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Testimony of Secretary of Homeland Security Michael Chertoff Before the Senate Homeland Security and Governmental Affairs Committee

Release Date: 07/14/05 00:00:00

Dirksen Senate Office Building
Washington, D.C.
July 14, 2005

Senator Collins: The committee will come to order.

Good afternoon. This afternoon, the committee will examine the results and recommendations of the second stage review of the Department of Homeland Security conducted by Secretary Chertoff. I applaud the secretary and his team for a thorough analysis of the department's organization, strengths, and weaknesses. We meet in the aftermath of the grim reminder of why this review is so significant the terrorist attacks last week in London remind us that the enemy we face has an unlimited capacity for cruelty. They remind us that terrorists can be blocked again and again, and yet they need carry out only one successful plot to cause death and destruction. And the attacks remind us that we must strive for success every single time.

I know we all extend our deepest condolences to the people of Great Britain. I also know that these attacks only strengthen their resolve and our commitment to stand with them against those who would destroy our way of life. The Department of Homeland Security was created to help us respond to the enormous challenges we face. Our nation was attacked by a new enemy in a new way, and we responded with a massive and innovative effort to better protect our nation against the threats of the 21st Century. This committee, which drafted the legislation creating the Department of Homeland Security, and which has confirmed two generations of its top officials, worked closely with the department to continually improve our nation's homeland security posture. We have always viewed our role not as critics of the department, but as partners in a common cause.

Whether the issue is securing our cargo ports, or our chemical facilities, equipping and training our first responders, or improving counter terrorism, intelligence and information sharing, we have worked with the department not just to identify problems, but also to forge solutions. This second stage review comes appropriately enough as the second generation of department leaders take over from the commendable start of its predecessors.

As Secretary Chertoff said in previous testimony shortly after he announced this review, the department "was created to do more than simply erect a large tent under which a lot of different organizations would be collected." The secretary's announcement yesterday outlined a strong direction for the department, one of better integration, risk based planning, and dynamism. The proposals put forth in his review do not construct additional partitions within that big tent, but rather seek to remove those that are counterproductive to the comprehensive approach that the homeland security challenge requires. It is about accomplishing goals and objectives not about preserving the status quo.

Within this overall theme, of course, there are a great many specifics that we will discuss today and, over the coming months, particularly where implementing legislation is required. We will also address several organizational proposals, such as the merger of infrastructure protection, domestic preparedness, and other entities into a new directorate of preparedness and the establishment of a much needed policy and planning office to develop coherent strategies and comprehensive policy guidance at the very highest levels of the department.

The secretary has also proposed the creation of a chief intelligence officer responsible for both internal and external coordination. I'm particularly interested in this proposal as just three months ago Senator Lieberman and I urged the secretary to assess the information analysis and infrastructure protection directorate and its relationship will the intelligence community, state, local and tribal governments, and the private sector. As with so many aspects of homeland security, the collection, analysis and dissemination of critical intelligence requires not just a federal strategy, but a national strategy that recognizes the contributions of intelligence not only across the federal government, but our state and local partners as well. I believe that strengthening the department's intelligence efforts and giving its chief a direct line of communication with the secretary would help begin to resuscitate what appears to be a rather moribund and underutilized part of the department.

I hope that the efforts of a second stage review lead to further functional integration, as Deputy Secretary Michael Jackson and I discussed during his nomination process, the department-wide management functions, particularly in procurement, information systems, finance, must be integrated with and support the department's missions. And I know that the secretary's reorganization plan recognizes and addresses those critical management issues.

Secretary Chertoff's predecessor, Tom Ridge, often described the creation of the Department of Homeland Security as the greatest IPO in history, a merger of unprecedented size and complexity. The organizational challenges are extensive, and DHS will need to continue to evolve. I commend the secretary for his leadership on this crucial matter. I look forward to hearing from him today in more detail about his findings and his specific plans and recommendations.

Senator Lieberman.

Senator Joseph Lieberman (D-CT): Thank you, Madam Chairman.

Secretary Chertoff, welcome back to the committee, and I thank you for appearing today to discuss the top to bottom departmental review you commissioned when you were confirmed as secretary five months ago.

The department has made our country safer than it was before, but I think we all would agree that it's not yet as safe as we need it to be. And the department was ready, it seems to me, for a second chapter step back look at where we've been, and see how we can carry out our responsibilities better. It appears to me that you have done a thorough, honest, constructive job here that will help you as the head of the department with primary responsibility for the protection of the American people at home to not only fulfill your responsibility, but to fully take advantage of the opportunity you have to guide the department, and to the critical second stage of the post-9/11 development.

I want you to know that I was encouraged by several parts of your recommendations as I took a first look at them, and I know we'll discuss them in more detail today. The first was the emphasis on the strategic policy planning, highlighted in oversight hearings of the department that the committee held earlier in the year, the establishment of an undersecretary for policy is very important, and hopefully will lead to a clear setting of priorities, which has not been as much the case as we would have wanted up until now.

Intelligence is a critical function of the department. We focused on that in the legislation creating the department, and I would say although a number of significant improvements have been made across the intelligence community, particularly one we passed, the Intelligence Reform and Terrorism Prevention Act, last year, I don't think that the department's Office of Information Analysis has to date received the support that it needs. Therefore, I take the separation out of that department, the creation of a chief intelligence officer, as a step in the right direction. I certainly hope it is. And I look forward to discussion with you your idea for supporting the intelligence activities of the department and improving the coordination among the various intelligence agencies within DHS and the intelligence support that's received.

Also, the proposal for a chief medical officer makes a lot of sense to me. It's something that I've been interested in myself. In legislation I proposed earlier this year Bioshield II, we called for the creation of an assistant secretary for medical readiness and response and it seems to me I hope that the chief medical officer that you're talking about creating will fulfill that role. This is to coordinate and galvanize preparedness for one of the nightmares of the age of terrorism, and that is a biological terrorist attack.

I do have questions about some of the other reorganization proposals. I want to know more about the rationale for separating FEMA from the Department's preparedness programs, and of eliminating the Department of the Director of Border and Transportation Security. I must say, generally as I heard your remarks yesterday I was concerned about the extend to which you feel limited by the limitation of financial resources. And I will bring to you the experience I've had as a member of the Senate Armed Services Committee, we always say to the people at the Pentagon, don't let your decisions be budget driven, we're talking about the security of the United States of America. I would say the same to you as you go forward.

In that regard, as you may know, there's been a lot of controversy today about some statements you made yesterday, and I want to ask you in your opening statement if you could respond to them and this is on questions that were asked yesterday about mass transmit protection and you're quoted in an Associated Press story this morning as saying that -- basically you're contrasting aviation security with mass transit and saying by contrast mass transmit systems are largely owned and operated by state and local authorities. You seem to be saying that the federal government must focus on attacks that could produce the most casualties.

The quote is, "the truth of the matter is, a fully loaded airplane with jet fuel, a commercial airliner has the capacity to kill 3,000 people, a bomb in a subway car may kill 30 people. When you start to think about your priorities you're going to think about making sure you don't have a catastrophic thing first. I'm reading from the AP story this morning. Asked is this meant communities should be ready to provide the bulk of the protection for local transit systems Chertoff said, "yes." This has alarmed a lot of us who have mass transit going through our states, a lot of people who ride mass transit are already worried about security them, because they're not a closed system. And inevitably I think this has to be at least in part a national responsibility. So I use that as an example just to say that in all the structural changes you're making, which generally to me seem to be heading in the right direction, we also need you to not let your decisions which are life and death decisions, be budget driven.

I thank the chair.

Senator Collins: Thank you, Senator.

We are expecting to begin role call votes, a series of them, shortly after 3:00. So I would ask my colleagues to keep their opening remarks extremely short, and if you could even bring yourself to just submit them for the record, that would be even better.

Senator Voinovich.

Senator George Voinovich (R-OH): Thank you, Madam Chairman. I applaud your leadership and expediency for calling this hearing, one day after Secretary Chertoff released the Department of Homeland Security Second Stage Management view. I'm anxious to hear what he has to say today, and I'll ask that the rest of my statement be inserted in the record so we can move on to hear the Secretary.

Senator Collins: Thank you so much.

Senator Akaka.

Senator Daniel Akaka (D-HI): Thank you very much, Madam Chairman. I want to add my welcome to the Secretary and say thank you for being here. I will not have an opening statement, but let me say that we have just received the Secretary's proposal on the reorganization of the Department of Homeland Security. I just want to say at first glance, some of the Secretary's recommendations look good, but I'd like to take the time to try to understand how they impact our security. So I look forward to the Secretary's statement, and also possibly future hearings in this committee, as we explore how to best proceed.

Thank you very much.

Senator Collins: Thank you very much, Senator.

Senator Coburn.

Senator Tom Coburn (R-OK): I have no opening statement, Madam Chairman.

Senator Collins: Thank you.

Senator Lautenberg.

Senator Frank Lautenberg (D-NJ): I do have a statement, Madam Chairman. And I'll try to make it brief, but this is a rare opportunity for us to meet with the secretary and to explain to the public how we see things, to make certain that we are not rushing past a chance to learn more about what's taking place at Homeland Security. I particularly want to thank Secretary Chertoff for being here. Yesterday he unveiled proposals to make the Department of Homeland Security more effective, and we respect that greatly.

