causes for losing all this money," said Whelan.

Tamara Faulkner, a media liaison for the Inspector General, said Ervin's office was reviewing Turner's letter and was already looking into "certain aspects" of the issues he raised.

Boyd said ICE is crafting a response to Turner's letter as well.

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Two union-backed outsourcing measures added to Senate Defense bill

Jason Peckenpaugh — Tue, 15 Jun 2004 00:00:00 -0400

The legislation, sponsored by Sens. Susan Collins, R-Maine, and Carl Levin, D-Mich., would let federal workers appeal the outcome of public-private job competitions to the General Accounting Office--a right currently enjoyed only by contractors.

In separate action, the Senate added an amendment from Sens. Edward Kennedy, D-Mass., and Saxby Chambliss, R-Ga., to the Defense bill that would make it easier for the Pentagon to shift work from contractors back to government employees. The provision is seen as a Senate counterpart to the Langevin-Cooper amendment that was added to the House version of the Defense bill last month. "This amendment expands competition, which is good for both the government and the private sector," said Chambliss in a statement issued Monday.

Both measures were approved by unanimous consent, a victory for federal employee unions, which had lobbied for them. "Contractors knew they didn't have the votes to stop either amendment," said John Gage, president of the American Federation of Government Employees.

Collins' measure would amend the 1984 Competition in Contracting Act to let GAO hear proposals from two officials: the "agency tender official," the formal representative of in-house teams, and an official chosen by a majority of employees in a competition. Collins said her proposal would "level the playing field" on appeal rights.

But contractor advocates criticized the Senate's actions, saying it had approved far-reaching proposals without debate or, in the case of Collins' bill, holding a hearing. "This overturns fifty years of federal procurement and labor policy without any debate or even a vote," said Stan Soloway, president of the Professional Services Council, an Arlington, Va.-based contractor association.

Cathy Garman, vice president for public policy at the Contract Services Association, another contractor group, said the Senate's Republican leadership let the amendments go forward to help move along the Defense bill. "They're not necessarily happy with this stuff, but they don't feel in the scheme of things, with the country at war . . . that these are the types of issues you want to waste time on floor debate with," she said. Garman said contractors hoped the measures would be stripped from the Defense bill during an expected House-Senate conference over the legislation.

"Conference," she said, "is the only game that's left in town."

In recent years, Congress has frequently passed legislation to tweak outsourcing rules--particularly at Defense--only to be beaten back by Bush administration officials during House-Senate conference proceedings.

But Defense officials on Tuesday signaled they had fewer qualms with the Kennedy-Chambliss amendment than they did with the corresponding House-side language. In particular, they said that a provision requiring Defense to consider using federal workers to fulfill new work requirements, which often are given to contractors, would not be difficult to implement. "We think this is much less onerous," said Joe Sikes, director of competitive sourcing and privatization at Defense.

Sikes and others have criticized the Langevin-Cooper measure for requiring the Pentagon to let civil servants compete for a set percentage of jobs now filled by contractors. But the Kennedy-Chambliss provision drops this requirement. Instead, it instructs agencies to let civil servants a chance to perform new work as a matter of policy.

"Office of Management and Budget Circular A-76 shall be revised to ensure that the heads of all federal agencies give fair consideration to the performance of new requirements by federal government employees," states the provision. John Threlkeld, an AFGE lobbyist, said this would reverse policy that has steered new work to the private sector for years. "It represents a fundamental change from decades and decades of shrinking the federal sector in favor of the contractor sector," he said.

But Garman said the amendment was bad policy. "To me, what we're doing is putting the federal government into the position of business development and going after work they shouldn't go after," she said.

Giving federal workers the chance to compete for new work is a long-standing priority for AFGE. In 2001, the union supported a provision from Rep. Neil Abercrombie, D-Hawaii, that forced the Pentagon to subject equal numbers of government and contractor jobs to public-private job competitions each year. The Abercrombie provision did not become law.

But the Kennedy-Chambliss amendment does not require federal workers to triumph in a competition before taking on new work -- a good feature, according to Sikes. "It gives us some flexibility in [Defense] because it says if you want to do new requirements in-house, you wouldn't have to hold a public-private competition first," he said. Sikes said Defense would not protest the competition provision in the Kennedy-Chambliss amendment.

Sikes added that Defense does object to other provisions in Kennedy-Chambliss, including language that gives in-house teams a 10 percent or $10 million cost advantage in job competitions involving 10 or more federal jobs. This provision makes it difficult for small businesses to be competitive in job contests, he said.

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Gun Battle

Jason Peckenpaugh — Tue, 15 Jun 2004 00:00:00 -0400

Agents, firearms makers and Congress members are nervous about a new deal to outfit the Homeland Security Department with sidearms.

At 7.1 inches from barrel to grip and just under two pounds, the .357-caliber Sig pistol is one of the smallest weapons in the U.S. war on terrorism. But if terrorists make it on board an airplane, a Sig wielded by a federal air marshal could thwart a hijacking. The .357 fires a faster bullet than the pistol used by agents from the old Customs Service, the Glock 9 mm semiautomatic. The subcompact version of the 9 mm-known as the "Baby Glock"-is more than an inch shorter than the .40-caliber pistol, made by Heckler & Koch, the weapon of choice of agents from the now defunct Immigration and Naturalization Service. "Those [INS] guys carry cannons," says a former Customs agent. "I wear my gun on my ankle. Do I want to carry a freakin' cannon on my leg?"

It's a timely question, because agents from Customs, INS and the Air Marshals are now in the same agency, the Homeland Security Department's U.S. Immigration and Customs Enforcement bureau. And they're about to get new handguns. Since February, the world's top gun makers have been in a shootout for the right to sell handguns to ICE. In August, after extensive testing at federal armories in Pennsylvania and Georgia, ICE will pick one or more of them to arm its more than 12,000 law enforcement officers. In a novel arrangement, other agencies in the department also will be allowed to buy pistols through the ICE contract. Up to 45,000 gun carriers could get new weapons.

"This is the largest pistol procurement in the history of U.S. law enforcement," says Wayne Weber, a manager with the German firearms giant Heckler & Koch, one of the top-tier firms competing for the five-year, $25 million contract. Besides H&K, Austrian gun manufacturer Glock, Italy's Beretta, and two American-based manufacturers, Smith & Wesson and SigArms Inc., acknowledge vying for the pact. "We believe that most of the companies will lower their price to land such a large, important contract," says an executive with another of the gun manufacturers, who requested anonymity to speak candidly about the ongoing procurement.

With so many different officers to arm, ICE and its Homeland Security overseers want to maximize their buying options. They are looking for a family of firearms-a .40-caliber, a .357-caliber and a 9 mm-in full/compact and subcompact form (subcompacts are popular with officers who have smaller hands and those who work undercover). While Homeland Security eventually might prod some of its agencies to use the same gun, officials say the procurement is not designed to force consolidation. "Each agency has mission-driven requirements, so what's good for one is not always good for another," says Thomas Trotto, director of ICE's National Firearms and Tactical Training Unit.

The procurement has caught the eye of rank-and-file officers. Buying handguns is not like buying paper clips; it's about as wrenching as procurement gets. "People use this item to protect their own lives," says the gun company executive. "It's a very emotional issue." At some Homeland Security agencies, including ICE, veteran INS and Customs officer are being merged-and possibly forced to use the same weapon.

At ICE, former INS and Customs criminal investigators carry different guns, even though some of them now work the same cases. Agents from both camps wonder whether the bureau will use the procurement to switch its 6,000 agents to a common pistol: the Glock 9 mm used by Customs veterans, or the .40-caliber H&K carried by INS agents. "A lot of people feel this is the turning point," says a former Customs agent. "A lot of INS people want to stay with the .40 [caliber]. A lot of Customs people want to stay with the 9 mm. It's like, which agency are we going to placate?"

At Homeland Security's Customs and Border Protection bureau, INS and Customs inspectors are being merged into a single corps. Inspectors now train together, wear the same uniforms and earn the same salary. But they still carry different firearms. CBP will use the procurement to help pick a standard weapon, says Christiana Halsey, the agency's acting assistant commissioner for public affairs. "Hopefully, once the [procurement] testing is done, they will all be receiving the same weapon," she says.

At ICE firing ranges, Trotto is putting the pistols through one of the most rigorous testing regimens ever devised, gun manufacturers say. With the help of dozens of officers from CBP, the Coast Guard and the Secret Service, Trotto's team will fire ten thousand rounds with each model. The guns get beat up; they are put in a 200-degree oven for eight hours and dropped on concrete. They are dunked in salt water and sprayed with sand. "We put the [guns] through the wringer to find out what their real performance capabilities are," says Trotto.

ICE acquisition officials promise a fair, open competition. "We're not going to let this be a political decision," says Soraya Correa, ICE's director of procurement. Trotto and Correa know their acquisition is being scrutinized, and not just by officers in the field. They work in the shadow of a gun procurement by the Transportation Security Administration last year during which the agency reversed itself several times-at one point it appeared to stack the solicitation toward Smith & Wesson-before selecting H&K. As reported by National Journal's CongressDaily, TSA's actions raised the ire of Congress and the world's premier gun makers, who now are keeping close watch on ICE.

Anxious Agents

Put a group of gun experts in a room, and the debate over the best caliber and manufacturer will rage late into the night. "It's like Ford versus Chevy engines at NASCAR," says Trotto. "Everyone has their favorite." Most rank-and-file officers come to favor certain guns, sometimes for very personal reasons. For CBP's Halsey, a gun collector who prefers Glocks, it's the way the safety is joined to the trigger. Guns can become part of an agent's persona. Bonni Tischler, who retired in 2002 as the highest-ranking female executive in Customs history, was known for her golden gun, a tiny five-shot revolver.

Inside ICE, the gun procurement has stirred debate about "stopping power"-a pistol's ability to neutralize an enemy with a single shot. While stopping power is a function of several factors, including bullet design, some former INS agents are concerned that Customs' 9 mm comes up short. As a veteran INS firearms instructor puts it, "The real issue with any firearms decision is whether or not the agency wants to put its agents at risk and regress to a 9 mm weapon that provides less stopping power." "So why not bring a bazooka to work?" asks a former Customs agent. "We're not trained to kill. We're trained to shoot until aggressive action stops." Other Customs veterans note they can load more rounds in their 9 mm than INS agents can fit in their .40-calibers.

Some ICE agents are restive because the agency has yet to pick a standard firearm, which they see as just one more example of the agency's slow decision-making. In January, a group of INS veterans was so frustrated by ICE's pace in promoting INS agents from the GS-12 to the GS-13 level, the rank of their counterparts in Customs, that they contemplated suing the agency. The agents contacted a Washington law firm, Woodley and McGillivary, to explore the possibility of a class-action lawsuit against ICE, according to e-mails obtained by Government Executive. (No lawsuit was filed, and INS agents were promoted to GS-13 rank in May.) A long-running effort to change the name of the agency to Investigations and Criminal Enforcement, as opposed to Immigration and Customs Enforcement, also has been held up. "There is now a good chance that a name change to Investigations and Criminal Enforcement will become a reality before too long," wrote John Clark, ICE's director for investigations, in a Dec. 15, 2003, e-mail to senior field officials. Six months later, the name change still was on hold, and agents still lack ICE badges.

