Industry security clearances: broken process.

In order to perform many critical services for government customers, tens of thousands of defense industry personnel must obtain and renew security clearances every year. Both at home and abroad, these requirements have skyrocketed to unprecedented levels. The security clearance process, rules and regulations are very important, because they create the mechanism by which industry obtains and retains qualified personnel to support the government's critical missions.

An effective and efficient process for clearing personnel is the only way to ensure that qualified personnel are readily available to accomplish the country's national security needs. The current process of providing clearances is inadequate to meet these needs and must be improved.

Industry faces increased pressure to deliver cleared personnel on the day a contract begins. The current process makes it almost impossible for industry to meet these demands.

Delays in obtaining clearances ultimately increase costs both to the government and to the taxpayer, by postponing the ability to use the most qualified personnel on critical programs. These costs run into the hundreds of millions of dollars both for the government and industry:

Delays also stifle innovation and cooperation, since it is virtually impossible to share a good idea or leverage an existing team across agencies without having appropriately cleared personnel. Ultimately, a considerable amount of important work is not getting done.

The current process for industry to obtain an initial clearance, or periodic reinvestigation after five years, requires companies to provide all the required forms to the Defense Department Industrial Security Office, which then forwards the request to the Defense Security Service. DSS in turn passes the request to Office of Personnel and Management to conduct the actual background investigation. In addition to all of industry's requests handled in this manner, all of the department's civilian and military requests are processed through OPM, which also handles clearances for nearly all other federal agencies.

Recent disturbing actions by the DSS and OPM have had an alarming impact on the industrial base, and have severely clouded the future of a viable, efficient clearance process.

The first such action came in April when the DSS--citing funding shortfalls--imposed a moratorium on submitting requests for initial industrial security clearances and periodic reinvestigations. This action greatly compounded existing and already unacceptable delays that industry faces in delivering critical goods and services to the government. Periodic reinvestigations conducted by OPM can take even longer, because they are assigned a lower priority than initial investigations.

Congress recently approved a reprogramming of a significant portion of the department's current funding to restart the acceptance of industry applications starting back in July. However, the 2007 budget request for DSS significantly under funds this program for that year and beyond. It needs revision before delays begin to reoccur.

Industry also has significant concerns about the impact that Homeland Security Presidential Directive 12 could have upon the investigative process for security clearances once. In short, HSPD-12 requires that, by October 27, 2007, everybody needing access to a federal information system or a federally controlled facility must have a biometrically encrypted identification card. This directive applies to government, contractor and subcontractor employees alike. Recently, an interim Federal Acquisition Regulation was published, applying the directive to contracts and subcontracts. This FAR rule requires that each agency be responsible for the development and implementation of a procedure to conduct investigations and background checks on all employees of all contractors and subcontractors covered by the directive.

This rule further requires that the procedures use the OPM Federal Investigative Services for the personal identity-verification investigation and the FBI records databases for the criminal background check.

It is the requirement for using OPM that is most disconcerting. Industry is concerned that since OPM, thus far, has had significant difficulty in processing the existing applications for security clearances in a timely fashion, the process will only degrade further once agencies begin to submit applications for PIV investigations.

This concern has been dismissed by OPM, but there is no indication that the agency has the resources to handle clearance investigations, much less this new responsibility. OPM does not have enough personnel. To date, it has been unable to automate and make interoperable its data collection systems so that it can be compliant with the Intelligence Reform Act. And it does not have any dear plans for reducing and eliminating the workload that it currently cannot handle.

The volume of HSPD-12 investigations is anticipated to run into the millions. This estimate does not include government personnel that will need a comparable PIV investigation, if they do not already possess one for another reason. OPM has shrugged off this concern, contending that the process is automated. However, even the workload of entering this data and ensuring that investigations are processed, completed and reported back to the submitting agency is staggering.

It cannot be overstated that industry is committed to preserving the strict government requirements for clearances. Industry's interest is not to minimize current requirements. It is to make appropriate changes to an antiquated process that would allow the nation to remain vigilant in determining who has access to sensitive information, while better meeting defense and intelligence needs at the lowest possible cost.

Industry looks forward to working with government to improve the current clearance process, and stands ready to devote its experience and significant expertise with best practices to ensure that critical government programs do not go unexecuted for lack of available cleared personnel.

However, the only long-term solution for effective and timely security clearances processing is a complete overhaul of the process. We must move away from the antiquated Cold War-era, bureaucratic process to a more technological and comprehensive 21st Century approach that is tailored to meet the fast-paced and dynamic national security threats confronting our nation.

NDIA GOVERNMENT POLICY

Peter M. Steffes

Vice President,

Government Policy

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Ruth W. Franklin

Director, Procurement

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Ann Stock-well

Director, International Trade Policy

and Programs

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Chandra Burnside

Analyst, Government Policy

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Meredith Kyttle

Government Policy Staff

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