While Secretary Chertoff was announcing these steps yesterday, the Senate acted contradictorily to his goal of protecting our homeland from terrorist attack. The Senate voted to reduce the amount of homeland security grant money that will go out, based on highest risk. In the real world that means that we are thwarting Secretary Chertoff's desire to protect our country to the best of his ability. And I will only continue to say, loudly, and clearly, that the only basis for allocating homeland security resources, as the 9/11 commission requested, is to distribute to the area of highest risk. If we knew of an imminent anthrax attack targeting Detroit, we wouldn't send 40 percent of the limited vaccine to California. So why should we do that with our national security grants.

Nearly one year ago DHS put out an orange alert on three jurisdictions, New York City, Washington, D.C., and Northern New Jersey. People in our area are justifiably worried, but we assured them that the government would be doing all it can to keep their communities safe. One of those targets was a building in Newark, New Jersey. If this happens again, I'm not sure what we can tell them, tell them that the money is in Kansas some place? We have to live up to our responsibility. The administration has been very clear about what they want. They want to put the money where the risk is. Last summer the risk was within sight of my New Jersey office. Our intelligence services gathered data showing that terrorists had studied the Prudential office building. That's how you measure risk, analysis and intelligence, not a simple formula.

Secretary Chertoff wrote a letter to all the senators yesterday in which he says, providing enough flexibility to distribute over 90 percent of grant funds on the basis of risk, so that confirms your view. There seemed to be a question about whether or not figures that CRS developed were accurate or not. I ask unanimous consent that a letter from Daniel Mulhollan, the director of CRS, be included in the record.

Senator Collins: Without objection.

Senator Lautenberg: Thank you. He said that, we reviewed -- this is dated the 14th of July, we reviewed the calculations that underlay the data presented in the memorandum, to me, dated July 8th, and confirmed their accuracy. So we're not making any mistakes about the mathematics included in this. I was hoping that the London attacks would finally wake up the Senate to this reality. Unfortunately, I was wrong. I look forward to hearing the testimony of our distinguished secretary. Thank you.

Senator Collins: Senator Domenici, please proceed.

Senator Pete Domenici (R-NM): I hope that you have confidence in what you're doing, in spite of the difficulties of organizing, because everybody should know that you are either -- you either have the privilege, or you're the victim, whichever, of having to organize a reorganization that is the largest in 50 years. And when you take that, as big as we are, and you say that big a reorganization, it's hard to put it together, and I think it will require more than one reorganization effort. So keep the faith.

Secondly, I was going to ask about the border, but it has become so prevalent these last few days, on the floor, and in your commitments you're going to talk about it. You can't do enough, and it is organizable, and with your new commissioner who is in charge, who is excellent, we spoke to him at length. If his game plan is your game plan, you ought to promote it. It's terrific. I will get us there. It will control the border within the next four or five years, without putting the United States military on the border.

Last, a little, tiny thing that I think is a big thing, and that is since 9/11 the flow of foreign students to our universities has turned from a river to a trickle, and there may be some around that say, great, what do we need them for. But, frankly, that's abysmal for America, not only because they should be coming here to get educated, but because the best way to influence countries, including countries like China, is to have 20-30 thousand of their students here going to our great universities and then having them go home. And the trickle has to be solved. We have to turn it back into a flow. And you have, from time to time, spoken about your ideas regarding students coming across. If you don't address it today, I will seek your position, and if we need legislation, I'll be glad to pursue it. I think it's very important, subtle but dramatic.

Thank you, Madam Chair.

Senator Collins: Thank you.

Senator Pryor.

Senator Mark Pryor (D-AR): Thank you, Madam Chair. I want to thank you for your leadership, and the ranking member

And, Secretary Chertoff, good to have you here in the committee today. Thank you.

Senator Collins: Thank you very much.

Senator Dayton.

Senator Dayton: Madam Chair, I look forward to hearing from the distinguished secretary, so I will pass. Thank you.

Senator Collins: Thank you.

Welcome, Mr. Secretary, you may proceed with your statement.

Secretary Chertoff: Thank you, Chairman Collins and Senator Lieberman, I will ask that my full statement be made part of the record. I will just try to briefly cover some points, and then offer myself up to questions.

First, I do want to give you my sincere and deep gratitude for the counsel and advice that you, Madam Chairwoman, and Senator Lieberman, and others of the committee have given me in discussions about this department over the period of time since even before I became the secretary, and up to the present time. We have had an opportunity to talk about a number of the ideas here, and a number of the ideas, frankly, are plagiarized from suggestions and proposals that have been offered by this committee, and I invoke every means of paying tribute to your good suggestions.

But I think maybe the most eloquent is that we've adopted a lot of them in the reorganization as well. So we have to pay a lot of close attention to what this committee is doing.

Let me outline briefly, kind of give you an overview of what we're tried to do here, and then I want to respond a little bit to Senator Lieberman's point in his opening statement.

This is not -- neither my speech yesterday nor my testimony today is a complete review of everything that we need to do and are doing. We've had some previous testimony here about for example chemical site security. I didn't feel the need to repeat that again yesterday. We are working very hard on that issue, because we do recognize that there is a lot of concern about making sure that chemical sites don't become weapons in place.

But some things which I think we had not talked about seemed appropriate to talk about yesterday: preparedness, making sure that we had focused on preparedness for our greatest risks, and that includes biological, nuclear, chemical, things of that sort.

Transportation, including mass transportation, making sure we have better systems that move people and goods into the country and around the country, and taking account of the nature of the systems themselves, be able to bring modern technology into play, and also to make sure that we're being interoperable, that when we set up various trusted traveler programs and screening programs, we build them in a way so that they work together, and so that eventually instead of having four or five separate trusted traveler cards, people can have one, and that can do the duty for all the different kinds of screening that we need to do.

I mean this kind of thinking smart not only promotes security but it promotes privacy and it promotes efficiency.

Borders and immigration, obviously a huge issue. Senator Domenici, I can tell you that the discussion that the commissioner had with you reflects the way this department is approaching the border, which is an integrated approach that is looking to take and coordinate new technology, infrastructure, and people in a way that makes them work together, and also does something we sometimes don't do in government, which is take a strategic look at the whole picture.

Because you know the issue of dealing with illegal migration is not just apprehension, but it's also when we apprehend people do we detain them? If we detain them how quickly can we remove them? And all of these pieces work together.

I can tell you, sometimes we make a mistake when we flood a lot of resources to one piece of a system and we don't take account of the fact that it's going to bottleneck another piece of the system.

What we're doing now is, we're going to have a program manager who is going to build an entire system, and make sure that all the pieces are properly scaled so that we actually increase efficiency.

Likewise, too, I'm delighted to point out, Senator Domenici, in terms of the foreign students, that as I announced yesterday, Secretary Rice and I are working on an agenda that we hope to announce shortly that will expedite and make it easier and more welcoming for those who want to come to the country to visit and study in a positive way to come here.

There is no question part of this struggle against terrorism is the struggle of ideas, and we want to embed our ideas overseas, and that's one of the reasons why we want to be welcoming and not forbidding.

Information sharing is a key element, and the chief intelligence officer that we envision is going to have the ability and the authority to fuse the intelligence that is generated by the over 10 components in our department that currently have some intelligence responsibilities, and to do it with a view to having strategic intelligence that fulfills the unique mission that I think Congress envisioned for this department, which is not merely playing catch the terrorist, but is talking about how to help our state, local and private partners, protect their infrastructure, prepare themselves for any eventuality, and prevent acts of terrorism on state and local levels.

Finally, I'd be remiss, and I would be remiss, had I not mentioned organization as a critical part of what we're trying to do, and that's why I mentioned it yesterday. And that means not only procurement policy, and we talked about this -- I sat down with the inspector general very soon after I arrived, and I said, I want to get your ideas about how to make procurement work with efficiency and integrity -- but also having capital properly move forward. We have MAX HR.

One of the things I'm trying to do is not only -- is to move that forward and implement it in a way that is reassuring and accessible to the employees of the department, but also build a culture in the department where people learn that we are working as a team, and that involves doing things for example like encouraging career paths where people can move among different components so that they get a sense that we are part of a larger department.

To do all these things, I've outlined a series of organizational changes which I won't go into in detail on my opening statement, but which I think will give us the tools to make sure when we look at our mission in terms of our policy, our intelligence, and our operations, we look with a single pair of eyes, that operate in synchronicity, and allows us to look across the entire department and drive the agenda and accomplish the mission without regard to the individual component stovepipes.

Let me just take a moment to respond to Senator Lieberman's observations about mass transit. I've obviously been closely involved in our response to what happened in London, and in dealing with the whole issue of how we are preparing ourselves with respect to transportation in general.

As I said, I think I said in my confirmation hearings, I believe we need to make sure that we are paying as much attention to our nonaviation transportation as w e paid to our aviation transportation. But I also had tried to emphasize that these are different systems, they work differently, their ownership is configured differently.

And therefore, although they each require the same degree of attention, the particular way in which we pay attention may be a little bit different. Aviation is, for example, a closed system. People enter and depart in a relatively fixed number of points. Once you're on the airplane, you're on the airplane, and so our configuration in terms of security is one that is guided and molded by the existing nature of the system. We don't want to break the system.

We all know that we could not import that system into the New York Subway system. I've ridden the New York subways. I've ridden the Washington subways. To have magnetometers would be to destroy the system itself, so we'd have to think about how do we make that system work with security and with efficiency.

