[House Hearing, 112 Congress]
[From the U.S. Government Printing Office]



 
 SCREENING PARTNERSHIP PROGRAM: WHY IS A JOB-CREATING, PUBLIC-PRIVATE 
                 PARTNERSHIP MEETING RESISTANCE AT TSA?

=======================================================================


                                HEARING

                               before the

                SUBCOMMITTEE ON TRANSPORTATION SECURITY

                                 of the

                     COMMITTEE ON HOMELAND SECURITY

                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION

                               __________

                 FEBRUARY 7, 2012 and FEBRUARY 16, 2012

                               __________

                           Serial No. 112-68

                               __________

       Printed for the use of the Committee on Homeland Security
                                     

[GRAPHIC] [TIFF OMITTED] CONGRESS.#13


                                     

      Available via the World Wide Web: http://www.gpo.gov/fdsys/

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                     COMMITTEE ON HOMELAND SECURITY

                   Peter T. King, New York, Chairman
Lamar Smith, Texas                   Bennie G. Thompson, Mississippi
Daniel E. Lungren, California        Loretta Sanchez, California
Mike Rogers, Alabama                 Sheila Jackson Lee, Texas
Michael T. McCaul, Texas             Henry Cuellar, Texas
Gus M. Bilirakis, Florida            Yvette D. Clarke, New York
Paul C. Broun, Georgia               Laura Richardson, California
Candice S. Miller, Michigan          Danny K. Davis, Illinois
Tim Walberg, Michigan                Brian Higgins, New York
Chip Cravaack, Minnesota             Jackie Speier, California
Joe Walsh, Illinois                  Cedric L. Richmond, Louisiana
Patrick Meehan, Pennsylvania         Hansen Clarke, Michigan
Ben Quayle, Arizona                  William R. Keating, Massachusetts
Scott Rigell, Virginia               Kathleen C. Hochul, New York
Billy Long, Missouri                 Janice Hahn, California
Jeff Duncan, South Carolina
Tom Marino, Pennsylvania
Blake Farenthold, Texas
Robert L. Turner, New York
            Michael J. Russell, Staff Director/Chief Counsel
               Kerry Ann Watkins, Senior Policy Director
                    Michael S. Twinchek, Chief Clerk
                I. Lanier Avant, Minority Staff Director
                                 ------                                

                SUBCOMMITTEE ON TRANSPORTATION SECURITY

                     Mike Rogers, Alabama, Chairman
Daniel E. Lungren, California        Sheila Jackson Lee, Texas
Tim Walberg, Michigan                Danny K. Davis, Illinois
Chip Cravaack, Minnesota             Jackie Speier, California
Joe Walsh, Illinois, Vice Chair      Cedric L. Richmond, Louisiana
Mo Brooks, Alabama                   Bennie G. Thompson, Mississippi 
Peter T. King, New York (Ex              (Ex Officio)
    Officio)
                     Amanda Parikh, Staff Director
                   Natalie Nixon, Deputy Chief Clerk
                   Vacant, Minority Subcommittee Lead
                            C O N T E N T S

                              ----------                              
                                                                   Page

                               STATEMENTS

                       Tuesday, February 7, 2012

The Honorable Mike Rogers, a Representative in Congress From the 
  State of Alabama, and Chairman, Subcommittee on Transportation 
  Security.......................................................     1
The Honorable Sheila Jackson Lee, a Representative in Congress 
  From the State of Texas, and Ranking Member, Subcommittee on 
  Transportation Security........................................     2
The Honorable Bennie G. Thompson, a Representative in Congress 
  From the State of Mississippi, and Ranking Member, Committee on 
  Homeland Security..............................................     5

                      Thursday, February 16, 2012

The Honorable Mike Rogers, a Representative in Congress From the 
  State of Alabama, and Chairman, Subcommittee on Transportation 
  Security.......................................................    23

                               WITNESSES
                       Tuesday, February 7, 2012

Mr. John S. Pistole, Administrator, Transportation Security 
  Administration:
  Oral Statement.................................................     6
  Prepared Statement.............................................     7

                      Thursday, February 16, 2012

Mr. Mark VanLoh, A.A.E., Director, Aviation Department, Kansas 
  City International Airport:
  Oral Statement.................................................    24
  Prepared Statement.............................................    26
Mr. Stephen D. Amitay, Esq., Federal Legislative Counsel, 
  National Association of Security Companies:
  Oral Statement.................................................    29
  Prepared Statement.............................................    31
Mr. John Gage, National President, American Federation of 
  Government Employees:
  Oral Statement.................................................    39
  Prepared Statement.............................................    40

                             FOR THE RECORD
                       Tuesday, February 7, 2012

The Honorable Mike Rogers, a Representative in Congress From the 
  State of Alabama, and Chairman, Subcommittee on Transportation 
  Security:
  Letter From Chairman Rogers to Administrator Pistole...........     9


 SCREENING PARTNERSHIP PROGRAM: WHY IS A JOB-CREATING, PUBLIC-PRIVATE 
                 PARTNERSHIP MEETING RESISTANCE AT TSA?

                              ----------                              


                       Tuesday, February 7, 2012

             U.S. House of Representatives,
           Subcommittee on Transportation Security,
                            Committee on Homeland Security,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 3:01 p.m., in 
Room 311, Cannon House Office Building, Hon. Mike Rogers 
[Chairman of the subcommittee] presiding.
    Present: Representatives Rogers, Lungren, Walberg, 
Cravaack, Turner, Jackson Lee, and Thompson.
    Also present: Representative Mica.
    Mr. Rogers. The Committee on Homeland Security Subcommittee 
on Transportation Security will come to order.
    This subcommittee is meeting today to examine the 
Transportation Security Administration's Screening Partnership 
Program. I apologize for the delay, but they don't let me have 
any say-so over when votes are called on the floor. But I do 
appreciate your patience and your participation.
    I will start by recognizing myself for an opening 
statement. I want to thank Administrator Pistole for being here 
and the time it takes to prepare for this.
    Today the subcommittee will examine the Screening 
Partnership Program and TSA's willingness to work with the 
private sector to improve transportation security.
    Let me state first and foremost that I am a strong 
supporter of the Screening Partnership Program, or SPP, and was 
disappointed with the TSA's decision last January not to expand 
the program beyond the existing 16 airports utilizing private 
screening services.
    I am aware that last week the TSA approved one airport but 
denied two others from participating in the SPP. Limiting SPP's 
growth is the wrong approach, in my opinion, especially since 
both TSA and GAO have determined that the performance of 
Federal screeners and private screeners are roughly the same 
and that the security standards set for the SPP and non-SPP 
airports are completely identical.
    Rather than trying to insulate a giant Federal workforce, 
TSA should be working to strengthen and improve the private 
screening program and make it more cost-efficient so that U.S. 
businesses can take on a more meaningful role. Then TSA could 
concentrate on implementing the management, oversight, 
contracting, procurement, and training reforms it desperately 
needs.
    Last April, the full committee Chairman and I introduced 
H.R. 1586, the Security Enhancement and Jobs Act of 2011. The 
bill requires TSA to approve any SPP application that would not 
compromise security and provide a written explanation to 
Congress and the airport concerned if an SPP application is 
denied. I am pleased that language similar to our bill was 
included in the FAA reauthorization conference report, which 
recently passed the House.
    In addition, the huge number of TSA personnel working in 
airports that do have private screeners troubles me. Recent 
data provided to the committee reveals that at certain airports 
where contractors do screening and TSA is just there to oversee 
the screening process, there are upwards of 50 TSA employees on 
the payroll.
    While we can agree that strong oversight in this area is 
critically important, having 50-plus TSA officials in a single 
airport where they are not responsible for conducting screening 
is just plain overkill, and it is costing taxpayers huge 
amounts of money. We will look at this issue and other 
contracting and management issues throughout the hearing.
    I look forward to all the witnesses and now recognize the 
Ranking Member of the subcommittee, my friend, the gentlelady 
from Texas, for any opening statement she may have.
    Ms. Jackson Lee. Thank you very much, Mr. Chairman. We are 
friends. We have worked on this committee because we both have 
an abiding commitment to the security of this Nation.
    I am delighted to see Administrator Pistole and thank him 
before he even starts for his leadership. This is a time for 
tough choices, tough decisions, and strong commitments to 
secure this Nation.
    I would offer to say that, because of this committee and 
the leadership of Ranking Member and Chairman, that in 
actuality the United States has through some very, very 
difficult times managed to secure itself since 9/11, a horrific 
act that no one will ever forget throughout history and the 
annals of history of this Nation. It was on that day that the 
security of this Nation through airports was privatized. It was 
on that day that private security entities allowed individuals 
who ultimately sent planes into the towers in New York to kill 
thousands of persons.
    So I have a vigorous disagreement, and I am hoping that the 
administration will courageously hold the line. This is not a 
time for politicizing and making people happy, and it is not a 
time for humoring small businesses. I am, in my mind, in the 
work that I have done, considered an avid supporter of small 
businesses, medium-size businesses, large businesses, and the 
work that is done in procurement to ensure that the American 
business has an opportunity to serve its Nation.
    But on this one, I believe in one point of the Chairman; he 
is right that we need to be fiscally responsible. We need to 
assess our needs. We need to ensure that individuals are placed 
and utilized in the TSA structure and the transportation 
security officer structure in the most efficient, appropriate, 
and secure manner that we possibly can have.
    Mr. Chairman, you were right about that question. But I 
cannot adhere to a massive reform that would provide for an 
expansion of the Screening Partnership Program without the 
appropriate limitations that are presently in place today.
    So I would like to thank the witness and witnesses for 
joining us today to discuss TSA's Screening Partnership 
Program, commonly referred to SPP. Under this program, airports 
may apply to opt out of using the Federal screening workforce.
    In January 2011, based on their review, Administrator 
Pistole decided not to expand the SPP beyond the 16 currently 
participating airports unless there was a clear and substantial 
benefit to doing so. I might add, there should be a security 
analysis in this, as well. I hope my words, ``substantial 
benefit,'' in his testimony or questioning, we will discern 
that ``substantial benefit'' or ``clear and substantial 
benefit'' does not ignore the security ramifications.
    According to TSA, operating the SPP costs taxpayers more 
than using the Federal screener workforce. In light of that 
fact, in these tight budgetary times, that would be reason 
enough to support the administrator's decision not to expand 
the program, but the list goes on.
    Further expansion of privatized screening hampers TSA's 
ability to push out intelligence information to front-line 
workers. It adds to inconsistency. It makes changing procedures 
based on threat more complex. That means you not only have to 
vet the front-line officers, you have to vet the company, vet 
the executives of the company, vet the ownership, vet the 
financial structure of this, vet the banks that the private 
company goes to, who is paying whom to turn their head and to 
overlook some dastardly act that is prepared to attack American 
citizens as they travel the skies of America.
    There has been much discussion of whether privatized 
screeners perform better than their Federal counterparts. I am 
always supportive of making sure that our Federal employees 
across the board are respected but also do their job. There is 
no conflict with insisting on excellence in performance to the 
idea that I have that privatized screeners are not adequate. 
Make the Federal employees excellent. That has been done in 
many, many places.
    We certainly don't criticize our first responders in terms 
of their service, and we have no criticism of the young men and 
women who have come into our military service, non-privatized, 
who have offered themselves to serve. We would expect no less 
from transportation security officers. They are on the front 
line.
    TSA informs us that the performance of privatized screeners 
is comparable to that of the Federalized workforce. I want our 
TSO to be better than privatized workers, and I believe our 
focus should be on how we achieve that. We don't need equals in 
this business; the Federal Government is always expected to be 
better than. We have the responsibility of millions of 
Americans all across this Nation. They look to us, this great 
Nation who uses the terminology ``great,'' to be great and to 
be excellent.
    The reality is that security incidents have occurred at 
both airports with privatized and Federalized screeners. Under 
the watch of privatized screeners at San Francisco 
International Airport, a woman pushed through a closed 
checkpoint lane, boarded a plane, and flew to Baltimore without 
ever being screened.
    The statute establishing the SPP did not endeavor to 
micromanage TSA's decision to include or exclude an airport 
from participation. It was to show a sense of openness. Sixteen 
is enough. Rather, it gave proper deference to the 
administrator's judgment by stating that he may approve an 
application.
    Now, I know from this very hearing we will see the 
potential amendments coming in, Mr. Administrator, trying to 
demand and say that you shall, just as we have seen in the 
language of the FAA bill. That is unfortunate. I am sorry that 
we are having this hearing after the fact. But I will live to 
rise again, and I will find a way, just like others did, to 
undo that, because I think it is wrong.
    Unfortunately, despite having never been debated by this 
committee, the committee of jurisdiction, and no Members being 
appointed as conferees on behalf of the committee, the 
controlling statute was amended in the FAA Reauthorization Act, 
which will soon become law. That is called midnight 
legislating--in the dark, no transparency, and adhering to the 
voices of one tune.
    The new standard limits TSA's flexibility to approve or 
deny an application from an airport to opt out, places a time 
limitation of 120 days on TSA to determine whether to approve 
an application, and provides a waiver for the requirement that 
a private contracted screening company be owned and controlled 
by a United States citizen.
    Now, just a few years ago, everyone was up in arms about 
the potential of ports being owned by foreign entities. We have 
resolved and/or studied that issue, and I assume that it is 
still being studied. But there is no doubt that aviation still 
remains one of the most attractive entities for individual 
franchise terrorists. Now we suggest waivers, even if the 
company is owned by a foreign entity or the airport is owned by 
a foreign entity? How outrageous.
    I look forward to hearing from the administrator on his 
views of the changes to the SPP statute and how he intends to 
continue to develop TSA into the Federal counterterrorism 
network he envisioned. He comes with years of experience with 
the FBI, who I understand and he knows full well are meticulous 
in their responsibilities, ensuring the security domestically. 
We can do no less when it comes to this Nation's skies and as 
well for those who travel internationally on our soil, into our 
area.
    As we look forward to what I hope will be a productive 
year, Mr. Chairman, let us not forget the lessons of the past, 
one of which is that the system of privatized screeners failed 
us on 9/11. There is no further sentence that I need to make. 
The 9/11 day of horror was partly on the watch of privatized 
screeners.
    The wisdom of the United States Congress in the immediacy 
of those tragic days was to come together and find a way to 
ensure that TSO was a Federal system over which we had the 
opportunity to provide intelligence, training, oversight, and, 
yes, security for the American people. I see nothing has 
changed today, and I would hope we change nothing in spite of 
the FAA legislation. I ask the administration to reject the 
premise of that legislation, even as it has been signed.
    I yield back.
    Mr. Rogers. I thank the gentlelady.
    We have been advised we are going to be called for votes 
between 3:45 and 4:00, so we will try to move.
    But now I recognize the gentleman from Mississippi, the 
Ranking Member of the full committee, Mr. Thompson, for any 
statement he may have.
    Mr. Thompson. Thank you very much, Mr. Chairman.
    I am pleased that Administrator Pistole could join us today 
to discuss TSA's Screening Partnership Program. I would like to 
also extend a welcome to our second panel of witnesses.
    It is my hope that some of the myths and rhetoric 
surrounding this program can be put to bed today.
    By this hearing title, my colleagues on the other side of 
the aisle have implied that the current use of Federal 
screeners impedes job growth. There is no proof in law or fact 
for that assertion. The number of screeners at an airport is 
determined by an analysis of the risk threat and volume at that 
airport. These factors will not change based on whether the 
screeners are private contractors or Federal employees, so the 
number of jobs will not change based on whether the screeners 
are public- or private-sector employees.
    Under the Republican suggestion, the only thing that will 
change is whether the jobs will be public or private. We know 
that both types of screeners are effective and face challenges, 
follow the same rules, and receive the same training. We also 
know that private screeners cost up to 9 percent more than 
Federal screeners. We know that public and private screeners 
can join unions. So the only real difference is cost. What we 
want to know is why the Republicans seem to be willing to pay 
more for the same service and how doing so will create jobs.
    If the added cost to taxpayers fails to convince you that 
this program should not be expanded, consider that it takes us 
back to a model similar to the one in place during 9/11. 
Administrator Pistole performed a full review of TSA's policies 
and practices and determined that the SPP should not be 
expanded unless there was a clear and substantial advantage to 
doing so.
    Contrary to claims made at the time, the administrator did 
not shut down the program. Rather, he set a reasonable standard 
for expansion. That standard was met last week by a low-risk 
seasonal airport in Montana, and TSA approved their 
application. TSA did so because the net impact was advantageous 
to Government.
    On the same day, TSA denied the applications of two 
airports because they failed to demonstrate an operational, 
security, or cost advantage over Federalized screening 
applications. Both of these directions are perfectly logical.
    Regrettably, this hearing comes a day late and a dollar 
short for the committee. Last week, the FAA Reauthorization Act 
was passed by the House and soon will be signed into law. As 
described by subcommittee Ranking Member Jackson Lee, that 
aviation safety bill contained a security provision within this 
committee's sole jurisdiction altering the law controlling the 
SPP. In summarizing this provision, it amounts to a 
Congressional attempt to micromanage the SPP by stripping the 
administrator of his discretion.
    Without this committee having held one hearing, markup, or 
debate on the changes proposed, Homeland Security Members were 
denied a seat at the table by the Speaker when the provisions 
went to Congress. Chairman King and I sent a letter to the 
Speaker just 2 weeks ago requesting that jurisdiction over DHS 
be consolidated. Apparently, under this leadership, even when 
you have jurisdiction you get left out.
    With that, Mr. Chairman, I yield back.
    Mr. Rogers. I thank my colleague from Mississippi.
    Other Members of the committee are reminded that the 
opening statements may be submitted for the record.
    We are pleased to have two distinguished panels of 
witnesses with us today.
    The first panel, we would like to welcome the Honorable 
John Pistole. He has been the administrator of the TSA at the 
Department of Homeland Security since 2010. As the 
administrator, he oversees the management of approximately 
60,000 employees, the security operations of more than 450 
Federalized airports throughout the United States, the Federal 
Air Marshal Service, and the security of our highways, 
railroads, ports, mass transit systems, and pipelines.
    Welcome, Mr. Pistole. The floor is yours.

