Border Security Virtual Fence Costs Questioned

U.S. House Democratic leaders and government accountants last week scrutinized a multibillion-dollar contract with The Boeing Co. to design and build a comprehensive U.S. border security system rich with advanced perimeter protection technology, called SBInet.

One major question still at issue is how much the virtual fence will ultimately cost.

One congressman has put the multiyear cost of SBInet at US$30 billion, while the Department of Homeland Security will only estimate the cost for the southern border with Mexico. SBInet is the high-tech portion of DHS's Secure Border Initiative announced in November 2005.

The DHS estimate for the southern border portion of SBInet is $7.6 billion through 2011, including fencing, ground sensors, radar, cameras and command, control and communications equipment, according to a report (pdf format) issued last week by the U.S. Government Accountability Office.

Milestones have not been set for the northern border, although DHS told the GAO that the upper limit of funding will provide border security technology for "6,000 miles of secure U.S. border," which is for both the northern and southern borders. The funding estimates provide primarily for technology in SBInet and do not include costs such as added border patrol agents in the broader SBI.

Two congressional Democratic leaders in recent hearings also have questioned the way the Boeing contract is managed. One hearing was held last week before the House Homeland Security Committee.

Bennie Thompson, D-Miss., chairman of the House Homeland Security panel, took note of the 65-page GAO report questioning management of SBInet. "After reading the GAO assessment of SBInet, it seems that the department's scattershot approach of issuing different, interdependent simultaneous task orders leaves the program vulnerable to collapsing on itself, like a house of cards," he said in a statement.

Earlier in the month, U.S. Rep. Henry Waxman, D-Calif, the chairman of the House Oversight and Government Reform Committee, warned in a Feb. 8 hearing that SBInet could be subject to waste and abuse, given how the Department of Homeland Security is relying on Boeing and private contractors to design, build and even conduct oversight of the project.

"There seems to be no task too important to be outsourced to private contractors," Waxman said. More than half of the 98 staff members hired by DHS to oversee the new SBInet contract are private contractors, he said, and some of them work for companies that are business partners of Boeing, the company the staff members are overseeing, he said.

The GAO said DHS needs to tighten oversight and accountability of SBInet with "explicit and measureable commitments" for costs and schedule. The GAO also said the actual SBInet contract should include a maximum quantity beyond the unclear statement of funding for "6,000 miles of secure U.S. border." Waxman put the Boeing contract's value at $30 billion in a statement issued at the Feb. 8 hearing.

Officials from Boeing and DHS testified before the two committees and have partly addressed the concerns raised by the congressional leaders and the GAO. Regarding the ultimate costs, the DHS repeated its "6,000 miles of secure U.S. border" upper limit to GAO, and a DHS spokesman reiterated that language in an interview Thursday.

Regarding Waxman's concerns about oversight and the need for independent review of contracts, the DHS spokesman took note that the GAO had a similar concern, but had been satified by steps taken by DHS for independent validation of contracts. DHS's Chief Procurement Office certified last November that Boeing had established procedures to prevent conflicts of interest between the company and major subcontractors, added Kia Evans, a spokeswoman for U.S. Customs and Border Protection, a division of DHS.

As for Thompson's criticism about task orders being issued simultaneously, Evans admitted that DHS is proceeding "with a sense of urgency on this critical national issue" of border security, while remaining sensitive to House concerns. "We are working to ensure that appropriate tasks are on contract to fulfill the mission," Evans said in an e-mail response to questions.

Boeing's vice president and program manager for SBInet Jerry McElwee updated Waxman's committee on SBInet on Feb. 8, stressing that the government will set requirements for the entire program, and not Boeing. "We do collaborate extensively [with the government] but the final decision is made by the government," he said in his remarks.

One task order in the project, known as Project 28 for a 28-mile stretch of border near Saseby, Ariz., has already been started, McElwee testified. It calls for equipping a mobile tower in that location with new technology by mid-June, including all-weather electro-optic gear, infrared camera, radar and digital communications equipment, he said. DHS has put the cost of Project 28 at $20 million.

One congressional aide described Project 28 as a "virtual fence" to work instead of an actual physical fence, which characterizes much of the SBInet program.

McElwee said Boeing is trying to address a variety of terrains and threats, using a "tool kit" approach with different combinations of sensors, communications systems, IT and command and control capabilities depending on the area.

The purpose of SBI, a DHS spokesman said, is to have the "right mix of infrastructure, technology and added agents ... to get control of the border more effectively and efficiently. In different parts of the border, there are different ways to gain control. In some areas, a fence has an important part, and in others it might be unmanned aircraft, sensors and cameras. Terrain plays a role and urban vs. rural plays a role."

Congressional aides said House members so far seem to be avoiding condemnation of SBInet, especially before it gets off the ground. But members still want to scrutinize spending and procurement policies for such a large project, two aides added.

DHS Secretary Michael Chertoff and Boeing announced the SBInet contract last September when reporters at a press conference asked repeated questions about ultimate costs. At that time, a minimum cost of $2 million was announced, under a contract of three years with options for three one-year extensions. The contract is known as an Indefinite Delivery/Indefinite Quantity contract, a specialized contract used by federal officials.

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