By Jason Miller
Executive Editor
Federal News Radio

Lawmakers want to do some minor house cleaning nearly eight years into the Homeland Security Department’s existence.

The Senate Homeland Security and Governmental Affairs Committee is marking up the first ever DHS authorization bill to eliminate and consolidate some DHS offices and improve management functions for everything from acquisition and technology to human resources.

“We’re basically going back and looking at how this department has functioned since it began eight years ago,” said Sen. Joseph Lieberman (I-Conn.), chairman of the committee. “Some of the office authorized then never really materialized, or we have concluded that they don’t do enough that is worth their existence so we’ve consolidated, terminated, etc. In some cases, we beefed up offices or combined them. We took the assistant secretary for policy and made him an undersecretary because he’s playing that kind of role in the department. The main effort here at a time of real fiscal stress is to make sure that Homeland Security is fulfilling its mission but doing it in the most cost effective way possible.”

The bill, S. 1546, includes seven sections focused on everything from management and efficiency to structure and organization — as well as specific DHS mission areas such as preparedness, response and recovery.

“DHS is a more effective department than it once was but the department must continue to mature and reach its full potential,” said Sen. Susan Collins (R-Maine), ranking member of the committee. “And that is why we brought forth this bill. Most of us agree the status quo needs improvement. If we do nothing we are stuck with the status quo. This first ever reauthorization is a step toward the goal of making the department more effective.”

Forming the basis of the bill

Collins said the committee has held more than 70 hearings over the past six years, and many of those helped form the basis of the bill.

The legislation focuses heavily on acquisition, including the creation of an acquisition review board. DHS has already created such a body. DHS undersecretary for management Rafael Borras told Federal News Radio recently the new entity reviews major program’s cost, schedule, performance and other key areas to ensure they are on track.

Lawmakers want to codify the concept in law because Collins said DHS needs a process to more accurately forecast programs and better oversight.

“We’ve found a model for creating a cost analysis division that is modeled on DoD’s successful Cost Assessment and Program Evaluation office,” Collins said. “We also strengthened DHS’s review process to ensure that there is a better definition of requirements up front and to ensure contracts meet mission needs and are within budget, schedule and performance expectations.”

The bill also encourages DHS to set up independent verification and validation (IV&V) for major IT acquisitions.

“There are a series of provisions to bring greater discipline to the department’s acquisition process which we hope in turn will save billions of dollars that are now lost to waste or actually failure of projects,” Lieberman said.

Lieberman, Collins and other members of the committee pointed to agency projects that either failed or didn’t live up to expectations such as the Secure Border Initiative Net (SBI-Net) and several financial-management consolidation programs, as evidence of why DHS needs to improve its processes and oversight.

In addition to acquisition changes, the legislation would eliminate five offices, including the Office of Counternarcotics Enforcement, Office of Cargo Security Policy and the Border and Transportation directorate.

But the committee also would create a new office — the Office of International Travel Security and Screening — bringing together U.S. Visit, the visa waiver program and the Screening and Coordination Office.

Lawmakers also would rename the National Protection and Programs Directorate (NPPD) the Infrastructure Protection and Resilience Directorate.

FPS to charge for services?

Among the other things the legislation would do is let the DHS secretary make the Federal Protective Service a fee-for-service agency, which will allow FPS to collect fees from other agencies for its services. It directs DHS to consolidate at the St. Elizabeth complex by 2018, and it would create a chief management officer at FEMA.

During the markup Wednesday, committee members reviewed 14 of the 68 amendments offered to the bill. Sen. Rand Paul (R-Ky.) offered 32 amendments and Sen. Tom Coburn (R-Okla.) offered 16.

The committee passed eight amendments and agreed to revisit several in the future. The other 54 amendments will be taken up by the committee next week and thereafter.

Sen. John McCain (R-Ariz.) introduced one change that would prohibit DHS from using cost-plus type contracts except for certain circumstances. Instead, McCain said the agency should use fixed-price contracts.

The Obama administration has pushed agencies to reduce this type of contracting because it places too much risk on the government. DHS, for instance, cut the number of cost-plus by 3 percent last year. And across government, the Office of Federal Procurement Policy reported agencies awarded 19 percent fewer cost-plus type contracts in 2010 as compared to 2009.

OFPP mandated agencies reduce the use of these contracts by 10 percent in 2010 and save $40 billion, by either through not using these high-risk contracts or renegotiating them between 2010 and 2011.

But Collins said while she agrees these contracts pose a risk to the government, a blanket ban on this type of contract isn’t the answer either.

“There are certain, as the department has told us, research and development contracts where you are dealing with the development of an unknown technology and trying to reach a goal,” she said. “DARPA uses cost-plus for the same reason. You need to have that flexibility because no one will bid because they don’t know what it will cost.”

McCain said the amendment includes a waiver authority that DHS could grant for specific reasons But he said cost-plus contracts should only be used when absolutely necessary because DHS has wasted millions of dollars on these contracts.

“We see this time after time, [vendors] low ball the bid, get the bid and when you have a cost-plus contract, the costs go up and up,” he said. “It’s standard operating procedure.”

Collins offered a substitute amendment to require written authorization for cost-plus type contracts on any procurement worth more than $250 million.

McCain said $250 million was too high, but he said he would work with Collins to improve the amendment.

Clean financial audit by 2016

Several provisions did pass, including one from Sens. Tom Carper (D-Del.) and Scott Brown (R-Mass.) requiring DHS to have an auditable financial statement by 2016.

This is similar to the requirement Congress passed requiring the Pentagon to have auditable financial books by 2017.

Sens. Collins and Rob Portman (R-Ohio) received approval of their amendment to prohibit DHS from collecting information on its vendors’ political contribution. This is in direct response to a draft White House executive order requiring agencies to review this information before awarding contracts.

Another provision would require DHS to give acquisition officers more training on using small businesses. And yet another would ask the department to report annually to Congress on how much money it’s giving to the 72 fusion centers located across the country. The fusion centers are where state and local law enforcement agencies share data with federal law enforcement entities based on terrorism related threats.

Lieberman said he hopes to finish marking up the bill next week and get it through the Senate. He also was hopeful about the House Homeland Security Committee taking up a version of the authorization bill.

“Chairman [Peter] King (R-N.Y.) is bringing forth an authorization bill as well and we’ve been in touch,” Lieberman said. “I think there will be a lot in common — not everything. Hopefully we can meet up and get it done in this session.”

In a statement, King said he will introduce and the committee will mark up a House version of the DHS authorization bill.

“I intend the legislation to be targeted to reduce inefficiencies and waste, consolidate functions, and improve the acquisition process, while strengthening valuable homeland security programs,” King said.

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