       STATEMENT OF HON. JOHN S. PISTOLE, ADMINISTRATOR, 
             TRANSPORTATION SECURITY ADMINISTRATION

    Mr. Pistole. Well, thank you, Mr. Chairman, Chairman 
Rogers, and Ranking Members Jackson Lee and Thompson, Members 
of the committee. It is good to see you.
    I appreciate the opportunity to appear before you today to 
discuss the Transportation Security Administration's mission to 
protect the freedom of movement for people and commerce. I also 
appreciate the opportunity to update the committee on the 
progress we continue to make in our efforts to develop and 
deploy a range of risk-based intelligence-driven initiatives to 
prevent terrorist attacks while facilitating the movement of 
people and goods across the United States and internationally.
    Our goal and No. 1 priority is to provide the most 
effective security in the most efficient way. TSA accomplishes 
this vital National security mission through a series of 
public-private partnerships. For example, last year alone, TSA 
invested nearly $2.5 billion in the private sector in critical 
services, technology, and equipment across all transportation 
modes. Since 2002, our experienced workforce has safely 
screened more than 5 billion passengers through a multi-layered 
security system.
    Throughout 2011, we began evaluating the benefits of 
several risk-based security screening concepts, including TSA 
PreCheck, an initiative which, as many of you know and some 
have experienced, began last fall and is currently operating in 
seven of our country's busiest airports. Participation in TSA 
PreCheck is currently open to U.S. citizens who are members of 
existing Customs and Border Protection trusted traveller 
programs as well as certain airline frequent fliers.
    In the few months since we began this initiative, over 
310,000 passengers have gone through TSA PreCheck, and the 
feedback we have been receiving from participants has been 
consistently positive. As a result, we have plans to expand 
this initiative to other airports and other U.S. airlines 
throughout 2012.
    There is much more to risk-based security than just TSA 
PreCheck. Other efforts recently developed and deployed include 
S-90 screening of over 300,000 airline pilots in 10 airports, 
changes in screening procedures for the 60,000 or so children 
12 and under traveling by air every day, and the expanded use 
of behavior detection techniques in 2 airports. Additionally, 
we are taking steps to further develop our layered approach to 
security through state-of-the-art technologies, additional 
canine teams, better passenger identification techniques, and 
other actions which strengthen our capability to keep 
terrorists off aircraft.
    By continuing our efforts to move away from a one-size-
fits-all approach, risk-based security is helping to move TSA 
toward becoming a high-performing organization with a 
counterterrorism focus. The goal behind all of this is to look 
for ways to conduct the most effective security in the most 
efficient way. Doing so allows us to focus our resources on 
those travelers we know the least about or those on the 
terrorist watchlist, thereby reducing the size of the haystack 
in which a terrorist may hide. Combine that focus with a more 
comprehensive use of classified and other intelligence and we 
are in a better position to inform the security screening 
process.
    As has been mentioned, through ATSA, Congress also created 
a means to assess the effectiveness of privatized screening 
through the SPP program beginning in 2002 with five airports. 
Currently, among the more than 450 airports with security 
overseen by TSA, there are, as has been mentioned, the 16 
airports in the SPP. As you may know and as was noted, I 
recently approved one more application, West Yellowstone, and 
if a contract for private screening is awarded, the number will 
be 17. I have also recently denied two applications that did 
not provide a clear and substantial advantage to the taxpayers 
and our ability to achieve our mission.
    Given Senate passage of the FAA bill last night and 
assuming the President's signature, we will assess the 
implications of the new law, and I will direct appropriate 
resources and engagement to carry out its intent, all in 
coordination with this and other oversight committees.
    Thank you again for the opportunity to appear before you 
today.
    [The statement of Mr. Pistole follows:]
                 Prepared Statement of John S. Pistole
                            February 7, 2012
    Chairman Rogers, Ranking Member Jackson Lee, Members of the 
subcommittee, I am pleased to appear before you today to discuss the 
Transportation Security Administration (TSA) Screening Partnership 
Program (SPP). TSA employs risk-based, intelligence-driven operations 
to prevent terrorist attacks and to reduce the vulnerability of the 
Nation's transportation system to terrorism. Our goal at all times is 
to maximize transportation security to stay ahead of evolving terrorist 
threats while protecting passengers' privacy and facilitating the 
secure and efficient flow of legitimate commerce. TSA's current 
security measures create a multi-layered system of transportation 
security that identifies, manages, and mitigates risk. No layer on its 
own solves all our challenges, but, in combination, they create a 
strong and formidable system.
    TSA has an experienced Federal workforce that has safely screened 
more than 5 billion passengers since TSA was created and has 
established a multi-layered aviation security system reaching from the 
time a ticket is purchased, throughout a passenger's flight, to the 
time the passenger exits the secure area of their destination airport. 
Every day we see the effectiveness of these security measures with TSA 
Officers (TSO) detecting hundreds of prohibited items. In fact, over 
the past decade TSOs have confiscated approximately 50 million 
prohibited items, and last year alone TSOs prevented more than 1,200 
guns from being brought onto passenger aircraft.
    As our risk-based approach evolves, we must ensure that each new 
step we take strengthens security. In addition to exploring new ways of 
focusing our attention where it is most needed, we are continually 
reevaluating existing programs to ensure that our resources are 
directed in a manner that yields the greatest level of security 
overall. This continued reevaluation includes the SPP.
    Along with the creation of TSA itself, Congress determined that 
aviation security would be most effectively served by having passenger 
screening as a predominantly Federal responsibility. The Aviation and 
Transportation Security Act (ATSA) (Pub. L. 107-71) nevertheless 
established a privatized security screening pilot program (see 49 
U.S.C. 44919). Under the pilot program, TSA was required to select five 
airports from five airport security risk categories, as defined by the 
administrator, to participate. Screening companies that met statutory 
qualifications were selected to provide comparable screening services 
through contract with the Federal Government, using employees who met 
the same qualifications and were compensated at the same level as 
Federal Transportation Security Officers (TSOs), and who met the same 
rigorous security standards as those in effect at airports with Federal 
security staffs. In addition, ATSA established a program through which 
the administrator could contract with additional qualified private 
screening companies for screening at other U.S. airports after 
completion of the pilot program (see 49 U.S.C. 44920). Under the SPP, 
airports may apply to TSA to have screening carried out by a qualified 
private screening company. As with the pilot program, private screeners 
must meet the same qualifications as TSOs and must be provided 
compensation and benefits at a level equal to or greater than the 
compensation and benefits provided to TSOs. Still, regardless of 
whether an airport has private or Federal screeners, TSA remains 
ultimately responsible for security, with Federal Security Directors 
overseeing the contracted operations as well as the other airport 
security operations, such as air cargo and facility security compliance 
inspections that continue to be conducted only by Federal employees.
    Currently, among our 450 airports with Federal screening, there are 
16 airports participating in the SPP. These include the original five 
pilot airports--San Francisco International; Kansas City International; 
Greater Rochester International; Jackson Hole; and Tupelo Regional--and 
11 others--Sioux Falls Regional; Key West International; Charles M. 
Schultz-Sonoma County; Roswell Industrial Air Center; and seven small 
Montana airports: Frank Wiley Field; Sidney Richland Regional; Dawson 
Community; L.M. Clayton; Wokal Field; Havre City County; and Lewiston 
Municipal. In the most recent study conducted by TSA and examined by 
the Government Accountability Office (GAO) comparing the cost of 
screening at SPP airports and airports with a Federal screener 
workforce, we estimated that the cost to TSA of contracted screening is 
generally between 3 and 9 percent more than the cost of Federal 
screening. While GAO identified limitations in our initial cost 
estimates, their updated review in March 2011 noted that they believed 
``TSA has made progress in addressing three of seven limitations 
related to cost we identified in our January 2009 report and now has a 
more reasonable basis for comparing the cost of SPP and non-SPP 
airports.''
    Shortly after I was confirmed as TSA Administrator, I directed a 
full review of TSA policies and programs with an eye toward helping the 
agency evolve into a more agile, high-performing organization that can 
detect and respond to evolving security threats. The SPP is just one 
program that I reviewed. At the time, I did not see any clear and 
substantial advantage to expanding the program, though I remained 
committed to maintaining contractor screening where it then existed. 
Now, as then, I am open to approving new applications where a clear and 
substantial benefit could be realized.
    That being said, TSA remains a U.S. Government counterterrorism 
agency. To fulfill our responsibility in this mission, it is important 
to maintain our flexibility--as new and emerging threats are 
identified, we must be able to adapt and modify our procedures quickly 
to protect the traveling public and promote the flow of legitimate 
commerce. As such, contracts with private service providers must 
include the flexibility to deliver screening comparable to that 
provided by Federal screening. Additionally, with a Federal workforce 
we have greater flexibility to more easily augment staff in the event 
of exigent circumstances such as natural disasters, or for surge 
capabilities, with National Deployment Office (NDO) screeners or 
screeners from nearby TSA-operated airports. Nevertheless, as noted 
above, I remain committed to maintaining a contractor workforce where 
such existed as of January of 2011, as appropriate.
    As noted at the outset, we strive to maximize security not only by 
keeping ahead of current threats identified by intelligence, but by 
maintaining security systems that focus our resources on areas where 
they will yield the optimal benefit. This is consistent with our risk-
based approach to security and critical in times of budget austerity. 
The SPP, no less than any other security program, must be implemented 
in a manner determined by cost as well as demonstrable benefits.
    Thank you for the opportunity to appear here today. I will be happy 
to answer any questions that you may have.

    Mr. Rogers. I thank the gentleman.
    I now recognize myself first for questions, and then we 
will alternate from side to side in the order Members arrived.
    Mr. Pistole, about 4 months ago, I sent a letter to you.
    By the way, I would like to ask unanimous consent to offer 
that for the record.
    Without objection, so ordered.
    [The information follows:]
          Letter From Chairman Rogers to Administrator Pistole
                                   October 14, 2011,Washington, DC.
The Honorable John S. Pistole,
Administrator, Transportation Security Administration, 601 South 12th 
        Street, Arlington, VA 20598.
    Dear Administrator Pistole: I am writing to express my strong 
concerns regarding the September 27, 2011 ruling of the United States 
Court of Federal Claims in the case of FirstLine Transportation 
Security, Inc. (FirstLine) vs. The United States and Akal Security, 
Inc.
    According to the ruling, the Court found that TSA's acquisitions 
process in this case was fundamentally flawed and must be set aside. 
The Court specifically found that TSA awarded a Screening Partnership 
Program (SPP) contract to Akal Security to provide screening services 
at Kansas City International Airport in Kansas City, Missouri (MCI) 
despite the fact that its proposal was found to be significantly weaker 
overall than the proposal submitted by FirstLine, the contractor 
currently providing screening services at MCr. The Court specifically 
cited, among other criticisms, that:
   The best-value analysis performed by TSA's Source Selection 
        Evaluation Board was both irrational and inconsistent with the 
        evaluation criteria set forth in the Request for Proposal 
        (RFP), and that the award to Akal Security was fundamentally 
        unfair; and
   TSA not only ignored the dramatic difference in the number 
        of strengths assigned to each of the proposals, but that it 
        also irrationally minimized the significant differences between 
        the proposals.
    These findings call into question TSA's ability to make responsible 
contracting decisions, and whether taxpayer dollars were unnecessarily 
wasted in this process. Moreover, I am deeply concerned that a 
contractor was selected to screen passengers and help secure our 
aviation system despite TSA's own admission, according to the Court's 
ruling, that it would pose more operational risk and require 
Governmental intervention. This type of poor judgment is unacceptable 
in my view, considering the continued threats to aviation security. I 
hope you will agree that TSA runs the unnecessary risk of endangering 
travelers and causing serious economic damage by narrowly focusing on 
the cost advantages of one SPP proposal over another, rather than a 
true comparison in the ability to carry out security screening 
services.
    SPP was authorized by Congress in 2001 and it has been a successful 
program over the last 10 years. TSA has repeatedly certified that all 
private screeners perform at or above the level of Transportation 
Security Officers. Kansas City International Airport is one of the 
largest U.S. airports participating in SPP, first entering the program 
in 2002. I am concerned that, particularly in light of your decision in 
January to limit expansion of this program, TSA's improper contracting 
decision involving one of the programs largest airports and one of its 
highest-performing private screening companies seems to indicate that 
TSA is not serious about the program and would rather see it fail than 
succeed. I continue to feel strongly that the private sector has an 
important role to play in security and must be properly leveraged, not 
forced out of the process in favor of a larger Federal workforce.
    While it is my sincere hope that the poor handling of this RFP 
resulted from human error and was not intentionally flawed, I am 
requesting your full cooperation and assistance to bring greater 
transparency to the rationale behind this decision and ensure that any 
deficiencies are addressed quickly. I request that you provide by no 
later than October 24, 2011, copies of all documents and communications 
created by or in the possession of TSA that pertain to the RFP issued 
by TSA on April 2, 2010, and the subsequent related contract award 
decision made on March 17, 2011, to perform SPP contract screening 
services at the Kansas City International Airport. The terms 
``documents'' and ``communications'' are intended to mean all records 
including, but not limited to, files, reports, analysis, assessments, 
memoranda, notes, and presentations, in all forms of media, including 
emails or other electronic communications, and including any archived 
materials.
    Additionally, as Chairman of the Subcommittee on Transportation 
Security, I intend to hold a hearing on SPP and the handling of the MCI 
contract in the coming weeks, and I respectfully request that you 
provide testimony at this hearing. I understand that TSA has already 
made a decision to issue a new RFP for the MCI contract following the 
Court's ruling. I urge you to postpone any action on this RFP until the 
subcommittee can complete a review of the documents requested and 
conduct necessary oversight of TSA's acquisitions process in support of 
a robust SPP and proper use of taxpayer dollars.
    Thank you for your prompt and personal attention to this matter. I 
appreciate your continuing efforts to secure the Nation's 
transportation systems and look forward to working with you to improve 
TSA's performance in carrying out its critical mission.
            Sincerely,
                                               Mike Rogers,
                 Chairman, Subcommittee on Transportation Security.

