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Port Security Grant Process Needs Improvement, GAO Says

Wednesday, December 21, 2011
Sandler, Travis & Rosenberg Trade Report

The Government Accountability Office released this week a report evaluating the Department of Homeland Security’s administration of the Port Security Grant Program. This report examines the extent to which DHS has allocated PSGP funds in accordance with risk, the challenges encountered in administering the program and what actions have been taken to overcome these challenges, and how DHS evaluates the effectiveness of the PSGP.

The report finds that in 2010 and 2011 PSGP allocations were highly correlated to port risk and determined through a combination of a risk analysis model and DHS implementation decisions. DHS uses a risk analysis model that includes all three elements of risk—threat, vulnerability and consequence—and modified the vulnerability equation in 2011 to recognize that different ports can have different vulnerability levels. However, this equation is still not responsive to changes in port security, such as the implementation of PSGP-funded security projects. It also does not utilize the most precise data available in all cases; e.g., by incorporating the results of past security investments and refining other data inputs.

The report notes that there have been several challenges in distributing PSGP grant funds. While DHS awarded nearly $1.7 billion in port security grants for fiscal years 2006 through 2010, only about 25% of that amount had been drawn down as of September 2011. Another 25% remains unavailable, usually because either federal requirements (such as environmental reviews) have not been met or the port area has not yet identified projects to be funded. In addition, DHS has been slow to review requests from grantees to forego the cost-share requirement. Other challenges include managing multiple open grant rounds, complying with program requirements and using an antiquated grant management system. As a result, about $400 million in awarded grant funding remains unavailable to grantees for port security projects. While DHS has taken steps to address this situation, the report states, it is too soon to determine how successful these efforts will be.

Finally, the report points out that DHS has not evaluated the effectiveness of the PSGP because it does not have measures to track progress toward achieving program goals. Initial steps have been taken to develop performance measures for the program, but the time frame for implementing them is unclear. Without a plan, GAO concludes, there is little assurance that these measures will be implemented in a timely way to assess the program’s effectiveness in ensuring that critical port infrastructure is protected.

GAO makes four recommendations to help strengthen the implementation and oversight of the PSGP: develop a vulnerability index that accounts for how security improvements affect port vulnerability and incorporate these changes into future iterations of the PSGP risk model, determine the most precise data available to populate the data elements within the vulnerability index and utilize these data as an interim measure, evaluate the waiver review process to identify sources of delay and take measures to expedite the process, and develop time frames and related milestones for implementing performance measures to monitor the effectiveness of the PSGP.

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