Gun tester Trotto, who also heads working groups drafting ICE policies on firearms and the use of force-neither of which had been issued by late May-says ICE is being deliberate, getting feedback from each of its units, including the Federal Protective Service, which ICE inherited from the General Services Administration. "We pick the best of everything and decide what we want the policy to be," he says. "It's been a very positive process." As an example of a decision ICE has made, he cites a new policy to have all agents carry batons, as INS agents did before joining DHS.

Asked whether all ICE agents will switch to the same weapon, Trotto suggests consolidation is likely. "I would say that as firearms are replaced, that you will probably see them coming together," he says. Other sources say ICE plans to let its agents continue to use 9 mm and .40-caliber pistols until they need to be replaced. At that point, agents would receive the new ICE firearm. Postponing a decision would let ICE base its firearm selection on the diagnostic tests being conducted by Trotto. "You'll never please everyone," he says. "But if [agents] have a respect for our process, and know that we looked at this empirically, we'll be better off."

Under the Gun

ICE's gun procurement has its roots in a buying strategy developed by Gregory Rothwell, Homeland Security's procurement chief. Shortly after arriving at the department in July 2003, Rothwell set up more than a dozen commodity councils, interagency groups that review how the department buys common items, from uniforms to computers. Last September, the weapons and ammunition council began to meet, and officials quickly decided that ICE would head the pistol acquisition because of its testing facilities. Not all Homeland Security agencies will necessarily buy guns through the ICE contract. "[The contract] doesn't mean everybody has to dump their [pistol] inventory," says Correa. "There are other [pistol] contracts out there at other bureaus." Within ICE, the air marshals are unlikely to order many weapons at first, because their .357 Sig pistols are relatively new, sources say.

The procurement hinges on robust competition-a tall order according to some observers, who note that the history of federal handgun procurements is rife with bid protests and allegations of favoritism. "The 'gun' people usually have a favorite and write the [specifications] to favor that favorite in some specific way," says the gun company executive. "They usually try to write the [specifications] to sound like they are making it a level playing field, but there is always something in there that gives their favorite an edge."

If they detect bias, gun manufacturers are not shy about contacting Congress. Already, legislators have weighed in on the ICE procurement. In March, House Small Business Committee Chairman Donald Manzullo, R-Ill., and Rep. Jeb Bradley, R-N.H., whose district includes the headquarters of SigArms, expressed concern that the solicitation lacked protections for U.S. manufacturers, known as Buy American provisions. At a March 10 meeting with the congressmen, Rothwell assured them the omission was a mistake, say two congressional aides present at the session. A Buy American clause quickly was added to the solicitation. "DHS has been willing to work with us," says an aide with the House Small Business Committee. "Working with TSA was much more difficult than working with DHS at this point."

Despite congressional entreaties, Homeland Security and ICE have not committed to making multiple awards, which would let the department buy pistols from two or more manufacturers. If ICE makes a single award to a gun maker without a U.S. manufacturing base, Manzullo and Bradley worry that U.S. firearms manufacturing jobs could be lost. But "You don't make multiple awards just for the sake of having competition later," says Correa, though she adds that ICE could make multiple awards if Trotto's testing shows that two or more bids are roughly even.

Correa became ICE's procurement chief in late March, and gun manufacturers credit her with opening communications with them. Relations with gun companies got off to a rocky start in February, when firms attending a pre-proposal conference in Altoona, Pa., were told they could not ask questions of ICE officials present. "I tell them not to be afraid to ask questions," says Correa. "You just have to be fair and balanced to make sure they all have the same information at the same time." But outreach can't smooth away every issue. By late May, one manufacturer had lodged a protest with the General Accounting Office over the procurement. "I'm not surprised by it, given the nature of the procurement itself and the companies involved," says Correa. She emphasizes that ICE will stick to its solicitation and evaluate all proposals fairly: "I am very sensitive to making sure we do the right thing."

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Purchasing Power

Jason Peckenpaugh — Tue, 15 Jun 2004 00:00:00 -0400

Where might David Safavian lead White House procurement policy?

David Safavian graduated fifth in his class at Detroit College of Law, served as a legislative aide to Rep. Chris Cannon, R-Utah, and Rep. William Schuette, R-Mich., and worked at one of Washington's premier lobby shops, Janus-Merritt Strategies. But in federal acquisition circles, Safavian, President Bush's pick to oversee federal procurement policy at the Office of Management and Budget, is still something of an unknown.

"He doesn't have a lot of background in procurement, so the hope is that he's a good learner," says Steven Kelman, who served as federal procurement administrator in the Clinton administration. "I don't know where David Safavian comes out on [acquisition reform]," says Allan Burman, another former procurement chief. Angela Styles, who held the top acquisition post until last September, says Safavian has "no apparent philosophy" on procurement issues. The Senate Governmental Affairs Committee approved Safavian's nomination on June 2.

In some fields-financial management, for instance-federal executives can go their entire careers without articulating a philosophy about their work. But Safavian has been tapped to lead the procurement community, where debate over the acquisition reforms of the 1990s still rages. Kelman, the architect of those reforms, remains a steady voice in favor of them. Styles is a skeptic, a provocateur who charges that the reforms-including creating governmentwide contracts, lifting restrictions on General Services Administration schedules, and streamlining bid proposals and competition-have gone too far and fostered abuse. As an example, she cites misuse of information technology contracts by GSA's Federal Technology Service.

Safavian's supporters say he is less ideological than some of his predecessors. He cut his procurement teeth at GSA, where he served as chief of staff when problems at FTS surfaced. He did not associate those improprieties with acquisition reform. "He walked away with an appreciation that what we need is good guidance on how we manage services," says a procurement official at a civilian agency who requested anonymity. OMB declined a request for an interview with Safavian because he is not yet confirmed by the full Senate.

Asked whether he shared Styles' emphasis on "procurement basics," which advocates of reform view as code words for rolling back change, Safavian pledged his support for the 1990s-era renovations. "I believe solutions can be achieved for most problems that do not erode the efficiencies Congress authorized over the past decade and, more importantly, maintain the trust in our workforce's ability to exercise good business judgment," he wrote in an April 16 response to questions from the Governmental Affairs Committee.

Observers note that Safavian's wife, Jennifer, is chief counsel for oversight and investigations on the House Government Reform Committee chaired by Rep. Tom Davis, R-Va., who is the legislative force behind the new era of acquisition reform. At his Senate confirmation hearing, Safavian had kind words for a Davis-backed initiative: broadening the use of share-in-savings contracting. Safavian termed it an "intriguing concept [that is] worth agencies' consideration." The approach allows agencies and contractors to split savings generated by projects.

As procurement administrator, Safavian would be the Bush administration's point man for its controversial competitive sourcing initiative, which likely would take up much of his time. But some experts say OMB should attend to broader acquisition issues. If Safavian is confirmed, he would take office at a time of increased procurement scrutiny. Ethics fallout over Boeing executive Darleen Druyun's criminal plea, controversy about the use of contractors in Iraq, and revelations of questionable practices at FTS could spur further investigation. Those who know him predict Safavian would move quickly to improve the management of services contracting, possibly by writing a new section of the Federal Acquisition Regulation.

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Army contractor count stymied by red tape

Jason Peckenpaugh — Thu, 03 Jun 2004 00:00:00 -0400

The project, authorized in a March 2002 memorandum from White, was intended to give the Army more visibility of its contractors, showing the units they support, the offices that administer their contracts, and the total number of contract workers on the service's payroll. No single Army office currently tracks such information.

But despite White's order, and an additional endorsement by the Business Initiative Council, a Pentagon management reform group, the Army project has been delayed by procedural hurdles. "The initiative has not started implementation yet," said an Army official, who spoke on condition of anonymity. "Most of the time since approval of the initiative by the [Business Initiative Council] has involved compliance with the Paperwork Reduction Act process."

White, reached by telephone Wednesday, was flummoxed by the Army's slow progress. "I just don't understand how the [Paperwork Reduction Act] would come into play here," he said. "I think if you are looking at controlling manpower costs and you are in the business of outsourcing . . . you would want to have a very firm grip on how much contract labor you were paying for as a principal cost of doing business."

Some observers said the project, if implemented earlier, could have yielded information on Army contractors now working in Iraq. "It appears that a law enacted to minimize red tape, the Paperwork Reduction Act, has been used to delay the Army's ability to collect data to account for contractors in war zones," said Dan Guttman, a government contracting expert at Johns Hopkins University. Several lawmakers, including Reps. Ike Skelton, D-Mo., and Jan Schakowsky, D-Ill., have pressed the Pentagon for data on how many contract workers are supporting the U.S. military in Iraq.

But Stan Soloway, president of the Professional Services Council, a contractor association in Arlington, Va., said the Army had adequate information on contractors at the unit level. "If that's not visible at the headquarters level … that's an internal systems issue within the Army," he said Wednesday.

One major Army contractor routinely provides employee data to the Pentagon: Kellogg Brown & Root (KBR), a division of Halliburton. Under the Army's Logistics Civil Augmentation Program contract, KBR is required to report on employees assigned to carry out individual task orders, according to Patrice Mingo, a Halliburton spokeswoman. But Guttman said the KBR contract was atypical. "Other than the LOGCAP contract, everything else is a seat-of-the-pants estimate," he said.

The Army has been trying to count its contractors since December 2000, when it announced plans in the Federal Register to collect information from them. But the project has been repeatedly tripped up by the 1995 Paperwork Reduction Act -- in 2001, the Office of Management and Budget cited the law in halting a version of the project. A provision in the law requires agencies to evaluate the burden and expected benefit of collecting information.

As a result, the Army has no firm tally of its contractor workforce. In a 2003 report to Congress, the service estimated it employed anywhere from 144,000 to 562,000 contractor employees. "Without the ability to initiate the [Business Initiative Council] approved reporting pilot, a credible basis for estimating a more specific number than the range specified is not available," the Army stated.

In his 2002 memo, White revived the project to help identify "unnecessary, costly, or unsuitable contracted work." At the time, he wrote the Army lacked "credible information on contract labor," making it impossible to tell whether the service's contract workforce should be downsized, as its active military and civilian ranks were in the 1990s. White's directive was sent to three Pentagon undersecretaries, who were asked to support the initiative.

In an apparent effort to make the project less burdensome to contractors, White said the Army would pay them for reporting information.

Some contractors and procurement experts question the purpose of the Army project, saying the size of the contractor workforce has little bearing on how government manages contracts. "It's not really relevant how many people you have working on a project, it's a matter of how much you pay and the quality of the work being done," said Angela Styles, a former federal procurement administrator who is now a partner at the Washington law firm Miller & Chevalier.

Soloway doubted the project would yield much useful information. "I don't think it's any great problem that they haven't moved forward because I'm not sure the value of the information will be that great," he said.

Other branches of the military have expressed interest in counting their contractor workforce. The Navy is studying the Army's method, as well as others, said Rear Adm. Robert Cox, the Navy's director of total force programming and manpower. "The Navy is in the process of determining what types of information -- such as hours, dollars and contract category -- will be helpful to track contract work, as well as the best method to obtain that information," he said in a statement last month.