    Mr. Rogers. I sent a letter to you expressing my concern 
over the ruling of the U.S. Court of Federal Claims in the case 
of FirstLine v. U.S. and Akal Security, Inc. I have just 
submitted that for the record.
    The curious thing about the SPP contracting problem at 
Kansas City is the timing of it. Specifically, it came on the 
heels of your public statement that SPP doesn't fit into your 
vision for a Federal workforce. My concern is whether the 
decision made in the Kansas City case could have been affected 
in some way by the fact that TSA does not want SPP to be 
successful and an integral part of its operations.
    We have the director of the Kansas City aviation here 
today, who will offer his perspective on the second panel, but 
before we hear him, I would like for you to address this 
concern. Why did the Kansas City contract go so wrong?
    Mr. Pistole. Well, thank you, Mr. Chairman.
    There were several issues that we found in the Court of 
Federal Claim's decision where we could have done a better job. 
Part of that was in our assessment of not only the best value 
but the cost and the security aspects that were inherent. Of 
course, this was an SPP airport that was continuing as an SPP 
airport; it was just a question of which private screener was 
the best value to the taxpayers and could provide the best 
security.
    The other finding that the court made was that we did not 
do as good a job as we could have--and I agree with this--in 
documenting our findings, both between the board that reviewed 
this and then the source selection authority.
    I do note that the court ruled in our favor on six of eight 
issues, but the key takeaways were we could have done a better 
job on both our analysis and our documentation. Then the 
question became, how should we move forward?
    So, clearly, we and I am supportive of Kansas City. They 
have had a good provider there, in terms of their private 
screening. The whole intent, as evidenced by this, was to 
continue that. It was a question of which private company was 
best suited to provide those services.
    Mr. Rogers. Okay.
    The former Federal security director of Kansas City 
Airport, Mr. Richard Curasi, was working as an advisor for Akal 
Security at the time the company submitted its proposal and won 
the bid to take the screening services at the Kansas City 
Airport. Were you aware of that?
    Mr. Pistole. I was not.
    Mr. Rogers. Now, did anyone at TSA who was involved in 
making the award have direct contact with Mr. Curasi starting 
from the time the RFP was issued until the contract was 
awarded?
    Mr. Pistole. Not to my knowledge.
    Mr. Rogers. Are you concerned at all about the influence a 
former senior TSA employee could have had on the contracting 
process given his connections inside your agency?
    Mr. Pistole. Well, given that I was not aware of that--
obviously, there is always the appearance that we need to be 
mindful of. But I was assured, in terms of review of this and 
looking at the court decision, that there was no improper 
influence, that everything was done according to the 
procurement, the acquisition process.
    But with the court's findings, in terms of both our 
assessment and our documentation of our findings, we could have 
and should have done a better job. So, as a result of that 
court decision, I have changed the procedures to ensure that 
that does happen and that we don't repeat the mistakes that we 
did in that instance.
    Mr. Rogers. Great.
    In the same letter I referenced earlier, I also urged you 
to postpone any action on the new RFP for Kansas City until the 
subcommittee could conduct necessary oversight. Despite my 
request, I understand that TSA intends to issue a full 
recompete of the Kansas City SPP contract.
    Why did you decide to go back to square one on that 
contract?
    Mr. Pistole. I looked at the court opinion, Mr. Chairman, 
and, in that, they noted that the permanent injunction was in 
the public interest because, and I quote, ``It will promote 
full and open competition in the procurement process.'' That is 
from page 73 of the decision.
    So, given that and the belief that by opening it up again 
we would have the opportunity to look at perhaps another 
contractor that could come in and do at least as good, if not a 
better, job than the two who had competed, that, coupled with 
several changes in the statement of work from 2010, added to my 
belief that we should simply open it back up.
    As I would also note from the court decision, they 
concluded, the judge concluded, ``What course of action TSA 
chooses to pursue after the contract is cancelled in order to 
maintain security screening services at MCI''--Kansas City--
``is not for this court to decide.'' So I took that 
discretionary function and exercised it.
    Mr. Rogers. Do you know how much it has cost so far for 
this recompete and how much it will cost?
    Mr. Pistole. I don't know the details. I would be glad to 
get that and get back with you on that.
    Mr. Rogers. I would appreciate that.
    I see my time has expired. The Chair now recognizes the 
Ranking Member of the subcommittee, Ms. Jackson Lee, for any 
questions she may have.
    Ms. Jackson Lee. Mr. Chairman, thank you so very much, and 
thank you to all the Members.
    Mr. Pistole, I am going to be speaking quite quickly so I 
can get some quick answers from you. Thank you, first of all, 
for your testimony and your service.
    Administrator Pistole, you state in your prepared testimony 
that TSA is a U.S. counterterrorism agency. What other domestic 
counterterrorism agency has outsourced the work of their front-
line employees at an extra expense to taxpayers? Do you know of 
any?
    Mr. Pistole. None that I am aware of, ma'am.
    Ms. Jackson Lee. Thank you very much.
    As I addressed in my opening statement, a provision 
fundamentally altering your discretion to approve or deny an 
application to participate in the SPP will soon become law via 
the FAA Reauthorization Act. Since this committee never debated 
these changes and was shut out of the conference by the 
Republican leadership, I would like to take the time to review 
some of the key changes made and to get your response.
    I also want to join my colleague, Mr. Thompson, and 
indicate that I am aghast at the emphasis of lack of 
employment, when obviously people who work in the Federal 
Government--you might just answer this, Mr. Pistole--are they 
people who are not unemployed? If they are working for you, 
they are not unemployed. Is that my understanding? If someone 
is working for the Federal Government, they are not in the 
unemployment line.
    Mr. Pistole. Yes, ma'am.
    Ms. Jackson Lee. So, in essence, we are creating necessary 
jobs. Is that----
    Mr. Pistole. Yes, ma'am.
    Ms. Jackson Lee. All right.
    The language of this specific legislation requires you to 
approve an airport's application to the SPP if the approval 
would not compromise security or detrimentally affect the cost-
efficiency or the effectiveness of the screening of passengers 
or property at the airport.
    What impact will this language have on your decision not to 
expand the SPP unless there is a clear and substantial benefit 
to do so?
    Mr. Pistole. Well, let me first say, ma'am, that obviously 
we are just assessing this at this point. So this is just an 
initial response.
    But, obviously, it is changing the burden, if you will, 
on--and the discretion that I have in terms of making that 
decision, which is to be in the taxpayers' best interest in 
terms of cost, but also, obviously, the bottom line is who is 
providing best security. So if I am required to accept 
something unless I can prove affirmatively that it does not 
meet that criteria, it obviously changes the standard.
    Ms. Jackson Lee. That burden, I think, makes everyone--
well, makes your job more difficult, not that you are opposed 
to difficulty, but more difficult in securing this country.
    Mr. Pistole. Well, obviously, Congress has passed this law 
and the President is intending to sign it, I believe. So I look 
forward to working with the committee to figure out the best 
way forward on this.
    Ms. Jackson Lee. Well, I would argue to say that a non-
security committee passed the bill. So I would make that point.
    Does this language have the potential to increase the cost 
to taxpayers for administering the SPP due to the need for 
increased oversight and management?
    Mr. Pistole. Well, clearly, if there is a flood of 
applications that come in, we will have to increase our 
headquarters staffing to handle those, as we have a small staff 
now to handle the 16 and now 17, potentially 17, SPP airports. 
But, yes, hypothetically, if every airport, all 450, or the 
remaining came in, then, yes, we would have to increase our 
staffing substantially.
    Ms. Jackson Lee. So now this process opens it up to all 450 
airports in the United States; is that correct?
    Mr. Pistole. That is my understanding, yes.
    Ms. Jackson Lee. So, then, my comment, we are looking 
forward to returning to 9/11.
    The language requires you to approve or deny an airport's 
application within 120 days. Does that pose a stressful time 
frame? Is that adequate for you to conduct full review of the 
security implications?
    Mr. Pistole. Well, there are a lot of aspects to that, but, 
yes, that is a compressed time schedule. For example, if there 
is one application, it is much easier to comply with that than 
if there are 10 or if there are 100.
    Ms. Jackson Lee. I want to go back to the thought that I 
raised in my opening statement. The language contains a 
provision waiving the requirement that any company contracted 
with for screening services be owned and controlled by a United 
States citizen. Thankfully, that language contains a clause 
that affords you complete discretion to reject any application 
that requires this waiver.
    As you well know, Administrator Pistole, we live in a 
complex world with shifts in allegiances and a dynamic threat 
environment. One need look no further than to some of the 
activities that are going on with our neighbors in the Mideast, 
the pending complexity of Iran and its nuclear weaponization; 
some of the individual franchise terrorist acts that have 
occurred over the last decade, even after 9/11, though this 
Nation has been very fortunate; and, of course, the concern 
about, as you mentioned, the idea of sharing intelligence.
    My question to you: Will you commit to us today that during 
your tenure as administrator you will not approve any 
application that requires a waiver of the citizenship 
requirement on the basis of the need for the securing of 
intelligence and the securing of this Nation?
    Mr. Pistole. Well, clearly, madam, I would need to review 
any application. The fact that it would be a foreign-owned 
company, I would need to look at the intent of Congress, but 
that does give me concern about the--potential concern about 
the issues that might be inherent in that business.
    But, again, I am just seeing this language for the first 
time, so I need some more time to assess that.
    Ms. Jackson Lee. Mr. Chairman, I just have--let me just 
follow up with him----
    Mr. Lungren. Mr. Chairman, we have----
    Ms. Jackson Lee [continuing]. For a moment.
    Mr. Lungren [continuing]. Fifteen minutes until we are 
supposed to have a vote. There are four Members who would like 
to ask questions. Could we proceed in regular order, please?
    Ms. Jackson Lee. Well, let me do this, Mr. Lungren. Mr. 
Chairman, I will defer to you, but let me just put this 
question on the record.
    Mr. Lungren, you are not the Chairman at this time.
    Mr. Rogers. The time has expired.
    Ms. Jackson Lee. Excuse me.
    Mr. Lungren. We have four other Members----
    Mr. Rogers. Regular order.
    Mr. Lungren [continuing]. Who would like to ask questions.
    Ms. Jackson Lee. Excuse me, Mr. Lungren----
    Mr. Lungren. Out of respect to other Members----
    Ms. Jackson Lee [continuing]. You are not the Chairman.
    I am asking to put this question on the record. I will not 
ask for an answer, Mr. Chairman. Mr. Lungren is not the 
Chairman.
    Mr. Rogers. I would just ask you to submit it for the 
record.
    Let's go to Mr. Thompson for any questions he may have.
    Mr. Thompson. Thank you very much, Mr. Chairman.
    Mr. Pistole, I am concerned that comments by some lobbying 
for the expansion of privatized screening has resulted in a 
misunderstanding of what this would mean for the flying public.
    We created this entity, TSA, after 9/11. If a similar 
incident occurred today, would you have the authority to direct 
private screeners to other locations?
    Mr. Pistole. Under the existing contracts, no. They would 
be limited to the airport to which they are assigned.
    Mr. Thompson. So, basically, the ability to respond based 
on an incident is hampered by your inability to move private 
screeners where that situation could potentially be.
    Mr. Pistole. Yes, that is one of the limitations that is 
part of the contract process which we could address in future 
contracts. But under existing contracts, that would be a 
voluntary aspect of that, so I cannot direct them.
    Mr. Thompson. Thank you.
    In your experience in negotiating public and private 
contracts, has it been your experience that private contracts 
for screeners cost more than Federal contracted screeners?
    Mr. Pistole. Under the existing SPP contracts, they have 
all, I believe, except for one, cost more than it would have 
cost for the Federal Government to have the TSOs there.
    The incidence last week where I approved the application 
from West Yellowstone is another exception because they--I 
believe they will be able to come in with a bid that will be 
less than what we would be able to do because we are sending 
people in on temporary duty assignment for the 4 months that 
West Yellowstone is open. So that would be another exception.
    Mr. Thompson. Can you clarify for us what screening 
protocols must be followed by privatized screeners?
    Mr. Pistole. The same as for all other Federalized 
airports.
    Mr. Thompson. Do privatized screeners, in your experience, 
perform better than their Federal counterparts?
    Mr. Pistole. I believe that they--every assessment is that 
they perform comparably to the Federalized workforce, both in 
terms of security and in terms of customer engagement.
    Mr. Thompson. So, again, all things being equal, at this 
point your experience is, other than the cost associated with 
private screeners versus Federal contracted screeners, we are 
pretty much on par.
    Mr. Pistole. Yes.
    Mr. Thompson. Thank you.
    Now, one other issue. Does maintaining a mixed-use, public-
private model of screening cost taxpayers more or less if the 
entire system is Federalized?
    Mr. Pistole. So, it costs us slightly more to have both the 
Federal and the SPP airports. Is that what----
    Mr. Thompson. Yes.
    Mr. Pistole. Yes, it does.
    Mr. Thompson. What your testimony basically is, is that one 
system would allow the taxpayers a greater savings than 
managing a two-part system?
    Mr. Pistole. Well, yeah, I mean, the taxpayers are paying 
either way, whether it is to the Federal employees, the TSOs, 
or to the privatized screeners, who also have overhead for a 
private company.
    Mr. Thompson. But they are paying more.
    Mr. Pistole. Right. So, in the past--and now we have driven 
that down, but, in the past, it has been anywhere from 3 to 9 
percent more than the Federal approach.
    Mr. Thompson. Thank you.
    Ms. Jackson Lee. Does the gentleman yield?
    Mr. Thompson. I yield back.
    Ms. Jackson Lee. Would the gentleman yield?
    Mr. Thompson. We need to go on with some of the----
    Mr. Rogers. The gentleman yields back.
    The gentleman from Minnesota is now recognized for 5 
minutes.
    Mr. Cravaack. Mr. Chairman, if I could, I would like to 
yield--I will not yield at this time.
    Mr. Pistole, thank you very much for coming. I appreciate 
it.
    Just in the spirit of what I believe this committee should 
be all about, which is finding solutions to the problems, I 
would like to yield 30 seconds of my time to answer Ms. Jackson 
Lee's question. Would that be all right?
    Mr. Pistole. That is fine with me.
    Mr. Rogers. Ms. Jackson Lee, you are recognized.
    Ms. Jackson Lee. Thank you very much.
    Thank you very much. I appreciate it.
    Mr. Pistole, TSA has a veterans preference. In privatizing, 
would you be able to ensure that there would be a veterans 
preference for private companies?
    Mr. Pistole. We would be able to negotiate that as part of 
the contract. As I think you are aware, approximately 24 
percent of the overall TSA workforce are veterans.
    Ms. Jackson Lee. Would it be an extra cost, sir, for 
privatized?
    Mr. Pistole. I don't know that. I would have to look into 
that.
    Ms. Jackson Lee. All right. We appreciate the yielding of 
the gentleman, and I will pursue that further with the 
administrator. I thank the Chairman for his kindness.
    Mr. Cravaack. I will reclaim my time.
    First off, thank you very much, sir. I appreciate 
everything you have done. I have gone through that PreCheck. It 
is slick. What it does--it is fantastic--it concentrates our 
limited resources on known and unknown threats, and it is just 
absolutely awesome. I commend you on that.
    Mr. Pistole. Thank you.
    Mr. Cravaack. One of the things I want to bring up, too, is 
there is a big difference between pre-9/11 and post-9/11 
security, whether you are privatized or you are a Federal 
employee. As an airline pilot that went pre-9/11, I can 
dramatically see the difference.
    Mr. Pistole. Right.
    Mr. Cravaack. So it is a completely different ball game--
much more professional group, much more adherence and 
concentrating on security. As an airline pilot for 17 years, I 
can see the big difference.
    One of the questions that I want to just really bring out 
relatively quickly is, a while back, SPP applications for six 
airports in February 2011, TSA denied the applications for the 
six, indicated that they did not allow the expansion for the 
program. Later in 2011, we walked it back a little bit and we 
said there had to be a clear and substantial advantage to the 
TSA airport, like you had said.
    How did the TSA determine the threshold for the airport 
participating in the SPP, in that the airport must demonstrate 
that there is a clear and substantial advantage in order to 
create that determination?
    Mr. Pistole. Thank you, Congressman. Thank you for your 
comments about PreCheck. The men and women of TSA are excited 
by that because of the service they are able to provide, which, 
frankly, they had been hampered on previously. So thank you for 
that.
    So, obviously, the process is an airport applies. Thus far, 
you know, in the 10-plus years that TSA has been in existence, 
we have only had 30 or so airports actually apply for the SPP 
status. Now, some of those, a couple times because they were 
denied. So only 30 out of the 450-plus airports.
    So when they apply, then we evaluate that. Under this new 
criteria, it would be: Is there a clear and substantial 
advantage to the taxpayer, for the one? So is there a cost 
benefit that is improved in some way that we can show that 
there is a savings to the taxpayer? Then obviously they have to 
comply with all the security protocols and regimens.
    So it really comes down to, unless there is a clear and 
substantial advantage, then what benefit is there in changing 
if it would cost more and simply provide the same level of 
security?
    Mr. Cravaack. The metrics that you were applying, do you 
have a copy? Can you forward those metrics to us?
    Mr. Pistole. I basically outlined what they are. In terms 
of the cost, and so what do we assess the cost as being? Then 
the security protocols should be absolutely the same, if not 
better than the current standard operating procedures for TSA. 
So that is really what it comes down to.
    Mr. Cravaack. Okay. For the private organizations that did 
apply for the SPP program, did you get back to them on telling 
how their applications could be improved, why they were 
deficient?
    Mr. Pistole. What we asked them to do is come in and 
provide what they believed would be the clear, substantial 
indicia or information that would indicate why they would be a 
better proposition than the Federal--so we didn't go back and 
say, ``A, B, C, D, E, address these issues,'' if that is what 
you are asking.
    Mr. Cravaack. Okay, you did not do that.
    Mr. Pistole. Did not do that.
    Mr. Cravaack. Okay.
    I am running quickly out of time, but I guess the big thing 
for us is we want to make--everybody here on this panel wants 
to make sure that we have an effective and efficient TSA.
    Mr. Pistole. I appreciate that.
    Mr. Cravaack. You know----
    Mr. Pistole. That is my goal also.
    Mr. Cravaack. Yeah, I know it. It is a bipartisan issue. We 
have worked on a lot of different issues regarding 
transportation as well.
    The big thing I think we want to make sure that we have 
public is that there is a beneficial cost associated with the 
privatized, if there is one; and, No. 2, that we have an 
effective system that you are able to manage.
    So, with that, I am out of time and I will yield back.
    Mr. Pistole. Thank you, Congressman.
    Mr. Rogers. I thank the gentleman.
    We are supposed to be called for votes soon, but I 
understand that Mr. Mica has joined us, the Chairman of the 
Committee on Transportation and Infrastructure, and would like 
to sit at the dais. So I would ask unanimous consent that he be 
permitted to do so.
    Without objection.
    Welcome, Mr. Mica.
    The gentleman from California, Mr. Lungren, is recognized.
    Mr. Lungren. Thank you very much, Mr. Chairman.
    First of all, Mr, Pistole, thank you for the PreCheck 
program. I think that is a move in the right direction.
    Mr. Pistole. Thank you, Congressman.
    Mr. Lungren. Having said that, though, you know my 
consternation with respect to this program. Let me ask you, is 
there any statutory language that reads that you must find 
clear and substantial advantage before you can approve a 
private contractor?
    Mr. Pistole. None that I am aware of, no.
    Mr. Lungren. So it is not part of the statute; it is 
something----
    Mr. Pistole. No.
    Mr. Lungren [continuing.] That you have put as your 
additional requirement.
    Mr. Pistole. Yes. Trying to understand what I believed the 
Congressional intent was in terms of creating TSA, you know, 
after 
9/11 as a Federalized workforce, with the exception of the SPP, 
you know, the initial five and that assessment of whether 
privatized airports could add value.
    Mr. Lungren. Right. So it is not part of the statute.
    Mr. Pistole. Not my knowledge, no.
    Mr. Lungren. Would you think it unreasonable for an airport 
such as the one in my district to not have applied for this yet 
because they believe this is disfavored by you and by TSA?
    Mr. Pistole. Well, I would hope that each airport would 
make a business decision to assess what would be best for their 
passengers, for their----
    Mr. Lungren. I understand that. But let me ask you, if you 
were told that they have to prove a clear and substantial 
advantage, even though everything else must be equal----
    Mr. Pistole. Uh-huh.
    Mr. Lungren [continuing]. If you observe that the TSA, in 
trying to make a comparison of the costs, initially said they 
were double-digit, but Government Accounting Office when they 
looked at it said, you know, ``TSA, you have forgotten about 
the cost of Federal retirement,'' and then you brought that in 
and you brought, I think, the difference down to about 3 
percent; and if you saw what happened in Kansas City where the 
court--frankly, I would be embarrassed if a court said this 
about me or my client, that--it was an 81-page decision which 
reversed, in the court's words, ``a fundamentally flawed source 
selection by the TSA.''
    They said, the TSA did not conduct a proper best-value 
analysis. The court found, TSA arbitrarily deviated from their 
own procedures that they had put in place. It said that TSA did 
not document its evaluation and decision. It said that TSA's 
price evaluation scheme was irrational. The only way you could 
overturn something like this is if you find it arbitrary and 
capricious. They found, frankly, TSA to be arbitrary and 
capricious.
    Then it is extended out over time, and if I am an operator 
of an airport, that doesn't suggest to me that TSA is going to 
be objective in this; it sounds to me like TSA is going to make 
it extremely difficult for me.
    So, I mean, I have an airport in my district that would 
want to do it. They have not applied to you, at this point in 
time. But I just want to set for the record that that is not 
because they do not wish to.
    So you keep quoting this number that, out of 400-and-some-
odd airports, only so many have applied. Then you have told me 
you don't want to approve very many--you just approved West 
Yellowstone?
    Mr. Pistole. Yes.
    Mr. Lungren. How many flights do they have a day?
    Mr. Pistole. I don't know.
    Mr. Lungren. Have you ever been to West Yellowstone?
    Mr. Pistole. Never been there.
    Mr. Lungren. I have been to West Yellowstone. It is not one 
of the large metropolises of America. Although I did get good 
ice shaving there one time. If you ever want to find some good 
ice shaving and you are coming out of Yellowstone, you will 
find that that works very, very well.
    There have been things that have been said on this dais 
today that don't insult the Federal employee, and I do not wish 
to insult the Federal employee, but to insult the private 
employee I think is irresponsible, to suggest that the private 
employee cannot do a good job.
    Are you suggesting to us that the security at San Francisco 
International Airport, the largest airport that has a private 
contractor, is less than what it is at any other airport?
    Mr. Pistole. Absolutely not.
    Mr. Lungren. Would you allow that to be the case?
    Mr. Pistole. Absolutely not. If they didn't do the job, 
then we would seek another company or whatever other options.
    Mr. Lungren. I mean, I do not understand why we have to sit 
here and suggest that if you have a private employee, that 
private employee is less than a public employee. Frankly, we 
ought to Federalize the entire American workforce and have 138 
million people all working for the Federal Government if that 
happens to be the case.
    I know that you oppose the proposition that was in the law, 
but you have said that you will work to enforce that.
    Mr. Pistole. Absolutely.
    Mr. Lungren. I know, from your record, that you will do 
that.
    Mr. Pistole. Absolutely.
    Mr. Lungren. I just hope you will not add any additional 
things, such as ``clear and substantial advantage'' or whatever 
else you would come up with, to undo the intent of Congress, as 
you suggest that we are trying to follow the intent of 
Congress.
    With that, I see my time is over, and I thank the Chairman.
    Mr. Rogers. I thank the gentleman.
    We have been called for votes, but I want to recognize Mr. 
Mica for his set of questions.
    You are recognized for 5 minutes. Thanks for joining us.
    Mr. Mica. Thank you so much, Mr. Chairman, Mr. Thompson, 
Members of the committee, for affording me a few minutes. 
Hopefully--well, I will definitely finish within my 5.
    I am pleased to have Administrator Pistole. He has probably 
one of the toughest jobs in Washington. It is very difficult.
    Of course, you know my history, having been involved--I was 
chairman of the Aviation Subcommittee. The good Lord gave me 
that task in 2001, and the President wanted a bill on his desk 
by Thanksgiving after the attacks in September. Of course, we 
don't have jurisdiction. I try to conduct oversight. I am also 
on Government Reform and try to do our, you know, good job in 
protecting the taxpayer and the flying public. It is an 
important mission.
    But that being said, we are here now, and there is great 
frustration, as you know. You have probably heard some of it 
today. We have talked, and I think that we need to get to a 
risk-based system. I was pleased also--I wasn't here but I 
heard of your willingness to work with the committee to 
implement the new language, and that is important. I will work 
with you. We want this to be successful. We want to work with 
you, tried to work with Members of the Homeland Security 
Committee in that regard.
    But, you know, I have the most recent meltdowns--Honolulu, 
you know, was a meltdown; Charlotte Douglas; most recently, 
Liberty International. It is not just a couple, it is quite a 
few of the TSA employees you had problems with. Every time you 
pick up the paper--here is just last week's headlines: ``TSA 
Workers: The Theft Cops'' and then ``TSA Agent Arrested for 
Stealing iPads.'' Those are a couple from last week.
    Then the recruitment and training, we spent $2.4 billion on 
recruitment and training. We trained 137,000 people. Actually, 
more people have left. I think we need to find a more efficient 
way. If we can incorporate that into the SPP model, I think we 
can have great savings there. That is something that I don't 
think was in the GAO report.
    Then, you know, you have resorted--I know the difficulty in 
hiring people. You have advertised on the top of pizza boxes. 
This is pizza boxes. This was on the top of--I saw this on a 
National--well, I buy cheap gas. I went to a discount gas 
station and actually took that picture. I was stunned to find 
that Washington Reagan National, one of our most-targeted 
probably, and need-to-be-secure airports, is now hiring 
transportation security officers--it tells all the benefits--
above the ``cheapest gas in town'' pump ad.
    You have gone to a huge number of screeners, 51,000; pretty 
substantial administrative staff, somewhere between 12,000 and 
14,000 out there. But right now, folks, for everyone in the 
administrative realm, we are looking at about 30 people--well, 
I will say 25 people, just a little lower, in administrative--
because have you marshals and others, we don't want to count 
them in--overseeing this.
    We have looked at all the models. I looked at them before; 
I have looked at them around the country. The United States is 
now one of only a few Western countries--Poland, Romania, 
Bulgaria, and the United States. Libya did have an all-Federal 
screening force. But you went and saw the models in Israel. I 
went before, I went back after you went there, and Napolitano. 
The United Kingdom, which had huge incidents of terrorists, 
probably faced terrorism far worse than we did, they all retain 
private screenings.
    No one is saying, do away with the Federal Government. No 
one is saying Federal employees do a bad job. But I want to get 
you out of the personnel business and into the security 
business--and I think that is so important, because we do have 
a threat--so you can focus.
    So, again--and the union issue. You know, the SPPs they 
joined unions before the Federal employees. Those in San 
Francisco and other places we looked at, sometimes the private 
screeners pay more money to retain people. The turnover is 
great. Maybe we could submit this comparison if it has it 
between San Francisco and Los Angeles. There is room for that.
    My only question, sir, is--you had stated to the committee 
that you would work with us, and I hope you will work with me, 
to try to improve this and implement the law that the 
President, we expect, will sign in a few days.
    Mr. Pistole. Yeah. Absolutely.
    Mr. Rogers. I thank the gentleman.
    I would like to ask you open-endedly before we go to vote, 
where do you see this going? Do you envision a time horizon in 
which you see an expansion of SPPs? Or is that something you 
really don't want to see?
    Mr. Pistole. I think it is hard to forecast, Mr. Chairman. 
It is a good question because we, frankly, don't know.
    You know, before my decision last year not to expand beyond 
the 16 unless there is some clear and substantial benefit, as I 
mentioned, there had only been the handful, less than three 
dozen, that had applied. So even before that decision, it 
wasn't like they were knocking down our doors. Now, to 
Congressman Lungren's point, maybe there was a belief that we 
wouldn't accept them.
    So I, frankly, don't know what it will look like, but 
obviously we have to be prepared for any substantial number.
    If I could comment----
    Mr. Rogers. Certainly.
    Mr. Pistole [continuing]. On Congressman Mica's points, you 
raised a number of good points and, obviously, some 
philosophical differences. I don't know, I don't have 
visibility into the private workforces, but just as there are 
some outstanding security officers within the Federal 
Government and not so, I assume that is the same in the private 
sector.
    What we don't hear about, for example, are some of the 
great stories. For example, the security officer at Newark who 
found $5,000 and turned it in. Another officer saw a second 
officer taking the $5,000 and reported that. So, you know, good 
with the bad there. Then just last week in Harrisburg, 
Pennsylvania, a security officer whose apartment that he lived 
in caught on fire, the apartment building. He went back in and 
helped saved the lives of 10 people.
    So those things aren't out there, but it just demonstrates 
that we have great people within the Federal Government. There 
are great people in the private sector. But, yeah, so, to 
answer your question, it is----
    Mr. Rogers. Yeah, I don't argue that. I mean, I think we 
all admire the great employees that we have in the Federal 
system. But we do have some good examples, like in San 
Francisco, where the private contractors are working 
wonderfully.
    So I am anxious to see, as the next few months unfold, if 
more people do pursue it, and if so, you know, how you view it. 
Because I just don't want to close the door. I think there are 
some great opportunities out there for us to transition, as 
long as we can maintain comfort----
    Mr. Pistole. Sure.
    Mr. Rogers [continuing]. That it is being done well.
    There is a real concern on my part, though, that we have 
seen the ratio of supervisors at the airports where we have SPP 
programs be pretty high--40 or 50 folks supervising at one 
airport. Can you speak to that?
    Mr. Pistole. Yeah----
    Mr. Rogers. Do you know what the ratio is?
    Mr. Pistole. Well, for example, at SFO, with over 1,000 
security officers, TSOs, I don't know the exact figure, but I 
think that 40 to 50 is probably right. Because the private 
company is simply doing the front-line workers and what we call 
the leads and I believe the supervisors. But all the managers 
and all the, as Congressman Mica refers to, the administrative 
staff, those things still have to be done. The private 
companies aren't paying for that; we are paying for that. So--
--
    Mr. Rogers. Is that because you have contracted that you 
want to keep those responsibilities? So the private company 
could do it but you chose to maintain that authority?
    Mr. Pistole. I don't know the specific contract provision 
on that, Chairman, so I will have to take that back and look at 
that. But that is the model. Whether that is by design or 
simply--and, obviously, the Federal security directors and the 
deputies in all the airports are still TSA employees.
    But there is a certain efficiency of doing that. So, for 
example, whether it is one of the small, Montana 7 or 
something, yeah, there has to be some TSA presence in order for 
us to oversee and make sure the protocols are being followed 
accordingly.
    So I will look into that.
    Mr. Rogers. Well, and I will probably need to get back with 
you in a classified setting, because I have some pretty glaring 
examples that--they may be legitimate, they may be wrong, but 
also they may have some security reasons why. But I would like 
to know more about this ratio of TSA personnel to contract 
personnel in airports, as well as some TSA folks that are in 
other roles at airports. But I don't want to bring that up in a 
public setting and----
    Mr. Pistole. I appreciate that.
    Mr. Rogers [continuing]. Compromise anything that might be 
inappropriate from your perspective.
    I hate that votes have been called. I have a whole lot of 
things I want to talk to you about, and these other guys and 
gals did too. But we don't have control, and I don't want to 
inconvenience you any further.
    I hate to delay the second panel, but I have to go vote. As 
soon as we get back, we will have our second panel.
    So, with that, Mr. Pistole, thank you for being here.
    Mr. Pistole. Thank you very much.
    Mr. Rogers. We are in recess.
    [Whereupon, at 4:01 p.m., the subcommittee was recessed, 
subject to the call of the Chair.]



