Customs and Border Protection Issues

4/12/2010

Subcommittee on Homeland Security House Appropriations Committee

Chairman Price, Ranking Member Rogers, distinguished members of the Subcommittee; I would like to thank you for the opportunity to provide this testimony. As President of the National Treasury Employees Union (NTEU), I have the honor of leading a union that represents over 22,000 Customs and Border Protection (CBP) Officers and trade enforcement specialists who are stationed at 327 land, sea and air ports of entry (POEs) across the United States. CBP employees’ mission is to protect the nation’s borders at the ports of entry from all threats while facilitating legitimate travel and trade. CBP trade compliance personnel enforce over 400 U.S. trade and tariff laws and regulations in order to ensure a fair and competitive trade environment pursuant to existing international agreements and treaties, as well as stemming the flow of illegal contraband such as child pornography, illegal arms, weapons of mass destruction and laundered money. CBP is also a revenue collection agency, expecting to collect an estimated $29 billion in federal revenue according to FY 2010 estimates.

FUNDING FOR CBP SALARIES AND EXPENSES AT THE PORTS OF ENTRY

On October 1, 2009, a draft report of the Southwest Border Task Force, created by Homeland Security Secretary Janet Napolitano and reported by the Associated Press, recommended the “federal government should hire more Customs [and Border Protection] officers.” The report echoes the finding of the Border-Facilitation Working Group. (The U.S.–Mexico Border Facilitation Working Group was created during the bilateral meeting between President George W. Bush and President Felipe Calderon held in Merida in March 2007.) “In order to more optimally operate the various ports of entry, CBP needs to increase the number of CBP Officers. According to its own estimate, the lack of human resources only for the San Ysdiro POE is in the “hundreds” and the CBP Officer need at all ports of entry located along the border with Mexico is in the “thousands.” (“CBP: Challenges and Opportunities” page 1 and 2. Memo prepared by Armand Peschard-Sverdrup for: Mexico’s Ministry of the Economy: U.S.-Mexico Border Facilitation Working Group. January 2008.)

NTEU is disappointed that the Administration’s FY 2011 budget includes no increase in frontline CBP Officer or CBP Agriculture Specialist new hires, and instead projects a net decrease of about 500 positions this year, despite increased appropriations. The FY 2011 budget request does include $70 million to address “systemic salary shortfalls” and $45 million for 389 CBP Officers to “maintain staffing for critical positions.” Rather than funding an actual increase in new hires, however, the Administration is seeking appropriations to maintain CBP positions funded by user fees. CBP states that 37% of its inspection workforce at the POEs is currently funded by user fees. This is a precarious funding stream because user fees decrease during times of economic recession, even though security needs of the nation have not decreased.

NTEU has become increasingly concerned as the number of positions funded by “surplus” user fee revenues has grown over time. According to GAO/GGD-94-165FS (page 17-18), “through fiscal 1993, surplus revenues have funded 472 full-time permanent positions…” Today the number of “surplus-funded” positions is over 7,000. Due to the recession, user fee collections are falling and CBP is facing a structural dilemma in its current funding of CBP inspection personnel.

NTEU believes that all CBP employees at the POEs should be funded by appropriated funds through the appropriations process, not with user fees that by statute are to be used primarily to pay for overtime, premium pay, agency contributions to the Civil Service Retirement and Disability Fund, preclearance services and Foreign Language Awards Program.

CBP is now facing a serious structural funding shortfall for CBP salaries and expenses at the POEs due to its reliance on user fees rather than appropriations.

Also, in 2003, the Department of Homeland Security (DHS) created a new Customs and Border Protection (CBP) Officer position and announced the “One Face at the Border” initiative that purportedly unifies the inspection process for travelers and cargo entering the United States. Consolidating immigration and customs inspection functions has caused logistical and institutional weakness resulting in a loss of expertise in critical homeland security priorities. The “One Face” initiative should be ended and overall CBP inspection staffing should be increased.

TRADE ENFORCEMENT AND COMPLIANCE STAFFING

When CBP was created, it was given a dual mission of safeguarding our nation’s borders and ports as well as regulating and facilitating international trade. It also collects import duties and enforces U.S. trade laws. In 2005, CBP processed 29 million trade entries and collected $31.4 billion in revenue. In 2009, the estimated revenue collected is projected to be $29 billion—a drop of over $2 billion in revenue collected. Since CBP was established in March 2003, there has been no increase in CBP trade enforcement and compliance personnel and again, the FY 2011 budget proposes no increase in FTEs for CBP trade operations personnel.

In effect, there has been a CBP trade staffing freeze at March 2003 levels and the maintenance of CBP’s revenue function has suffered. Recently, in response to an Import Specialists staffing shortage, CBP has proposed to implement at certain ports a tariff sharing scheme. For example, because CBP has frozen at 984 nationwide the total number of Import Specialists positions, CBP is reducing by 52 positions (from 179 to 127) the number of Import Specialists at the New York city area ports and shifting those positions to other ports. To address the resultant shortage of Import Specialists at New York area ports, CBP is implementing tariff sharing between the port of New York/Newark and the Port of JFK airport. Currently, each port (Newark and JFK) processes all types of entries and all types of commodities via the Harmonized Tariff Schedule (HTS). The reduction in trade personnel will result in each port being assigned only parts of the HTS. Tariff sharing will result in each port only processing half the commodities entering its port. Tariff sharing presents a number of operational problems with regard to trade personnel performing cargo exams on merchandise that is unloaded at the port of Newark, but the only commodity teams that are trained to process it are at JFK and, vice versa, when merchandise that can only be processed in Newark, is unloaded at JFK. CBP proposes that instead of physical examinations of the merchandise, digital photos can be exchanged between the ports. This is a short-sighted solution that shortchanges taxpayers, trade compliant importers, and the federal treasury. NTEU urges the Committee to increase funding to hire additional trade enforcement and compliance personnel, including Import Specialists, at the POEs.