The Navy estimates it has 230,000 contractor employees, but Cox said this projection is not based on a firm methodology. "It is this very imprecision we are working hard to overcome," he said.

Cox said a contractor count could help the Navy make better management decisions. White made a similar argument in his 2002 memo: "Contract support is not unlike all other processes -- in order to manage it effectively, we must, first, have full visibility into it."

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Reining In Contractors

Shane Harris and Jason Peckenpaugh — Tue, 01 Jun 2004 00:00:00 -0400

The prison scandal in Iraq raises questions about contractor oversight.

When Congress learned that private contractors were implicated in the abuse of prisoners at the Abu Ghraib prison outside Baghdad, legislators turned to the Pentagon for answers: Why was the military using contract interrogators to question Iraqi prisoners? Could contractors be prosecuted in U.S. courts? And, as Sen. Daniel Akaka, D-Hawaii, asked at a May 11 Senate Armed Services Committee hearing, is any government agency responsible for keeping tabs on all the contractors working in Iraq? Army Maj. Gen. Ronald Burgess, director of intelligence on the Joint Chiefs of Staff, admitted he didn't know.

As the scandal unfolded, other answers were hard to come by. It took days for the Pentagon to pinpoint which unit oversaw a contract with CACI International Inc., a technology and network services company based in Arlington, Va., to provide interrogators. The military's need for contract support-even for sensitive work such as security and intelligence-long has been obvious to private firms. For example, at the hearing, Army Lt. Gen. Keith Alexander admitted the service had only 540 active-duty interrogators. But far less obvious are the ways the Pentagon is acquiring such services and the rules under which contractors must operate.

To obtain interrogator services for Abu Ghraib and other detention centers in Iraq, for example, the Army used a contract intended for the purchase of information technology services. The procurement was performed on behalf of the Combined Joint Task Force-7, which at the time had operational control of troops in Iraq. The National Business Center, a fee-for-service procurement operation of the Interior Department, did the buying between August and December of 2003. The center had negotiated an open-ended purchase agreement against a pre-existing General Services Administration contract with Premier Technology Group Inc., a technology and intelligence services firm in Fairfax, Va. The procurement was conducted from the National Business Center's offices at Fort Huachuca, Ariz., which is also home to the Army's military intelligence school.

The contract provides a broad range of technology services, including programming, backup and security, maintenance, facility operations, computer-aided design and data conversion. It is a GSA information technology schedule contract, one of thousands awarded to companies GSA approves for use by government agencies. As the user of the schedule, the National Business Center had legal responsibility for the administration of the contract.

The contract first was awarded in 1998 to Premier Technology. CACI bought that company in May 2003 in order to obtain its expertise in "intelligence and military operations," according to Jack London, CACI's chairman and chief executive officer. For CJTF-7, the National Business Center used the contract to procure interrogators, intelligence support-which included intelligence gathering and data entry-and "screening cell support," which a center spokesman defined as "a screening program designed to clear a host country national for access to U.S. military host country base camps." CJTF-7 has been replaced by Multinational Force Iraq, which is responsible for strategic planning, and Multinational Corps Iraq, which is responsible for tactical operations.

The center's description of the work CACI performed shows only tenuous connections to technology. For instance, one order for "interrogator support," issued Aug. 14, 2003, specified "database entry" as part of the task. Workers defined as "intelligence advisers," "intelligence research clerks" and "intelligence and technical support" would gather intelligence and then "update various databases." While that order, worth about $20 million, involved technology devices, another order from Dec. 3, 2003, makes no mention of technology at all. The order for "HUMINT [human intelligence] augmentee contractors" called for employees to assist CJTF-7 and its brigades, and "in performance of HUMINT and counterintelligence missions in secure and fixed locations." A GSA spokeswoman confirmed that three intelligence and interrogator orders, collectively worth almost $45 million, were placed through the CACI schedule. GSA's inspector general has opened an inquiry into the orders.

For critics of Defense contracting, the lack of transparency created by third-party procurement is connected to a larger problem: the government's inability to oversee and regulate the swarms of contractors supporting the U.S.-led occupation in Iraq. "Pending a thorough investigation . . . all contracts with civilian firms for functions involving security, supervision and interrogation of prisoners, should be suspended," wrote Rep. Jan Schakowsky, D-Ill., in a May 4 letter to President Bush. Defense Secretary Donald Rumsfeld has pledged to develop rules governing contractors providing security, but it's unclear whether prisoner detention would be covered. Sixty security firms with 20,000 employees now operate in Iraq.

Defense is working on yet another set of rules for "contractors accompanying the force," such as Kellogg, Brown & Root, a subsidiary of Halliburton, the Houston-based oil industry giant. KBR and other logistics support firms have been mainstays since the early 1990s, but observers say more guidance is needed. "Well over a year ago we asked the department to take a look at this," says Allan Chvotkin, counsel for the Professional Services Council, which represents several contractors doing business in Iraq. Chvotkin says guidance on issues such as when contractors can carry weapons and how they interact with combatant commanders simply wasn't apparent before the 2003 war in Iraq.

But critics say Defense has done little to get a handle on its contractor workforce, despite repeated warnings that it was growing rapidly in size and importance without enough oversight. In a March 2002 memorandum, then-Army Secretary Thomas White said the service lacked data to eliminate "unnecessary, costly or unsuitable contracted work." He ordered the collection of data from Army contractors. More than two years later, the Army has yet to gather any data. "Most of the time . . . has involved compliance with the Paperwork Reduction Act process," says an Army official.

As the line between contractors and soldiers blurs in Iraq, observers say the need for rules governing contractors is urgent. Says Dan Guttman, a contracting expert at Johns Hopkins University, "There has been a stunning failure to come to grips with the fundamental legal and policy issues raised by such extensive contracting."

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Up in the Air

Jason Peckenpaugh — Sat, 15 May 2004 00:00:00 -0400

Politics may stand in the way of the Federal Aviation Administration's effort to conduct the biggest job competition in federal history.

When pilots get lost in the fog of Virginia's Shenandoah Valley, or try to navigate the Blue Ridge Mountains for the first time, they rely on Federal Aviation Administration specialists like Curt Lasley to help them get their bearings. On a cloudy night three years ago, Lasley helped a pilot who had lost the electronics on his plane-he was essentially flying blind-rise above the cloud line and find an airport where he could land. But after 18 years of being a lifeline for pilots in a jam, Lasley now faces his own quandary. He is one of 2,711 FAA flight service specialists whose jobs could be contracted out as a result of the largest, most complex public-private competition ever held in government. § On a rainy April morning, Lasley walked into a group interview with a reporter at an automated station in Leesburg, Va. When a manager extolled the possible benefits of the competition, including a separate budget for flight service, Lasley, a regional vice president with the National Association of Air Traffic Specialists, was quick to disagree. "You give one side, I'm going to give the other," he told his manager. "We look at it as nothing more than a check mark by the box for the President's Management Initiative."

Strong feelings and political agendas are the hallmarks of FAA's attempt to use the public-private competition process to solve a long-standing management problem: how to upgrade its flight service operation. For decades, the customers of flight service, the 550,000 noncommercial pilots who make up the general aviation community in the United States, have called specialists on the phone to file flight plans, receive preflight weather briefings, and hear the latest airport conditions and flying restrictions. But pilots now can get many of these services online, particularly weather forecasts, without talking to a specialist. Since the early 1990s, the demand for flight services has dropped, but FAA has not closed any of its 58 stations in the continental United States, Hawaii and Puerto Rico. Some stations, like the one in rural DeRidder, La., struggle to attract staff. But they stay open.

FAA officials say the flight service system begs for reform. "The buildings are old, the equipment is falling apart, the people are disgruntled," says Joann Kansier, FAA's director of competitive sourcing. Kansier has spent 19 years at FAA in various acquisition jobs, and for as long as she can remember, the agency has been studying different ways of providing flight services. But political pushback from Congress and NAATS has kept reforms from getting off the ground. "We've wanted to do something in this area for a long time, but because we're in 58 congressional delegations, the question is how," she says.

Enter competitive sourcing. For Kansier and other FAA officials, including Marion Blakey, FAA administrator, the Bush administration's management agenda offered a way to modernize the outdated system. It gave them a highly structured process, outlined in Office of Management and Budget Circular A-76, and a political ally in the White House. "You need the strong support and backing of OMB, and we have that," says Blakey.

So in 2002, when some agencies were staging A-76 competitions over a single job, FAA set out to hold a nationwide contest involving thousands of specialists and the entire infrastructure at its 58 stations (three in Alaska are not part of the competition). The agency gave bidders free rein to propose where its stations should be, how many specialists should staff them, and what technology to use. Chasing a potential $2 billion payday, blue-chip firms flocked to the contest, and innovative partnerships sprouted up. Northrop Grumman is competing alongside NAV CANADA, the private air traffic corporation in Canada. FAA's own employees have teamed with Harris Corp., an experienced FAA contractor. After nearly two years of work, FAA will start evaluating proposals in August, and could pick a winner this winter.

That is, if political considerations don't stop the competition first. Many legislators, including Republicans such as Oklahoma Sen. James Inhofe, remain opposed to the competition. Massachusetts Sen. John Kerry, the Democratic presidential standard-bearer, will halt the competition if he is elected president, according to Andy Davis, his Senate spokesman. "Why would we federalize passenger and baggage screening functions only to privatize control over the nation's air traffic safety system, including flight service?" asks Davis. "It doesn't make any sense, and in Sen. Kerry's view, it would be detrimental to our aviation security efforts."

The politics of flight service led FAA to try competitive sourcing on a grand scale. And politics may be the undoing of its effort.

Hearing Voices

The work of flight service is hard to capture in a single phrase, or to encompass in a statement of work. Specialists are best known for their weather briefings, but they actually perform more than 2,000 separate tasks, an FAA team found while planning for the competition. "There is far, far more to a flight service station than the stereotypes perpetuated by the FAA," says Bill Moriarty, a supervisor at a station in Bangor, Maine, who served on the team.

For some specialists, the competition has compounded the feeling that they are second-class citizens inside FAA. Technically, specialists are a type of air traffic controller. But over the years, they have received far less attention and funding than controllers who work in air traffic control towers and centers. The core flight service technology, still in use at more than 40 stations, is something called Model 1 Full Capacity, a 1970s-era system that long ago was declared obsolete. FAA technicians scour hospitals and schools to find replacement parts. "We are still stuck in the 1970s," says Lasley.

Despite their museum-worthy systems, specialists are good at what they do. They distill weather data and flight restrictions into three- to five-minute briefings, tailored to pilots' experience level. Like a crisis counselor, a specialist learns to listen for voice inflections that reveal a pilot's background and frame of mind. "Their first words betray them," wrote Jay Wade, a specialist in Nashville, Tenn., in "I Hear Voices," a tribute to specialists published in Flying magazine in May 2001. "It is not age, sex or pitch, but their pace and tone."

Pilots value this expertise. In a survey of fliers conducted for Kansier's office, the Mitre Corp. found pilots wanted more back-and-forth with specialists. "We can have all the automation in the world, but the human expert and the ability to interpret is considered to be a large quality factor by people who use that service," says James Washington, FAA's vice president for flight services.