 SCREENING PARTNERSHIP PROGRAM: WHY IS A JOB-CREATING, PUBLIC-PRIVATE 
             RELATIONSHIP MEETING RESISTANCE AT TSA? DAY II

                              ----------                              


                      Thursday, February 16, 2012

                  House of Representatives,
                    Committee on Homeland Security,
                   Subcommittee on Transportation Security,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 1:07 p.m., in 
Room 311, Cannon House Office Building, Hon. Mike Rogers 
[Chairman of the subcommittee] presiding.
    Present: Representatives Rogers, Cravaack, Turner, Jackson 
Lee, and Richmond.
    Mr. Rogers. The subcommittee will come to order. I would 
like to welcome everybody back to this important hearing, and 
thank our witnesses for not only being here, but being so 
patient and accommodating to our schedule. Today the 
subcommittee will continue to examine the Screening Partnership 
Program and TSA's willingness to work with the private sector 
to improve transportation security. Last week we had a very 
productive dialogue with Administrator Pistole on the role of 
private screeners under the SPP program. I appreciated 
Administrator Pistole's testimony and candid responses to my 
questions and other Members' questions.
    I now look forward to hearing from individuals who are 
directly impacted by the decisions TSA makes with regard to 
this important program. I hope that we can identify ways to 
improve this program and TSA's relationship with the private 
sector. I now would like to recognize our panelists.
    We have Mr. Mark VanLoh is the director of aviation for the 
city of Kansas City. Mr. VanLoh oversees all aspects of the 
management, development, operation and maintenance of Kansas 
City International Airport and Charles B. Wheeler Downtown 
Airport. Prior to his tenure in Kansas City, Mr. VanLoh served 
with Chattanooga Metropolitan Airport Authority, where he was 
president and CEO since 2001. From 1998 to 2001, Mr. VanLoh was 
commissioner of airports for Cleveland Hopkins International 
Airport and Burke Lakefront Airport in Cleveland, Ohio. 
Previously, he served as director of airports for the Toledo-
Lucas County Port Authority in Toledo, Ohio, and director of 
aviation for the Greater Rockford Airport Authority in 
Rockford, Illinois. Mr. VanLoh is an accredited member of the 
American Association of Airport Executives, and serves on the 
board of directors for Airports Council International.
    Mr. Steven Amitay is the Federal legislative counsel for 
the National Association of Security Companies, NASCO, the 
Nation's largest contract security association. For the past 12 
years, Mr. Amitay has represented ASIS International, the 
world's largest association of security professionals, and was 
involved in the Congressional passage of the Private Security 
Officers Employment Authorization Act. Mr. Amitay previously 
served as a professional staff member of the then-Senate 
Governmental Affairs Committee Subcommittee on Government 
Efficiency, Federalism, and the District of Columbia.
    Also Mr. John Gage is with us. He is the national president 
of the American Federation of Government Employees, the largest 
Federal employee union, representing 600,000 Federal and D.C. 
government workers Nation-wide and overseas. He has held this 
position since 2003. Mr. Gage has been involved in the American 
Federation of Government Employees and the labor movement for 
more than 25 years. Welcome all of you.
    Again, thank you for being here and devoting your time and 
attention to this effort. The Chairman now recognizes Mr. 
VanLoh for his summarization of your testimony for 5 minutes. 
Your full statement will be put in the record.

     STATEMENT OF MARK VAN LOH, A.A.E., DIRECTOR, AVIATION 
         DEPARTMENT, KANSAS CITY INTERNATIONAL AIRPORT

    Mr. VanLoh. Good afternoon, Mr. Chairman. I am Mark VanLoh, 
as you said, director of aviation for the city of Kansas City. 
Thank you for inviting me to appear before the committee today 
to discuss the airport Screener Partnership Program. First I 
want to describe Kansas City International Airport. It is one 
of the country's major medium hubs. We are served by 23 
passenger and cargo airlines, with approximately 200 daily 
flights, and generate over 10 million passengers a year. Kansas 
City International Airport is particularly conducive to 
Screening Partnership Program because of its unique 
configuration. Designed in the late 1960s, we have three 
separate semicircular passenger terminals that are not 
connected. It was designed so that the distance between the 
curb and the jet bridge is 75 feet.
    The lack of a central concourse also creates the need for 
multiple security screening locations, and does not allow for a 
central screening checkpoint that most modern airports have. My 
testimony today addresses the airport Screener Partnership 
Program based upon Kansas City's nearly 10 years of experience 
under this program since it began shortly after 9/11. In the 
aftermath of 9/11, Congress made fundamental changes to the way 
airport passengers and property are screened. It took screening 
out of the hands of the airlines and Federalized it under TSA.
    However, Congress wisely decided to allow private screening 
in two ways: First, it established a pilot program covering 
five airports. Second, it established an opt-out program. Once 
the pilot program expired, airports had the ability to opt out.
    Kansas City was selected by TSA in 2002 under the pilot 
program, along with four other airports, San Francisco, 
Rochester, Tupelo, and Jackson Hole. It has been a partnership 
that has worked extremely well at Kansas City. I have been an 
airport operator for 28 years. In my view, the Screening 
Partnership Program has provided a level of screening services 
and security protection at least as good as, indeed we think 
better than, levels that TSA would have provided using Federal 
personnel. It has done so with operational efficiency and high 
levels of customer satisfaction. By ``customer,'' I mean the 
traveling public, the airport, and TSA. Because of the success 
of the pilot program, we enthusiastically elected to continue 
the Screening Partnership Program under the opt-out program. In 
fact, all the original five airports selected have also elected 
to continue to participate in this program. The advantage of 
the Screening Partnership Program can be summarized as follows: 
Enhanced flexibility and efficiencies in personnel use and 
deployment; greater flexibility to respond to increased or 
decreased service requirements; greater flexibility to cross-
train and cross-utilize personnel. We are not subject to the 
Federal employee hiring freezes or employment caps that we have 
all come to know. More effective in dealing with nonperformers. 
That is key.
    The private screening company has greater flexibility than 
the Federal Government to redeploy screeners on short notice, 
to reschedule screeners' shifts to and from off-hours, to add 
or delete checkpoints on short notice. In fact, several airport 
directors have recently complained about a decrease in staffing 
and an increase in wait times at their Federalized airports. I 
have the luxury in Kansas City of making one local phone call 
to resolve any issue at my airport, and make immediate changes 
without having to wait on a response from Washington.
    Based on our nearly 10 years of experience under the 
private program, I can report that the Screening Partnership 
Program has been very effective in providing high-quality 
service to our passengers at a security level equal to, if not 
better than, that level using Federal Government employees. It 
is a cost-effective program that can be used to increase 
private sector opportunities and reduce costs to the Federal 
Government. Using private contractors to perform critical 
safety and security missions is quite common. There are many 
safety and security functions carried out by private entities 
with strong Federal oversight, as my written testimony points 
out. One comes to mind is there are 200 private air traffic 
control towers in the United States run by private operators 
under the supervision of the air traffic control system.
    While I firmly believe the program has worked well for 
Kansas City, there are a number of areas I think it can be 
improved. First, TSA needs to be more flexible in its 
supervision of private screening companies as to better foster 
improvements and innovation. TSA should set minimum levels of 
security standards and operational procedures, but give the 
private screeners the flexibility to provide security in a new 
and innovative and creative way. However, as we understand it, 
TSA requires all Federal and private screeners to operate under 
the same procedures, including centralized procedures for 
screener hiring and assessments, and coordinating all of it 
through TSA headquarters.
    I do not believe that the law requires a one-size-fits-all 
approach. Second, TSA should develop staffing resources based 
on the operational requirements of each airport, not on some 
arbitrarily wide system capping based on salary caps and 
staffing caps that it uses for the Federal workforce. Such an 
approach would more effectively account for the unique 
requirements of each airport, including the need for part-time 
screeners. Once again, one size doesn't fit all. For example, 
staffing requirements in Kansas City, which does not have a 
single checkpoint, as I mentioned, would be markedly different 
than the requirements for airports that have these facilities. 
Third, private screening companies should have the flexibility 
to vary compensation and benefits to enhance screener 
performance. The law requires only that the private screeners 
receive compensation and benefits not less than the Federal 
screeners. But private screening companies should have the 
flexibility to develop their own compensation plans, especially 
when we compare the costs of living for Kansas City as compared 
to Washington, DC, or the New York areas.
    Fourth, there needs to be greater coordination with the 
airport operator. Of course, TSA has the ultimate legal and 
operational responsibility for screening. But more can be done 
to get the airport operator's input on rational procedures, 
staffing, and other critical activities. For example, TSA 
recently chose to replace Kansas City's long-time private 
screening company, yet they never asked us for our input on the 
incumbent's prior performance, even though Kansas City 
International received first place in the J.D. Power awards for 
passenger satisfaction in 2010. We were not unhappy when the 
TSA's decision to switch providers was challenged and 
overturned in the United States Court of Federal Claims.
    Fifth, the choice of screening companies should be based 
largely on technical capabilities and performance, not on cost. 
Basing selection primarily on cost considerations, we will 
return to the poor performing system we had prior to 9/11, 
where contracts were generally awarded to the lowest bidder, 
manned by screeners who lacked experience, critical skills, and 
performance incentives.
    In conclusion, the Screening Partnership Program has worked 
very well at Kansas City International Airport. It has shown 
that private screeners under the direct control and supervision 
of the TSA will perform excellent security and customer service 
at a reasonable cost.
    Mr. Chairman, this concludes my prepared remarks. I would 
be pleased to address any questions you or Members of the 
subcommittee may have. Thank you.
    [The prepared statement of Mr. VanLoh follows:]
                   Prepared Statement of Mark VanLoh
                            February 7, 2012
    Chairman Rogers, Ranking Member Jackson Lee, and Members of the 
Transportation Security Subcommittee, I am Mark VanLoh and I am the 
Director of Aviation for the City of Kansas City, Missouri. Thank you 
for inviting me to participate in today's hearing on the airport 
screener partnership program.
    My testimony today addresses the airport screener partnership 
program based upon Kansas City's nearly 10 years of experience under 
the program since it began in June 2002. Kansas City International 
Airport is one of the country's major medium-hub airports. We are 
served by 23 passenger and cargo airlines with approximately 200 daily 
flights and generate over 10 million annual passengers.
    Based on our experience, the screening partnership program has 
worked extremely well at Kansas City. It has provided a level of 
screening services and security protection at least as good as, indeed, 
we think better than, the levels that TSA would have provided using 
Federal personnel. It has done so with operational efficiency and high 
levels of customer satisfaction. As I will discuss later on, there are 
a number of areas of improvement that TSA should implement to make the 
program even more effective and efficient.
    Prescreening of airline passengers and baggage had been a component 
of the commercial aviation landscape for almost 40 years. The FAA 
implemented universal prescreening on January 5, 1973, placing 
prescreening responsibility on the airlines. Since this became a 
component of airline costs, this approach resulted in a security 
screening workforce based generally on the lowest-cost bidder, with 
employees paid at minimum wage, lacking experience, skills, and 
performance incentives, and with relatively poor training. In addition 
to the United States, only two other countries in the world--Canada and 
Bermuda--relied on air carriers to foot the responsibility for aviation 
security screening.
    In the aftermath of the terrorist attacks on September 11, 2001, 
Congress promptly began to address enhancements to aviation security 
and made fundamental changes in the way airport passengers and property 
are screened. On September 21, 2001, a bill was introduced in the 
Senate that would place security screening responsibility in the hands 
of the Federal Government, manned by a Federal security workforce. A 
competing House bill proposed to utilize private screening companies 
under the direct supervision and control of the Federal Government. The 
Aviation and Transportation Security Act (ATSA) was passed by Congress 
on November 16, 2001 and signed by the President on November 19, 2001.
    ATSA created a new Federal agency, the Transportation Security 
Administration within the Department of Transportation (subsequently 
transferred to the Department of Homeland Security), with 
responsibility for security of all transportation modes. ATSA 
Federalized security screening at more than 440 commercial airports in 
the United States.
    As a compromise between the Senate and the House approaches to 
private versus Federal security screeners the ATSA provided for two 
private screening options:
    First, under 49 U.S.C.  44919, Congress created a mandatory 2-year 
``pilot program'' directing the TSA to establish a ``pilot program'' 
for private screening involving not more than five airports (one from 
each of the five security risk categories defined by TSA). Under that 
program, TSA, not the airport or the airlines, is required to contract 
with a private screening company at the selected airports.
    Second, under 49 U.S.C.  44920, Congress authorized a ``security 
screening opt-out program'' beginning November 19, 2004, under which 
airports can ``opt out'' of the Federal screening program and have 
security screening performed by qualified private screening company 
under a contract with the TSA rather than Federal screeners.
    Kansas City applied for participation in the pilot program in May 
2002 and was selected on June 10, 2002, as one of the five airports to 
participate in the pilot program, also known as PP5, along with San 
Francisco, Rochester, Tupalo, and Jackson Hole. These airports 
represented a balanced cross-section of the different airport security 
risk categories.
    At the end of the pilot program, Kansas City had the automatic 
right to ``elect to continue to have screening carried out by screening 
personnel of a qualified private screening company'', and Kansas City 
enthusiastically chose to continue with private screening through the 
``opt-out'' program. Actually, all of the original five airports in the 
program have elected to continue this partnership.
    It is vitally important for Congress and TSA to recognize that a 
``one-size-fits-all'' approach to airport security would not work. 
There are vast differences in the physical layouts among the Nation's 
airports. One of the reasons we believe Kansas City International 
Airport was a perfect candidate for the pilot program was because of 
the airport's unique physical layout and the unique requirements for 
security facilities and personnel.
    Kansas City International Airport has three separate semi-circular 
passenger terminals. The airport was designed in the 1960's with the 
passenger convenience objective of shortening the distance between the 
terminal entrance and the points at which passengers board aircraft. 
Consequently, Kansas City International Airport is unique among major 
airports as it is configured so that the distance between curbside and 
boarding bridge is only 75 feet. This unique design minimizes the 
distance between curbside and gate, shortens the time between arrival 
and boarding, and maximizes customer convenience. The lack of a central 
concourse also creates the need for multiple security screening 
locations and does not allow for central security screening that is 
common with more modern airport designs.
    Although the airlines and our passengers are well-served by the 
current configuration, we are in the initial design-stage of a program 
to modernize Kansas City International Airport which, when completed, 
will have one large terminal, rather than three separate terminals. 
However, that project is many year away.
    Based on our nearly 10 years of experience under the private 
screening program, we think that the public-private screening program 
is very effective in providing high-quality service to our passengers 
at a level of security equal to, if not better than, the level that 
would be provided at the airport using Federal Government employees. It 
is a cost-effective program that can be used to increase private-sector 
job opportunities and reduce costs to the Federal Government. The 
private screening program at Kansas City has been a success and is a 
model for expansion of the public-private screening program for other 
airports throughout the country.
    Relying on private entities to perform critical safety and security 
missions is common. There are many safety and security functions 
carried out by private entities with strong Federal oversight. These 
include consumer products and medical products manufacturing, travel 
through the National airspace, physical security at Federal facilities 
(like the U.S. DOT and FAA, for example) are activities that are 
conducted by private companies. These products and services are 
important to the safety and security of U.S. citizens but are conducted 
by private entities under the appropriate supervision of Federal 
regulation, certification, inspection, and enforcement. There is no 
sound reason why screening services at U.S. airports cannot be 
delegated to private entities. We think that the public-private program 
has proved that it can be done so successfully, safely, and with the 
highest level of security.
    The ATSA statute ensures that the level of security provided under 
the private screening program remains high. This is because the law 
mandates that the level of screening provided at the airport under the 
contract program ``will be equal to or greater than the level that 
would be provided at the airport by Federal Government personnel.'' 49 
U.S.C. 44920(d)(1).
    The advantages of public-private screening can be summarized as 
follows:
   enhanced flexibility and efficiencies in personnel use and 
        deployment.
   greater flexibility to respond to increased or decreased 
        service requirements.
   greater flexibility to cross-train and cross-utilize 
        personnel.
   not subject to Federal employee ``hiring freezes'' and 
        employment caps.
   more effective in dealing with non-performers.
   less expensive to the Federal Government.
    Kansas City has been quite satisfied with the level of performance 
of the private screener at Kansas City International Airport--Firstline 
Transportation Security, Inc., a company with long-standing experience 
in providing security. The quality of screener performance is high and 
they have demonstrated a commitment to providing a high level of 
customer service while not sacrificing their over-arching security 
responsibilities.
    At the outset of the pilot program, we provided input to the TSA 
Federal Security Director on the critical goals and objectives for the 
private screening program, focusing on the external customer service 
issues, short lines, courteous behavior and professionalism, efficiency 
coupled with thorough and quality screening of our customers. Based 
upon the experience to date, the quality of performance of the private 
screeners has been very good. Kansas City is particularly conducive to 
a private screening workforce because of the need for flexibility to 
re-deploy screeners on short notice, to reschedule screener shifts to 
and from off-hours, and to add or delete screening checkpoints on short 
notice as airline services increase or decrease. In fact, several 
fellow airport directors have recently complained about a decrease in 
staffing and an increase in passenger wait times at their airports. I 
have the luxury in Kansas City of making one local phone call to 
resolve any issues and make immediate changes without the need to wait 
for a response from Washington.
    While we believe the program has worked well for Kansas City, there 
are a number of areas in the way TSA oversees the private security 
program that should be improved.
    First, TSA needs to be more flexible in its supervision of private 
screening companies so as to better foster improvements and innovation. 
The law provides for TSA oversight and requires that TSA ensures that 
the level of screening services and the protection afforded ``will be 
equal to or greater than the level that would be provided at the 
airport by Federal Government personnel.'' To fulfill that 
responsibility, TSA should set minimum levels of security standards and 
operational procedures, but give the private screeners the flexibility 
to provide the security in new, different, innovative, and creative 
ways. However, as we understand it, TSA requires Federal and private 
screeners to operate under the same procedures, including centralized 
procedures and facilities for screener hiring and assessments, and 
coordination or hiring through TSA headquarters. The law doesn't 
mandate a one-size-fits-all approach.
    Second, with respect to screener staffing, instead of establishing 
arbitrary staffing caps based on a system-wide staffing model, TSA 
should conduct staffing analysis and operational requirements for each 
specific airport. We believe that this approach does not effectively 
account for the unique requirements of each airport, including the need 
for part-time screeners. Again, one size doesn't fit all. For example, 
staffing requirements for Kansas City International Airport's, which 
does not have a single central security location but are spread 
throughout several terminals, will be markedly different than the 
requirements for airports that have centralized security screening 
facilities.
    Third, private screening companies should have the flexibility to 
vary compensation/benefits to enhance screener performance. The law 
requires only that the private screeners receive compensation and 
benefits ``not less than'' Federal screeners, but private screening 
companies should have flexibility to develop their own compensation 
plans--especially when comparing the cost of living in areas such as 
New York with the Midwest.
    Fourth, there needs to be greater coordination with the airport 
operator. While TSA has the ultimate legal and operational 
responsibility for screening, more can be done to get the airport 
operator's input in the operational procedures, staffing, and other 
critical activities.
    Fifth, screening companies must be selected on the basis of 
technical capabilities, performance and not just on cost. When our 
long-term private screening company's contract expired, TSA selected 
another company in large part based on price. That company TSA selected 
did not match the incumbent's experience and technical capabilities. 
These decisions simply should not be based primarily on cost otherwise 
we will return to the system that existed pre-9/11 where contracts were 
generally awarded to the lowest-cost bidder, with employees paid at 
minimum wage, lacking experience, critical skills, and performance 
incentives. The low-cost bidder would be hard-pressed to retain 
experienced workers because of the need to reduce salaries/staff. And, 
TSA never asked Kansas City for our input on the incumbent's prior 
performance. The TSA's decision was challenged and eventually 
overturned by the United States Court of Federal Claims. Firstline 
Transportation Security, Inc. v. United States, No. 11-375C, issues 
September 27, 2011.
    In conclusion, the public-private airport screening program has 
worked well and has demonstrated that under appropriate circumstances 
private screeners under the direct control and supervision of the TSA 
will provide high levels of security, on an efficient and cost-
effective basis, with enhanced customer service.
    Mr. Chairman, this concludes my prepared remarks and I would be 
pleased to address any questions you and the Members of the 
subcommittee may have. Thank you for this opportunity to present Kansas 
City's views on this important topic.