And in that regard one of the things I wanted to be careful to emphasize, and perhaps I'm not always as careful as I want to be, is that we have to look at the whole range of threats. Obviously even a bombing that kills 30 people or 40 people is a very serious matter. But a biological incident in the subway or a chemical incident in a subway, which could happen, would have the capability of killing many, many more people, and in fact rendering a subway unusable for a substantial period of time, would be a matter of significantly worse consequence.

It's part of the nature of my job to make sure that as we go about doing things in terms of our priorities, that we take account of the structural differences of the systems we deal with, the differences in consequence. I think that's the essence of risk management.

But I do want to emphasize, so there is no mistake about it, that as we speak, and before London, we were working very, very hard focusing on the rail system, and particularly on those vulnerabilities that people in this committee have talked about, including concerns about the movement of hazardous chemicals on our rail system, concerns about the possibilities, as I say, of chemicals or biological things on the system, and also, obviously, working on new technologies to detect explosives and to allow us to give greater sense of safety to those who use the transportation system.

So that's my kind of overview. And I hope I've clarified any misconceptions. And I look forward to answering questions.

Senator Collins: Thank you, Mr. Secretary.

During the past three years the department has invested a great deal of resources, time and attention in improving our nation's preparedness and ability to respond to a terrorist attack, and that's obviously a very important part of the mission of the department.

Less attention has been given to the intelligence role of the department. As Senator Lieberman, who is the chief author of the department's legislation would affirm, or confirm, it was intended by Congress that the Department of Homeland Security would play a role integrating a lot of the information reporting, and announcements, related to terrorism,

And that really hasn't happened. The department's role has really been minimal in the intelligence community. And yet you have a department with component agencies like the Coast Guard and the Border Patrol where the access to information and intelligence reporting is absolutely critical.

I had always thought when the Terrorist Threat Integration Center was created, that that would have been placed within the department. But as I said, the department has never really fulfilled its role.

Under your new plan what do you see the role of the department being, and in particular, the new intelligence chief, chief intelligence officer, within the department, but also within the broader intelligence community, both at the federal level, and working with our partners at the state and local level?

Secretary Chertoff: Like you, Chairman Collins, I am passionate about intelligence as the key to doing our job properly. I mean that's the best way to avoid a problem is to detect it in advance.

We have within the department over 10 individual components that do intelligence. A lot of it is tactical intelligence, for example, Customs and border protection, each needs to know about new types of phony passports. And that's appropriately done at the level of Customs and border protection.

But there is a strategic component to that as well. As people come across the border, as they're intercepted and we question them, sometimes they're turned away. Sometimes we find phony documents.

If you stand back and connect all those dots, you sometimes get very interesting pictures that are not necessarily known to those who are within the individual offices, or even within the individual component.

We've done some things, for example, on an ad hoc basis, where we've put Coast Guard intelligence together with Customs and border protection and ICE, and we have actually been able to put a team together to assemble a much wider picture of a particular intelligence threat than we could have done in each component on its own.

And then we have taken that to the wider community and sat with the FBI and with the DNI and the NCT. We've plugged that into what they are doing in a coordinated way.

So we have begun this process even before the organization by doing it manually in the sense that I'll call up the head of the components and say, bring these people and let's sit down, let's fuse this together.

The lesson there is that we need to do it institutionally, not just when the secretary intervenes personally. And that's what we're really trying to build here.

The chief intelligence officer will have the authority and obligation to pull intelligence from all the components inside, and make sure it's fused and integrated from a department perspective.

The second piece is, we need to make sure that we then become better participants in the intelligence community as a whole. By having more to contribute, first of all, we will have frankly more vigorous place at the table.

But I've also made it clear, and I'm going to continue to make it clear, that our intelligence officer, our chief intelligence officer, has a unique role to play in the community. We're not simply chasing terrorists. We are looking at this information trying to understand how does it affect our border operations? How does it affect our Coast Guard operations? Because we do adjust these based on the intelligence.

And then how do we work with our state and local partners, and our private sector partners, in passing this on and helping them make use of it? And so that is a big part of what that job is going to be.

Let me conclude by saying that one of the things I announced yesterday was that I had spoken to a number of governors and homeland security advisers in the states about their desire to have fusion centers. We are inviting them all to come meet with me and the top leadership to see how we can network those fusion centers, which are another form of intelligence gathering, and distribution mechanism, in order to get them all linked together.

So that's a really long-winded response to your question.

Senator Collins: Mr. Secretary, I want to turn very quickly to a recommendation that you did not embrace. As you know, we have had testimony before this committee from the Rand Corporation and others recommending a merger of CBP and ICE, and I've asked the department's inspector-general to analyze that and report back to us.

It appears to me that you're going in exactly the opposite direction by moving CBP and ICE out from under a common directorate, the border and transportation security, and have them reporting to you directly.

If anything you're further separating the entities. We know that a lot of law enforcement officials believe that it would be better instead to bring them together. Could you give us your thoughts on why you decided to move them out, and if anything, separate them rather than merge them?

Secretary Chertoff: I took this question very seriously, and I actually met with the inspector-general to get a sense of at least of what he was finding.

I also spent time talking to people in the field about it, and I also have the ability to rely on my own experience doing law enforcement work, and as a prosecutor, dealing with different agencies. And I mean it was a difficult question. I understand the arguments in favor of it.

We begin with the fact that a merger like that would in itself impose substantial costs. So I asked myself what are the problems we're trying to cure here, and is there a way to cure them in a less drastic approach?

I think one problem is a financial problem that had to do with the original merger, and we are I think close to getting that cured with additional funding and additional management control in ICE.

I don't think I would recommend merging the two organizations to correct a management problem in one. I think we ought to just correct the management problem.

The second question is how do you get them to work together operationally? And I think there has been a problem there. Some of it may be cultural. Some of it may be a legacy of what was left over from the original merger.

I asked myself the question is this a case where we have two agencies that are chasing the same type of activity? Usually when you find that there is a good argument for combining them.

But here, there is -- although there is some overlap, there is actually a fairly distinct center of gravity in each organization. I mean FAMS for example, which we have indicated we're going to move back to TSA, really has nothing to do with these two organizations in terms of their main missions.

But much of what ICE does in detention and removal and investigation is functionally different to a large degree from Customs and border protection.

So I guess I concluded that merging them would simply -- they'd still have to have different functions, they would simply have deputy assistant secretaries instead of assistant secretaries.

What seemed to be important was to get them to operationally work together, but to do it with the other components as well, with Coast Guard, for example, and with -- even with infrastructure protection.

And that's where having an operations and a planning and policy shop department-wide I think supplies the answer.

When we sat down to talk about a border security strategy, what we needed to do was to build a plan that was comprehensive, that took us from the beginning of the process through the end, and that spanned among other things the role of CBP, ICE and Coast Guard.

Putting together a tool that allows us to do that, which is what we recommended, I think will address the problems that have been identified.

Now, as I said, I spent time thinking about it. I understand reasonable minds can disagree. I think that at this point I'm confident that our solution has a very, very good prospect of succeeding, and I look forward to talking about it more with you in the future.

Senator Collins: Thank you.

Senator Lieberman.

Senator Lieberman: Secretary Chertoff, let me come back to the question I asked you about the comments you made yesterday.

First let me clarify it, because I've been asked, by coincidence many of us were in a classified briefing with you yesterday. I would never quote from that. This is a quote from apparently a meeting you had yesterday with Associated Press reporters, and editors.

I want to read it to you, because on the face of the story, if you've not seen it, it's very unsettling coming a week after the London attacks. It must be particularly unsettling to the 14 million Americans who ride rail and transit.

We know as you said in your initial response or your opening statement that these are not closed systems, so they're harder to protect that aviation for instance. But there seems to be a suggestion here that there is not a federal responsibility to protect local and state rail and transit systems.

And to me that goes to the heart of what the department is about. The department is dealing with a national threat of terrorism, and doesn't base its protective actions on whether a federal government regulation dominates in one area or another.

I'll just read it to you briefly. This is an AP story today; Laura Jakes Jordan, Associated Press writer.

"Federal government can provide only limited help to states and local governments to protect transit systems from terror attacks, and local officials must be largely responsible for the cost of improved subway, train and bus security, Homeland Security Secretary Michael Chertoff said Thursday. One week after the bombings on London's subway and bus systems, Chertoff said the U.S. government is bound to financially support the security of the nation's commercial airliners in part because the aviation system is almost exclusively a federal responsibility. By contrast, he said, U.S. mass transit systems are largely owned and operated by state and local authorities. He also said the federal government must focus on attacks that could produce the most casualties."

Quote, "the truth of the matter is a fully loaded airplane with jet fuel, a commercial jet airliner, has the capacity to kill 3,000 people, Chertoff told AP reporters and editors. And bomb in a subway car may kill 30 people. When you start to think about your priorities, you're going to think about making sure you don't have a catastrophic thing first. Asked if this meant communities should be ready to provide the bulk of their protection for local transit systems, Chertoff said, yep."

So I want to give you a chance to respond to that, because I think -- I repeat, I gather you've already been challenged to apologize by one of my colleagues on the floor of the Senate. This will create an uproar, and you happen to be here, so I think it's important for you to clarify how you see the department's responsibility with regard to the safety of rail and transit systems in our country.

Secretary Chertoff: We have an equal responsibility to protect Americans across the board in every respect. The way in which we protect differs depending on the nature of what we're talking about.

And I think the points I was trying to make, and again, perhaps not with perfect precision, was, we have to deal with the differences in the system as we talked about the way in which we interact with the system.

