Homeland Security budget passes

House funds existing IT programs, but new initiatives are a year or more away

The House of Representatives voted overwhelmingly, 425-2, to approve $29.4 billion for the first full budget of the Department of Homeland Security, but companies in the federal information technology sector should not expect major new IT initiatives to begin soon.

A significant portion of the money in H.R. 2555 has been allocated to projects already identified in some of the 22 agencies that were combined into Homeland Security earlier this year. For instance, $318.7 million was assigned to the Automated Commercial Environment project, the $5 billion contract IBM Corp. of Armonk, N.Y., won in 2001 to modernize what is now the Bureau of Customs and Border Protection.

Another $350 million has been targeted for the U.S. Visitor and Immigrant Status Indicator Technology system, or US VISIT, once known as the Entry-Exit System. The Coast Guard's Deepwater project, to modernize much of its ship, aircraft and communications inventory, received $530 million.

"What we see and certainly applaud [in this appropriation] is the focus on mission delivery systems, the tools and systems required to actually execute improved entry-exit under US VISIT, the Automated Commercial Environment work [and] different things at [the Transportation Security Administration]," said Darryl Moody, managing director and vice president for homeland security at BearingPoint Inc. of McLean, Va.

But Moody said he doesn't expect Homeland Security to begin awarding new departmental-type IT initiatives for 12 to 18 months.

To get new programs started, the agency must develop requirements and then move them through the procurement process. The big-ticket items mentioned in the appropriation primarily were projects already under way in individual agencies before their consolidation into Homeland Security.

"We've always said that homeland security is a market you can't ignore, but keep it in perspective," said James Kane, president of Federal Sources Inc., a McLean, Va., market research firm.

Sen. Thad Cochran, R-Miss., chairman of the appropriations subcommittee on homeland security, said June 26 that his panel will consider its version of the Homeland Security budget July 9, with the full committee markup scheduled for the next day, according to committee spokesman Tim Boulay.

The Senate appropriations committee allocated $28.5 billion to the Department of Homeland Security, instead of the House's $29.4 billion, Boulay said. The difference between the two is mostly in spending on Bioshield, the plan to stockpile vaccines and drugs to protect and treat biological attacks.

The Senate version of the Homeland Security appropriations bill should reach the Senate floor at the end of July, said Bill Hoagland, director of budget and appropriations in the office of Senate Majority Leader Bill Frist, at a June 18 meeting sponsored by Equity International of Washington.

Hoagland said he expected the Senate version to mirror the House-passed bill.

"I think you will find when the Senate sits down to fill out its [spending] column, it will be similar to the House" for homeland security, he said.

The House approved spending $206 million on development and acquisition of IT equipment, software, services and related activities departmentwide, but that also includes the cost of converting to narrowband communications, including the operations costs of the Land Mobile Radio legacy systems.

Kim Dougherty, senior vice president and executive director of the newly formed Homeland Security Executive Council in Washington, said she was struck by the control Congress intends to exert over Homeland Security's spending.

"It's noteworthy that the House saw fit to give 100 percent funding as the department had requested for technology across the board. That's very positive," Dougherty said.

But the appropriations bill "built a firewall" around different pots of money awarded to the department, including language that bars the agency from spending more on US VISIT or the Automated Commercial Environment project than the amount appropriated for those programs.

Anti-terrorism programs at the state and local level got a boost in the bill. The House approved $500 million in grants for law enforcement terrorism prevention activities, $200 million for critical infrastructure grants, $35 million for grants for centers for emergency preparedness, and $500 million for discretionary grants for high-density urban areas and high-threat areas.

William Loiry, president of Equity International, an international business development firm, said he is concerned about the appropriated funds not getting to the front lines of homeland defense.

"We continue to hear from the federal government that money has been appropriated for first responders for technology, but we continue to hear from first responders that they haven't seen much of the money," Loiry said. "Whatever the true story, those on the front lines need to see the money."

Other areas of concern, he said, are the allocation of money for container security and measures to provide technology to screen for explosives in commercial cargo on passenger aircraft.

"The first [appropriation] was for passenger screening itself, but when that initiative was going on, they missed dealing with the commercial cargo," Loiry said. The spending measure includes $129 million for the Bureau of Customs and Border Protection to spend on inspection technology.

TSA is slated to receive $235 million to modify commercial airports specifically for installing checked baggage explosive detection systems, and another $100 million for the purchase of those detection systems. The agency also was given $487 million for its administrative budget, which includes investment in information technology.

The directorates that comprise Homeland Security each received their own funds. The Information Analysis and Infrastructure Protection directorate got $776 million toward its expenses, while the Science and Technology directorate was given about $900 million.

Loiry said it is important that the bill gets passed in a timely fashion, unlike last year's congressional standoff, which led to continuing resolutions and a hold on spending for new projects.

"A delay hurts our security," he said. *

Staff Writer Patience Wait can be reached at pwait@postnewsweektech.com.

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