    Mr. Rogers. Thank you, sir. I appreciate that.
    The Chairman now recognizes Mr. Amitay for his opening 
statement.

   STATEMENT OF STEPHEN D. AMITAY, ESQ., FEDERAL LEGISLATIVE 
      COUNSEL, NATIONAL ASSOCIATION OF SECURITY COMPANIES

    Mr. Amitay. Chairman Rogers, distinguished Members of the 
subcommittee. As the Chairman said, my name is Stephen Amitay, 
and I am Federal legislative counsel to NASCO, the National 
Association of Security Companies. Founded in 1972, NASCO is 
the Nation's largest contract security trade association, and 
NASCO works with legislators and officials at every level of 
government on issues that affect the use of private security. 
NASCO strives to increase awareness and understanding of the 
important role of private security in safeguarding persons and 
property, and supporting law enforcement and government 
entities. At the same time, NASCO has been the leading advocate 
for raising standards for the licensing of private security 
officers and for firms. Across the Nation, almost 2 million 
armed and unarmed security officers are employed by private 
companies. Private security is providing protection and 
screening of employees and visitors at thousands of Federal 
facilities, including DSA and TSA headquarters, CIA and FBI 
offices, NASA launch sites, Federal courthouses, National labs, 
and National heritage sites.
    Private security officers are also on duty at numerous U.S. 
military installations. Private security protects the vast 
majority of critical infrastructure facilities in the United 
States. Today's hearing addresses the use of private companies 
to provide passenger and baggage screening at U.S. airports 
under the Screening Partnership Program, SPP. More 
specifically, the subcommittee is examining why, after 9 years 
of a successful partnership with private screening companies, 
TSA now believes the expansion of the SPP program will 
essentially inhibit TSA's ability to provide effective aviation 
security.
    First off, the stated justifications for this new non-
expansion policy relating to potentially lessened ability to 
modify procedures, redeploy screeners, and distribute 
intelligence are alternatively unsubstantiated, or as Mr. 
Pistole stated last week, can be addressed through contract 
modifications. Furthermore, while anyone can come up with 
fanciful what-if scenarios, there is absolutely no tangible 
evidence in the almost 10-year history of the SPP that an SPP 
contractor has not effectively served the needs of the TSA.
    For instance, when TSA virtually overnight implemented the 
3-1-1 liquid and gel screening procedures at all airports, the 
SPP contractors were right on top of it. There is no indication 
that the TSA's needs cannot be similarly met in the future by 
private companies if the SPP expands. As to the more general 
issue of whether private screeners should be used at all at 
U.S. airports, which was a major focus of last week's hearing, 
putting aside that using private screeners allows TSA to focus 
more on aviation security and less on personnel management, 
putting aside that private companies are more adept at screener 
management and motivation, hiring, and retaining employees, and 
are much more customer-service focused, which also has a 
security benefit, putting aside that all cargo screening in the 
United States is done by private companies under TSA oversight, 
putting aside that virtually all other Western countries have 
determined that private screening under Federal oversight is 
the most effective screening model, and putting aside that if 
TSA was ever able to account for all its costs and conduct a 
true cost comparison, it would find SPP airports to be less 
costly to operate than non-SPP airports, but for opponents of 
the SPP to claim that using private screeners is not as secure 
or effective as using Federal screeners is completely unfounded 
and contradicted by independent evaluations, covert testing, 
and TSA performance metrics.
    It came as no surprise then when credit for the TSA's 
decision to halt the expansion of the SPP was not claimed by 
aviation security experts, but by the union now representing 
Federal screeners. At a minimum, and I repeat a minimum, under 
the SPP, private screeners must meet the same employment 
screening, proficiency, and training requirements of Federal 
screeners. They must be provided compensation and benefits at a 
level no less than Federal screeners.
    Finally, the level of screening services and protection 
provided by the private screening company must be equal to or 
greater than the level that would be provided at an airport by 
Federal screeners. In fact, as is often the case, private 
screeners undergo more employment screening and training, their 
pay and benefits equal or exceed those of Federal screeners, 
and most significantly, as mentioned, covert testing, 
independent evaluations, and the awarding of contract 
performance bonuses provide clear evidence that the level of 
screening provided by private screeners is superior to that of 
Federal screeners. Therefore, for anyone to characterize the 
possible expansion of the SPP as a ``return to the pre-9/11 
screening workforce,'' such a statement not only defies 
credulity and shows a complete lack of understanding of how the 
SPP operates and is governed, but is also an insult to the 
highly-trained, hard-working men and women working as screeners 
at SPP companies.
    Passenger and baggage screening is not an inherently 
Governmental function. Like with many other complex services, 
qualified private screening companies possess the real-world 
experience, management, and cost accounting tools, flexibility, 
and motivation that allows them to provide equal or better 
service more efficiently than the Federal Government.
    From the experiences and lessons learned in the SPP, it is 
clear that the use of private screening companies has proven to 
be a viable and effective option for airports. Private 
screening can effectively be overseen by TSA. It is therefore 
unfortunate, and indeed ironic, that at a time with 
unprecedented interest and emphasis on Government efficiency 
and sustained and meaningful job growth that TSA is trying to 
limit and marginalize a successful public-private partnership 
that is exceedingly efficient, effective, and customer-focused.
    Far from ignoring the SPP and its mission to provide the 
best possible aviation security, the TSA should be embracing 
the SPP. Private security companies stand ready to work with 
TSA to improve passenger and baggage screening at U.S. 
airports. Thank you.
    [The prepared statement of Mr. Amitay follows:]
                Prepared Statement of Stephen D. Amitay
                            February 7, 2012
                       nasco and private security
    NASCO is the Nation's largest contract security trade association, 
whose member companies employ more than 300,000 security officers. 
Across the Nation almost 2 million private security officers, both 
contract and proprietary are at work protecting (and often screening 
persons and bags) at Federal buildings, courthouses, military 
installations, critical infrastructure facilities, businesses, schools, 
and public areas. In addition, as the Screening Partnership Program 
(SPP) has demonstrated, private companies are also effectively 
providing passenger and baggage screening services to U.S. airports. 
Formed in 1972, NASCO strives to increase awareness and understanding 
among policy-makers, consumers, the media and the general public of the 
important role of private security in safeguarding persons and 
property. At the same time, NASCO has been the leading advocate for 
raising standards for the licensing of private security firms and the 
registration, screening and training of security officers. At every 
level of government, NASCO has worked with legislators and officials to 
put in place higher standards for companies and officers. As the 
recognized source of information and views for the contract security 
industry, NASCO regularly holds seminars and other events for industry 
which provide a forum for information and interaction with Members of 
Congress, Congressional staff, Federal officials, legal and policy 
experts on issues and activities affecting the private security 
industry. NASCO recently formed a ``Government Security Contractor 
Caucus'' to widen and strengthen its efforts to improve the working 
relationship between Federal agencies and private security companies 
and since the inception of the SPP, NASCO has worked with companies and 
policy-makers involved and interested in the program. Most 
significantly, over the past several years NASCO has been very active 
in working with Congress and the Federal Protective Service (FPS) to 
strengthen the ``public-private partnership'' that is the FPS Contract 
Guard Program.
                         background on the spp
    After 9/11 Congress passed the Aviation and Transportation Security 
Act (ATSA), which stood up TSA and authorized it to assume 
responsibility for security in all modes of transportation, including 
the creation of a Federal workforce to conduct passenger and baggage 
screening at U.S. airports. However, Congress did not make a blanket 
judgment that in going forward with more stringent airport screening 
only a Federal workforce could provide effective screening. As such, 
the ATSA also required TSA to set up a parallel screening program (the 
SPP) that would allow airport operators to ``opt out'' of using Federal 
screeners. Instead, these airports could have their screening conducted 
by personnel from a qualified private screening company chosen by TSA 
operating under strict Federal standards, supervision, and oversight. 
The SPP was made available to all U.S. airports in November 2004, after 
a required 2-year SPP pilot program involving five airports, one from 
each of the five ``airport security risk categories.''
    Currently, sixteen airports, including all five of the airports in 
the original pilot program, have opted out of the use of Federal 
screeners with the largest being San Francisco International Airport 
(SFO) in California and Kansas City International Airport (KCI) in 
Missouri.
    For a company to be ``qualified to provide screening services'' 
under the SPP, the company must only employ individuals ``who meet all 
the requirements applicable to Federal Government personnel who perform 
screening services at airports.'' The company must ``provide 
compensation and other benefits to such individuals that are not less 
than the level of compensation and other benefits provided to such 
Federal Government personnel.'' Finally, a private company can only 
provide screening at an airport if TSA determines and certifies to 
Congress that ``the level of screening services and protection provided 
at the airport under the contract will be equal to or greater than the 
level that would be provided at the airport by Federal Government 
personnel.''\1\
---------------------------------------------------------------------------
    \1\ Aviation Transportation and Security Act, Section 108, 49 USC 
44920.
---------------------------------------------------------------------------
    To reiterate, at airports where private screening companies are 
used: (1) The screeners at a minimum have met the same employment 
screening, proficiency, and training requirements of Federal screeners, 
(2) the screeners are provided compensation and benefits at a level no 
less than Federal screeners (in fact on its website TSA states that it 
has ``conducted an extensive review of the private contractors and 
found overall the private screening companies are providing pay and 
benefits that equal or exceed the pay and benefits provided by the 
Federal Government''),\2\ and (3) the level of screening services and 
protection provided by the company must be equal to or greater than the 
level that would be provided at the airport by Federal screeners. 
Therefore, when John Gage, the head of the AFGE which represents 
``competing'' Federal screeners, characterizes the SPP as ``a return to 
the pre-9/11 screening workforce of low paid and poorly trained non-
Federal employees'' such criticism defies credulity and shows a 
complete lack of understanding of how the SPP operates and is 
governed.\3\
---------------------------------------------------------------------------
    \2\ TSA website, ``Screening Partnership Program'' FAQs. http://
www.tsa.gov/what_we_do/optout/spp_faqs.shtm.
    \3\ The TSO Voice; January 20, 2010.
---------------------------------------------------------------------------
    Furthermore, the inference that the use of private screeners at 
airports allowed for the tragedy of 9/11 to take place is plain wrong. 
FAA regulations in place on 9/11 permitted the weapons the terrorists 
used to take over the planes to be brought on board, and the 9/11 
Commission Report found that each security layer relevant to 
hijackings--intelligence, passenger prescreening, checkpoint screening, 
and onboard security--was seriously flawed prior to 9/11.
    In fact, over the past 9 years since airports have been using 
private screeners under the SPP there is considerable evidence from 
covert testing results, GAO reports, independent evaluations, reports 
from airport operators, anecdotal information, and other sources that 
the public-private partnership of utilizing private screeners under 
Federal regulation and oversight is a superior and more cost-effective 
security option for airports than using Federal screeners.\4\
---------------------------------------------------------------------------
    \4\ See House Committee on Transportation and Infrastructure 
Oversight and Investigations, Staff Report: TSA Ignores More Cost 
Effective Screening Model, June 3, 2011, [hereinafter T&I SPP Report].
---------------------------------------------------------------------------
                       tsa resistance to the spp
    TSA has described the SPP as a way ``to benefit from private 
expertise and know how.''\5\ Accordingly, during the pilot and the 
first several years of the program the screening companies involved 
truly felt the SPP was being used by TSA as a ``laboratory'' to see how 
the private sector could help improve and innovate airport screening 
and the management of screeners. TSA would both bring SPP company 
officials to Washington and send TSA ``tiger teams'' to SPP airports to 
observe and learn about the screening methods and operations of the 
companies. In 2007, TSA even encouraged some smaller airports in 
Montana to apply to join the SPP, as the rigid TSA staffing model was 
inefficient to staff those airports. Even as recently as 2009, in 
awarding an SPP contract to continue private screening for Roswell Air 
Center in New Mexico, the TSA Federal Security Director overseeing the 
airport called it an ``excellent example of an effective public-private 
partnership'' and he ``looked forward to working'' with the private 
screening company.\6\ However, while TSA has never fully embraced the 
SPP, as the title of today's hearing notes, this public-private 
partnership is now (and has been for the last couple years) 
encountering serious resistance at TSA.
---------------------------------------------------------------------------
    \5\ http://www.tsa.gov/what_we_do/optout/what_is_spp.shtm.
    \6\ TSA Press Release; ``Private Screening Contract Awarded for 
Roswell International Air Center'' July 16, 2009.
---------------------------------------------------------------------------
    TSA resistance related to the SPP and SPP companies has taken many 
forms. There are no more ``lessons learned'' meetings with SPP 
companies. The process for SPP companies to submit innovations to TSA, 
a component of SPP contracts, is now ignored or ideas are summarily 
dismissed as unworkable. While the level of communication between SPP 
companies and local TSA officials, program managers, and contracting 
officials remains high, the flow of information from TSA headquarters 
to screening companies, and airports, has diminished. The ability for 
the screening companies, airports, and TSA to work together has been 
limited by a lack of TSA sharing of important performance and service 
data and the agency often taking a ``my way or the highway approach'' 
to doing things. In addition, as TSA gets more secretive and guarded 
with its information, TSA is now seeking to limit the ability of SPP 
companies to share information. In a recent SPP contract, TSA, without 
any notice or explanation, inserted a provision that prohibits the SPP 
from publicly disseminating ``any information, oral or written, 
concerning the results or conclusions made pursuant to the 
performance'' of the contract ``without prior written consent of the 
Contracting Officer.'' This includes seminars, professional society 
meeting/conferences, and even requests for information from Congress. 
Before this ``gag order'' was put in place, SPP companies were already 
prohibited from releasing protected Government information under both 
previous contract language and various Federal laws. Given the 
broadness of this clause, SPP companies are now reticent to discuss 
almost any aspect of their performance with anyone without first 
receiving TSA's written permission. This could severely restrict the 
amount of information available to airports, Congress, and the public 
about the SPP.
    TSA's mishandling last year of the SPP contract award for the 
Kansas City airport could also be seen as resistance to the SPP or 
perhaps just incompetence. Either way it showed an irrational lack of 
consideration for quality service. TSA was required to make the award 
based on a ``best-value analysis tradeoff'' using price and six non-
price factors. However, the U.S. Court of Federal Claims determined 
that the TSA award was ``essentially made on a lowest-cost technically 
acceptable basis not pursuant to the best-value determination required 
by the RFP.''\7\
---------------------------------------------------------------------------
    \7\ FirstLine Transportation Security Inc. v. United States, 2011 
U.S. Claims LEXIS 1945 (September 27, 2011).
---------------------------------------------------------------------------
    In ordering the award to be stopped, the Court concluded that it 
was ``clear that the Source Selection Evaluation Board failed to 
account for the significant differences between the competing proposals 
with respect to technical quality including the four most important 
technical evaluation factors in the tradeoff analysis (Management 
Approach, Screening Services, Security Training, and Pre-Transition/
Transition).'' In addition, the losing proposal was assigned 33 
strengths and not a single weakness, while winning proposal received 
only one strength and one weakness. It goes without saying that it is 
in the public's best interest for TSA to properly award airport 
screening contracts using a ``best value'' analysis, which places a 
premium on performance capabilities as opposed to a ``low price 
technically acceptable'' basis.
    The greatest TSA ``resistance'' though related to the SPP though is 
the now year-old TSA policy that it will not approve new airports for 
the SPP unless there can be demonstrated a ``clear and substantial 
advantage'' to do so. This new policy was announced in the wake of the 
denial of 5 SPP airport applications for which TSA provided no details. 
It was also preceded by attempts of TSA officials, from the 
administrator on down, to discourage airports from joining the SPP.\8\
---------------------------------------------------------------------------
    \8\ Even though the current TSA administrator has not been known to 
have ever visited any SPP airport since assuming his position, as 
documented in the House T&I SPP Report, he did make a visit to the 
Sanford Orlando Airport to try to personally talk the airport director 
out of joining the SPP.
---------------------------------------------------------------------------
    While a plain reading of ATSA language governing the SPP gives TSA 
complete discretion in approving application (``The Under Secretary may 
approve any application submitted . . . ''); nonetheless, the intent of 
Congress seemed clear that if a screening company could provide a level 
of services and protection equal to or greater than that of Federal 
screeners, and the airport making an application had a good safety and 
security record, then that airport would be accepted into the program. 
While TSA never embraced the SPP, this interpretation of the SPP 
statutory language was followed by TSA--until last January. Essentially 
now, airports are cut off from the SPP.
    The vague justifications provided for the new policy relating to 
agility, cohesive and intelligence sharing, as will be discussed later, 
are alternatively unsubstantiated or can be addressed through TSA 
working with SPP companies and modifying SPP contracts. And to no 
surprise, credit for this new dubious policy was not claimed by 
aviation security experts but by the union now representing Federal 
screeners.
    Fortunately though, help is on the way for new airports wishing to 
join the SPP and benefit from more effective, efficient, and customer 
service-oriented private screening companies. Under the FAA 
Reauthorization bill about to be enacted, Congress has amended the ATSA 
to add criteria and time lines under which the administrator must act 
in considering SPP applications. Specifically, TSA:

``Shall approve an application submitted by an airport operator under 
subsection (a) if the Under Secretary determines that the approval 
would not compromise security or detrimentally affect the cost-
efficiency or the effectiveness of the screening of passengers or 
property at the airport.
``Shall provide to the airport operator, not later than 60 days 
following the date of the denial, a written report that sets forth the 
findings that served as the basis for the denial; the results of any 
cost or security analysis conducted in considering the application; and 
recommendations on how the airport operator can address the reasons for 
the denial.''\9\
---------------------------------------------------------------------------
    \9\ H.R. 658, FAA Reauthorization and Reform Act of 2011, Section 
830. APPROVAL OF APPLICATIONS FOR THE AIRPORT SECURITY SCREENING OPT-
OUT PROGRAM.