The aviation system -- my point was, the aviation system is essentially a closed system. We can govern people who enter and who have access to it. We can do it in a way that, because of the timing of aviation, allows us to put up portals and things of that sort.

And frankly there is almost nobody positioned to do the -- to put the boots on the ground so to speak other than what we do. I mean there are not large numbers of local authorities that would provide screeners.

So in terms of a manpower-intensive approach to screening in the aviation area we do have a large federal presence.

As someone who has ridden subways and trains all my life, most of the boots on the ground are local. They're local police, and they are local transit police and local transit authorities. So a lot of the actual folks who do the work, and a lot of the manual day-to-day stuff is held by local governments, and some by private. For example, bus lines and things of that sort.

So our responsibility is the same, but our way of interacting is going to be different. The help that we can give transit authorities for example may come in a different form than what we do with respect to airlines. No one is suggesting, I think, that we take federal police and put them on subways.

What we want is, we want the ability to use our technology, do the kinds of things we're now doing for example here in Washington, and in other places like Boston and New York, to have better detection equipment, use of synchronized video cameras, of for example, chemical and biological sensors, so we can get better efficiency and more efficiency with respect to the way in which we protect our subway and transit passengers.

So it's not a question of not having responsibility across the board. It's a recognition of the fact that different sectors of our economy are configured differently, and we have to be partners with everybody, and we have to recognize those differences in the way we apply our partnership.

Senator Lieberman: Okay, so I want to give you an opportunity to clarify, and I think you have.

Let me state what you know, which is, there is an enormous federal investment, which we're debating right now, in the mass transit systems themselves. Leave aside the security question, we're debating that on transportation legislation. So there is a big federal involvement there.

But I agree, we're not talking in the case of mass rail and transit systems of federal police for instance. They're going to require federal financial support and technological support. And I just want to give you the opportunity to clarify that you believe that there is a federal responsibilities, specifically through the Department of Homeland Security, in assisting rail and transit systems around America in protecting the security of the 14 million people who ride them everyday?

Secretary Chertoff: Absolutely, and we do that, and we will continue to do that.

And my point is that we will do it in partnership with those systems. We're not going to come in and take the system over.

Senator Lieberman: Understood.

Secretary Chertoff: We're going to do it with them, and in fact, that's what we have been doing.

Senator Lieberman: Thank you.

Senator Collins: Senator Voinovich.

Senator Voinovich: Thank you, Madam Chairman.

I think we need to reiterate the fact, Mr. Secretary, that you have 180,000 people in 22 departments. The General Accounting Office, accountability office, has said that the way the department is coming together is on the high risk list. And I would hope that during your tenure that one of the goals you have is to get it off the high risk list.

And I was there when Senator Gregg opened up the introduction of his appropriations bill, and he showed us four feet of reports that had been done on your department during the last couple of years, and I would hope that perhaps two years from now that you might be able to in fact, you might judge your performance on the number of feet and inches you reduce the stack.

That being said, how often have you come up to the -- how many committees in the Congress do you have to report to?

Secretary Chertoff: Boy, that's tough. I'm sure -- obviously we have two authorizing committees, two appropriations subcommittee, including the Senate. I think we have two if not three additional committees. I think in the House probably the same. So I think we have, I would venture to say somewhere on the order of eight to 10 committees probably with some degree of jurisdiction.

Senator Voinovich: Madam Chairman, the issue of oversight I still think is before the Senate. And we've been -- the 9/11 Commission or whatever they call themselves now was very critical of us.

I remember Jim Woolsey coming up, who was with the CIA and Congress was insisting on 185 days, and he made 205 trips here to the Congress. And I really would like you to lay out just how often you have been here. Because the more time you're here the less time you have to run your department.

Secretary Chertoff: Well, I can say, and I say this with mixed emotion, that I think next week some departmental representative will have attended the 100th hearing on Capitol Hill since the beginning of the year. So that is a milestone of some sort.

Senator Voinovich: As you know I'm very interested in human capital, and I applaud you for our MAX HR program. I'd like you to share with the committee how you feel about, or what would happen, if the cuts that have been made in the House of $96 million from your proposed $146 million from that account, what impact that would have on your ability to get the job done that we're asking you to do.

Secretary Chertoff: I think, Senator, it would have a very serious impact. As it is, I believe based on the cuts in the '05 budget, we extended the period of time for getting the, say, the Internet, MAX HR from two years to three years.

I think we're in jeopardy if we don't adequately this to have the worst of all worlds, which is to have a pending change of significance but no ability to move it forward, which creates a great deal of tension among the employees, and a great deal of uncertainty.

So I would strongly encourage fully funding to allow us to move forward.

Senator Voinovich: In other words, without full funding you're not going to be able to implement the human capital and other management things that Congress has asked you to do?

Secretary Chertoff: We will not be able to do it in a reasonable or timely fashion.

Senator Voinovich: As a governor I dealt with FEMA, and from my perspective it's the agency with the most expertise in working with state and local governments to prepare or respond to and recover from events. And many stakeholders consider that FEMA's role has diminished after it was initially incorporated into the DHS.

And under your second stage review it appears that the FEMA director does not report to the undersecretary of preparedness.

Secretary Chertoff, with the division of preparedness and response, how will FEMA's all hazards mission be coordinated with the roles and responsibilities of the undersecretary for preparedness?

Secretary Chertoff: The undersecretary for preparedness, Senator, is going to have -- let me actually begin by saying, FEMA does a terrific job, and has done a terrific job.

What we've tried to do is make sure FEMA is focused on a mission that it is obligated to do, and that it does well. Now preparedness really covers the damage, it covers prevention as well as protection as well as response and recovery.

The expertise which will be drawn upon by the preparedness director will be clearly expertise residing in FEMA; also, expertise that comes out of Coast Guard and out of some of our other operating arms as well, including for example Secret Service, which does a very good job in the developing the kind of planning you need for preparedness.

So the idea here is not to decouple the skills of FEMA from preparedness. It is to allow FEMA to pursue its core mission as a direct report to the secretary, and then look to the preparedness directorate to draw on FEMA's skillset, and the other skillsets, in equal measure, in order to make sure it's covering the entire gamut of preparedness from prevention through to response and recovery.

Senator Voinovich: We had a hearing this morning in terms of the congressional region coordination, and you have a Mr. Lockwood (ph) in your department, and I must say that I was very impressed with the testimony that was prepared.

I asked I think it was Mr. Lockwood I asked him how many people he had working for him, and he explained it to me. And the gentleman who represented the state of Maryland said that Mr. Lockwood does not have the people necessary in his shop to get the job done.

And I would appreciate your looking into that situation.

I think one of the things that I'm very concerned about is so often we ask people to do work around here, and we don't give them the resources to get the job done.

Secretary Chertoff: I agree with that. I think they've done a fine job, and I think in fact it was in working with that office and the mayor of Washington and the governors of Virginia and Maryland in the most recent period of time after London last week I saw what fine job they're doing. And I will certainly make sure that they are adequately supported.

Senator Voinovich: Thank you.

Senator Collins: Senator Akaka.

Senator Akaka: Thank you very much, Madam Chairman.

Secretary Chertoff, I'm sure you will agree with me that financial accountability is critical to the success. You mentioned DHS. That's why I wish to bring to your attention the administration's noncompliance with legislation.

I, along with Representative Platts and former Senator Fitzgerald, successfully passed legislation that brings the department under the Chief Financial Officers Act. Our bill, which became law October 16, 2004, requires the president to appoint a chief financial officer for the department no later than 180 days after enactment. As with all CFOs, the DHS CFO is to report directly to the secretary.

However, your second-stage review neglects the position. I would be interested in knowing, first, the status of the nomination of a CFO, as required by the Department of Homeland Security Financial Accountability Act of 2004; and two, given the direct reporting requirement under law, where will the DHS CFO be placed in the proposed reorganization?

Secretary Chertoff: Well, I don't know that we've identified the person to hold that position yet. We currently have a person on an acting basis who's holding the position.

It's important -- obviously, there's a legal obligation of a direct report, and I can tell you that I probably work more closely with the acting CFO now than I do with many people in the department. I think it's important, though, that that still remain well coordinated with our overall management function. And as I say, I envision it complying with the law but making sure that our CFO and his very important function, first of all, has authority and coordination over the entirety of the department, which I think is critical in terms of making sure the financial system works together and that it's closely configured with the other management elements of the department, which include procurement, human capital and things of that sort.

Senator Akaka: Mr. Secretary, this morning the Subcommittee on Oversight of Government Management, chaired by Senator Voinovich, held a hearing at my request on security in the national capital region. We discussed how important the DHS Office of National Capital Region Coordination, ONCRC, is to the success of the NCR. Under your proposal, the director of ONCRC would report to the undersecretary of preparedness instead of to you, the secretary, as is current policy.

My question to you, and this has been touched on already, what rationale led you to create another layer of bureaucracy between yourself and the national capital region? And two, what steps do you intend to take to ensure sufficient full-time employees, rather than detailees, are available to staff this critical function?

Secretary Chertoff: Well, again, there are -- numerous direct reports to the secretary, and what we've tried to do is look at the actual work flow and pattern within the department and configure people who do a lot of work closely together in a manner that gets them close together in the organization chart. The national capital office, which has really the function of preparedness for the capital, does something that is -- needs to be very closely linked with preparedness in general.

