	Background

Section 550 of the DHS appropriations act for fiscal year 2007 requires  DHS to issue regulations establishing risk-based performance standards  for the security of facilities that the Secretary determines to present high  levels of security risk, among other things. The CFATS rule was  published in April 2007 and Appendix A to the rule, published in  November 2007, listed 322 chemicals of interest and the screening  threshold quantities for each.implementing DHS’s CFATS rule, including assessing potential risks and  identifying high-risk chemical facilities, promoting effective security  planning, and ensuring that final high-risk facilities meet the applicable  risk-based performance standards though site security plans approved by  DHS. From fiscal years 2007 through 2012, DHS  dedicated about $442 million to the CFATS program. Senior ISCD Leaders Developed the ISCD Memorandum to Highlight Various Challenges Hindering CFATS Implementation

		ISCD’s Memorandum Based Largely on Observations of Senior ISCD Managers

Our review of the ISCD memorandum and discussions with ISCD officials  showed that the memorandum was developed during the latter part of  2011 and was developed primarily based on discussions with ISCD staff  and the observations of the ISCD former Director in consultation with the  former Deputy Director. ISCD Management Was Concerned That Challenges Place the CFATS Program at Risk

The ISCD memorandum discussed numerous challenges that, according  to the former Director, pose a risk to the program. In addition, the memorandum provided a  detailed discussion of the issues or problems facing ISCD, grouped into  three categories: (1) human capital management, such as poor staffing  decisions; (2) mission issues, such as the lack of an established  inspection process; and (3) administrative issues, such as a lack of  infrastructure and support, both within ISCD and on the part of NPPD and  IP. ISCD Has Begun to Take Various Actions Intended to Address Challenges Identified

		ISCD’s Action Plan Included Time Frames and Appears to be Helping Address Some Legacy Issues

ISCD is using an action plan to track its progress addressing the  challenges identified in the memorandum, and, according to senior  division officials, the plan may be helping them address some legacy  issues that staff were attempting to deal with before the memorandum  was developed. They said that they agreed that actions being taken in the plan were  needed to resolve challenges facing ISCD. ISCD’s June 2012 Plan Update Showed 38 Action Items Completed

Our analysis of the June 2012 version of the ISCD action plan showed  that 40 percent of the items in the plan (38 of 94) had been completed. The remaining 60 percent (56 of 94) were in progress. For the remaining 56 items that were in progress as of June 2012, 40  involved human capital management and administrative issues. Action Plan Performance Measures Could Help Gauge Progress

ISCD, through its action plan, appears to be heading in the right direction  towards addressing the challenges identified, but it is too early to tell if the  action plan is having the desired effect because (1) the division had only  recently completed some action items and continues to work on  completing more than half of the others, some of which entail long-term  changes, and (2) ISCD had not yet developed an approach for measuring  the results of its efforts. The agency  concurred with our recommendation and developed a new action item  (number 95) intended to develop metrics for measuring, where practical,  results of efforts to implement action plan items, including processes for  periodic monitoring and indicators for corrective actions. ISCD Officials Stated That Almost Half of the Action Items Required Collaboration with or Action by NPPD or IP

According to ISCD officials, almost half of the action items included in the  June 2012 action plan either require ISCD to collaborate with NPPD and  IP or require NPPD and IP to take action to address the challenges  identified in the ISCD memorandum. NPPD, IP, and ISCD officials have  been working together to identify solutions to the challenges the  memorandum identified and to close pertinent action items. This includes collaborating with NPPD officials  representing the NPPD human capital, facilities, and employee and labor  relations offices, among others, and with IP’s Directorate of Management  Office. GAO Contact and Staff Acknowledgements

For information about this statement please contact Cathleen A. Berrick,  Managing Director, Homeland Security and Justice, at (202) 512-8777 or  BerrickC@gao.gov.
Why GAO Did This Study

The events of September 11, 2001, triggered a national re-examination of the security of facilities that use or store hazardous chemicals in quantities that, in the event of a terrorist attack, could put large numbers of Americans at risk of serious injury or death. As required by statute, DHS issued regulations that establish standards for the security of high-risk chemical facilities. DHS established the CFATS program to assess the risk posed by these facilities and inspect them to ensure compliance with DHS standards. ISCD, a division of IP, manages the program. A November 2011 internal ISCD memorandum, prepared by ISCD senior managers, expressed concerns about the management of the program. This statement addresses (1) how the memorandum was developed and any challenges identified, (2) what actions are being taken in response to any challenges identified, and (3) the extent to which ISCDs proposed solutions require collaboration with NPPD or IP. GAOs comments are based on recently completed work analyzing the memorandum and related actions. GAO reviewed laws, regulations, DHSs internal memorandum and action plans, and related documents, and interviewed DHS officials.
In a July 2012 report, GAO recommended that ISCD explore opportunities to develop measures, where practical, to determine where actual performance deviates from expected results. ISCD concurred and has taken action to address the recommendation.

What GAO Found

The November 2011 memorandum that discussed the management of the Chemical Facility Anti-Terrorism Standards (CFATS) program was prepared based primarily on the observations of the former Director of the Department of Homeland Securitys (DHS) Infrastructure Security Compliance Division (ISCD), a division of the Office of Infrastructure Protection (IP) within the National Protection and Programs Directorate (NPPD). The memorandum was intended to highlight various challenges that have hindered ISCD efforts to implement the CFATS program. According to the former Director, the challenges facing ISCD included not having a fully developed direction and plan for implementing the program, hiring staff without establishing need, and inconsistent ISCD leadershipfactors that the Director believed place the CFATS program at risk. These challenges centered on three main areas: (1) human capital issues, including problems hiring, training, and managing ISCD staff; (2) mission issues, including problems reviewing facility plans to mitigate security vulnerabilities; and (3) administrative issues, including concerns about NPPD and IP not supporting ISCDs management and administrative functions.
ISCD has begun to take various actions intended to address the issues identified in the ISCD memorandum and has developed a 94-item action plan to track its progress. According to ISCD managers, the plan appears to be a catalyst for addressing some of the long-standing issues the memorandum identified. As of June 2012, ISCD reported that 40 percent (38 of 94) of the items in the plan had been completed. These include directing ISCD managers to meet with staff to involve them in addressing challenges, clarifying priorities, and changing ISCDs culture; and developing a proposal to establish a quality control function over compliance activities. The remaining 60 percent (56 of 94) that were in progress include those requiring longer-term effortsi.e., streamlining the process for reviewing facility security plans and developing facility inspection processes; those requiring completion of other items in the plan; or those awaiting action by others, such as approvals by ISCD leadership. ISCD appears to be heading in the right direction, but it is too early to tell if corrective actions are having their desired effect because ISCD is in the early stages of implementing them and has not yet established performance measures to assess results.
According to ISCD officials, almost half of the action items included in the June 2012 action plan require ISCD collaboration with or action by NPPD and IP. The ISCD memorandum stated that IP and NPPD did not provide the support needed to manage the CFATS program when the program was first under development. ISCD, IP, and NPPD officials confirmed that IP and NPPD are now providing needed support and stated that the action plan prompted them to work together to address the various human capital and administrative issues identified.