But specialists may take customer service too far. "We found cases where flight service specialists were turning on airport lights," says Kansier. Mission creep contributes to flight service's steep price tag: It cost $564 million to operate the system in fiscal 2002. FAA estimates that each pilot call to a specialist costs between $20 and $36. "I frankly have not had anyone debate me that the cost-benefit [ratio] on this makes sense," says Blakey.

Blakey adds that current specialists will continue to be part of the flight service system, even if a contractor wins the competition. Forty percent of the specialists are retirement-eligible, meaning they could go work for a contractor and still collect a retirement check from Uncle Sam. "They could earn two salaries to do what they're getting paid one salary for now," says Kansier.

But many specialists don't see this silver lining. They note that the competition almost certainly will result in fewer specialists at fewer stations, and those who remain may have to uproot their families and move to new cities. Across the country, National Association of Air Traffic Specialists members are contacting lawmakers to rally opposition to the competition. In Washington, NAATS has hired lobbyist Chet Lott, son of Sen. Trent Lott, R-Miss., to press its case with Congress.

Other specialists are trying to influence the competition itself. Wade, the specialist laureate, has launched a quixotic attempt to bid in the competition himself, through a company he formed called Wade & Associates. While other bidders regard Wade as a curiosity, his steady stream of technical comments has made an impression at FAA headquarters. "He keeps us on our toes," says Kansier. "Jay cares about flight service, and I think he just wanted to have a voice in the process," says Derek Buchanan, a fellow specialist in Nashville.

Advocates for the specialists, including FAA's Washington, worry the competition could erode the local weather knowledge that pilots depend on. If a contractor consolidates the system into 10 stations in large cities, will future specialists understand the fog off Machias, Maine, or the distinctive wind patterns along the Blue Ridge Mountains? There are risks in putting an entire branch of your agency on the auction block. "This has never been done before," says Washington. "There have been other A-76 studies, but none this large, and none in a truly operational context."

Cutting-Edge Competition?

In competitive sourcing circles, FAA is seen as a trailblazer. Since the agency began planning the competition in 2002, it has churned out several innovations. In December 2003, FAA won OMB's approval to offer a 10-year contract, longer than A-76 rules typically allow. OMB also signed off on an agency request to make cost less important than technical innovation in its bid grading.

By tweaking A-76 rules and asking for technology-heavy solutions, FAA attracted top-tier systems integrators that usually ignore A-76 competitions. "This is not a typical A-76 where you just re-badge government employees as contractors," says Michael Freeman, a senior director at Northrop Grumman IT. "You have to provide a huge technical infusion."

Freeman is full of compliments for Kansier's office, which has used FAA's custom acquisition rules-the agency is not covered by the standard Federal Acquisition Regulation-to be more responsive to bidders. As part of FAA's performance-based approach, bidders can propose to use or scrap any of the 58 facilities where specialists now work, as long as they meet performance targets.

FAA is holding bidders to tight spending limits. Bidders will receive no more than $435 million a year, and FAA expects them to slash costs by an additional 22 percent over five years, yielding at least $478 million in savings. Despite these caps, contractors believe they can still turn a profit. "We think there is a sound business case here," says Richard Kramer, director of business development with Computer Sciences Corp.

Still, bidders say FAA could do more to encourage creative proposals. Freeman would like the agency to indemnify contractors from potential lawsuits over the flight services they would provide, a move FAA so far has resisted. Robert McMullen, FAA program manager for the in-house team, says a requirement that bidders use an existing FAA communications network could "blunt" technological innovation.

Some observers worry FAA is rigging the competition to favor contractors-a claim repeated not only by NAATS members, but also by OMB's former top competitive sourcing official, Angela Styles. In September 2003, shortly before she left OMB, Styles called Kansier and other agency officials into her office to voice her concern that the competition's tight deadlines would prevent the in-house team from crafting a competitive bid. At the time, FAA had allotted just two months for teams to craft proposals after the final solicitation was released, a startlingly short amount of time to write a bid, particularly for the in-house team, which had never submitted a proposal before.

"I remain concerned in light of recent events that the FAA has no intention of giving the in-house workforce a fair shot at competing," says Styles, now a partner at Miller & Chevalier law firm. In December, after an appeal from NAATS president Wally Pike, Blakey agreed to extend the deadline. Proposals are now due in August, and FAA will make an award sometime between Oct. 1, 2004, and March 17, 2005. "We are trying our best to be very fair to our own employees," says Blakey.

While Kansier says a contract award is "unlikely" before December, FAA technically could make an award as soon as Oct. 1, the start of fiscal 2005, when a Blakey pledge that FAA would not outsource any workers in fiscal 2004 expires.

An earlier award date would please contractors, who fear a potential Kerry administration would halt the competition. "We would love it," says Freeman. "We actually advocated that it be awarded before November of this year, because of the potential change in administration."

Playing Politics

When asked what a Kerry victory would mean, Blakey said A-76 planning began under her Democratically appointed predecessor, Jane Garvey. Blakey denies that politics has affected how FAA is conducting the study. "It's not being driven by the election cycle, it's being driven by how you get the job done on an efficient basis that ensures equity for the employees and the best result for the taxpayer, and for the [general aviation] community," she says.

But when FAA tries to close stations, politics can be hard to avoid. It spent much of the 1980s trying to consolidate 316 stations into the present configuration of 61. NAATS supported the move. But because legislators sought to protect stations in their districts, the move took 15 years.

Already, legislators are mobilizing to resist FAA competition, which undoubtedly will result in some closures. In the Senate, Democratic appropriators may press Blakey for a written pledge against outsourcing any jobs in fiscal 2005, according to a Democratic staffer. "At this point, I don't currently see a need for further letters," responds Blakey. "We've been pretty clear about what we are doing."

There is something ironic in how FAA has tried to use competitive sourcing, which has been a magnet for political controversy, to carry out sweeping changes to its flight service system outside the political process. Kansier is adamant that better management, not politics, is FAA's sole concern. "This is not about scoring points for Bush," she says.

But the controversy is unlikely to ebb. NAATS member Lasley says he is a "Republican-leaning independent" who plans to vote for Kerry. "I've talked to quite a few specialists about this, and they're all going to go for Kerry this year," he says. Once again, flight service's future may be settled by politics.

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Able Sentry

Jason Peckenpaugh — Sat, 01 May 2004 00:00:00 -0400

The Coast Guard helps prevent a mass migration from Haiti.

In early February, Haitian rebels began threatening the government of then-president Jean-Bertrand Aristide. On Feb. 21, as the unrest spread, Homeland Security Secretary Tom Ridge went to the White House with a plan to prevent what officials feared most: a wave of Haitian emigrants sailing for U.S. shores.

The ink was still wet on Ridge's plan, finished at 5:19 that morning by department officials in Miami who pulled an all-nighter. It called for an armada of Coast Guard cutters, Border Patrol helicopters, and aircraft from the Bureau of Immigration and Customs Enforcement (ICE) to patrol the coast of Haiti for boats full of emigrants. They would be stopped and repatriated to Haiti.

The plan worked, even as Aristide's government collapsed. With round-the-clock patrols and repeated calls for Haitians to stay put-a message emphasized by President Bush, among others-a mass migration never materialized. Homeland Security repatriated all 905 Haitians who had set sail for Florida as of March 11.

In the public imagination, the effort was largely a Coast Guard operation. The service provided most of the resources, enlisting 15 cutters and 1,550 personnel, and did the physical work of returning Haitians to their country. But Ridge's plan, known as Operation Able Sentry, called for five other DHS agencies to pony up personnel. Seven Florida law enforcement agencies also participated. To coordinate them, DHS unveiled a command structure that officials see as a model for managing future homeland security events.

The Haitian operation was run by Homeland Security Task Force Southeast, which counts members from all DHS agencies in Florida. Established by Ridge last June, the task force quickly realized that every agency entering the new department had its own procedures for responding to migration incidents. After months of work, officials merged these plans into a 3-inch-thick document that became the playbook for the Haitian crisis.

To lead the task force, Ridge's office tapped Coast Guard Rear Adm. Harvey Johnson, and named the Border Patrol's Lynne Underdown as his deputy. Both have day jobs: Johnson runs Coast Guard operations for District 7, which covers the Caribbean, while Underdown heads Border Patrol efforts in Florida, Georgia and the Carolinas. But as task force leaders, they answered to Homeland Security headquarters in Washington, giving Ridge a direct line to officials in the field. "Within three minutes of the first Haitian being repatriated, they knew about it in Washington," says Johnson.

Once the task force got up and running, Underdown asked DHS agency chiefs in Miami to ante up the resources called for in their migration plan. In quick succession, she had access to 12 aircraft from ICE, planning specialists from the Federal Emergency Management Agency, and public affairs officials from the Transportation Security Administration. ICE detention and removal officials readied plans in case Haitians made it to U.S. shores, while the Bureau of Citizenship and Immigration Services (CIS) put 17 asylum pre-screening officers on Coast Guard cutters, to determine whether any Haitians qualified for asylum.

These assets essentially belonged to the task force for the duration of the incident; Johnson and Underdown could deploy them as they saw fit. But they were careful to keep DHS agency chiefs in the loop. "We weren't giving orders to their people without coordinating through them," says Underdown. "The task force [chain of] command was parallel to the normal agency chain of command."

Johnson's staff drew up a joint patrol schedule for DHS and Florida agency aircraft to take turns patrolling key areas. "The Border Patrol would say we can patrol an area off West Palm Beach from 8 a.m. to 4 p.m.; then the Florida Wildlife Commission would do it until midnight, and ICE would take it after that," says Underdown.

Closer to Haiti, Coast Guard cutters were continually reacting to events in Port-au-Prince, the nation's capital. On a single day, Johnson says the service nabbed about 500 emigrants, who took to the seas at Aristide's urging, they believe. "It was very dynamic whether Aristide would come or go," says Johnson. "It was not unusual for us to get real-time intelligence out of that theater every 15 minutes," adds Underdown.

On Feb. 25, the task force scrambled to intercept the Margot, a Panamanian-registered freighter that had issued a distress call just 10 miles off the Florida coast. Teams from ICE, the FBI and the Coast Guard descended on the vessel, finding 17 Haitians and some weapons on board.

Because the Haitian emigrants were intercepted at sea, the task force never resorted to contingency plans for processing and returning Haitians who made landfall in the United States. On March 11, Ridge directed the task force to cease its Haitian operations, although the Coast Guard continues to watch for signs of a migration should security in that country worsen.

In Washington, officials view the Haitian task force as a model for how the department should manage joint operations in the field. Later this year, the department plans to create regional offices in an effort to unify the field structure of its 22 agencies. At a March 24 hearing of two House Government Reform subcommittees, Asa Hutchinson, Homeland Security's undersecretary for Border and Transportation Security, cited the Haitian task force as an example of the role these offices will play. Regional directors will manage temporary events and will be Ridge's direct liaisons on certain occasions, but they will not oversee daily operations. "The day-to-day operational control would still be through the traditional agencies," Hutchinson said after the hearing.

For Homeland Security officials in the field, Operation Able Sentry was largely a success. Underdown tells a story of four Cuban emigrants who were intercepted outside New Orleans, near the mouth of the Mississippi river. The emigrants wanted to sail for Miami, but the smuggler they paid declined. "He said DHS was all over Miami, so he took them all the way up to the Mississippi river instead," says Underdown.