For example, a lot of the work that we want to do under our proposed chief medical officer is going to have direct effect on the capital, because we've suffered an anthrax attack here. I want to make sure they're working together, and in fact what this does is it enhances the ability of the national capital office to participate in our preparedness planning -- including the buyer preparedness planning -- using the perspective that he has drawn from the unique challenges that you face in this particular city, given the fact that it's the seat of government.

So I actually don't view it as diminishing the role of that office, but actually as enhancing its ability to touch and influence many of the preparedness functions that we need to use that will be of direct significance to protecting the capital of the country.

Senator Akaka: Mr. Secretary, you have mentioned the need to enhance and speed up baggage inspections, and you call for more research on sophisticated detection equipment. I have a suggestion that is budget neutral. To help solve this problem, I urge you to improve TSA screener rights and protections.

As an example, the checked bags at Dulles International Airport are placed on conveyors where they're taken to the basement for inspection. Bags are physically lifted off the conveyor belt, placed on screening machines and then again lifted off and loaded on baggage carts. If the conveyor belt breaks down -- which happens often at Dulles, because several airlines ignore weight limits and the machinery is overstressed -- the bags are physically moved by TSA baggage screeners many yards to a working screening machine. This example clearly demonstrates why employee input on the working conditions and new technology are important, because employees know firsthand the impact technology will have on their ability or inability, as the case may be, to do their job.

However, without the rights and protections granted to the other DHS employees, TSA employees may hesitate to disclose problems that directly affect the efficiency and security of our transportation system, as well as costs, since TSA employees have high rates of worker's compensation claims due to the physical nature of their job.

I believe granting TSA screeners full whistleblower protections, including appeal right to -- (inaudible) -- Protection Board, will improve our screening capability. And I just wanted to get that to you and maybe just ask you what you think about that.

Secretary Chertoff: Well, first of all, I don't think anybody needs to hesitate about suggesting improvements in the screening system. In fact, I believe that when we do procurements, and particularly when we design request for proposal, we need to do that by up-front going to the operators and making sure we understand the operational conditions and constraints.

It makes no sense, as you point out, to build equipment that in real life doesn't work because the people who operate it -- it doesn't work in the real-world environment. So we're going to be encouraging participation by people with operational experience in the process of designing and procuring our systems going forward.

Senator Akaka: Thank you -

Senator Collins: Senator Coburn.

Senator Tom Coburn (R-OK): Thank you, Madame Chairman, and thank you, Mr. Secretary, for your testimony.

A couple of things.

First of all, to follow up on CFO -- I don't know if you're aware, but the Federal Financial Subcommittee has been looking at this. And I can tell you, in terms of the president's management agenda, a qualified and vibrant and active CFO is a must for you to meet that, plus the PART assessments, plus IPIA, which is the Improper Payments Act, plus all the other acts from GPRA on up. And so I would just encourage you to get that settled, because that's going to help us help you.

The second thing -- under your six imperatives that you outlined, the second one dealt with borders and immigration.

(Searching through materials.) Let me see if I can find it here. (Pause.)

And you mentioned strengthening border security, interior enforcement and reform immigration processes. And I note that the third was reforming immigration processes, and I understand that that works with it.

But I want to make sure you understand that the consensus in the country, even though we have to have some immigration reform, is to secure our borders, northern and southern. And it's important for me, for this president and the people who work for him in positions such as you -- is to let the American people know what we're actually doing. And what is the priority? Is it to change immigration policies, or is it to secure the border? I understand that they all are interdependent, but which is the greatest priority?

And I would also bring forth to you the fact that we had some questions of Mr. Aguilar in some of our oversight hearings, one of which is I ask him specifically to get to me exactly what they needed -- his department -- to secure the border. And I want to tell you what he sent us could have come from a second-grader, in terms of being vague, noncommittal. In other words, he sent us some information but didn't send us any information. And I think that's inappropriate, number one.

Number two is, we really do need to see assessments. You see the amendments on the Senate floor about increasing Border Patrol? That is a reflection of the tension that's in the country. And I'd just like for you to moment. What are we doing on our borders? Do we have the money? Do we have the personnel? Do we have the training capabilities to secure the border first, in conjunction with our immigration reform?

Secretary Chertoff: You know, I'm acutely aware of how troubled people are, justifiably, about the situation at the border. I think I said in my speech that flagrant violation of our borders not only undermines our security but it really flouts the rule of law. And of course it imposes a particular burden on the border communities.

I don't know when you got the information from Chief Aguilar, but I can tell you what we're doing. We are, as I said earlier, looking at this whole picture as a total system. There's a tendency, I can say, going back to my years when I was a prosecutor, a line prosecutor in the federal government, sometimes to flood a lot of resources to a piece of the system in a way that breaks the system. This is about Border Patrol guards -- Border Patrol agents in part, but only in part. You've got to be able to deploy them effectively.

That means you have to have surveillance technology. It has to be integrated in command and control with the boots on the ground. You have to have changes in infrastructure so people can move more quickly, and then you've got to do some other things. You've got to have -- for other-than-Mexicans you can't simply deport to Mexico, you've got to have beds. But then, when you look at beds, you've got to ask yourself this question: how does long does somebody occupy a bed? If they -- now it takes an average of about 40 days to get a person back to their home country. If we can cut that, we've effectively doubled the beds.

You understand the point. We are -- I think we have now mapped out this system in its entirety. I think we now know all the moving pieces. And I will tell you I personally spent a fair amount of time, including some weekend time, on this. We are now getting -- finding a program manager, and we need to build a very specific set of plans that will now do things like, say, okay, for every x number of border patrol or x number of OTMs, how quickly do we have to move them out of their beds, what do we need to do that, where does that mean we flow the funding?

You're exactly to expect that we do that. One of the main reasons I am arguing for a policy and a planning director is to give us the people who can take these policies and now really literally grind out the instructions very specifically about how we get there. I'm convinced we can do it. We're working on it now. We're looking to start immediately on the detention removal issue. That's not going to happen overnight, but we're also looking to do a system-wide procurement for a suite of technology and infrastructure and people that will be integrated and will get us to where we need to go in a way that doesn't create a bottleneck.

Senator Coburn: Well, let -- let me just follow up. We had also on a June 7th hearing on the subcommittee on tyranism (sic) -- Terrorism and Technology and Homeland Security, Mr. Aguilar discussed the expedited removal process for OTMs on our southern border. I was impressed by what we have heard so far. Currently that's being done in two of 20 sectors, both on the southern and northern border. And Senator Kyl, asking for a time frame, when we could expect this to expand from two to 20, and -- and Senator Kyl's actual words were, "Are we talking about a matter of months, or what are we talking about?" And Mr. Aguilar's quote was, "I would feel comfortable with that if DHS approves everything else. Yes, sir." So, what does it take to approve that so that we get that type of process going in all 20 sectors?

Secretary Chertoff: I have approved it I think for a couple more sectors since then. The limiting factor, Senator, is beds. Expedite, you -- an expedited removal for a non-Mexican means you've got to arrange to send them back to their home country.

Senator Coburn: Yeah, I understand.

Secretary Chertoff: So we need -- we need -- now you need beds, but let me just give you one other little example of a small thing we could do that would make it better.

Right now sometimes we wait, I think for a period of days, perhaps, for a consular officer from the local country to appear and talk to the person before we can move them out. If we put in video conferencing and we get them to do it in a matter of hours, we can cut bed time.

So Chief Aguilar was right. We're talking about a growing -- we're talking about a matter of months to scale this up. But we need to make sure that when we scale it up on expedited removal, we've fully scaled up all the rest of the process.

Senator Coburn: All right. And you feel confident that that's moving along.

Secretary Chertoff: Yeah.

Senator Coburn: Okay. Thank you, sir.

Senator Collins: Senator Lautenberg.

Senator Frank Lautenberg (D-NJ): Thank you, Madame Chairman.

Mr. Secretary, those of us who come from the urban area states are extremely concerned with the commentary made about transit systems and the federal role in helping fund security for those systems. Now, most of -- many of these systems are interstate systems. We have Amtrak -- is Amtrak considered part of a national responsibility, or is that a -- does that too get divided up somehow in terms of supplying security funds?

Secretary Chertoff: Well, I think the Amtrak police are -- I think are federal employees. I mean, I -- you know, as I said, I mean -- I've ridden the same systems that we're talking about for many, many years. I don't think anybody's suggested we make the New York City transit police federal police, or the New Jersey transit police federal police. You know, the hiring, the payment, the managing of those police will continue to remain, as I understand it, in the state and local hands. What we can do is we can add value in areas like technology and things of that sort. And we can give some financial help. But I guess it -- again, the way the ownership and the operation of those systems works is different in every different context.

Senator Lautenberg: The -- it's a cloudy definition, and we are going to need federal help in many of these operations. We just don't have the means within the states to take care of it on our own.

Mr. Secretary, we took an action here yesterday that runs contrary to the statement that you make that you would oppose any amendment that doesn't allow 90 percent of the funding to be based on higher risk. Now, yesterday we voted within the Senate to decrease the funding that goes to the higher risk areas by $138 million, confirmed by CRS. Does that represent an impairment for your operation in any way? Is it too small a sum to be concerned about?

