Cost for security clearances expected to increase in 2017, 2018

Agencies will be paying more for security clearances in fiscal 2017 and 2018 as the National Background Investigations Bureau (NBIB) moves into initial and then full operating capability.

Jim Onusko, the transition leader of the NBIB at the Office of Personnel Management, said the 2017 pricing schedule for security clearance should be finalized later this month.

“The cost factors is multi-dimensional. One of the things the NBIB already has been able to do is get the cost cycle proactively in advance to better align with the budgeting process,” Onusko said Sept. 7 at the Intelligence and National Security sponsored by INSA and AFCEA in Washington. “As fiscal 2018 moves forward this winter, we plan to roll that back and actually get the prices out sooner to better align with the budgeting cycles with federal agencies. For fiscal 2019, it will actually be in the summer so next July the fiscal 2019 pricing will be projected as well.”

Onusko said part of the delay for 2017 is the NBIB plans to award a contract to increase vendor support around investigations to help further address a backlog of security clearance cases that has ballooned to more than 500,000 over the last two years. That contract award has been delayed, but should be made soon.

“Developing those pricing protocols are very complicated. You have to look at the risk and cash flow the NBIB will be taking in that regard. The prices also reflect the level of capacity the customers are willing to pay for and put on that equation. The higher the price, the more capacity you can put on so to speak, the more investigative service providers can put on the streets and the timelier those investigations are,” he said. “There is a wide range of prices that are proposed to the federal community. Those are gotten together through official forums with customer agencies and they provide feedback on what their needs are and the timeliness. Certainly, the prices have increased dramatically.”

Onusko said the price increase may be only for the short term as the NBIB hits initial operating capability on Oct. 1 and moves toward full operations. He said the investments in technology and big data tools should help reduce the costs of security clearances over time.

“The thing about growing IT capabilities and such is you have to invest in that before you see the returns,” he said. “I’m not sure the prices will dramatically increase in the near future as a lot of capacity is put on to neutralize this backlog. But for the future, I see where good performance metrics, accountability, this business process reengineering effort to optimize the process and then you incorporate the big data and you minimize the level of shoe leather you put on the street — not eliminate it because there always will be that need — you certainly can see prices stabilize.”

He said future pricing also will depend on the demand, which also will be influenced by new vetting policies, federal investigative standards and the new tiered structure.

This isn’t the first time agencies faced an increase in the cost of security clearance processing. Back in July 2015, the Office of Personnel Management retroactively charged agencies more for security clearance processing to help offset costs of the massive data breach that impacted 21.5 million current and former federal employees and their families. The Defense Department, which has the most employees with security clearances, paid more than $132 million extra in 2015. published a chart in January outlining the increase in costs in a range of 18 percent to 118 percent between 2015 and 2016.

Bill Evanina, the national counterintelligence executive in the Office of the Director of National Intelligence, said the funding burden should no longer be carried by agencies.

“I think we need to get away from the fee-for-service construct. I think background clearances are so important for where we are now and where we are moving in the future and the ability to bestow that trust on the employee is so important, I think it should be funded by Congress,” Evanina said. “We only have 4 million-plus of these in the government. We don’t have that many. A lot of the agencies in the intelligence community and folks that have designated authority to do it on their own, it’s part of their budget process which they get from Congress. There is no reason OPM and NBIB shouldn’t have a line item cost provided by Congress to eliminate the entire pricing structure so you minimize, if not eliminate, ebbs and flows in pricing, and OPM’s current inability to future cost and then all the customers would be able to at least functionally budget for the prioritization of their clearances.”

Evanina said he’s hopeful more lawmakers will support this idea of paying for security clearances, especially if the NBIB eventually becomes an independent agency.

Doug Thomas, a former intelligence community official and now director of counterintelligence operations and corporate investigations at Lockheed Martin, said changes to the way agencies conduct security clearance evaluations will impact cost over the long run. He said the move to continuous evaluation and the use of big data will require fewer investigators on the street.

Onusko said the transition team is working with the Performance Accountability Council on pilots around continuous evaluation.

“A cost analysis really needs to be done. As you harbor in big data, certainly then you require analysts to analyze that and there is going to be gaps between continuous evaluation and security that will arise from that analysis,” he said. “I don’t know if it will be forgone conclusion that it will be cheaper. But it will certainly be a better future state where we can put a more comprehensive infrastructure in place.”

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