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Clarke's Lament

Jason Peckenpaugh — Sat, 01 May 2004 00:00:00 -0400

Agencies try, and fail, to fight terrorism.

After stirring up a white-hot political controversy, Richard Clarke's Against All Enemies has been boiled down to its headline-grabbing criticism that President Bush did too little to stop al Qaeda, both before and after Sept. 11. But Clarke's memoir of his counterterrorism career is more than an anti-Bush broadside: It's also a cautionary tale of how federal agencies reacted to the terrorism threat during the Clinton and Bush administrations-a story with few peaks and many valleys.

In Clarke's telling, one of the high points came on Sept. 11, when bureaucratic rivalries were put aside in the scramble to safeguard the United States after the terrorist attacks. In a breathless narrative, Clarke recounts the scene in a chaotic White House Situation Room, where officials linked by videoconference carried out the government's response to the crisis: grounding thousands of airplanes, closing land borders and scrambling fighter jets above U.S. cities. With many Cabinet-level officials out of town or stashed away in bunkers, their deputies seized the initiative. The Navy's Atlantic Commander marshaled his Norfolk-based fleet and steamed for New York, even though no one at the Pentagon had ordered him to. "At times like these, initiative was a good thing," Clark writes.

But as the rest of Clark's memoir makes clear, many agencies lacked the initiative for a full-on fight against al Qaeda before Sept. 11. The book is full of bitter anecdotes of Clark and his counterterrorism allies aghast at bureaucratic colleagues who opposed stronger action against al Qaeda. After the USS Cole was bombed in Yemen in October 2000, an attack that bore the stamp of al Qaeda, agencies still resisted bombing the group's training camps in Afghanistan. Instead, they pressed for full CIA and FBI investigations. "What's it gonna take, Dick?" asks Mike Sheehan, a State Department official, after one White House meeting. "Who the shit do they think attacked the Cole, fuckin' Martians? . . . Does al Qaeda have to attack the Pentagon to get their attention?"

One of Clarke's favorite punching bags is the FBI, which he depicts as painfully ignorant of al Qaeda. Only after the 2000 Millennium terrorist threat, when the United States and other countries uncovered several al Qaeda cells, including some in the United States, did the FBI begin to focus its 56 field offices on terrorism. "The FBI is like an aircraft carrier," Dale Watson, counterterrorism chief at the FBI, tells Clarke in 2000. "It takes a long time to stop going in one direction and turn around and go in another." Clarke claims the military also was uninterested in the anti-terrorism mission, producing plans suited for conquering nations when the White House asked it to snatch specific terrorists.

Clarke repeatedly runs into agencies that are reluctant to work together. In 1996, it takes an intervention from Vice President Al Gore to prod agencies to get serious about safeguarding the Atlanta Olympics. Agencies respond, yielding lessons used to protect other national events. But as Clarke laments, "The teamwork and integration forced on the departments for special events did not always continue when the events were over."

By all accounts, Clarke was a skilled bureaucratic infighter, and after Clinton appointed him counterterrorism czar in 1998, he did persuade agencies to pony up anti-terrorism funds, which were used to start homeland preparedness programs and tighten security at U.S. embassies and Defense installations overseas. Just as often, though, his ideas, such as a plan to tap the Secret Service and Customs Service to create an air defense unit to protect Washington, fell on deaf ears. "Most people who heard about our efforts . . . thought we were nuts," he admits.

Without Sept. 11 to clarify their priorities, many Clinton officials made potent arguments against Clarke's proposals. In 2000, Gen. Anthony Zinni, then head of the military's Central Command, opposed bombing al Qaeda training camps in Afghanistan, arguing it could destabilize Pakistan. Clarke himself is reluctant to criticize Clinton for not bombing the camps after the Cole attack, acknowledging the administration's last gasp effort for a Middle East peace accord was a higher priority. "If we could achieve a Middle East peace much of the popular support for al Qaeda . . . would evaporate overnight. There would be another chance to go after the camps."

In his memoir, Clarke and his allies-like the FBI's John O'Neill, who died in the World Trade Center on Sept. 11-come off as latter-day Paul Reveres, trying to warn their fellow bureaucrats of the gathering threat before it is too late. But even officials who share Clarke's urgency, such as the CIA's George Tenet, are stymied by bureaucratic pushback. One is left with an appreciation for how easy it is for agencies to review, study and assess their way out of taking action, until a major event jolts them awake. In such an environment, Clarke concludes his warnings were destined to fail: "And America, alas, seems only to respond well to disasters, to be undistracted by warnings." It's a sobering thought as officials gird for the next wave of terrorist threats.

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House chairman introduces procurement reform bill

Jason Peckenpaugh — Wed, 28 Apr 2004 00:00:00 -0400

The bill, known as the Acquisition System Improvement Act (ASIA), is the latest chapter in Davis' long-running effort to modify federal procurement laws. Aides to Davis described it as a sequel to his Services Acquisition Reform Act, portions of which became law last year.

"My goal is to have the government approach the best practices of industry, particularly in the acquisition of cutting-edge information technology and management services," Davis said in a statement. Rep. Duncan Hunter, R-Calif., is co-sponsoring the bill.

The bill includes several mainstays of Davis' agenda, including giving agencies permanent authority to award share-in-savings contracts, where agencies share profits generated by projects with contractors. Agencies now have limited authority to use this approach, and the technique is not widespread.

Critics of share-in-savings contracting faulted Davis' proposal. "It's hard to imagine Congress saying yes to a multimillion-dollar giveaway to contractors, in the current fiscal climate," said Danielle Brian, executive director of the Project on Government Oversight, a government watchdog group.

Brian pointed to a 2003 estimate by the Congressional Budget Office that share-in-savings contracting could cost agencies $450 million over 10 years.

Robert White, a spokesman for Davis, contested this. "We continue to dispute that share-in-savings has any [cost]," he said. "CBO has been wrong before."

The legislation would also create an exchange program between acquisition workers at agencies and federal contractors. White said this proposal, which is modeled on a similar government-industry program for technology workers, would expose federal managers to best practices in the private sector. "This is especially important in areas such as information technology and acquisition, where government clearly does not have all the answers," he said.

But POGO's Brian said the measure would only exacerbate problems associated with federal officials leaving to take positions with contractors. "I don't see much future for institutionalizing a revolving-door program," she said.

The bill also would consolidate several agency boards of contract appeals into two boards, one for the Defense Department and one for all civilian agencies.

Both the share-in-savings proposal and the acquisition exchange program have been part of previous acquisition reform bills sponsored by Davis. White said the congressman had not settled on a legislative strategy for ASIA. Last year, Davis attached his acquisition legislation to the Defense authorization bill.

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Rough Seas

Jason Peckenpaugh — Thu, 15 Apr 2004 00:00:00 -0400

The Coast Guard's revolutionary acquisition strategy hits choppy waters.

hen federal executives talk about management reforms, few are as passionate as Coast Guard Rear Adm. Patrick Stillman. But then, few managers have bet the future of their agency on a radically new procurement approach.

Compact and wiry, with intense eyes and a wide smile, Stillman rhapsodizes about how cutting-edge acquisition techniques will transform the Coast Guard. "Hey, I'm here to tell you that with the right metrics, with a well conceived, balanced score card, and with a partnership that truly is designed to provide accountability and assess performance, you can get where you need to go, partner," he says.

Stillman doesn't just talk management theory. He lives it. As program executive officer for the Coast Guard's Deepwater acquisition program, it's his job to replace the service's aging, beat-up offshore fleet with a force of renovated and new ships, aircraft and sensors linked by the latest electronics. Stillman's partner in this project is Integrated Coast Guard Systems, a Lockheed Martin and Northrop Grumman joint venture that brings together a battalion of subcontractors from 17 states. In a novel arrangement, the Coast Guard gave ICGS wide latitude to design, build and maintain the new Deepwater fleet.

Stillman doesn't run Deepwater as much as monitor the joint venture, using performance assessments, contract incentives and appeals to a sense of common purpose to keep his contractors on schedule.

Necessity is the mother of the Coast Guard's inventiveness. Unlike the Navy, which has a thousands-strong procurement staff at its Naval Sea Systems Command, the Coast Guard lacks the manpower to oversee an army of subcontractors. "We have to rely on our systems integrator to be the systems integrator," says Gregory Giddens, who is Stillman's deputy.

But the Coast Guard- ICGS partnership faces a raft of unforeseen challenges. Almost two years after signing a $1 billion contract with ICGS, the acquisition is being tested by spiraling maintenance needs, mounting homeland security missions and cultural adjustments:

The contract won't be complete for 22 years, but the Coast Guard already is tapping Deepwater funds to replace the engines in 95 short-range helicopters, which have suffered 70 in-flight power failures since October. Repairs could drain more than $200 million over several years from the Deepwater budget. Almost a fifth of the Bush administration's proposed Deepwater budget for fiscal 2005-$113.5 million of $678 million-would be used to sustain existing assets instead of buying new equipment.
Because of the Coast Guard's homeland security role, a chorus of outside analysts, led by RAND Corp., now believes the service needs far more assets than it is scheduled to buy through Deepwater.
Both ICGS and the Coast Guard have struggled to adjust to their unusual government/industry partnership. Personnel shortages, a lack of training and poor communication have hindered the work of Deepwater's integrated product teams, the contractor-led groups that head design and construction work, according to a March report by the General Accounting Office (GAO-04-380).

Many of these issues surfaced during the Deepwater overhaul of the Matagorda, a 110-foot patrol boat based in Key West, Fla. All 49 Coast Guard patrol boats await renovation by Bollinger Shipyards in Lockport, La., where workers will pack them full of state-of-the-art sensors and add 13 feet to each boat to provide more workspace.

REMAKING THE MATAGORDA

In February, 2003, the Matagorda limped into Bollinger, a subcontractor for ICGS. Almost immediately, metal workers received a surprise: Nearly a third of the ship's hull plating was corroded, the result of the relentless pace of patrols in the Caribbean. Many pipes were coated with rust. "If you leaned on them, they'd break right off," recalls Bobby Arnold, a Coast Guard representative at Bollinger. Because of the scale of repairs, the Matagorda redesign wasn't finished until March 2004, five months behind schedule.

Refurbishing the Matagorda was the first test of how the Coast Guard-ICGS partnership would work in the field, where some employees still puzzle over the division of labor between both parties. "When you figure it out, let me know," says a Coast Guard maintenance chief. "A lot of people are still confused by ICGS," says a mid-level Lockheed Martin official who has been working on Deepwater for ten months. "They think it's a civilian contractor, and it's not. It's a joint venture that Coast Guard people have entered into with the two companies." Not so, says the Coast Guard's Giddens. "ICGS is a commercial entity, a joint venture between Northrop Grumman and Lockheed Martin. We have an oversight responsibility for what they're doing, but we're not managing their effort."

Part of the confusion stems from an unusual "partnering agreement" with ICGS. The agreement states that Coast Guard personnel will work alongside ICGS and subcontractor employees on teams to add a dose of reality to the contractors' ideas. "Whether it's 'hey, we tried that with our ships six years ago,' or 'in the field, we do it this way,' they provide core Coast Guard expertise," says Giddens. ICGS is supposed to use the teams to run the acquisition day to day.