Secretary Chertoff: You know, I think I -- boy, I thought I was about as clear as you could possibly be in the letter. And I'm sure I'm better in letters than I am sometimes when I speak off the cuff. I mean, obviously, the closer we move to a totally risk-based system, the more ability we have to manage our resources in an effective way. And again, a risk-based means looking at consequence, vulnerability and threat. And as I try to make clear, you can't necessarily tell -- at least, I -- maybe some people think they can. I can't necessarily tell you which states, quote, "win or lose" under that formula. What I can tell you is that a risk-based formula lets us our resources in a way that is driven by our analysis of risk, as opposed to predetermined categories, is what we favor.

Senator Lautenberg: Are you familiar with the statement made about the most dangerous two-mile stretch in the country as an invitation for a terrorist attack? You're familiar with that?

Secretary Chertoff: Talked about this, I know we have. Yeah.

Senator Lautenberg: Do you believe that's true?

Secretary Chertoff: I can't tell you what the most dangerous two-mile stretch is. I can tell you there are -- we look in a very disciplined way at all the infrastructure and the way the infrastructure is built around each other. And we're very mindful of, you know, what reflects the highest dangers based not only on -- obviously, the location of population -- but also the relationship with the infrastructure that can have cascading effects on things that are very far distant.

I think -- again, I mean, the way -- you know, what we advocate is, and what I advocated in the letter is a funding mechanism that allows us to use some of the tools we've developed -- and some of them are quite sophisticated -- in analyzing threat vulnerability and consequence of all different kinds of infrastructure in different parts of the country, and let us allocate the money on that basis.

Again, bearing in mind what I said, you know, a lot of the infrastructure is in private hands, and so that means the private sector has to bear its fair share of the responsibility, as do our other partners.

Senator Lautenberg: Well, it is suggested in a review of chemical hazards in the country that fairly significant damage could result from an attack on any one of these. One of the most threatened place to the largest number of people is a chemical facility in Carney, New Jersey, which is part of the New York/New Jersey region. And it's estimated that as many as 12 million people could perish if an accident or a raid took place there.

Do you have any reason to challenge these estimates?

Secretary Chertoff: I can't say that I've heard of 12 million based on a single chemical plant.

I can tell you that we are -- what we do, and what we are continuing to do is look at chemical plants, for example. And I think we have grouped them into tiers in terms of the threat that they would pose to particular, you know, parts of the country or numbers of people. It depends a lot on the nature of the chemical, the location of the plant and how it's configured relative to, you know, other parts of a particular community. And I certainly don't want to announce publicly what the most dangerous ones are. But that is the model we're going to look at. You know, to the extent we have the ability to apply our resources in a risk-based way, that's the kind of modeling we will use and go forward on.

Senator Lautenberg: Thanks very much.

Senator Collins: Senator Coleman.

Senator Norm Coleman (R-MN): Thanks very much, Madame Chair.

Mr. Secretary, just to follow up on Senator Lautenberg's comments, the whole idea of risk assessment -- it's not an exact science, and there's not a mathematical calculation that will allow you to rank order most risk. There is a whole range of factors that enter into that, including the part which we don't understand, is what's in the mind of the terrorist -- soft targets, hard targets.

Minnesota has a nuclear power plant on the Mississippi River, so it's not a matter of the number of people that could be affected; you could affect commerce, one of the major flows of agricultural commerce in the United States, if that was a target. Or the Mall of America, which is in a suburb outside of Minneapolis-Saint Paul, but has 30 million, 35 million people a year and is a symbol.

So I just -- as we go about doing what we do in the Senate, I mean, for those of us who represent states with large cities, but, you know, not of the size of New York or Los Angeles, risk is throughout this country. I think that's a fair statement.

Secretary Chertoff: I do. And I think there's something here, Senator, I wanted to point out, because it didn't get as much attention in the speech as I thought it might.

When we talked about the bio -- you know, having a chief medical officer and making biological -- preparedness for biological threats, you know, putting it in the top rank of things, I was careful to talk about threats to animals and to our food supply. I mean, that's something which -- you know, beef -- people don't talk about perhaps that much here in this part of the country, but we all eat. And I think I'm -- you know, we're all familiar with the impact, for example, that foot-and-mouth disease can have on our agriculture. And just look at what happens with one cow.

So that's an example of something that I do put as a high risk. Now, it doesn't mean we -- again, you know, every risk we deal with differently. It doesn't mean we're going to have federal cattle police sitting in the farms. But it does mean that when we think about preparedness, that's the kind of thing that I do want to put a lot of emphasis on.

Senator Coleman: And I would note -- I didn't make a formal statement, but in my formal remarks I wanted to say I was encouraged by the focus you've provided with the --

(Audio break.)

Senator Coleman: (In progress following audio break) -- if you look at a map of where the offices are, they're not in the areas where they're directly impacted in those northern regions.

So I'm concerned about the impact on ordinary citizens. It's that kind of balance between securing our borders, which the senator from Oklahoma talked about, but also doing it in a way that doesn't unduly burden average Americans going about living their lives, and particularly in those areas where there is a real economic impact, there is a real quality of life impact.

So are you considering other ways to address this other than the passport requirement?

Secretary Chertoff: We are, Senator, and I think we made clear at the very beginning we were looking at anticipated alternatives to passports. Obviously, a passport would be sufficient.

And by the way, I don't think this requirement would come into effect under the law, which Congress passed as part of, I believe, the Intelligence Reform Act for a few years. We have a few years to stage into this.

But the idea is to identify other forms of secure identification that would suffice for purposes of doing this. And that's again why I'm driving the point of having interoperable systems of cards and verification of documents so that you could use a wallet-sized card that would do a number of different things for you.

And it may be that under the -- as we get off our regulations under the Real ID Act, it may be that we can move to the point that even driver's licenses will be able to satisfy the requirements of the statute.

Senator Coleman: Thank you, Mr. Secretary.

Thank you, Madam Chair.

Senator Collins: Senator Pryor.

Senator Mark Pryor (D-AR): Thank you.

Secretary Chertoff, let me ask, if I may, something that Senator Coleman referred to a few moments ago you followed up on about the food supply and agriculture generally.

Do you -- what is your assessment of the risk of an attack to agriculture -- I guess we call it agroterrorism? Tell me --

Secretary Chertoff: I don't know that I can give you a number. I think the general issue of biological attacks on human health and animal health and food are -- it's an area that we need to be concerned about.

We know historically that terrorists have looked at biological and chemical weapons, and I think it's not hard to see how that might be applied in an agricultural setting as well as in a human setting.

Now the principal point in our general governmental preparedness process for dealing with these issues is the Department of Agriculture. And they own the expertise. But our responsibility as those who essentially have to look at the total architecture of our preparedness is to make sure that we are working with the Department of Agriculture, that we have a good set of plans, a good set of preparedness, for what to do in case of an attack like this.

Obviously part of this is keeping these agents out of the country in the first place, but we also -- we know that there are naturally occurring things, like foot-in-mouth, in the world, so there is a fair amount of learning and understanding about how to deal with that, and we just need to make sure we've got a good set of plans and resources in place in case something like that should happen.

Senator Pryor: You mentioned a good set of plans and good preparedness . Do you feel like the department is there?

Secretary Chertoff: I think we have done a lot. But I think by indicating my desire to consolidated preparedness and make it accountable in one place that I feel we need to polish up what we have. And we need to make sure that to the extent there are issues you have to debate about how you deal with these things, that we get those debates done in advance and make some decisions about what the appropriate course of action is before, God forbid, we face an actual crisis.

Senator Pryor: So in other words, you're saying agroterrorism is real.

Secretary Chertoff: I think we have to treat the danger of a biological attack or a chemical attack on our agricultural system as a priority concern.

Senator Pryor: Also would you include part of that as using agricultural chemicals in an attack, like maybe the Oklahoma City bombing?

Secretary Chertoff: That's a somewhat different category of issues. The question of explosives, and we know that fertilizer can be used as an explosive --

Senator Pryor: I just mean they're much more available in agricultural areas.

Secretary Chertoff: I think that's true, although I must tell you there are a disturbing number of household chemicals which can be used to make powerful explosives. So that is a species of a larger problem that I would consider a little bit separate from the biological problem.

Senator Pryor: Okay. Well, I may want to follow up with you on that separately at some point to talk about that in more detail.

Do you think that agriculture security will be considered a high enough risk to be part of the risk-based funding? I mean, are we there on that?

Secretary Chertoff: It's clearly a high risk in terms of our priority. Again, I mean I guess I want to come back to the original point I made to Senator Lieberman. I can't equate priority necessarily with the amount of money that's spent. There are going to be many things that are very, very high priority in which the infrastructure, frankly, is in private hands. And I'm not going to say that the federal government is going to pay private people to protect what they own.

We will use other ways to encourage the private sector to do what it has to do. So I can tell you that agroterrorism is a very high priority. How that plays out in terms of funding depends an awful lot, again, on the particular characteristics of that sector of the economy and the way that business model works.

Senator Pryor: Okay, great. Tell me about the chief medical officer. How do you envision that working?

Secretary Chertoff: Well, again, we don't own -- the expertise in human health is principally HHS. The expertise in animal health is principally agriculture. And that's before we even get to all the state officials who have a tremendous amount of expertise in this area.

I don't see DHS as competing to seize control of the expertise. What we do have an obligation to do is to look at the total picture, make sure that we turn to the departments for the expertise and ascertain that they have a plan in place, that it is properly integrated with everything else we're doing in case -- in terms of preventing and protecting against an attack and responding if we have an attack; making sure that the plans, if there is uncertainty about the plan, that we get that resolved and we have certainty; and ultimately owning the responsibility for coordinating the response with these experts in the various departments across the board.