    The Act also give airports a voice as to which qualified screening 
company would best meet its screening needs and the Act gives the 
administrator the discretion to waive the SPP requirement that a 
screening company be ``owned and controlled by a citizen of the U.S.'' 
in the case of U.S. subsidiaries ``with a parent company that has 
implemented a foreign ownership, control, or influence mitigation plan 
that has been approved by the Defense Security Service of the 
Department of Defense.''
    The expected results of these changes to the SPP seem clear. More 
applying airports will be accepted into the SPP in a timely fashion 
with more qualified screening companies available to them. As described 
below, it seems virtually impossible based on the past and current 
performance of screening companies in the SPP that the administrator 
will reasonably determine that using a private screening company will 
``compromise security or detrimentally affect the cost-efficiency or 
the effectiveness of the screening'' at an airport. We will soon find 
out though as FAA bill also requires the TSA to reconsider those 
applications that were pending before it limited the program and denied 
five applications last January.
              merits of the screening partnership program
    The merits and effectiveness of the Screening Partnership Program 
and a public-private partnership for airport screening can be viewed on 
policy, operational, and other levels.
    On a policy level, with private companies doing airport screening, 
TSA is not both the regulator and operator. The reasons supporting 
lessening TSA's direct role and conflicting mission in screening are 
two-fold. First, the enormous task of managing the 50,000 or more TSA 
employees involved in airport screening diverts and denigrates TSA's 
ability to focus on critical transportation security-related functions 
such as setting security standards, technology adoption, conducting 
risk management analyses, performing oversight, enforcing standards and 
regulations, analyzing intelligence, auditing screening operations, and 
doing more to stop aviation-related terror before the terrorists get to 
the airport. Second, as the entity both conducting the screening and 
overseeing the screening, there are inherently greater risks of poor 
screener performance going uncorrected or even worse being encouraged 
or covered up by management.
    Last year an investigation at Hawaii's Honolulu International 
Airport uncovered a massive on-going security breech involving improper 
(lack of) screening of checked bags for explosives. Forty-five TSA 
workers at the airport were fired or suspended including screeners, 
their supervisors, and the Federal Security Director. The TSA screeners 
claimed they were forced to abandon required screening practices 
because of TSA management pressure. Could TSA managers at an SPP 
airport, operating at ``arm's length'', be able to pressure a private 
screening company to abandon required screening practices putting the 
company in clear default of its entire contract? Not likely. The 
potential loss of a contract and hundreds of jobs is a strong incentive 
for a company, and everyone in the company, to make sure that all 
employees are compliant with the requirements of the contract. At the 
Hawaii airport, the malfeasant Federal screeners, managers, and 
security director were simply replaced by other Federal employees.
    On an operational level, the reasons why using private screeners is 
more effective and efficient are numerous and well-documented. While 
private and Federal screeners are required to meet the same minimum 
training/screening standards and are compensated comparably, there are 
many advantages in using private screeners and private screening 
companies. In providing many services, the private sector is much more 
innovative, efficient, and effective than the Federal sector and 
airport screening is no exception. The same can be said for the 
managing of such services.
    Private screening companies at SPP airports have come up with 
numerous innovations, some which TSA adopted Nation-wide, and are doing 
things to improve screener quality and performance (and airport 
satisfaction) that TSA does not or cannot do. SPP companies came up 
with better configurations for processing passengers through screening. 
An SPP company came up with dual functioning screeners (certified for 
both checkpoint and baggage screening), which facilitated flexibility 
in scheduling. To address widespread baggage screener injuries and 
related costs, an SPP company created a non-certified position assigned 
only to lift bags for the certified baggage screeners (significantly 
reducing screener injuries and workers compensation costs). At a 
Federalized airport a new OPM job classification would first be 
required. SPP companies employ full-time health and safety 
professionals on-site to investigate and study injuries and devise ways 
to mitigate them. SPP companies competitively bid for materials and 
support services. Screeners that are better at image recognition are 
paired with new screeners in a ``mentor'' arrangement. SPP companies do 
their own covert testing of screeners in addition to TSA coverts tests 
and provide remedial training on-site--something that TSA cannot 
provide.
    In terms of better hiring and retention of screeners, SPP companies 
also do many things that TSA does not or cannot do. In hiring 
screeners, SPP companies do their own local recruiting and screen 
applicants before submitting them for the formal TSA screening process. 
Even after a prospective screener passes the TSA screening process, he 
or she can still go through a company interview with supervisors before 
being hired. At airports using Federal screeners, screeners can show up 
for work, sight-unseen, already hired. The additional screening that 
SPP companies apply to the recruitment process results in more 
successful new-hire completion rates and on-going on-the-job success. 
At Federal airports, TSA headquarters sets compensation for screeners 
and managers and screeners have no real financial incentives to perform 
beyond the minimum requirements and barring the commission of a crime 
or serious violation of standards, Federal screeners and managers--like 
all Federal workers--have great job security.\10\
---------------------------------------------------------------------------
    \10\ Dennis Cauchon ``Some federal workers more likely to die than 
lose jobs'' USA TODAY July 19, 2011. Recently, a TSA screener who was 
caught on tape stealing $5,000 in cash from an air passenger's jacket 
at a TSA screening checkpoint and was arrested for grand larceny was 
``suspended pending investigation.'' At an SPP company, that screener 
would be ``suspended pending termination'' and likely be fired much 
sooner than at TSA. SPP companies, while in compliance with all DoL 
standards, have considerably more capability to discipline 
progressively and remove ineffective employees than TSA.
---------------------------------------------------------------------------
    At SPP airports, the screening operation is a business, and better 
performance is good for business both tangibly (award fees) and 
intangibly (reputation and future business). SPP company site mangers 
are very vested in hiring the right people, monitoring performance, and 
striving for better-than-average performance. Bonuses are provided for 
perfect attendance and robust attendance policies are maintained 
(recognizing that just one late screener can prevent the ``critical 
mass'' needed to open a check point). Does TSA even have an attendance 
policy for its screeners? Private screeners can also be immediately 
counseled and can be provided with remedial training if needed. A 
culture of cohesion and teamwork within the workforce and peer 
expectations are encouraged.
    SPP companies also use a pre-hire physical testing protocol coupled 
with other working initiatives that minimize on-the-job injuries, and 
allow for faster return to work and lower workers compensation rates. 
SPP companies will provide monetary and other incentives to retain 
screeners. SPP companies fully realize that a stable workforce is more 
efficient, effective, and motivated. The House T&I SPP Report 
calculated that the turnover rate at the non-SPP LAX airport was 13.8% 
compared to 8.7% at the SPP San Francisco (SFO) airport.\11\ Supporting 
the notion that TSA is not as effective at managing/motivating/
retaining its screener workforce is the recent ranking of TSA at 232 
(out of 240) as the ``Best Places to Work'' in the Federal 
Government.\12\
---------------------------------------------------------------------------
    \11\ Id at Appendix I.
    \12\ http://bestplacestowork.org/BPTW/rankings/detail/HS10.
---------------------------------------------------------------------------
    A major advantage that SPP companies have over TSA is in scheduling 
and managing its screener force. At Federally screened airports, the 
number of full-time and part-time screeners (actually FTE's) is 
dictated to TSA airport directors by TSA headquarters. At SPP airports, 
the SPP company site manager can hire more screeners as needed in order 
to meet the contract requirement for total screener hours. They can 
more flexibly schedule screeners in ways to provide better service 
without increasing costs. For instance, at most larger airports, the 
terminals are open for 20 hours. Under TSA's staffing model, this would 
require two full-time screeners at 8 hours per shift and one part-time 
screener for 4 hours to staff the position, with all three screeners 
receiving fixed benefits. On the other hand, at one SPP airport with 
such terminal operating hours, the SPP company is able to schedule two 
screeners at two 10-hour shifts reducing personnel and costs. TSA does 
not utilize such an option.
    For most airports, the No. 1 concern is wait time and SPP companies 
are much attuned to this concern. SPP companies use sophisticated 
airline industry-based scheduling tools, which efficiently schedule and 
manage staffing in real-time. They make the screening schedules and can 
make pinpoint adjustments using optimization software and airline data. 
They have decision support systems that allow managers to be proactive. 
Scheduling is also tied in directly with payroll, HR, and training 
systems, which ensure full visibility of manpower resources. For TSA, 
effective and efficient scheduling is a problem due to centralization 
of the scheduling system and institutional inflexibility. Airports are 
told when to open lanes and checkpoints with little local TSA (or 
airport) input. As evidence of the scheduling problems at TSA, in 2008 
the DHS Inspector General found that TSA is ``overly reliant on the 
(National mobile) deployment force to fill chronic staffing shortages 
at specific airports in lieu of more cost-effective strategies and 
solutions to handle screening demands.''\13\ In the House T&I SPP 
Report, it was estimated that SPP screeners (based on a comparison 
between two similarly-sized airports) are 65 percent more efficient 
than their TSA Federal counterparts.
---------------------------------------------------------------------------
    \13\ DHS OIG Report ``The TSA National Deployment Force'' April 
2008. OIG-08-09.
---------------------------------------------------------------------------
    While private screeners and private screening companies are more 
efficient, there is also a strong case to be made that they are more 
effective. While not much data is publicly made available, from what is 
available, screener performance is better at SPP airports than non-SPP 
airports. In 2007, USA Today uncovered covert TSA tests results that 
showed significantly higher screener detection capabilities at an SPP 
airport (SFO) than at a comparably-sized non-SPP airport (LAX). 
According to the test results, investigators successfully smuggled 75 
percent of fake bombs through checkpoints at Los Angeles International 
Airport . . . and 20 percent at San Francisco International 
Airport.''\14\ As reported by the GAO in a 2009 report, in December of 
2007, Catapult Consultants issued a report to TSA (which was never 
publically released) that found private screeners performed at a level 
that was ``equal to or greater'' than that of the average Federal 
screeners. TSA was also advised to ``explore the use of the SPP model 
as a tool to improve performance at low-performing fully Federal 
airports.''\15\ In addition, in SPP contracts, TSA measures a company's 
performance against the average performance of airports in the same 
category through a quality assurance surveillance plan (QASP). In order 
for a company to get an award fee they must score higher than the 
Federal average. In other words, SPP companies simply cannot meet the 
goal, they must exceed the performance metric in order to earn their 
award fee. SPP companies consistently earn award fees meaning they are 
consistently exceeding the average performance of similar non-SPP 
airports. This accords with the ATSA requirement that in order for an 
SPP company to maintain its contracts/certification it must be equal to 
or better in performance than similar Federal airports.
---------------------------------------------------------------------------
    \14\ Thomas Frank, ``Most Fake Bombs Missed by Screeners'', USA 
Today, Oct. 22, 2007.
    \15\ Government Accountability Office, Aviation Security: TSA's 
Cost and Performance Study of Private-Sector Airport Screening (Jan. 9, 
2009) (GAO-09-27R).
---------------------------------------------------------------------------
    Private screening companies are also cost-efficient. A commonly-
cited, yet thoroughly debunked, alleged disadvantage of the SPP is that 
it costs more to use screening companies at Federal airports than it 
does Federal screeners. The source of this allegation is a 2007 
internal TSA estimate that SPP airports would cost about 17 percent 
more to operate than airports using Federal screeners. A GAO review of 
that estimate found its methodology to be severely flawed and TSA 
agreed to redo the estimate using better data and methods. In January 
2011, TSA released a revised estimate that SPP airports would cost 3 
percent more to operate SPP airports.\16\ Even then, the renewed 
estimate only partially addressed four of seven ``cost analysis 
limitations'' that the GAO had identified.\17\ In addition, adjustments 
TSA made to calculate workers compensation, liability insurance, 
retirement cost, and revenue generated from corporate income taxes were 
only ``generally accepted'' by GAO and never substantiated. Data on the 
costs of deploying TSA National Deployment Force was also lacking from 
the estimate. In fact, TSA has no idea of the exact costs of screener 
operations at Federally-screened airports while SPP companies know 
their costs to the penny.
---------------------------------------------------------------------------
    \16\ To no surprise, even after TSA revised its estimate to 3% the 
AFGE continued to use the discredited 17% figure. See AFGE press 
release ``AFGE's Efforts Put SPP on Ice TSA Ends Expansion of Airport 
Privatization Program'' January 19, 2011.
    \17\ GAO Letter to Congress ``Aviation Security: TSA's Revised Cost 
Comparison Provides a More Reasonable Basis for Comparing the Costs of 
Private Sector and TSA Screeners'' March 4, 2011.
---------------------------------------------------------------------------
    TSA also has refused to address the wasteful issue of duplicative 
staff at SPP airports. In 2007, an independent evaluator hired by TSA 
recommended that TSA ``(e)xplore reducing the redundant general and 
administrative and overhead costs at SPP airports.'' However, a 2009 
GAO study found that TSA has ``not consider[ed] the impact of 
overlapping administrative personnel on the costs of SPP 
airports.''\18\ And while TSA has told Congress more recently that it 
has addressed the issue of duplicative staffing, Congressional 
investigators continue to find multiple instances of TSA employees 
holding similar or identical positions to those held by the private 
screening company at the airport.\19\
---------------------------------------------------------------------------
    \18\ See footnote 9, GAO-09-27R).
    \19\ T&I SPP Report, page 25.
---------------------------------------------------------------------------
    It is very likely that under a detailed analysis, TSA would find 
the cost of operating an SPP airport to be less expensive than an non-
SPP airport, and in fact House T&I SPP Report found that taxpayers 
would save $1 billion over 5 years if the Nation's top 35 airports 
operated as efficiently as the San Francisco International airport 
under the SPP program.
    Greater effectiveness and efficiency are not the only advantages in 
using private screeners, another demonstrable advantage--one that TSA 
does consider a performance metric--is customer service and 
accountability. At SPP airports, while TSA is the client, the airport 
is the customer as are the passengers. Better customer service also has 
a security benefit. Avoiding incidents and maintaining a calmer 
passenger base makes it easier for screeners and behavior detection 
officers to spot aberrant behavior. SPP companies realize the value of 
customer service and they teach and reinforce customer service 
constantly. Even with the difficult protocols, SPP screeners are taught 
to implement them with customer service empathy. It is no surprise that 
Kansas City International Airport, an SPP location has earned the J.D. 
Power and Associates award for highest customer satisfaction of all 
medium-sized North American airports twice in the last 4 years. 
Security checks provided by the SPP contractor were cited as a critical 
factor in making both awards. That airport's screening services as well 
as other SPP companies have garnered much praise from their airport 
directors for customer service and other innovations that have improved 
screening operations.\20\ For those airports wanting to join the SPP, 
greater customer service and greater accountability are major reasons. 
Said one airport official whose airport had applied to the SPP, ``As we 
have documented, TSA employees frequently have no concern for customer 
service. We feel that participating in the SPP will increase screening 
efficiency and flexibility and improve the customer service 
experience.''\21\ Critics of the SPP also try to fall back on the 
dubious claim that airport screening is an inherently Governmental 
function ``so intimately related to the public interest'' that Federal 
personnel must provide it.\22\ Putting aside that allowing airports to 
use non-Federal screeners is required under the ATSA, and putting aside 
the evidence that private screeners are more effective than Federal 
screeners, there is virtually no legal, policy, or practical support 
for the argument that passenger and baggage screening is inherently 
Governmental.
---------------------------------------------------------------------------
    \20\ See T&I SPP Report. Appendix 12 SPP Testimonials.
    \21\ May 20, 2011 Letter to House T&I Committee from Springfield-
Branson National Airport.
    \22\ As defined in Section 5 of the Federal Activities Inventory 
Reform Act ``inherently Governmental function'' means a function that 
is so intimately related to the public interest as to require 
performance by Federal Government (Pub. L. 105-270).
---------------------------------------------------------------------------
    First off, assertions that a private screening company's desire to 
make a profit and reduce costs means its screeners will not perform as 
well as ``non-profit'' Federal screeners are not only outright false, 
but a specious accusation. While seeking to reduce costs and eliminate 
waste in operations is one way for a contractor to increase profits, 
what also increases a contractor's profits is better performance. 
Better performance translates into award fees and more contracts. Also, 
in the private sector, constant competition from other contractors 
creates an incentive to perform well, employ best practices, reduce 
waste, and seek to constantly improve. These performance and cost-
containment drivers (especially in the area of reducing overtime costs) 
are not present in the Federal sector and the Federal workplace is 
beset with its own host of employee performance and motivation issues.
    Second, in the area of security services, OMB has specifically 
defined as ``inherently Governmental'' security operations in certain 
situations connected with combat or potential combat.\23\ Accordingly, 
below this very high threshold, many types of security and screening 
services can and are being performed by contractors on behalf of the 
U.S. Government. Federal agencies have consistently and successfully 
utilized private security and screening services at Government 
facilities (including Level 4 and 5 secured facilities) and to protect 
Federally-regulated critical infrastructure sites. From DoD locations 
requiring Top Secret and above clearances to the Department of Homeland 
Security Headquarters, NASA launch sites, nuclear facilities, Federal 
Courts, military installations, and FBI offices around the country, the 
U.S. Government has relied upon contractors to provide security and 
screening across the spectrum of sites. Everyday, contracted officers 
protect, screen, and provide access control at sensitive sites to 
millions of visitors, U.S. Government employees and invited guests each 
day.\24\
---------------------------------------------------------------------------
    \23\ OMB Office of Federal Procurement Policy Publication of the 
Office of the Office of Federal Procurement Policy (OFPP) Policy Letter 
11-01, Performance of Inherently Governmental and Critical Functions.
    \24\ The United States has multiple sites around the country that 
are American Heritage sites and potential targets for terrorists 
interested in ``making a statement.'' One such site is the Statue of 
Liberty. This site is controlled by the U.S. Park Police in concert 
with a contract security firm who provides unarmed screeners to 
efficiently process up to 15,000 visitors per day. This requirement has 
multiple lanes of visitors flowing through magnetometers, hand wands, 
and X-ray machines, very similar to those processes used by TSA.
---------------------------------------------------------------------------
    Also, as documented in the House T&I SPP Report, in other countries 
where the danger of aviation terrorism is equally of great National 
concern ``Federal oversight of qualified private contract screeners has 
shown to be effective all over the world (and) almost all Western 
countries operate civil aviation security through the use of Federal 
oversight of private contract screeners. Other than Romania, Poland, 
and Bulgaria, the United States has the only government in the Western 
world that functions as the airport security operator, administrator, 
regulator, and auditor.''\25\
---------------------------------------------------------------------------
    \25\ House T&I SPP Report, page 15.
---------------------------------------------------------------------------
    And if the TSA and critics of the SPP do not feel that private 
companies are as effective as Federal screeners to prevent a terrorist 
act on an airplane, then why are they not similarly concerned about 
cargo screening? Currently, all cargo screening is conducted by private 
screeners in compliance with TSA procedures, processes, certifications, 
and standards--the same model of TSA oversight for passenger screening 
under the SPP. It would seem hypocritical for TSA to treat passenger 
and baggage screening as ``inherently governmental'' when the all of 
the cargo placed on commercial airlines is screened by private 
companies.
    Finally, TSA can and does provide effective oversight of private 
screening services. Among the tools that TSA uses to track screener 
performance are daily TSA manager reports, monthly Performance 
Management Reviews calculated against challenging metrics, and twice-
yearly award fee reviews also calculated against challenging 
performance metrics. TSA can be assured, and indeed constantly assures 
itself, that SPP companies perform at a very high level.
                       tsa concerns with the spp
    In the House T&I SPP Report, the operational justifications that 
Administrator Pistole and TSA used to limit the scope of the SPP 
program to the current airports are reviewed. They included: 
Administrative burden--disproportionate amount of resources are spent 
on SPP airports; Intelligence--TSA can tailor and provide direct 
information to Federal employees; Direct control--another layer is 
involved when FSDs order direction action; Flexibility and use of 
resources--TSA can use its own resources for emergency events, but 
cannot utilize SPP; and Impact on workforce--TSOs at potential SPP 
airports face uncertainty about their job status, benefits, leave, and 
salary.
    While the T&I Committee staff notes that SPP Program Office 
officials have informed them that TSA was amending SPP contracts to 
eliminate any existing challenges related to the operational concerns, 
some of these concerns are not even substantiated by the facts. For 
example, the ``intelligence concern'' is negated by the fact that the 
managers employed by the SPP companies undergo the same SECRET 
clearance process as TSA employees and are capable of receiving the 
same intelligence as their Federal counterparts. The question of the 
flexibility of resources for emergency events is negated by the fact 
that the SPP contracts currently include programs such as the TSA VIPR 
program that allows SPP contractors to provide additional security 
outside of the airports where they work and that TSA's SPP contracts 
already include a ``surge clause'' that allows the TSA to direct SPP 
contractors to immediately support emergency situations.
    As to the concern that allowing more SPP airports will hinder the 
``agility'' of TSA, SPP companies vigorously disagree with this notion. 
While perhaps their screeners cannot, ``on paper'' be currently 
deployed directly by TSA, in many past instances SPP companies have 
demonstrated their agility and responsiveness to address staffing 
emergencies and a change in procedures due to a heightened security 
risk. In fact, neither the TSA nor SPP critics can point to a single 
actual situation where a SPP contractor has been less agile than the 
TSA. And although anyone can come up with fanciful ``what-if'' 
scenarios, there is absolutely no tangible evidence in the almost 10-
year history of the SPP where an SPP contractor has not served the 
needs of the TSA and the flying public completely and absolutely. 
Finally, as with other Federal security service contracts, additional 
deployment of staff to meet emergency requirements can be built into 
those contracts to facilitate additional agility in meeting unforeseen 
needs.
                               conclusion
    Many airports are satisfied with their Federal screening force and 
the ATSA language establishing the SPP in no way pushes or even 
encourages airports to use private screening companies. However, it is 
clear that Congress wanted airports to at least have the opportunity to 
utilize private screening which by law has to be equal to or greater in 
the level of security provided. From the experiences and lessons 
learned in the SPP, it is clear that the use of private screening 
companies has proven to be a viable and effective option for airports, 
and private screening can be effectively overseen by TSA. It is 
therefore unfortunate and indeed ironic that at a time with 
unprecedented interest and emphasis on Government efficiency and 
sustained and meaningful job growth, the TSA continues its attempts to 
limit and marginalize a successful public-private partnership program 
that is exceedingly efficient, effective, and customer-focused. Far 
from ignoring the SPP, in its mission to provide the best possible 
aviation security, the TSA should be embracing it.

    Mr. Rogers. Thank you.
    Mr. Gage is recognized for 5 minutes.