But when the Matagorda arrived at Bollinger, ICGS had no permanent representative at the shipyard. The integrator seemed reluctant to interfere with Bollinger, an experienced company used to working as a prime contractor. "I don't think people understood the level of coordination it would take," says Lt. Ben Fleming, a Deepwater representative who was sent to Bollinger in August.

Fleming's job isn't to provide shipyard oversight. "It's more of a facilitation role," says Giddens. ICGS, as the integrator, is responsible for overseeing Bollinger's work. But in practice, Fleming and his staff picked up more oversight duties as additional 110-foot cutters arrived at the shipyard. For example, ICGS puts the ships through a battery of tests when they come to Bollinger, to document their arrival condition. Fleming usually tags along with his own video camera in hand. "I trust them," he says of ICGS, "but I don't trust them trust them."

Fleming and his five-man staff also negotiated with ICGS over the fine points of the Matagorda contract, a 35-page document outlining the key elements of the upgrade: new sensors, a new bridge, more crew space, and a new cigar-shaped small boat used to board other vessels. The contract is written in general, performance-based language-for instance, it states that the vessel must be able to conduct migrant operations at night-leaving ICGS room to determine which equipment to employ, thereby influencing how the Coast Guard accomplishes its duties. Many routine repairs were deemed outside the contract's scope, so the Coast Guard had to pay extra to get them fixed.

The partnership extends beyond the shipyard: ICGS maintains the new equipment on the Matagorda, while the Coast Guard handles other systems, such as the engines, which were not upgraded. The Matagorda is a floating sign of what the Coast Guard will become through Deepwater: a better equipped service that is highly dependent on ICGS.

Fleming's staff say delays on the Matagorda were due to the technical complexity of the work. "There was no doubt in my mind [the deadline] was going to slip from the very beginning, because this [sensor] package is just so, so complex," says the Coast Guard's Arnold. Others say shipyard officials were left to fend for themselves with little direction from Washington. "What it boils down to is, the roles and responsibilities of all the parties concerned, although it may be written down somewhere, weren't clearly defined to everyone," says the maintenance chief.

Whatever turmoil accompanied the overhaul of the Matagorda, Lt. Kevin Driscoll, the ship's new commanding officer, was pleased with the overhauled vessel. ICGS automated the ship's navigation system, meaning his crew could toss their navigation charts, and installed sensors such as forward-looking infrared radar, which detects body heat, making it easier to spot migrants in makeshift boats.

On an overcast, breezy morning in early March, Driscoll was joined by senior leaders from the Coast Guard and ICGS on the waterfront at Bollinger for a ceremony to unveil the ship. "It's a new Coast Guard on the bridge, partner," said Stillman, pointing to the roomy deckhouse, which offers 365-degree visibility and can fit almost the ship's entire 18-person crew. "It's a phenomenal step up at a phenomenal price," he said, adding, "now, whether you [upgrade] all 49 is a good question."

DEATH SPIRAL

Coast Guard leaders envisioned Deepwater as a long-term acquisition, lasting up to 30 years to keep a lid on its hefty price tag. Through careful planning, the service believed it could extend the life of certain assets, like the patrol boats, while immediately replacing equipment in the most dire shape, such as the service's plodding 378-foot cutters-all while spending just $500 million to $1 billion a year.

But Sept. 11 threw a wrench in the works. The Coast Guard is taxing all its equipment to keep up with homeland security requirements. Patrol boats, designed to log 1,800 hours of operational time a year, now put in 2,200 hours at sea annually, causing hulls to corrode faster. The Coast Guard has resisted using Deepwater funds to bankroll immediate repairs. But when its helicopters lose engines in mid-flight, they must be repaired-even if that means tapping Deepwater's budget.

"When the existing systems fail, you've got to steal from the modernization fund to keep them going," says Coast Guard Commandant Thomas Collins. "The more you do that, the longer it takes to get your new systems." Stillman is blunter. "I call it a death spiral," he says of raiding Deepwater.

Maintenance problems imperil the acquisition strategy. ICGS depends on consistent funding; Deepwater's $668 million budget for fiscal 2004 will finance work on eight assets this year, all managed to specific schedules and performance targets. If funding is diverted, the schedule slips or work isn't done.

Privately, many Coast Guard leaders believe the only solution is to accelerate Deepwater. The service's allies on Capitol Hill agree. In early March, the House Transportation and Infrastructure Subcommittee authorized $1.1 billion for Deepwater, enough to complete it in 15 years if funding holds. In the Senate, Susan Collins, R-Maine, and Joseph Lieberman, D-Conn., have urged appropriators to add more money. "Accelerating Deepwater will save money in the long term, possibly as much as $4 billion," says Collins. "Each year the project is extended, repair costs will increase exponentially as legacy assets further deteriorate."

The Coast Guard is trying to speed development of certain Deepwater assets to ease maintenance woes. Because of widespread hull corrosion on the 110-foot patrol boats, the Coast Guard will speed up design of their replacement, the fast response cutter, which wasn't scheduled to begin production until 2017. Stillman estimates the first cutter could hit the water in late 2007. But to pay for the vessel, Stillman may have to raid the $66 million reserved for patching up 110-footers. Observers expect the Coast Guard to stop the patrol boat overhauls, perhaps next year, when Bollinger finishes the nine ships called for in its original contract.

SHIFTING REQUIREMENTS

Stillman says his acquisition strategy can adapt to shifting requirements, but Deepwater must pass muster with the service's overseers at the Homeland Security Department and the Coast Guard's operations directorate. Neither was satisfied by ICGS' proposed medium-range patrol aircraft, the CASA 235-300M, manufactured by a Spanish branch of the European Aeronautic Defence and Space Company.

"The CASA is not the right aircraft," says a senior Homeland Security official. "The operators in the Coast Guard know it's not the right aircraft." While the final purchase decision rests with the Coast Guard, Stillman loses leverage with ICGS if he dictates which assets it should buy. "How can I hold Lockheed Martin and Northrop Grumman accountable for performance when Congress or the Coast Guard is changing the solution all the time? The answer is, I can't," he says

The rift spotlights a risk at the heart of the acquisition: By giving ICGS so much freedom to design its new fleet, the Coast Guard is hard-pressed to say no if the contractor offers substandard solutions. And officials in the service's operations directorate believe the CASA is an inferior aircraft. "You've picked up on the sort of difference of opinion between the Deepwater program people and the operators," says the homeland security official.

Rear Adm. David Belz, who heads the operations directorate, denies any tension between his office and the Deepwater program shop, and says the two offices talk daily about how changing operational needs factor into Deepwater.

Belz led the Coast Guard's in-house study of its post Sept. 11 asset needs, known as the performance gap analysis. While the results of this study have not been made public, Coast Guard officials hint that it calls for expanding the scope of Deepwater. "My expectation is it's going to say you probably need more [assets]," says Collins. In a draft study financed by the Coast Guard, RAND concluded the service would have to double the size of its surface fleet to keep pace with expanded missions. For instance, it found the Coast Guard needs to buy 36 more national security cutters, in addition to the eight now planned under Deepwater.

The Deepwater package seems small today because it is based on 1998 estimates of the Coast Guard's future needs. To equip the fleet against post Sept. 11-threats, Belz's office already has proposed some design changes. For example, it said the national security cutter should be built to withstand attack by chemical and biological weapons, a design feature that ICGS has added to the ship.

For the Coast Guard, which thrives on juggling multiple missions, Deepwater is becoming a tricky balancing act. Service leaders must keep their fleet afloat while waiting for new equipment. And the contracting strategy is so complex that it still confuses some workers in the Deepwater program. But Stillman believes the Coast Guard-ICGS partnership is up to the challenge. He says both partners are adjusting to the arrangement.

Stillman also admits that the Coast Guard's future is partly in ICGS's hands: "I haven't thrown the keys to the transom to Lockheed Martin and Northrop Grumman, but God knows they have as much responsibility for the performance and the efficiency of this system as I do."

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Getting in Step

Jason Peckenpaugh — Thu, 15 Apr 2004 00:00:00 -0400

DHS agencies carefully choreographed a response to terrorist threats on New Year's.

n the night of Jan. 1, Homeland Security officials received troubling intelligence about British Airways Flight 216. Just minutes before the Washington-to-London flight was scheduled to depart Dulles International Airport, Jim Schear, a Transportation Security Administration official, scrambled to the gate and ordered everyone off the plane. More than 30 security personnel from four federal agencies joined him. With military precision, they interviewed certain passengers, combed through all luggage and cargo, and gave the cabin a once-over for hidden weapons, pulling up seat cushions and checking storage bins. "It was a wonderful choreography," says a senior Homeland Security Department official.

Less than 24 hours earlier, the same agencies appeared to be tripping over each other. When a British Airways flight landed at Dulles on New Year's Eve, confusion over how to secure the flight caused an hours-long delay in letting passengers off the plane. But by the next day, officials had hammered out a method for securing such flights. "There were some flights that did not go as well, but those were the early ones," says the official.

From late December 2003 into January 2004, federal officials carried out extraordinary security measures designed to prevent al Qaeda terrorists from using international flights to attack U.S. targets. The most visible step was to cancel flights, but the scope of federal security efforts was much broader than what the public saw, says Michael Dougherty, director of operations at the Bureau of Immigration and Customs Enforcement (ICE). Homeland Security Secretary Tom Ridge has said the measures likely thwarted a terrorist attack.

The successful response to the holiday threats was the fruit of a painstaking melding of disparate agencies that has been going on at the Homeland Security Department since it came together in January 2003. The response also marked a new level of coordination between Homeland Security agencies and outside partners such as the FBI. During the rapid unloading of the New Year's Day flight, agencies acted as a joint force, with ICE and the FBI interviewing passengers, and TSA checking luggage with help from Homeland Security's Bureau of Customs and Border Protection, which shared its hand-held radiation detectors. Longtime observers marvel at the teamwork. "To be blunt, I'm impressed," says retired Army Gen. Barry McCaffrey, former White House drug czar in the Clinton administration and an outspoken critic of poor coordination among border agencies.

While joint security checks unfolded at airports, a separate corps of analysts teamed up to scrutinize airline passenger manifests. Shortly before Christmas, FBI and Homeland Security officials met at FBI headquarters in Washington to cobble together a joint vetting process: Passenger names were checked not only against terrorist watch lists, which are handled by the National Targeting Center, a CBP unit, but also against ICE databases and FBI case files, which contain more extensive information. "The big change was that every single name was being run through these databases," says an ICE official involved in the process.

The checks focused on certain U.S.-bound flights originating in Mexico, France and Great Britain. For each flight, U.S. officials sent a list of suspect passengers to foreign law enforcement officials who interviewed the passengers before departure. The process hinged on getting final manifests an hour before takeoff; if names came in any later, as they often did, the operation was delayed. "We got one manifest an hour and 20 minutes after the flight was supposed to leave," says Gary Bald, assistant director of the FBI's counterterrorism division.