And that's what's really laid out in the national response plan which the president has issued.

Senator Pryor: And I'm curious about your new organizational paradigm then that you're trying to set up. Do I understand correctly that border and transportation security is sort of melding into preparedness?

Secretary Chertoff: No. What's going to happen -- we're going to take the -- border and transportation security did three things. It was responsible for policy planning, and it was responsible for operations, but only with respect to some of the components of the department.

It covered, for example, Customs and border protection, TSA and ICE. It doesn't cover Coast Guard, for example, or other functions.

What we're doing is -- essentially we're building on a good idea. We're taking the good idea of that planning function, but we're making it part of a department-wide directorate that is going to have the ability to plan for all of the components, not just some of the components.

We're going to take -- the BTS had an operational capability, but with respect to a few components. We're going to take that and create an office that can be operational, coordinator, for all the components.

Once we do that we've effectively taken the functions of border and transportation security and we've made them more nimble and made them more wide-spanning across the entire breadth of the department.

At that point we really don't need another layer to stand between some of the components. And the secretary -- we've taken out the functions; we've distributed them across the board, and I think we can actually flatten the organization.

Senator Pryor: So if I can summarize, it sounds to me like it's an example of the department being up and running for a couple of years, learned some lessons about how some things work and some things don't. And you're trying to streamline and make things more efficient.

Secretary Chertoff: That's exactly right.

Senator Pryor: Thank you.

Senator Collins: Thank you.

Senator Dayton.

Senator Mark Dayton (D-MN): Thank you, Mr. Secretary, for taking on these many enormous burdens.

We've had two instances in the last 13 months with small private plane originally unidentified, at least not communicated its identification to Capitol police, and evacuations. And I think both of them have demonstrated different gaps in communications. The first, as I recall, the FAA was aware the plane did not have an operating transponder, and under its own regulations should not have been permitted, but it was. They knew that. They didn't communicate that. There was an open line established I guess among different agencies to communicate post-9/11. That wasn't staffed. So the information wasn't shared.

More recently, the evacuation, I believe, showed a lack of communication between the federal and the city of Washington, and that a we learned this morning at a hearing that Senator Voinovich chaired the subcommittee, was instructive because we had representatives from the states, Virginia, Maryland and then Washington, D.C., and then the federal agency. And the complexity of these intergovernmental entities and relationships means, it seems, that there have to be these multiple communications which in an emergency situation -- it seems the more complexity you have the more likelihood that something is not going to function properly.

Is your agency responsible -- is there an overriding responsibility that someone has to protect the capital to make decisions that become necessary if that kind of a situation occurs again?

Secretary Chertoff: We have -- I guess we have responsibility for managing the relationship and the response with our state and local partners. To the extent, of course, that F-16s go up, as they do when we had these incidents, those F-16s obviously are part of the Department of Defense and operate within the authority of the Department of Defense.

What we did in the wake of -- in fact there have been many, many, many incidents with small planes. Very few of them get to the point of getting reported. And they are by and large innocent people either getting mixed up, or sometimes they're trying to avoid weather.

What we did after a recent incident was we sat down with the city and with everybody else. We have an operation center in which the -- (inaudible) -- states and the city of Washington are represented and have people present who can listen real time to the discussion over the airwaves when planes are coming in.

We decided that as a back up it made sense for Washington to have -- the District to have somebody present in our Transportation Security Administration operations center, which is a second center, and have that person again able to listen live, and then I think there is also some additional steps the District has taken to tap into some of our preexistent warning communication systems

Senator Dayton: So excuse me, my concern is that in both those instances, although people were evacuated, I give the Capitol Police -- I mean they were heroic to stay on their ground and get people out -- but if either of those planes had been a hijacked terrorist plane, it would have crashed in the Capitol well before many people, hundreds of people, would have been evacuated.

Secretary Chertoff: Well, actually, let me try to address it this way. Of course, the timeframe within which you know that a plane is coming is very, very short. We get hundreds and hundreds of planes within a certain number of miles do raise our interest.

I can tell you first of all -- I don't think there is an doubt that, had it been necessary, the Air Force would have had the capability to remove any threat, any airborne threat.

But that raises a second question, which is, to caution that evacuation is not always the right step in the face of an attack. A small plane, and I know this is being looked at now, does not necessarily have the capability of doing to a strong building what people envision, let's say in the case of what happened on 9/11.

On the other hand a small plane carrying chemical or biological agent would actually do more damage if people go out on the street than if people shelter in place.

And if there is one message I could leave to the country at large on this issue of preparedness is -- you know, our intuitions about the right reaction in the face of a threat, like an airplane, which is often to run, sometimes turn out not to be right. Sometimes we're better off sheltering in place.

And that's why one of the things we encourage people to do is, as part of preparedness, is to think through and understand. We want businesses to do this, too and government agencies, to understand that sometimes the right advice is, don't run out of the building. Stay where you are, maybe go down to a basement, and that is actually safer.

So I think, we spent a lot of time on this. I'm confident we have the situation well in hand. And we continue to monitor it and train on it.

Senator Dayton: Along those lines, how does opening National Airport to general aviation improve our homeland security?

Secretary Chertoff: What it does is, it's a recognition of the fact that where we have sufficient systems in place to protect ourselves, we ought to consider lightening the burdens and restrictions as well as making them heavier.

Senator Dayton: We have no security at the terminals I've gone through to private or charter planes, no screening, nothing.

Secretary Chertoff: Actually, when the regulation becomes effective -- and I think that should happen within a very short period of time, a matter of days -- it will not allow all general aviation to come in. It will require general aviation that comes in to be previously identified. It will require TSA screening at the place in which the general aviation departs from. It will require certain other security measures that are in place, precisely to avoid the situation you're concerned about.

Senator Dayton: If the greatest burden placed on somebody is to have to land at Dulles and drive in, as I've done several times for that reason -- I mean it seems to me that's a very small burden on anyone. These planes -- you say it's happened a number of times without having evacuation. It just seems to me having that many more planes and pilots with different degrees of knowledge about the procedures and all is just going to -- you're begging for more incidents related to the Capitol. And I don't get it. I just don't think it's one of those burdens that can be justified.

Secretary Chertoff: Well I think I can --

Senator Dayton: I'm sorry, my time is limited. I'm sorry to cut you off, but let me ask -- last night Senator Akaka offered an amendment to increase the funding for the first responders program, including the UASI and the like. And we were told by the chairman of the Senate Budget Committee on the Senate floor, he said, the simple fact is that you can't disregard the fact that there is $7 billion in the pipeline for first responders, $3 billion from the year 2004, $4 billion from 2005, that hasn't been spent.

Is there $7 billion in the pipeline, because we'd sure love to direct some of that pipeline to Minnesota?

Secretary Chertoff: I know there is -- I think the figure I have in my mind on state homeland security funding and urban security initiative funding in the last several years I think is a total of $8.6 billion. That's over a period of years.

And that's in various parts of the pipeline. Some of it has been spent. Some of it has been obligated. Some of it is going to be rewarded in grant programs that we currently have underway.

So, again, often figures get sliced in different ways. I'm never quite sure --

Senator Dayton: Never in the Senate.

Secretary Chertoff: -- how they're being sliced. But I can tell you that I think the figure I have for the last several years has been $8.6 billion.

Senator Dayton: Then, Chairman, I'll direct a question, if I may ask for a written response that really details of that, because I think if that was a misstatement on the Senate floor, it should be corrected. If it's accurate, I'd like to know why there is $7 billion that hasn't been distributed, and why in areas of Minnesota we're zeroed out in funding. I'll follow up on that.

Finally I noted with interest your comments, a brief in your prepared testimony, Mr. Secretary, about FEMA. We've had a couple of experiences in Minnesota with flooding, disasters, in 1997 when the Red River flooded and Grand Forks -- the East Grand Forks -- the -- (inaudible) -- were seriously damaged.

From all accounts, FEMA was outstanding there and responsive, a minimum of red tape. When the city of Roseau in northwestern Minnesota flooded in 2002 it was not the same efficiency of response.

Now I was up there myself a couple of times in the immediate aftermath, and FEMA's individuals came in from, I believe it was Washington State. But they were right on the spot. They couldn't have been more wanting to be forthcoming. But they were trying to explain these programs to beleaguered men and women, lost their homes, lost their businesses, lost their farms, whatever. And you have to have an advanced degree in computer science to track these different programs and intricacies and everything else, and then they have to apply, and then they got turned down, and then they didn't know that they had to appeal.

We could have made it a lot easier, and without just throwing money at people, they needed someone who would say, this is a time when people are down and out; they're in despair, and if ever government needed to sort of undo a lot of the bureaucratic red tape and just be able to be forthcoming in a reasonable way would just improve, I think, not only the quality of the service, but just the attitudes that those people have toward their own government in a time of critical need.

So I would urge you to bring to us as soon as you can any suggestions or whatever you need from us to untie the hands of these people and simplify these programs or assistance and authorize the people on the spot to do a job of empowering them to approve these awards and get the money in the hands of these people.

Senator Collins: Senator Dayton, thank you.

I just want to make sure Senator Carper has time for his questions, because of the vote has started.

Senator Dayton: He said I could have his time.

Senator Collins: (Laughs) -- and you did.

Senator Carper.

Senator Dayton: (Inaudible) -- remember that.

Senator Thomas Carper (D-DE): Mr. Secretary, welcome. Thanks for joining us again today. It's good to see you, as always.