In its FY 2011 budget request, CBP is seeking $25 million for Intellectual Property Rights enforcement including $14.1 million in human capital investment. This request, however, includes no increase in FTEs to implement this new enforcement program. It is also unclear if the human capital investment is for the trade policy arm of CBP--the Office of International Trade, or the operational arm--CBP Office of Field Operations (OFO). NTEU urges the Committee to appropriate the requested $14.1 million to increase the number of CBP OFO trade operations personnel at the POEs.

CBP CAREER LADDER PAY INCREASE

NTEU commends the Department for announcing an increase in journeyman pay for CBP Officers and Agriculture Specialists, initially scheduled to begin in March of this year. However, the ability to fund this increase was not secured and the journeyman pay increase has been delayed until late-September 2010. In addition, many deserving CBP trade and security positions were left out of this pay increase, which has significantly damaged morale. NTEU is relieved that full funding of the journeyman pay initiative is in the fiscal year 2011 budget request and strongly supports the inclusion of this funding in the FY 2011 DHS appropriations bill.

NTEU also strongly supports extending this same career ladder increase from GS-11 to GS-12 to additional CBP positions, including CBP trade operations specialists and CBP Seized Property Specialists. The journeyman pay level for the CBP Technicians who perform important commercial trade and administration duties should also be increased from GS-7 to GS-9.

FOREIGN LANGUAGE AWARDS PROGRAM

The FY 2011 DHS budget proposes to eliminate $19.1 million to fund CBP’s Foreign Language Awards Program (FLAP), a Congressionally-authorized program. Since its implementation in 1997, the Foreign Language Awards Program (FLAP), incorporating more than two dozen languages, has been instrumental in identifying and utilizing Customs and Border Protection (CBP) employees who are proficient in a foreign language. At CBP, this program has been an unqualified success, and not just for employees, but for the travelers who are aided by having someone at a port of entry who speaks their language, for the smooth functioning of the agency’s security mission.

Rewarding employees for using their language skills to protect our country, facilitate the lawful movement of people and cargo across our borders, and collect revenue that our government needs makes sense. Congress agreed that employees should be encouraged to develop their language skills by authorizing FLAP. Not only does it improve efficiency of operations, it makes the U.S. a more welcoming place when foreign travelers find CBP Officers can communicate in their language.

Congress authorized a dedicated funding source to pay for FLAP-- customs user fees pursuant to Title 19, section 58c (f) of the U.S. Code. This statute stipulates the disposition of these user fees for the payment of overtime, premium pay, agency contributions to the Civil Service Retirement and Disability Fund, preclearance services and FLAP. Due to the recession, however, user fee collections have fallen and on February 4, 2010, NTEU received notice from CBP of the immediate suspension of its Foreign Language Awards Program (FLAP) for CBP Officers and CBP Agriculture Specialists (CBPAS). NTEU strongly opposed the mid-year 2010 suspension of FLAP and asks the Committee to ensure that FLAP is fully funded in FY 2011.

FUNDING FOR DHS HUMAN RESOURCES MANAGEMENT SYSTEM

NTEU also commends the Committee for maintaining a provision, Section 518, in the FY 2010 DHS appropriations bill that prohibits the expenditure of funds to apply a new DHS human resources management system to employees eligible for inclusion in a bargaining unit. Because of this funding prohibition, DHS announced that the agency would rescind application of this new human resources system as of October 2, 2008. Even though DHS has rescinded the application of the human resource system, and DHS has no authority to issue any new regulations, regulations remain in place for adverse actions, appeals, performance management, and pay and classification and can be reactivated if the funding prohibition is lifted.

NTEU requests that identical language to Section 518, prohibiting the use of appropriated funds to implement any part of the regulations promulgated pursuant to Title 5, Chapter 97, is again included in the FY 2011 DHS funding bill.

Conclusion:

NTEU urges the Committee to include in its FY 2011 DHS appropriations bill:

• funding to increase both port security and trade enforcement staffing at the Ports of Entry;

• full funding for the announced career ladder pay increases for CBP Officers and CBP Agriculture Specialists;

• funding to extend career ladder pay increases to additional CBP personnel including trade operations specialists, CBP Seized Property Specialists and CBP technicians;

• full funding of CBP’s Foreign Language Awards Program;

• continuing the funding prohibition for implementation of USC 5, Chapter 97--the Homeland Security Act’s alternative personnel management provisions and a prohibition on the continued funding of the One Face at the Border initiative.

The more than 22,000 CBP employees represented by the NTEU are capable and committed to the varied missions of DHS from border control to the facilitation of legitimate trade and travel. They are proud of their part in keeping our country free from terrorism, our neighborhoods safe from drugs and our economy safe from illegal trade. These men and women are deserving of more resources and technology to perform their jobs better and more efficiently.

Thank you for the opportunity to submit this testimony to the Committee on their behalf.