With three agencies vetting, flight delays were common. Foreign airlines canceled some U.S.-bound flights because of the lengthy clearance process. At Dulles, TSA's Schear and his interagency team would secure an outbound international flight, only to see it sit at the gate while analysts continued their checks. "When the planes are buttoned up and ready to go, you like to see the flight moving," says Schear. "But you have to make sure you're comfortable with the people on board."

The FBI's process was especially painstaking. Running passenger names through the agency's case files often generated hundreds of "hits," or potential matches, which had to be checked by FBI analysts. One flight returned 13,000 hits. "We had an analyst reviewing every one of those," says Bald. "The names could be in the middle of a long document, so an analyst has to review three or four paragraphs to understand who the person was, and whether they were identical to the person getting on the plane." As a result, the FBI consistently took the longest to clear manifests, although Bald says analysts finished their checks within two hours. "They knew there [were] passengers sitting on the ground, pissed off, waiting for them," he says.

Homeland Security relied on a web of officials on three continents to respond to the quickly shifting threats. Federal air marshal teams in London, Paris and Mexico City ensured that certain U.S.-bound international flights had foreign air marshals on board. In Washington, DHS activated the interagency incident management group for the first time so that 20 outside agencies could weigh in. For example, Transportation Department officials offered suggestions on how to engage foreign airlines on security issues. The National Security Council and intelligence community also monitored the holiday threats.

The heightened alert provided Homeland Security agencies with an opportunity to work as a joint force. For complex operations involving several agencies-such as the flights at Dulles-the department sometimes picked a single agency to act as a coordinator. TSA took the lead for a few flights at Dulles, while ICE was tapped to coordinate vetting of manifests, in part because of its ties to the FBI. These designations were accepted without protest. "I think we made a breakthrough here in that everyone realized that somebody had to be the coordinator for these incidents," says the senior Homeland Security official. "You didn't hear any stories about fights among DHS people in the midst of these pretty contentious actions that were taken." The seeds of this coordination are contained in a series of small, subtle management steps taken during the department's first year.

FORGING TIES

When the department first opened its doors, officials weren't expecting TSA, ICE and CBP to operate jointly. Department leaders had their hands full planning Operation Liberty Shield, a series of measures to safeguard the United States during the Iraq war. Planning was a joint exercise. "We had representatives from the vice president's office down to the smallest federal agency in the room," remembers one official. But most of the actions taken required little collaboration.

Few of the DHS agencies had much experience at joint operations. "Initially, the only way to link all of our agencies up was to take a person from each organization and put them in the same room," says an official in the department's Border and Transportation Security directorate. With jurisdiction over three of the largest homeland security agencies-ICE, CBP and TSA-the directorate is a hub for operations. Over the past year, a small staff under Asa Hutchinson, DHS undersecretary for Border and Transportation Security, has been instrumental in forging ties between border agencies and other homeland security agencies.

One of the directorate's first creations was a daily operations report, a restricted document that highlights key security incidents such as a large influx of Pakistani nationals at a certain port of entry or progress in an ICE investigation. At first, agencies were reluctant to divulge such information. "None of the agencies were used to sharing stuff like this," says the BTS official. The report provides a common picture of events along the border and at U.S. airports, complete with a two-page glossary to help agencies decipher each other's lingo. It also facilitates after-action reviews of security operations.

As an example, officials point to an incident last fall when a person on a no-fly list was allowed on a plane. The person-who was not a terrorist, officials emphasize-was questioned by agents from TSA, CBP and ICE, but no one prevented him from boarding. "The bad news was that this happened," says the senior Homeland Security official. "The good news is at least we knew it happened. Now we're able to go back and fix these things." Officials scour the reports for cases of agencies working solo instead of reaching out to their sister agencies. "I want everyone to play," says the directorate official.

Directorate officials have helped resolve long-standing disputes among the border agencies. Last spring, after a few directorate-brokered meetings, CBP and the Coast Guard agreed to share data about ships' cargo, aiding port inspections. More recently, the directorate convened discussions between the Border Patrol and the Interior Department to bolster immigration enforcement in federal parks. Now, Interior is allowing Border Patrol agents to safeguard the Buenos Aires National Wildlife Refuge in Arizona, a 118,000-acre preserve along the U.S.-Mexico border. Other disputes have been harder to resolve. One source recalls a tense meeting between CBP and TSA officials over sharing passenger data. "We had very senior people from the agencies in the room, and they almost came to fisticuffs," says the source, who adds the agencies are now on the same page.

The directorate has helped its agents tap into the resources of intelligence agencies. One example: TSA's master cockpit crew list, a tally of pilots and other crew members from certain foreign countries. Last May, the directorate fed the list to intelligence agencies, whose staffers vetted it against several terrorism watch lists that TSA didn't have. The checks yielded 28 crew members who no longer will be allowed on U.S.-bound flights.

Last summer, the directorate helped coordinate a response to intelligence that indicated al Qaeda was targeting U.S. aviation. Some CBP officials regarded the Transit Without Visa program, which allowed designated foreigners to fly into the country without visas, as a potential vulnerability. So in July, directorate officials briefed intelligence agencies on the transit program and asked for a formal threat assessment. The program was suspended Aug. 2.

BALANCE OF POWER

Efforts to improve coordination are taking root at DHS. Since mid-January, about 50 staffers in Secretary Ridge's office have been working to link its five directorates. "The secretary wanted a horizontal integration mechanism across the department to do operational planning, exercises, senior-level training, strategic planning, so they're focused on that," says Robert Stephan, a special assistant to Ridge.

The department eschewed a military-style command-and-control system, opting instead for coordination. "You can't be heavy-handed because there are a lot of interagency equities here," says the senior Homeland Security official. As a result, agencies had to integrate in the field to pull off fast-moving operations. TSA's Schear and his colleagues at Dulles constantly shared intelligence. "Whenever we gathered at a flight of interest, the ICE, FBI and TSA people would all sit down and say, 'You got anything through your chain of command that we should know about?'" says Schear. "We all compared notes. . . . It was very effective." But at other airports, agencies didn't wait to share information and wound up duplicating efforts. "If TSA had the information, they ran with it. It all depended on what agency got the information first," says an ICE agent involved in the operations.

The Border and Transportation Security directorate picked a coordinator in the hope of preventing such overlap. The designation was informal. "I hesitate to say anybody was the lead agency," says Schear, who was the coordinator for the New Year's Day flight and has since moved on to the Federal Aviation Administration. A more formal declaration-an order putting TSA in charge of all airport incidents, for example-could have upset the balance among agencies involved.

Other departmental efforts to unify operations have sparked concern among employees. They fret that an ongoing initiative to create a regional field structure and appoint regional homeland security directors could impinge on their operational authority. ICE special-agents-in-charge, for instance, work directly for their headquarters in Washington. Putting a regional director between Washington and the field could disrupt investigations, some worry. But Homeland Security's Stephan says the new structure should not impede daily operations. Legal issues complicate giving the day-to-day line responsibility to a regional official, he says, but such problems don't apply to giving authority to an official on a temporary or crisis basis.

Down the road, the department may be more willing to select coordinators to manage particular incidents. Officials believe the concept worked well during the holiday operations. By mid-January, Schear's Dulles team was able to secure departing flights in less than hour. "It became a thing of beauty," he says.

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Getting on Track

Jason Peckenpaugh — Thu, 15 Apr 2004 00:00:00 -0400

Spain's 9/11 leads to pleas for increased U.S. rail security.

n the aftermath of the Madrid terrorist bombings, Congress took a fresh look at what the Homeland Security Department has done to protect rail and mass transit systems, and many legislators were distressed by what they found. Since 2003, the department has spent $115 million to safeguard rail and transit systems, roughly 1 percent of the $11 billion devoted to aviation security. By late March, the Washington-area congressional delegation, Sen. John McCain, R-Ariz., and dozens of congressional Democrats were weighing in with pleas for more funds-and criticism of Homeland Security. "Let's face it, our rail systems have been left vulnerable to terrorist attack," said Sen. Barbara Boxer, D-Calif., at a March 23 hearing of the Senate Commerce, Science and Transportation Committee.

Even new measures announced by Homeland Security Secretary Tom Ridge-a pilot program to test baggage screening at a single rail station and the creation of bomb sniffing dog teams-met skepticism from Democrats, who noted rail security still didn't merit a line item in the Bush budget. "No more security on the cheap," snapped Sen. Frank Lautenberg, D-N.J.

Homeland Security officials, for their part, were reluctant to let the bombings dictate their rail security strategy. "I believe it is important that we do not simply react to incidents," said Asa Hutchinson, undersecretary for border and transportation security, at the hearing, arguing that intelligence and vulnerability assessments should drive security funding.

But the Madrid bombing apparently changed the department's thinking in the area of railway baggage screening. Planners in the Transportation Security Administration had crafted a pilot rail-screening program before the Madrid attacks, but the effort had trouble getting off the ground. "There was quite frankly some hesitation as to whether the pilot is an appropriate step in the transit environment," Hutchinson told reporters after his testimony.

Aviation-style screening, which checks each passenger and piece of luggage, is seen as unworkable for mass transit, with its numerous entry points and links to other transport networks. In announcing the pilot project, Ridge stressed that TSA would not replicate "the aviation model" at train stations, but would instead test screening tactics that could be used "in high-threat areas or in response to specific intelligence."

Passenger screening has not been high on the wish lists of local transit agencies across the country. William Millar, executive director of the American Public Transportation Association, says transit agencies have spent $1.7 billion of their own funds to tighten security since Sept. 11 and need $6 billion more for security improvements such as perimeter fencing, video cameras and new radio communication systems. Transit agencies want Uncle Sam to open his checkbook.

Greg Hull, a transit security expert with the association, says rail systems are pleased with the technical assistance they've received from the federal government, much of which has come not from the TSA, but the Federal Transit Administration, a small Transportation Department agency. FTA has funded research, promoted security training and hired Booz Allen Hamilton, a consulting firm, to conduct vulnerability assessments of the nation's 37 largest transit systems.

Homeland Security officials also praise FTA's work. Officials at the department's Office of Domestic Preparedness say FTA's vulnerability assessments were used to divvy up the $115 million in security funds that have been handed out. But FTA did not experiment with baggage screening-an area that TSA, with departmental backing, now will begin to explore.

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Kerry pledges to cut contractors, freeze travel spending

Tom Shoop and Jason Peckenpaugh — Wed, 07 Apr 2004 00:00:00 -0400

In an address at Georgetown University in Washington, Kerry said the growing deficit could become a "fiscal cancer," and said he would attack the problem partly by "reducing or eliminating government programs that don't work."

"For example, we'll freeze the federal travel budget, reduce oil royalty exemptions for drilling on federal lands, and cut 100,000 contractors employed by the federal government," Kerry said. "We'll streamline government agencies and commissions and reduce out-of-control administrative costs by 5 percent. And when we're done, the federal government will be smaller but smarter, more effective and less expensive."

Kathy Roeder, a spokesperson with the Kerry campaign, said these proposals were inspired in part by research by Paul Weinstein, a senior fellow with the Progressive Policy Institute, a left-leaning Washington think-tank. In a February paper, Weinstein estimated that eliminating 150,000 federal consultants could save $67 billion over ten years.