I know this question came up earlier when I was unable to be here when it was raised. But I believe you may have testified before a committee in the House, either today or yesterday. I was asked by a reporter to respond to something that she thought that you had said.

The tenor of her question -- the thrust of her question was, Secretary Chertoff suggested before the House yesterday or today that the states really should assume the responsibility for underwriting the cost of terrorist protection or protection against terrorist attacks on inner-city passenger rail and on commuter rail services.

And I don't know if she was goading me or what, but she was trying to get me to kind of lash out at you. And my first response was, I find it hard to believe that he would have said that.

So I think it's probably come up here earlier, but I just want to hear with my own ears what you said.

Secretary Chertoff: It did come up earlier, Senator. And it's fascinating to watch the velocity of misunderstanding as it increases over time.

While I may not have been crystal clear what I said to the reporter -- it wasn't in a hearing, but what I said to a reporter is this, We deal with different systems.

We obviously have a federal responsibility for protecting everybody in the country. We deal with the mechanics of different systems, and so the way in which we carry out that protective responsibility differs in different systems. The aviation system is one in which - it's a closed system and basically federal authority is the only government authority that operates in the area of air travel.

When it comes to, for example, subways - and here I'm speaking from my own personal experience riding subways - a lot of the boots on the ground are local boots on the ground. They're transit police and local police and conductors and things of that sort. Although we have, for example, screeners at the airport that are federally employed, I don't think anybody would suggest we should federally employ all subway transit police or subway conductors. The way in which we work with protecting our transit systems is to work in partnership - to work in partnership with state and local authorities, and the boots on the ground largely are owned by those state and local authorities; they're not federal police.

What we do bring to the process is we give assistance - we have technological assistance, we have intelligence. I've talked at some length here about some of the detection equipment and detections systems we've worked with the states and locals to put into place, as well as work that we're continuing to doing - to be doing. And so - and of course we have made aid available through various transit programs as well as through - the president's budget contemplates $600 million in targeted infrastructure protection that's available for transit systems. Indeed, of the - we talked earlier about the state homeland security grants and the Urban Security Initiative grants. That's $8.6 billion, and that money is certainly - you know, transit protection is eligible for that kind of assistance.

So we do play a major role, working with our partners, in protecting our rail and bus systems, but the way in which that role is played of course is different in that that partnership setting than it is, for example, in a setting - in the aviation setting where it's a different kind of a system.

Senator Carper: All right. I'm told that if you add up all the people who ride subways and buses and trains and you look at the amount of money that we're spending as a nation to protect them from terrorist attacks it works out to about 12 cents per rider. I'm told that if look at the amount of money that we spend on those who ride airplanes around the country and around the world, that we spend, as a nation, about $7.5 per rider. I don't know if those numbers are correct, but if they are, we're spending roughly 50 times more per rider on an aircraft than we are on those who may be on a train or on a subway.

I appreciate the need for a partnership, but I have a concern that there's a lot of other expenses and needs that state and local governments are trying to meet with the federal grants that they get, and to load onto that a major expectation for them to help protect inner city passenger rail and transit I think it is unwise. I'm encouraged by what I hear you say but I want to have a chance to think about it a bit more.

Let me just come back to funding for this current fiscal year. My recollection was in the appropriations bill for homeland security in fiscal year '05, that we included about $150 million to look to the needs of particularly transit security. I don't know that there's any money there for inner city passenger rail - but about $150 million. And I'm told that we've spent precious little of that money during the course of this fiscal year. I don't know if that's true - maybe you can clarify that for me if it is - but if it's true, if we've spent none or little of the $150 million - I'm also told the administration didn't ask anything specifically for '06. I think we have about $100 million in the bill - are probably going to adopt an amendment to add to that - but my question is, what is the department doing to facilitate moving that money out to where it might be put to best use?

Mr. Chertoff: We retooled our process of analyzing how we were spending money this year in order to be somewhat more rigorous and disciplined in terms of how to get the money, and I think the rail money - some of the rail money that was stopped is now in the process of being moved out. I have to say - I think I read an article in the paper in the last couple of days where the head of the New York Metropolitan Transit Authority said he had a lot of money he hadn't spent yet, and they were asking him why, and he said, because I don't really know what to spend it on; I'm waiting to see what kind of technology is the best technology to use.

I think this is very important to protect transportation, but it's important to protect it in the right way and not to waste the money, and I can guarantee you if we waste the money I'm going to be reading stories in a year about how we wasted money on gyms and stuff like that, which I read from going back a couple of years.

I want --

Senator Carper: It's hard to waste money when we're not spending it. (Chuckles.)

Secretary Chertoff: Well, I think what we're doing -

Senator Carper: I don't think anyone is going accuse you of wasting money in providing for transit security.

Secretary Chertoff: What we're doing is we're spending it, but I think we've got a program now to make sure it's being spent wisely, and, of course, again, you know, when I hear the head of Transit Authority say, well, he's not sure he wants to spend his money yet because he doesn't know what to spend it on, that does put a little kind of cautionary flag up.

I do want to say that we are doing a lot of stuff in rail. We're doing a lot of stuff with respect to, for example, chemical and biological detection equipment, integrated systems with video and with detectors, which we now have in Boston and in New York and in Washington. We have BioWatch centers in 32 cities in the country. We're accelerating the development of that, and that's focused on a very significant threat in the subway system, which is the threat not just of a bomb, which could kill - you know, would be bad enough to kill a few dozen people, but imagine a biological agent put in a subway system that killed thousands of people and made the system unusable for a period of months. So I want to make sure that we are focused on putting our considerable resources that we are putting into transportation security, again, in a disciplined and prioritized way.

Finally, let me say, in this year's budget the total amount - we basically combined a number of programs, and actually our targeted infrastructure protection program requested $600 million, which would put in the area of rail and other similar things more money than would have been available to all of those things individually based on the prior year's spending. So we've actually put considerable additional money into this. And I want to remind the public that in addition we have large general grant programs for homeland security, which are fully available for transportation.

So we should not view transportation as limited to a few hundred million. We have literally made billions of dollars available to states and localities in various programs over the years that have been used to spend on enhancing transportation facilities.

Senator Carper: All right. My time is expired. Let me just say if the folks in New York or somewhere else don't know how to spend some of these dollars, I'm sure there are folks in other states, including my own, who could - and probably some other states that are represented here on this panel - could figure out how to do it. And I would urge you to consider - your department to consider putting out guidelines to help a New York or anyone who's having a hard time figuring it out.

Lastly, we don't have time to do this, but if I did I would ask you just to share with us, what do they do in New York - or rather in London - what systems do they have on the ground in place that enable them to track down so quickly the perpetrators of the crimes that were committed and killed all those people?

Secretary Chertoff: Cameras.

Senator Carper: That's what I hear.

Secretary Chertoff: Everywhere.

Senator Carper: That's what I hear. We don't have time for that today but they - that was amazing what they accomplished in a very short period of time in figuring out who did this, who perpetrated these crimes, and tracking down the perpetrators, identifying them.

Thank you.

Senator Collins: Thank you, Senator.

Mr. Secretary, we do have a vote on. You're in luck because that means this hearing has to conclude. I want to make to you just two very quick points. The first is that as I review your plan, you are intending to make some truly fundamental changes to the department without requesting legislative authority to do so. Your list of legislative changes is very narrow. I think you're pushing the boundaries on that. And I hope you will work with the committee so that we can draft a more comprehensive reauthorization bill. I think many of the changes you're proposing really should be done by law and not just administratively. So that's an issue we'll be pursuing with you.

Second, I can't let the record go uncorrected in response to the comments from the senator from New Jersey about the Collins-Lieberman Homeland Security Grant Amendment, which was adopted by the Senate overwhelmingly yesterday - more than 70 votes; 71 as a matter of fact. I want to make two points. First is that the Collins-Lieberman Amendment doubles the amount of money that would be allocated based on a risk assessment compared to current law. In fact, the latest CRS report, which I will put into the record, says that nearly 80 percent of the funding would be allocated based on a risk assessment. Second - and this is a very important point - the secretary of Homeland Security will have unprecedented authority to allocate funds. We have, as the Congressional Research Service, to do an analysis to see if they can find any other grant program in excess of a billion dollars where the secretary is given such unfettered discretion, and they cannot. And colleagues on both sides of the aisle have expressed concerns that we in the congressional branch are giving too much authority to you to allocate these funds as you see fit.

So, in fact, we've moved a long way towards the position that you've advocated, despite the concerns of the senator from New Jersey. And I hope your future public statements on this will reflect that as well.

Senator Lieberman: Madam Chairman?

Senator Collins: Senator Lieberman.

Senator Lieberman: May I just say that in this, as in so much else, the chairman speaks for the ranking member.

Senator Collins: (Laughs.)

Senator Lieberman: I do want to say it struck me as we were all focused on London that it bears mentioning that for all that we know now, the plot to attack rail and transit in London was put together in Leeds, a smaller town. It follows the pattern of the 9/11 attacks here and it shows the important role of local law enforcers in stopping such plots, not to mention the fact that agroterrorism obviously would be carried out in rural areas as well. So we'll work together on this.

Thank you very much.

Senator Collins: Thank you.

The hearing record will remain open for 15 days. I'm sure many of the members will have additional questions for the record, as well as other materials to submit.

Thank you very much for appearing today. We look forward to working closely with you.

This hearing is now adjourned.

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