By Jason Miller
and Julia Ziegler
Federal News Radio

The Homeland Security Department’s effort to consolidate its headquarters is falling victim to the budget axe.

“I’d rather have the money to complete building a national security cutter for the Coast Guard, support the Secret Service in its activities and sustain our activities at the border than a new building,” said DHS Secretary Janet Napolitano Thursday during a press briefing in Washington. “That is why St. E’s is on the chopping block for now. Ultimately it will happen, but not now.”

She said the project, being built at the St. Elizabeth’s site in Washington, D.C., will be put on hold in the short term to deal with budget constraints expected in 2012 and beyond.

The total cost for the St. E’s project is $3.6 billion and was expected to be completed in 2016, according to a General Services Administration estimate during a June 2010 hearing.

GSA, which is running the program for DHS, kicked off the consolidation effort in July 2009 when it hired Clark Construction under a $435 million contract to design the site’s first phase — a 1.18 million-square-foot Coast Guard headquarters facility.

But now even the Coast Guard moving into its new building is under discussion, Napolitano said.

“This will all have to be worked out in budget and budget negotiations,” she said.

The Coast Guard is expected to move into the new building starting in 2013.

Funding constraints

A significant portion of the St. Elizabeth’s funding — a combined $650 million — came from the Recovery Act. DHS said that money is still being spent on construction as needed.

But the rest came from DHS and GSA, and both face cuts to their appropriations in 2012.

“I expect we will flatten out and that’s not surprising,” Napolitano said. “The direction I gave the department and the direction I’ve used in preparing our department’s budget — we should have no deleterious impact on frontline personnel.”

That means DHS must be able meet its mission, including protecting the borders, enforcing immigration laws, analyzing intelligence from across the government to protect the country from a terrorist attack and responding to disasters, she added, and therefore St. Elizabeth’s will get the short end of the stick.

The department’s 2012 spending bill is among the furthest along in the congressional process.

Senate committee passes bill

The Senate Appropriations Committee Wednesday passed a $41 billion discretionary budget for DHS next year, which is $2.5 billion dollars less than President Obama requested and $666 million below the agency’s 2011 levels.

“The bill includes $56 million to complete the first segment of the DHS Headquarters at the St. Elizabeth’s campus in Washington, DC (Coast Guard headquarters building),” the Senate Appropriations Committee wrote in its release about the DHS funding bill. “The House bill includes no funding for this project, which will delay completion of the Coast Guard headquarters building by at least one year.”

The House passed the DHS spending bill June 2 at $40.6 billion for discretionary spending, which is $3 billion less than Obama’s request and $1.1 billion less than in 2011.

“The committee recognizes the clear requirement to rationalize the housing and operations of department agencies and components in the capital region, with roughly 70 offices spread in 46 locations across the area,” House lawmakers wrote in the committee report.

“The committee notes that the $77.4 million appropriated in fiscal year 2011 will enable the completion of the Coast Guard headquarters and adjacent construction at St. Elizabeth’s, allowing the department to complete excavation work in a logical sequence and avoid some unnecessary costs,” the report continues. “Furthermore, the funding, which became available for obligation later in fiscal year 2011, will likely be obligated only late in 2011 or in 2012. In addition, both costs and schedule of the current project are matters of concern for the committee.”

The House included a requirement for DHS to submit a revised schedule and cost estimate for St. Elizabeth’s four months after the spending bill becomes law.

The Senate bill still must be approved by the full body, and then both versions of the bill will go to conference committee so lawmakers can work out their differences.

The Senate’s version also includes reductions for reforming eight programs or offices, including the Office of Risk Management and Analysis, the National Biosurveillance Integration Center and the Office of Counternarcotics Enforcement. Lawmakers would cut more than $800 million, including $93 million of rescissions from programs with excess unobligated balances.

More trouble for St. E’s

This isn’t the first time the St. Elizabeth’s project has come under congressional scrutiny. In 2010, the House Appropriations Homeland Security Subcommittee asked DHS for better justification for spending on the project.

The headquarters project is the largest federal construction project since the Pentagon was built just before World War II. The National Capital Planning Commission approved the plan in 2009.

The St. Elizabeth’s site met DHS space requirements for 4.5 million square feet of office space and 1.5 million square feet for parking for the 14,000 employees who would work at the building.

This is only latest setback for the consolidation program.

GSA’s contract for technology infrastructure for the site faced multiple protests. In June, GSA announced an $867 million contract to General Dynamics that would provide services to design, install and maintain integrated network infrastructure to transport all DHS voice, video and data across the consolidated DHS headquarters campus.

It was the second award under DHS’s Technology Integration Program (TIP) after the agency initially awarded Northrop Grumman a $2.6 billion contract in September 2010, which was protested by General Dynamics and Lockheed Martin. GSA pulled it back in December and reopened the bidding after the vendors filed a protest with the Government Accountability Office .

Northrop then protested GSA’s decision to reopen the contract to GAO. GAO denied Northrop’s protest in March, paving the way for GSA to make a new award.

RELATED STORIES:

DHS marks new milestone with St. E’s campus groundbreaking

DHS awards $867M St. E’s contract to General Dynamics

Coast Guard HQ at St. Elizabeths gets full speed ahead

DHS may not have the funding to work together

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