Federal contractor groups criticized the idea of cutting contractors, saying it could make it more difficult for agencies to function. "I don't think the point ought to be to cut any number of contractors or federal employees. Staffing levels are determined by the size of the government's mission," said Stan Soloway, president of the Professional Services Council, an Arlington, Va.-based contractor association.

Chris Jahn, president of the Contract Services Association, questioned whether Kerry intended to hire more federal workers to replace contractors. "If Senator Kerry's real plan is to hire 100,000 new government employees, then he should say so," he said.

Roeder disputed this argument, saying some of the work performed by contractors could probably be eliminated. "Cutting the size of the workforce doesn't need to mean you shift employees from the private sector to government sector," she said. She added that Kerry's speech was focused on deficit reduction, and was not a "detailed reform agenda on the nuts and bolts of how government functions."

Angela Styles, an attorney who ran President Bush's competitive sourcing initiative from 2001 until last September, said that cutting contractor positions could hurt the military, which is largely reliant on contractors, and lead to job losses. "There also might be a serious economic hit by firing 100,000 contractors," she said.

"Kerry can create jobs by getting our economy back on track. Cutting the deficit is a key part of that," replied Roeder. She added that Kerry does not intend to cut contractors that support the military.

John Gage, president of the American Federation of Government Employees, praised Kerry's plan as a shift from Bush administration policies. "A pledge to reverse the Bush administration's ruinous policy of wholesale privatization will be strongly supported by all taxpayers," he said.

Agencies spent $245 billion on contracts worth $25,000 or more for goods and services in fiscal 2002, up more than 12 percent from 2001. In 2002, federal contracts generated 5.17 million jobs nationwide, according to calculations by Paul C. Light, a senior fellow at the Brookings Institution.

Agencies spent more than $10 billion on travel in fiscal 2002, the most recent year for which figures are available. That was an increase of nearly 12 percent over fiscal 2001 and $1 billion more than agencies had planned to spend on travel. There have been other such increases in years past, though not in the double-digits. And in fiscal 2001, after years of promises, agencies actually trimmed their travel budgets -- albeit by only 0.4 percent.

Weinstein proposed freezing the federal travel budget at $8 billion per year in his February paper, a move that would save $10 billion over ten years. He also advocated a 10 percent cut in the federal workforce at every agency except the Defense and Homeland Security departments, an idea that was not endorsed by Kerry Wednesday.

In his speech, Kerry pledged to cut the deficit in half within four years. He said doing so would likely force him to postpone several of his own initiatives. He singled out his proposals to expand national service programs and to make preschool education available to all American children as projects that would likely have to be slowed down or phased in over long periods.

The presidential hopeful also pledged to enforce budget discipline by implementing spending caps and reinstituting "pay-as-you-go" budget rules, which require cuts in spending or increases in revenue to offset proposed spending increases.

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Accessing A-76 results not easy, critics say

Jason Peckenpaugh — Thu, 01 Apr 2004 00:00:00 -0500

Fort Knox broadcast its need for sweets on FedBizOpps, the online catalog of federal contracting opportunities. Required reading for government contractors, FedBizOpps is perhaps the world's largest want ads, where federal agencies seek everything from doughnuts to detention space. As a general rule, if a company sells it, some agency is looking to buy it on FedBizOpps. In September 2003, the National Institute on Aging announced it was seeking a "standing colony of mutant mice."

Lately, agencies have used FedBizOpps to advertise a new contracting opportunity: the chance to win federal contracts by outbidding civil servants in public-private job competitions. The Bush administration decreed that all such contests be announced on FedBizOpps as part of its May 2003 rewrite of Office of Management and Budget Circular A-76, the rule book for job competitions.

OMB officials tried to make A-76 competitions more transparent, but some say the new rules aren't enough, according to staff writer Jason Peckenpaugh, who explored the competitive sourcing conundrum in the March 2003 issue of Government Executive magazine. Click here to read the full story.

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Wade's world

Jason Peckenpaugh — Thu, 01 Apr 2004 00:00:00 -0500

An FAA employee goes head-to-head with contractor heavyweights.

f you want to compete for the richest, most technically complex federal contracts, you need a stable of skilled subcontractors, a track record of managing huge projects and a team of market-savvy executives. Or you need to be Jay Wade.

For more than a year, Wade, a 51-year-old employee of the Federal Aviation Administration, has been angling to bid in a massive public-private job competition at the FAA. The infrastructure at 58 flight service stations in the United States is at stake, as are 2,700 flight service specialist positions, one of which belongs to Wade. But instead of defending his job alongside other FAA workers on an in-house team that is competing to retain the work, Wade wants to compete through a company-Wade & Associates-that he created to bid in the contest.

Wade & Associates has no clients and no revenue. It has a workforce of three. At the moment, company headquarters is Wade's house in Franklin, Tenn. He knows his enterprise lacks the cachet of other firms eyeing the FAA competition-such as Lockheed Martin and Northrop Grumman, two of the A-list companies that plan to submit bids. "We're a startup, going for a $2 billion contract out of the box," Wade says.

Observers don't know what to make of Wade. "I'm not exactly sure what he is doing," says Wally Pike, president of the National Association of Air Traffic Specialists, the labor union that is backing the in-house team. Robert McMullen, FAA's program manager for the in-house team, says firms like Wade & Associates usually serve as subcontractors in competitions this size. "Frankly, it's going to be a big contract. Normally, you'd see a large company and then see smaller [subcontractors] like Mr. Wade's company under them," he says.

But Wade bristles at the notion that he can't go toe-to-toe with the Lockheeds of the world over flight service, his passion for the past 22 years. "They probably don't think I'm qualified," he says, his voice rising. "Well, I got a quote for you. This contract manager has personally done over 150,000 pilot weather briefings without a single weather-related accident, so I think I'm profoundly qualified."

Besides providing weather briefings to pilots, flight service specialists orient lost aircraft, assist in search-and-rescues, and monitor temporary flight restriction zones. Specialists do not separate air traffic. That's the job of their better-known cousins, air traffic controllers. The specialist workforce is aging, and relies on expensive, outdated infrastructure-it cost $514 million to operate the stations in fiscal 2002-making the employees a ripe target for competitive sourcing.

FAA officials view the competition as a way to modernize the agency's flight service function, and observers expect to see a series of technology-heavy bids. In January, the in-house team joined forces with Harris Corp., a Florida-based firm that holds several information technology contracts with the FAA, to produce a joint bid. The highly unusual pairing is expected to boost the prospects of agency workers in the contest.

As a current flight service specialist, Wade is represented by the in-house/Harris alliance, according to McMullen. But Wade insists on submitting his own proposal, in part because he disagrees with the strategy he believes the in-house team will use. "The grapevine rumor I'm hearing is they are hoping to survive [the competition] by taking pay cuts and downsizing," he says. "But I don't think that is necessary."

McMullen says the in-house team is still crafting its proposal. "We haven't decided on what our plans are going to be to date, but if [Wade] sticks to the status quo, good luck to him," he says.

Wade's effort is so unusual that competitors speculate about his motives. Privately, some suggest he has ties to NAATS, and is only in the running to advance its agenda, perhaps by filing a bid protest at some point. But Pike, the president of NAATS, says Wade does not belong to his union. Wade, for his part, is critical of the labor union, and says he has ties with flight service specialists who are not union members. "The union hasn't stood up for us over the past few years," he says. "I'm just trying to bid on my job, and help other people who aren't in the union and don't believe the [in-house team] is in our best interests.

"All I want is the opportunity to compete," Wade says. "Is the Bush administration going to prevent me, a potentially displaced employee, from bidding on my own job?"

Wade already has cleared one procedural hurdle that threatened to end his quest. In January, the FAA asked prospective bidders to show that they had $110 million in cash reserves on hand. With no clients, Wade & Associates had no revenue. "What am I going to do, send them a copy of my lottery ticket?" he said at the time. But a few weeks later, the FAA dropped the requirement. "Nobody was more surprised than me that they did that," says Wade. There are now five potential prime contractors that could compete against the in-house team: Lockheed Martin, Northrop Grumman, Computer Sciences Corp., Raytheon, and Wade & Associates. The FAA plans to issue a final solicitation in May, and will ask for proposals by late summer.

If Wade & Associates were to win the competition, Wade would have to retire-FAA employees are prohibited from holding contracts with the agency. Even Wade acknowledges the odds of this happening are slim. But he wants to compete. "I know it's a long shot, but this is my business, so I'm going to give it a try."

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House lawmakers urge budget boost for air marshals

Jason Peckenpaugh — Wed, 31 Mar 2004 00:00:00 -0500

In a March 25 letter to House appropriators, Rep. Christopher Shays, R-Conn., and 14 House Democrats urged more funding for FAMS, which received $613 million in the Bush administration's fiscal 2005 budget, a $13 million cut from 2004 funding levels.

Without more funds, FAMS may be unable to help foreign governments develop their own air marshal programs, the lawmakers warned. Federal air marshals only fly on U.S.-based airlines.

"New FAMS initiatives, such as training to assist foreign governments in the establishment or enhancement of their own air marshal programs, could help reduce the likelihood of disruptions to international air travel when intelligence suggests that specific flights are being targeted by terrorists," the lawmakers wrote. David Adams, a FAMS spokesman, said the service supports the administration's budget proposal. According to Adams, the service has shared best practices with foreign governments and is exploring the possibility of offering training to foreign air marshals. FAMS also will host an international air marshal conference later this year.

Besides financing new programs, FAMS needs more funds to match an expected increase in air travel, the lawmakers said. Citing predictions from the Federal Aviation Administration, they said domestic flights would increase by more than 3 percent in fiscal 2005, while the number of international flights will go up by more than 5 percent during the same period.

To augment its staff, FAMS has begun training criminal investigators in the Bureau of Immigration and Customs Enforcement, its parent agency, to serve as air marshals. In an interview with Government Executive last month, Thomas Quinn, director of FAMS, said the majority of ICE's 5,500 agents would receive air marshal training.

"It's not going to be limited to a specific small number of ICE agents; it's essentially going to be the majority of the organization over time," he said. Quinn added that FAMS would train at least 100 ICE agents as air marshals by the end of March.

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Key immigration enforcement official steps down

Jason Peckenpaugh — Mon, 29 Mar 2004 00:00:00 -0500

Anthony Tangeman, who ran the Bureau of Immigration and Customs Enforcement's (ICE) detention and removals branch, left his post on Friday, according to ICE spokesman Garrison Courtney.

As detention chief, Tangeman tried to focus his office's efforts on rounding up alien absconders, or illegal immigrants who flee after receiving final deportation orders. There are an estimated 400,000 such absconders in the United States. But with only 2,600 law enforcement officers, Tangeman admitted he was strapped to make a dent in the backlog of cases.

Tangeman's office fared well in the Bush administration's fiscal 2005 budget proposal, receiving funds for 357 additional immigration enforcement agent positions.

Courtney said Tangeman stepped down for personal reasons.

David Venturella, who served as Tangeman's deputy, is now interim chief of detention and removals, Courtney said.

Tangeman's departure will not halt ICE's efforts to reduce the absconder backlog, including a program that uses electronic ankle bracelets to keep tabs on certain illegal immigrants, Courtney said. "We're still pursuing everything just like we were," he said.

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