STATEMENT OF JOHN GAGE, NATIONAL PRESIDENT, AMERICAN FEDERATION 
                    OF GOVERNMENT EMPLOYEES

    Mr. Gage. Thank you, Chairman Rogers, committee Members. 
Thanks for the opportunity to testify today. Also, Chairman 
Rogers, thank you, you have my thanks and Everett Kelley's 
thanks for your questions yesterday at the Armed Services 
Committee on behalf of Federal civilian workforce at Anniston 
Army Depot. Sir, the vital mission of air travel security is an 
inherently Governmental function. It is an important piece of 
an integrated National security system. It is no different than 
local, State law enforcement, the Federal Government's mission 
in securing our borders and ports of entry with Border Patrol 
agents and CBP officers, or even the mission of the U.S. 
Capitol Police to provide security for the U.S. Congress. It is 
disturbing that the Congress is moving to give the mission of 
providing air travel security to private corporations. The 
mission of corporations is to make profits for their 
shareholders. That is in direct conflict with the single-
focused mission of air travel security for Americans. 
Corporations belong in the private sector, where the focus on 
profits is appropriate. The real need to make profits 
inevitably leads to cutting corners on security. TSA will be 
significantly hampered by the fact that it would lose its 
fundamental security integration as one unit. Conceivably, 
privatization could mean hundreds of corporations at the 
airports, creating a nightmare for security coordination when 
speed and quick information sharing through the system is 
necessary. A hodgepodge of corporate entities will prevent TSA 
from acting quickly when it needs to do so.
    TSA will lose flexibility. For instance, TSOs will no 
longer be able to be deployed from one airport to another as 
they can do now. We are also concerned that the FAA legislation 
sponsored by Congressman Mica will allow corporations to be 
owned by foreigners or perhaps foreign governments. Outsourcing 
to foreign entities will undermine our security even further. 
Americans were outraged by the Dubai ports scandal, and they 
will be outraged when they learn of this giveaway.
    As Congresswoman Jackson Lee indicated, further 
privatization makes assuring internal security more complex and 
more costly. In addition to vetting of front-line officers, you 
have got to vet the company, vet the executives of the 
companies, vet the ownership, vet the financial structure of 
this, vetting their banks, if necessary. This becomes an 
intelligence and coordination nightmare, and would actually 
increase TSA's management cost. Then there is the cost of 
creating RFPs, reviewing contract proposals, and post-award 
litigation.
    As more airports become open to privatization, TSA will 
have to spend more resources on the initial bid and review 
process. Indeed, TSA will need hundreds of contracting 
officers, attorneys, and auditors. Conceivably every contract 
could be litigated into the courts, costing tens of thousands 
to defend each decision. Since the Congress has moved to 
privatize TSA, the corporations also should not be shielded 
from liability. I feel it is wrong to extend resources to cover 
claims. In summary, privatization will be more costly, will 
undermine air traffic safety and security. Corporations do not 
bring any added value. Their mission of profit is in direct 
conflict with the mission of protecting the flying public, and 
Americans will be at risk to a much greater degree. Thank you, 
Mr. Chairman.
    [The statement of John Gage follows:]
                    Prepared Statement of John Gage
                            February 7, 2012
    Chairman Rogers, Ranking Member Jackson Lee, and Committee members: 
On behalf of the American Federation of Government Employees, AFL-CIO 
(AFGE), thank you for the opportunity to testify today regarding the 
Screening Partnership Program (SPP) of the Transportation Security 
Administration.
    After the terrorist attacks on 9/11, America learned that the 
system of private screening companies and the private screeners in 
place on that fateful day were incompetent to perform the task of 
keeping terrorists off our passenger aircraft. As a result, Congress 
Federalized airport screening in recognition that the job of screening 
airline passengers and maintaining the security of the commercial 
aviation system was fundamental to our security as a Nation. Since 
then, our skies have been kept safe, despite constant threats.
    There isn't much that scares me. But the thought of returning to 
the days prior to 9/11, and to the expanded use of private contractors 
who are forced to cut corners to increase profits . . . that scares me.
    Aviation security is too important to be left to the private 
sector. I know the free-market advocates will recoil when I say that, 
but as we have seen over and over since 9/11, the terrorists will never 
quit trying to attack us. Private contractors must by their very nature 
keep their eyes on the bottom line. That consideration cannot help but 
bleed over into decisions on staffing, training, recruitment, 
retention, and operations. As a frequent flyer myself--and I know the 
Members of this committee are as well--it seems beyond question to me 
that we should want the Federal Government to continue to provide the 
focus, the consistency, and the stability that this mission requires. 
If we learned nothing else from 9/11, I would hope we learned that.
    SPP is not new, and the problems with SPP are not new. Airports 
have had the ability to ``opt out'' of the Federal screener system 
since TSA was created, but in those 10 years only a handful of 450 have 
chosen to do so. Opting out means opting in to the lowest bidder, which 
is not how homeland security should operate. It is too important to be 
left to companies that would not be accountable to the American people. 
There is no contracting out of the Secret Service, FBI, Border Patrol, 
Customs and Border Protection Officers, or the Capitol Police who 
protect Members of Congress and their staffs. Those agencies are all 
part of an integrated network designed to keep Americans safe. TSA 
should be no different. I think most Members of Congress would be 
reluctant to have the Capitol Police splintered into five or six 
private security companies, with each operating a different section of 
the Capitol complex.
    SPP is not about creating jobs as the topic of this hearing 
implies. TSA has created almost 50,000 jobs. These are good jobs, 
although the pay is still too low and working conditions need to 
improve. Moving these jobs to the private sector is, at best, a zero 
sum game after the private contractors take their profit off the top.
    The drumbeat to privatize security screening operations runs 
contrary to laws enacted by Congress in recent years requiring 
Government agencies to in-source functions that are inherently 
Governmental. Recent efforts to reform procurement practices at 
Government agencies and reduce their over-reliance on private 
contracting also argue against privatizing TSA's screening work.
    The Federal Government is obligated to the American taxpayers to 
perform its functions efficiently and spend taxpayer money wisely. 
Generally, before privatizing Federal employee work, agencies are 
required to demonstrate that a contractor is more efficient. Under 
TSA's Screening Partnership Program, the agency keeps the 
transportation screening managers but hires a contractor to create an 
additional layer of management, and converts the front-line homeland 
security Federal employees to contract workers.
    There is no doubt that TSA and its Federal screening workforce have 
protected our Nation from a repeat of the horror of 9/11. Rather than 
calling for the dismantling of an agency that is living up to its 
mission, despite constant challenges, proponents of private screeners 
should instead work to empower Federal screeners to do their jobs 
better. Only a well-trained, well-paid, fully empowered professional 
public workforce can provide the protection the American people need.
    TSOs receive constant and on-going training, including changing 
protocols or using new technology at a moment's notice to address new 
terrorist threats. These protocols can change from day-to-day or even 
shift-to-shift. The training TSOs receive is conducted by Government 
employees and based on threat detection and risk assessment from the 
Federal Government's National security, homeland security, and 
intelligence agencies. TSA may be required to renegotiate contracts 
when deploying new technology, resulting in delays, increased costs, 
and holes in the aviation security net. It is not credible that 
screeners working for private contractors have the same capability to 
adjust procedures to address emergent threats as TSOs working for 
Administrator Pistole.
    In conclusion, every single day America's patriotic TSOs are more 
than diligent at their duties because the last thing they want is for a 
terrorist to slip through on their watch. This is the same goal as TSA 
management. A TSO workforce with workplace rights and protections--
including the ability to have AFGE speak on their behalf--is empowered 
to report problems with procedures or gaps in security. The goal of 
keeping air travel safe for the flying public is mutual between TSA and 
its employees.
    Thank you again, Mr. Chairman, for this opportunity to address the 
issues surrounding SPP. I would be happy to answer any questions that 
you or the Members of the committee may have.

    Mr. Rogers. Thank you. You all did a great job. I recognize 
myself for the first questions. Mr. Amitay, Mr. Gage just made 
some pretty good observations that I would love to hear your 
thoughts on. For example, how do you make a profit when you 
have got to pay the exact same thing or more for your employees 
in an SPP program as the Government employees? Just address his 
comments. I am interested in your thoughts.
    Mr. Amitay. Chair, I think the primary cost saver for 
private companies doing screening as opposed to TSA is the 
ability of private companies to utilize cost accounting and 
management tools that either the Federal Government does not 
possess or does not even know how to utilize. It is in the 
oversight of its workforce and having to account to the last 
penny where private companies are much, much more efficient 
than TSA. For instance, take with the hiring and training 
process, the private companies are doing it more effectively so 
that, (A), it will be less expensive even though they are 
providing the same training if not more, and then (B), in their 
vetting process, they are selecting screeners who are more 
likely to stay, and therefore they are saving money on 
attrition costs.
    Then finally, another major area is overtime and workers 
compensation costs. These are costs that for the Federal 
Government are virtually unaccountable for, and are claimed at 
a much, much higher rate than with private companies.
    Mr. Rogers. What about Mr. Gage's assertion that this is an 
inherently Governmental function?
    Mr. Amitay. I completely disagree with that.
    Mr. Rogers. Why?
    Mr. Amitay. Because private security officers are, as I 
mentioned in my oral and written testimony, they are stationed 
and doing screening at DHS and TSA headquarters. They are doing 
screening of visitors and employees at cleared facilities, at 
top secret facilities. They have top secret clearances. They 
are doing screening at military installations. That is not an 
inherently Governmental function. Also, the recent OMB guidance 
on what is considered inherently Governmental did not mention 
at all these types of security services.
    Mr. Rogers. Okay. Mr. Gage, why is he wrong?
    Mr. Gage. Well, first of all, I think the profit motive 
there, I didn't hear Mr. Amitay really say anything 
specifically on how the private sector makes money off these 
service contracts. But if----
    Mr. Rogers. No, he did. He went through a litany of things. 
I am interested in why this is inherently Governmental, though.
    Mr. Gage. Well, it is, because it is part of an integrated 
National security--and it is not just the screening and the 
baggage checks, the BDOs, for instance, the people who walk 
the--I mean, there is a lot more being done there that you just 
can't--how do you coordinate that in 400 airports, 450 airports 
if you have all these private companies? You can't do screening 
operations in one airport different than in another.
    Mr. Rogers. But my understanding, and I may be in error, my 
understanding is all these SPP participants are under the 
supervision of TSA.
    Mr. Gage. That is true. But when there is 16, that is one 
thing. When there is hundreds, I think that is why Pistole is 
saying can't do it.
    Mr. Rogers. Okay. Mr. VanLoh, one of the things that Mr. 
Pistole pushed back on me, because as you know, I am a 
proponent of more of this privatization, one of the things he 
pushed back with me was to say, listen, there is not that much 
of a demand. We only had three airports ask, and we gave one of 
them the green light.
    So what do you say to that? Why are more airports not 
requesting to move in that direction?
    Mr. VanLoh. More airports are, I get that every week from 
fellow airport directors all around the country. There are 
about 400 of us in the United States that run airports of any 
size. Early on in the program, there was word out that if you 
privatized your screening and something happened, and somebody 
maybe got a weapon through and an aircraft went down, your 
airport would be sued out of existence. That scared a lot of 
cities away from this program. Well, that was false. That is 
not the case. Lately, a lot of airports were concerned about 
TSA's oversight going forward if they wanted to elect out. So 
there are, in fact, many airports that want to do this today.
    Mr. Rogers. You mentioned in your opening statement the 
cumbersomeness of the oversight that exists. One of the things 
that you would like to see is some relief on that front. I have 
heard criticisms that at these airports where we have these SPP 
programs, there are too many TSA folks overseeing. What has 
been your experience? What is the ratio of TSA personnel to 
your private personnel per airport?
    Mr. VanLoh. Mr. Chairman, that is information that I am not 
privy to, but I can guess that we have approximately 500 
screeners in Kansas City, and we have 50 TSA employees.
    Mr. Rogers. For what?
    Mr. VanLoh. I am not sure, I am not told.
    Mr. Rogers. My time has expired, but I thank the gentleman. 
Mr. Cravaack. Mr. Richmond has joined us, you are recognized 
for 5 minutes.
    Mr. Richmond. I will start with Mr. Amitay. This is not 
directly an SPP, but I think it is analogous, and I would like 
to hear your thoughts on it. Last year, well, in 2010, GAO 
released a report pointing to significant challenges across DHS 
contracting practices with FPS contract guardsmen such as the 
lack of training and decentralized operations. In one case in 
Detroit, a private security guard brought in a backpack with an 
explosive in it and left in it in storage for 2 weeks. Will we 
face the same challenges with SPP as we do with FPS?
    Mr. Amitay. That was an individual incident. I would just 
comment that also last year, 45 TSA employees at Honolulu 
airport were either fired or suspended because of a massive 
security breach that went from the screener level all the way 
up to the airport's Federal security director level. They are 
all implicated, fired, or suspended. So pointing to examples of 
individual instances where a security breach happened, I don't 
think that is inherently Governmental or inherently private.
    Mr. Richmond. I think you bring up a good point that all of 
them were fired. Do you know the company that the employees 
worked for in Detroit, that company is still on the job because 
it is hard for us to terminate a company once they are working 
with us, no matter what we find?
    Mr. Amitay. Sure. As the GAO testified last year, FPS, I 
think they took action against six or seven employees of the 
company involved, they were fired, and FPS and GAO both thought 
that that was sufficient punishment.
    Mr. Richmond. But we can't have zero tolerance with the 
company. See, part of what I am asking is, it is easy to 
dismiss and get rid of the employee, but if we find that it is 
a company that just lacks our confidence and through examples, 
we don't have much we can do about it.
    Let me ask you another question because I hear it thrown 
out all the time that private-sector employees are much more 
customer-friendly. Who does that survey and who--how do we come 
up with that? Because I will tell you, as someone who flies 
through airports and travels through the Capitol and a bunch of 
other places, I don't necessarily find that to be the case. So 
I am just wondering what authority determined that?
    Mr. Amitay. As Mr. VanLoh mentioned, J.D. Powers, they do 
an annual survey of performance at airports, including customer 
satisfaction and the private screening company at the Kansas 
City Airport won the J.D. Powers' award, I think last 3 out of 
4 years for medium-sized airports. I think also in the 2007 
study commissioned by TSA with Catapult Consultants, they also 
determined that customer service was higher at SPP airports 
than at non-SPP airports.
    Mr. Richmond. Well, I would just tell you as a person who 
frequents Federal buildings that have private security and 
airports that are TSA, being a young African-American male, I 
see no difference in either. You have your good actors and your 
bad actors, and I would hate for us to lump anybody in. I think 
it goes against the morale.
    Mr. Gage, I will ask you a question about that. When we 
talk about our Federal employees and my colleagues on the other 
side of the aisle, some on my side of aisle, were pushing for 
consistent pay freezes for Federal employees, and at the same 
time, we consistently look to privatize and get rid of as many 
Federal workers as we can. How does that affect the morale in 
TSA?
    Mr. Gage. It is not good. I am really surprised that the 
morale in TSA is as high as it is. People like the job, they 
really have a dedication, and I think that comes from being a 
public employee. I think TSA really does a nice job of getting 
some allegiance of the employees of sticking together and 
realize the importance of their job. So this idea that it that 
the private sector always does it better, I don't think so. 
There are many functions in Government, Social Security, for 
instance, or the VA where I think the Government employees 
simply, we do it better. I think TSA is an example.
    Again, I want to emphasize, running a system that big, 450 
airports is tough enough with a single--with TSA as an agency, 
to have hundreds of contractors out there. Mr. Pistole, I 
think, says it consistently every time, that is a management 
nightmare and it will lead to more and more risk in our flying 
security.
    Mr. Richmond. Mr. Chairman, I see that my time has expired, 
I yield back.
    Mr. Rogers. I thank the gentleman. The Chairman recognizes 
the gentleman from Minnesota, Mr. Cravaack.
    Mr. Cravaack. Thank you, Mr. Chairman, I appreciate that. 
Mr. Amitay, Mr. Gates brings up a point that I hadn't really 
considered before regarding outsourcing of companies that may 
have foreign entities that own them, background checks 
regarding that information that may increase the costs 
associated with a private entity versus a public entity. How 
would you respond to that?
    Mr. Amitay. Well, first of all, FOCI companies, foreign-
owned controlled and influenced, are already doing a lot of 
work for the Federal Government. Their U.S. subsidiaries are 
doing a lot of work. What the waiver says is that for any 
company that is a United States subsidiary with a parent 
company that is implemented a foreign ownership control or 
influence mitigation plan that has been proved by the defense 
security service of the Department of Defense prior to 
submission of the application. So in other words, DSS is 
already vetting the U.S. subs of these foreign countries, and 
in fact, these U.S. subs of these foreign countries are already 
doing a lot of classified and very important stuff for the U.S. 
Government and the Department of Defense, Department of 
Homeland Security and elsewhere.
    Mr. Cravaack. Okay, thank you for the clarification. Mr. 
Gage, along with--Administrator Pistole brought up another 
point that I wanted to verify with you, in saying that it is 
extremely important for the TSA to maintain, it is important to 
maintain flexibility, and that TSA must be able to respond and 
adopt to modify procedures quickly, as well as be able to 
augment staff in certain circumstances, natural disasters, 
certain of capabilities. Mr. Gage also brought up not able to 
transfer accordingly, could you comment on that as well?
    Mr. Amitay. In terms of the ability to surge and the 
ability to provide extra screeners, first of all, TSA already 
has a National deployment force of screeners that can be 
transferred to any location. Second of all, as Mr. Pistole 
mentioned last week, surge clauses and transfer clauses, these 
are all things that can be incorporated into contracts with 
private companies. Third, right now the private companies, they 
have never not responded to any TSA need. So again, engaging in 
these hypothetical situations, I think: (A), they are covered 
by the National deployment force, the ability to modify the 
contracts, and the fact that the screening companies are 
partners with TSA and they will get the job done.
    Mr. Cravaack. I don't mean to be, like, picking on you I am 
trying to clarify and get more information from you. Opponents 
of the SPP contend that training of contractors at TSOs is less 
than received of Federal screeners. Can you comment on that or 
how do you respond to that?
    Mr. Amitay. I would think it is the opposite. Right now, 
the training of contract screeners is at a minimum, the same as 
the Federal screeners. In fact, the contract companies, maybe 
not in the initial training, but once they are on the job, they 
have programs, training programs, remedial training programs 
that they utilize that the Federal screeners are not part of.
    For instance, at some of the private screening companies 
they will match their top performers with some of their lower 
performers, and they will provide the remedial training and 
mentoring services.
    Mr. Cravaack. Okay. Mr. Gage, you testified the SPP program 
will cost the Government 3 to 9 percent more than the Federal 
workers. What are you basing this--how do you base these 
numbers on?
    Mr. Gage. Profits.
    Mr. Cravaack. Profits?
    Mr. Gage. Yep. I think, too, it will require a lot more 
oversight from TSA management. In other words, the overhead of 
TSA--if all the screeners are private, to make sure there is 
consistency across the airports, and when you say there is 50 
TSA folks at the airport with 600 private screeners, I think 
that would be about right. I think you--it is not that you 
give, TSA gives an airports a minimum qualification standard 
for security and let them do whatever they want from that, that 
is not the way National security ought to go. This is not a 
minimum type of operation, it is constantly to get better and 
better, and to be able to keep a consistent--you can't have a 
good airport security and another airport that does bad 
security, they have to be consistent.
    I think TSA really has made the mark on making our airport 
screeners and security very consistent from airport to airport.
    Mr. Cravaack. Can you respond to that, Mr. Amitay?
    Mr. Amitay. I agree there needs to be consistency and, in 
fact, the way the SPP is set up, is that the private screening 
company can only be used at an airport if its performance will 
equal or exceed that of the average for the category class of 
airport. It has been proven through independent evaluations, 
covert testing, and then the awarding of contract performance 
bonuses based on performance metrics that the private screening 
companies are exceeding beyond the TSA standards. You are 
right, there are good airports and there are bad airports, but 
for the SPP airports, they are at the middle or above.
    Mr. Cravaack. My time has expired. I ask unanimous consent 
to materials I brought in for the Chairman of the 
Transportation Committee be submitted for the record.
    Mr. Rogers. Without objection, so ordered.*
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    * The information has been retained in committee files.
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    The Chairman now recognizes my friend and colleague from 
New York and somebody who knows something about running big 
organizations, Mr. Turner.
    Mr. Turner. Thank you, Mr. Chairman. I am still stuck on 
this 3 to 9 percent more efficient for the TSA. Who did this 
study and how is it done?
    Mr. Gage. It was TSA who did the study, sir.
    Mr. Turner. Oh.
    Mr. Amitay. I might just add that the 9 percent is not a 
valid figure. The GAO, in a letter to Congress in March 2011, 
they said that after TSA had taken in three out of seven GAO's 
recommendations, TSA produced a cost comparison in 2007, that 
said that the SPP airports are 17 percent more costly to 
operate. GAO severely criticized that. They asked TSA to relook 
at it and to consider, I think, 10 different factors.
    In 2009 then, TSA came back having only then addressed, 
they said they only addressed three out of the seven 
recommendations. They said that TSA estimated that SPP airports 
would cost 3 percent more to operate in 2011 than airports 
using Federal screeners. However, GAO noted that TSA needs to 
take additional action or provide additional documentation to 
address the remaining four limitations related to cost, and the 
three limitations related to performance. In addition, that 
didn't even take into the issue that was raised by GAO of TSA 
addressing the additional costs of overlapping administrative 
personnel at SPP airports.
    Mr. Turner. Perhaps Mr. VanLoh can help us here. Kansas 
City, there is an Orlin number, the TSA sends you a check for 
security, is that fair?
    Mr. VanLoh. I never see any of the deals to companies.
    Mr. Turner. It is somewhere, I am sure. What airport is 
comparable in size to Kansas City?
    Mr. VanLoh. We are the--I believe, we are the 32nd-largest 
airport in the country so perhaps Cleveland, Ohio is similar. 
We are a little bigger now than Cincinnati; Nashville is a 
little smaller than us, so we are medium-size airport in the 
United States.
    Mr. Turner. Any of those configured pretty much the same 
way?
    Mr. VanLoh. No one in the world is configured like Kansas 
City. As a matter of fact, Chairman Mica came to Kansas City a 
few years ago because he couldn't believe how the airport was 
set up, and after he left, he became a believer on how we 
operate with the private screening companies.
    Mr. Turner. All right. So a apples-to-apples comparison 
would be pretty difficult?
    Mr. VanLoh. It is.
    Mr. Turner. Wildly difficult?
    Mr. VanLoh. I would say so, I believe with our current 
configuration, we have more screeners than most major airports 
do.
    Mr. Turner. The other privatized airports, perhaps a little 
too small.
    Mr. VanLoh. San Francisco is one of them, and is many times 
larger than we are.
    Mr. Turner. Oh, San Francisco.
    Mr. VanLoh. They were one of the original five, yes, sir.
    Mr. Turner. Perhaps San Francisco and Boston or 
Philadelphia, comparisons could be made?
    Mr. Amitay. The House Transportation and Infrastructure 
Committee did a cost comparison with LAX which is a similar-
sized airport, and they found that it was 35 percent less 
expensive at SFO.
    Mr. Turner. That is about the number I would expect private 
to public. But thank you. I yield back.
    Mr. Rogers. I thank the gentlemen. I want to go back to the 
line of questioning I was pursuing a while ago, Mr. VanLoh. 
That is, the frequency, or the number of airports applying, am 
I interpreting your answer correctly in that you think more now 
are going to apply, that some of the concerns that they had 
initially they discovered were unfounded?
    Mr. VanLoh. Yes, Mr. Chairman, I believe that is true.
    Mr. Rogers. So give me an idea in the next year, do you 
think we will have five airports make application or 50?
    Mr. VanLoh. I think those are both extremes. I would 
estimate you could have 20 airports that would be immediately 
come--to the process.
    Mr. Rogers. That is interesting. That does--Mr. Pistole has 
been making a good point that there is no big clamor to come.
    One question I had a few minutes ago, in talking about the 
minimum standards that you have to meet as far as pay and 
training, does TSA at an SPP airport, does TSA tell you the 
minimum number of personnel you must have as well? That is for 
either one of you two gentleman.
    Mr. Amitay. No, TSA does not do that that with the SPP 
reports. Essentially, there is, for lack of better terminology, 
an overall hour security requirement, and then the SPP company 
then staffs it sufficiently, being able to use part-time, full-
time, whereas the TSA model is a specific amount of FTEs and 
part-time employees that are assigned to each airport under a 
screening allocation model.
    Mr. Rogers. I had asked Mr. VanLoh earlier about the number 
of personnel that are overseeing the SPP airports. Have you 
observed the same ratio that he has talked about, because I 
heard it from other people too that there are large numbers of 
TSA personnel overseeing these contractors. Have you seen that 
ratio as well that he described?
    Mr. Amitay. Well, that is something--I talked with some of 
the SPP companies, and they have raised that, they think it is 
an issue at the airport, but more importantly, the GAO has 
raised that as an issue.
    Mr. Rogers. What does the GAO say they are doing?
    Mr. Amitay. Well, the GAO says that TSA needs to include 
the impact of potential overlapping of administrative staff on 
the costs of SPP airports. So they identified this issue of 
overlapping staff, so did the TSA contractor who did a 
comparison. But as of yet, TSA really has not really 
addressed--and we are talking administrative staff, we are not 
talking security staff. We are talking administrative staff 
that is overlapping.
    Mr. Rogers. Mr. Gage, earlier you made the comment that you 
thought that 50 overseeing 600 was a sound number. Tell me why 
you think--is there a methodology to that?
    Mr. Gage. No, no, I think that it is very important that 
there be strong oversight over the contractors, and 50 in an 
airport of 600, or 600 screeners, doesn't, to me, sound 
outrageous, but I think the key thing here is not cost, it is 
consistency, and it is security, and that there has to be very 
strong oversight by TSA to make sure that procedures are 
followed, that the SOPs are rigorously enforced and that is 
just the nature of the business.
    Mr. Rogers. Is it your opinion, based on any objective 
evidence, that any of the SPP airports have provided a lower 
quality of screening?
    Mr. Gage. No.
    Mr. Rogers. Going back to this issue about the number of 
employees, what I--I hear a lot from folks that know that I am 
on this committee, whenever we are talking about over at TSA, 
they start complaining about the number of TSA agents standing 
around when they go through screenings. It just drives them 
nuts, that they are standing in line and they see all these 
people standing around apparently doing nothing.
    I know some of those are BDOs, and they are actually paying 
attention to some things, but there are folks who stand around. 
That has been one of my concerns is we aren't doing more to 
make at least the appearance of efficiencies. Is it your 
experience that is one way you can make these ventures 
profitable is to right-size the staffing as opposed to having a 
bloated staffing. I ask Mr. Amitay.
    Mr. Amitay. Yeah, that is exactly right. One advantage of 
the private sector is that with their scheduling tools, they 
are able to anticipate when there will be high demand and when 
there will be low demand. They are able then to adeptly match 
the screening workforce needed to the needs of the airport at 
the time. That is why there are shorter wait lines at SPP 
airports, and there is greater customer satisfaction, but the 
flexibility that the private companies have in terms of 
scheduling, it is a huge cost-saver, yet the security is not 
diminished at all because, as you mentioned, you don't get 
these occasions where there might be a dozen screeners standing 
around when obviously the requirements at that time do not 
require a dozen screeners.
    Mr. Rogers. Mr. VanLoh, in your testimony, you stated TSA 
never asked Kansas City for its input on the contractor's prior 
performance during contract award decision-making process. If 
Kansas City had been given the opportunity to provide its input 
to TSA, what would it have been?
    Mr. VanLoh. I would have explained much that I have 
explained to the committee today. We are winning passenger 
service awards, very few complaints, very low turnover. I think 
it is 2 percent, is our turnover rate right now. It is not 
broken, and let's keep going, it is working well.
    Mr. Rogers. Last, Mr. Gage, I wanted to raise an issue, you 
made the point that while TSA's morale has been questioned, 
that you are surprised it is as good as it is. Mr. Pistole had 
written to this committee saying data from employee surveys has 
repeatedly shown TSA ranking poorly in terms of employee morale 
and engagement. Employee engagement and security are 
interrelated and therefore, directly affect our capacity to 
carry out our mission. We must ensure TSOs are motivated and 
engaged as is their judgement, and discretionary efforts are 
critical to achieving a superior security. We must continue to 
do better, and by our employees, ensure we continue to 
accomplish this mission.
    What would you recommend that we do to deal with this TSA 
morale problem?
    Mr. Gage. A lot of the morale problem is pay, they are 
under a pay system that nobody understands, nobody likes, they 
are not under the GS system which is fair and people do 
understand it. I think the pay issue, Congressman, is really a 
very large one with our members.
    Mr. Rogers. Thank you. But I would make the point, private 
screeners are paid the same thing as these folks and we don't 
have the same morale problems. I want to recognize my friend 
and colleague from Texas, the Ranking Member who has joined us.
    Ms. Jackson Lee. Thank you very much, Mr. Chairman. I thank 
the witnesses for their patience. I was called to duty in my 
other committee, which I was introducing amendments and so I 
was delayed in coming here. This is an important hearing, and I 
truly wanted to have the opportunity to pose a number of 
questions. Let me quickly go to Mr. VanLoh. What size in the 
schedule of airports where they have top 10, what number are 
you in the Nation?
    Mr. VanLoh. I believe we are thirty-third in the Nation, 
ma'am.
    Ms. Jackson Lee. Have you been privatized since 9/11?
    Mr. VanLoh. That is correct.
    Ms. Jackson Lee. Were you privatized before 9/11?
    Mr. VanLoh. Yes, all our airports were.
    Ms. Jackson Lee. So there has not been any great altering 
of your structure. So you have employees that have been there 
for 10 years?
    Mr. VanLoh. We could have a few that are close to 10-year 
employees, yes.
    Ms. Jackson Lee. Anybody longer that that?
    Mr. VanLoh. Not to my knowledge.
    Ms. Jackson Lee. Are you given oversight by the 
Transportation Security Administration?
    Mr. VanLoh. I personally, my organization, the City of 
Kansas City has no oversight whatsoever.
    Ms. Jackson Lee. Are you in compliance with the 
Transportation Security Administration requirements?
    Mr. VanLoh. Absolutely.
    Ms. Jackson Lee. So you are doing pat-downs and private 
screening?
    Mr. VanLoh. Yes, ma'am.
    Ms. Jackson Lee. Do you handle individuals who are in a 
wheelchair or who may have an artificial limb in any way 
differently from the way the TSO officers do?
    Mr. VanLoh. No.
    Ms. Jackson Lee. So at the time when it was required to pat 
down children, you were patting down children?
    Mr. VanLoh. Yes, they were.
    Ms. Jackson Lee. As we look forward to some overview and 
rearrangement of some of these issues, you will then follow the 
TSO, TSA mandate?
    Mr. VanLoh. Immediately, yes, ma'am.
    Ms. Jackson Lee. So the question of whether or not you have 
happier passengers, it may be that you live in a happy 
community, it may be that the sun shines on the day they come 
in, it may be a lot of variables; is that correct?
    Mr. VanLoh. I am not the census taker, but it could be very 
well, yes, ma'am.
    Ms. Jackson Lee. Let me congratulate you for it. The fact 
you have it, I am glad that you do have it. I believe that 
those, even though I question the change in language that says 
you shall, I have no quarrel with the existing airport private 
screener structure. I have a quarrel with whether or not we 
privatize the entire Nation.
    Let me go to Mr. Gage, and say to you, Mr. Gage, what can 
we do--have you had an opportunity, or do you have some of your 
leadership, have had the opportunity, you fly, of course, to 
view some of other front-line agents, TSO officers on the front 
lines? What is your general perception?
    Mr. Gage. I am very impressed with them. Many of them have 
law enforcement backgrounds, military backgrounds, they are 
career law enforcement people. I think they are paid less than 
the rest of the Federal Government, border patrol agents, for 
instance, ICE agents, other Federal law enforcement. I think 
that is a big problem. I have gotten to know a lot, hundreds 
and hundreds of them. We have almost 14,000 members, and they 
are extremely dedicated people, and the turnover--as the 
turnover rate slowed, and you have more and more experience, 
they are really top-notch employees who know their job and can 
react to virtually anything.
    Ms. Jackson Lee. Let me emphasize what you just said. In my 
visiting airports, as the Chairwoman and now Ranking Member for 
a number of years on this committee, I have seen an enormous 
amount of professionalism, but you are absolutely right, they 
are former police or law enforcement individuals, they are 
certainly former military with a great sense of pride and they 
are just Americans who desire to work hard. I want to join my 
Chairman and say that we should always be looking to improve 
the efficiency and effectiveness of those Federal employees 
paid by Federal dollars that serve the American public, but Mr. 
Gage, and then I will ask Mr. Amitay, would you want to have 
the TSO officers give out lollipops and paint a smile on their 
face, or would you rather ensure that we have the kind of 
security professional treating everybody with dignity that is 
necessary?
    Mr. Gage, do you think that the work that we do, and I say 
``we'' in dealing with Homeland Security sometimes is not a 
friendly word. Let me say personally, I have experienced 
sometimes the strictness of the security check, but is it not, 
from your perspective, extremely important to have that kind of 
oversight as we utilize the Nation's transportation system?
    Mr. Gage. It is serious business, it has to be done 
professionally, it can't be sloppy, the people have to pay 
attention every minute in their jobs. I think that we have come 
a long way in airport security since the days before 9/11. 
Really, when I look at this workforce, I am proud of it. I 
think the Nation should be proud of it and if it is not broke, 
don't fix it.
    Ms. Jackson Lee. What I would say in being honest in my 
assessment in saying that I want to work with the Chairman, 
would you welcome increased professional training, increased or 
a review of the pay scale, and what I have been advocating for 
is professional development where the TSO officers would have 
the opportunity for promotion, promotion throughout the system. 
Would you welcome that?
    Mr. Gage. They really have to have the promotional 
potential into other Federal agencies too, even within the 
Department of Homeland Security. That is important when you are 
any worker that you are looking to better yourself and to do a 
good job so that you could be picked up as an ICE agent or 
another law enforcement officer somewhere else in the Federal 
Government. Right now those connections don't exist, and I am 
very concerned about it and we are working with Homeland 
Security to provide more promotional opportunity for TSOs.
    Ms. Jackson Lee. Let me pointedly ask you, the TSO officers 
could stand the enhanced professional development in training. 
Do you see that as an opportunity?
    Mr. Gage. I do. It is a constant training situation, as 
techniques evolve, almost sometimes weekly, where it seems to 
be getting better and better, smoother and smoother, and more 
and more professional.
    Ms. Jackson Lee. As well, you would argue, I don't want to 
say that you would argue--but that we should look seriously at 
the pay structure?
    Mr. Gage. No question, they lag way behind in pay. Someone 
dreamed up the pay structure they are in. It hasn't worked, it 
doesn't work. They need a consistent pay scale such as the 
general schedule.
    Ms. Jackson Lee. If I could conclude, Mr. Chairman, with 
Mr. Amitay. Are you suggesting, Mr. Amitay, and I have no 
quarrel with small contractors and business empowerment, and 
small businesses, and large businesses, but are you suggesting 
that something as important and serious as the massive securing 
of our airports should go back to 9/11, which is when the 
airports, through the airlines, were, in essence, secured by 
private companies, which, if not contributed to, were there on 
the day that those individuals traveled on 9/11? Is that what 
you are here to encourage us to do?
    Mr. Amitay. I think to make any comparisons of the current 
level of screening and security at airports now, using private 
screeners, to compare that to pre-9/11 when private screening 
essentially was regulated by the FAA, who then delegated the 
airlines to take care of it. To say that that is the same, that 
that system then, which was only one part of the reason for 9/
11, box cutters were allowed onto planes.
    Ms. Jackson Lee. You are correct that it was one part, you 
are correct. Go ahead.
    Mr. Amitay. So that part now has been radically changed and 
radically improved. To say that the private sector does not 
have the ability to provide enhanced screening under TSA, 
strict TSA standards and requirements. In fact, the level--in 
order for a private company even to be able to provide 
screening at an airport, the level of screening services and 
protection provided by the private screening company must be 
equal to or greater than the level that would be provided at 
the airports by Federal screeners. That is the law.
    Ms. Jackson Lee. You didn't answer my question. The 
question is are you calling for the complete privatization of 
all airports in the country?
    Mr. Amitay. What recently--right now, airports have the 
option, if they so desire, to opt out of using Federal 
screeners.
    Ms. Jackson Lee. Are you calling for the privatization of 
all airports, yes or no?
    Mr. Amitay. Am I personally calling for it? No.
    Ms. Jackson Lee. Is your organization calling for it?
    Mr. Amitay. No, we are calling for the law to be abided by.
    Ms. Jackson Lee. Thank you so very much. I agree with you, 
we should not. Thank you, Mr. Chairman.
    Mr. Rogers. The Chair now recognizes the gentleman from 
Minnesota, Mr. Cravaack.
    Mr. Cravaack. Thank you, Mr. Chairman. Mr. VanLoh, it has 
been noted that a former Federal security director of Kansas 
City was involved in a proposal team for one of the contract 
contenders; is that correct?
    Mr. VanLoh. Yes.
    Mr. Cravaack. Further, the committee has learned that he 
may have contacted city officials as much as 4 months in 
advance regarding an award, would that be correct?
    Mr. VanLoh. Yes, it is.
    Mr. Cravaack. Now, Administrator Pistole in the last 
hearing said that he was apparently unaware of this FSD's 
actions, others in the TSA, however, did know about the 
employment of one of the contract contenders and his efforts to 
contact city officials. In your opinion, would such actions 
raise concern as a director of an airport or any other airport?
    Mr. VanLoh. Well, they certainly did at the time, when he 
contacted my Mayor Pro Tem of Kansas City and told him his 
company was going to be taking over screening at Kansas City 
International 6 months before the award was made, I was very 
concerned.
    Mr. Cravaack. Okay. That raises an eyebrow or two, doesn't 
it?
    Mr. VanLoh. Yes, sir.
    Mr. Cravaack. With regard to a selection process of an SPP 
provider for Kansas City, were you or any other Kansas City 
officials ever contacted for your opinions solicited prior to 
the----
    Mr. VanLoh. Never.
    Mr. Cravaack. That is another eyebrow. How would you view 
the selection of the security provider for Kansas City who had 
no prior SPP or airport screening experience? How would you 
view that selection?
    Mr. VanLoh. I was very concerned.
    Mr. Cravaack. Okay, that is something else I think we 
should investigate. If you don't mind, I just have a couple 
more. Opponents of SPP contend that the performance by 
contractors is, at best, the same as Federal screeners. How do 
you respond, Mr. Amitay?
    Mr. Amitay. As I have stated before, I would say in order 
for private screeners to be used, the level of screening 
services protection must be equal to or greater, in covert 
testing, independent evaluations, and the awarding of contract 
performance bonuses based on performance metrics have shown 
that it actually is equal to or greater.
    Mr. Cravaack. Mr. Gage, do you believe that the private 
contractors are less qualified and less trained?
    Mr. Gage. I think they probably are, but I think that is 
really not the issue. It is hard to look at one airport and say 
private or public in that airport. The big argument and the 
logic for public is the whole-country system, that you have to 
be running this together in an integrated way and with private 
contractors, perhaps hundreds of them. That is impossible. I 
think Pistole and TSA have consistently said that.
    Mr. Cravaack. Isn't it true the SPC TSOs must implement the 
protocols and meet the same stringent requirements for all TSA?
    Mr. Gage. I would hope so, yes. But----
    Mr. Cravaack. All right. I thank you. In going back pre-, 
post-9/11, I was a pilot that flew pre- and post-9/11. There is 
a dramatic difference between the type of security because it 
did go out to the lowest bidder back then. Now it does not go 
out to the lowest bidder, but it goes out to--what is the word 
I am looking for, best value. So there is a huge difference 
between a lot of times you go through the security, and the 
person couldn't even speak English in a lot of cases.
    So there is a huge difference, and who is in charge, being 
the TSA has made a huge, huge difference in regards to that. So 
opponents of Mr. Amitay and opponents of the SPP include some 
Members of the committee that have asserted that expansion of 
this program is unnecessary risk and tantamount to returning to 
9/11. I just want to make sure that it is clear there is a huge 
difference because of who is in charge now in overseeing TSA 
agents. Mr. Gage, TSA agents, like in Minneapolis, I have got 
to give a shout out for those guys. They are great, they truly 
are, they a fantastic group, extremely professional. They try 
to get you through the line as quickly as possible.
    So there is a fine balance that can be reached here and I 
hope we all can reach that balance and have the most efficient, 
effective, and most secure system in the world. With that, I 
yield back.
    Mr. Rogers. Thank the gentleman, thank our witnesses. 
Again, appreciate you being here. This has been a very 
interesting hearing for me. For a couple of main reasons. One 
is the information by Mr. VanLoh that more people will be 
making applications, I will be watching for that. But the other 
thing is this staffing level issue, that has been very 
interesting to me to hear about these numbers of people who are 
assigned by TSA to oversee the private contractors, and then 
the bloated numbers that are being used in the airports the TSA 
screens with as opposed to private.
    So I am going to pursue a hearing or maybe two to maybe 
look at that. Now that we have got a model of some airports 
that have used private contractors to compare these staffing 
levels to see what is the right size, and also to try to figure 
out what in the world people are doing that are overseeing the 
contracts because I have yet to have anybody tell me what they 
are doing. It is my hope that maybe if we can right-size some 
of the staffing levels in the TSA airports, maybe we can pay a 
little better with the money we can save. But with this country 
in the financial straits it is in, it is pretty hard to see 
waste and not do something about it. You all have been very 
helpful.
    Ms. Jackson Lee. May I inquire of the Chair? Mr. Chairman, 
I would like for us to work together on it. Obviously I have a 
very strong position about privatization, but there is a 
provision in place that allows it. I raise the point and would 
like to join you on is the professional development, the 
question of structuring TSA for its most enhanced performance, 
and to also recognize that when you do privatize, the airports 
pay nothing, we take taxpayer dollars to pay private security 
companies. That, in and of itself, may be an expense and become 
an expense when you expand the privatization.
    So I think we can find some common ground on how we 
professionalize, train, look at the pay scale of the TSO 
officers and get them the way my good friend, Mr. Cravaack, has 
indicated in the airport Minnesota, I believe, that he 
commented. I will say that in the many airports that I 
traveled, Houston, Texas, many in Alabama, Boston, New York and 
other places have found, if not a group, individually competent 
persons that are serving our country.
    So I would like to work with you on that and maybe we will 
find common ground. I yield back to the Chairman.
    Mr. Rogers. Thank the gentlelady. Thank the witnesses and 
this hearing is finally adjourned, 2 weeks later.
    [Whereupon, at 2:14 p.m., the subcommittee was adjourned.]