SPENDING FEDERAL SECURITY GRANTS WISELY

Oct 1, 2005 12:00 PM

After receiving a modest federal port security grant in a recent funding round, a U.S. port agency has selected and installed an elaborate, state-of-the-art security system in compliance with federal port security regulations. However, as the system implementation was delayed, the port remained vulnerable to security threats.

If this sounds like a familiar scenario, it should, as some U.S. ports are realizing the actual cost of implementing a federally funded project. What some ports have failed to take into account when applying for the security grants is the additional expenses associated with training and/or hiring port personnel to use the system and ongoing operational costs necessary to effectively monitor surveillance, detection and control systems. For these ports, it is an expensive lesson that has delayed implementation of critical security measures and is only now being corrected.

It seems every day that security companies approach city and/or county agencies on how they should spend their security funds — especially when the federal government announces that more funds are available. It is not that security companies do not have something to offer — to the contrary, they are an important component of the public/private partnership endeavoring for Homeland security. The key for city and county agencies is to not be distracted from their own goals and federal security initiatives. It is important for local government agencies to stay-the-course by following their own Facility Security Plan (FSP) and/or Area Maritime Security Plan (AMSP).

There are several critical issues to consider related to federal security funding. Some of these issues local government agencies have little or no control over; others require their own self-control. First, there is limited funding to go around. Local government entities that seek financial support from the federal government often end up having to compete for limited funds.

In mid-May, the Transportation Security Administration (TSA) announced awards of approximately $150 million in security grant funding for ports. This latest round of funding brings the total amount of money awarded to ports for security measures to nearly $490 million since port security grant funding began in 2002.

At times, certain agencies are not allowed to compete. A case-in-point is the Fiscal Year 2005 Port Security Grant Program (PSGP) that recently made available approximately $150 million to only 66 U.S. ports. Second, these federal grant programs typically have a limited response window. In fact, those entities that had applied in the past for Federal Port Security Grant funds under the TSA program had approximately 45 days to respond; however, the FY2005 PSGA allowed only 30 days to respond.

Other critical issues related to federal funding, which government agencies have more control over, include estimating total cost and determining appropriateness. It is crucial to estimate accurately what the implementation of a security project actually costs. Inaccurate cost estimates can cause delays in construction, acquisition and operations.

Federal funding can be a two-edged sword. While it is a significant aid in implementing security projects, some government agencies are finding out that they lack their own required funds to operate and maintain security projects and systems. The public-private partnerships created as a result of the Sept. 11 attacks need to plan for total costs.

For example, a private security-related company may approach a government agency with the intent of deploying particular security equipment. In the company's zeal, it estimates only the cost of the equipment as a budget to obtain federal funds. Once the government agency receives the funding, it realizes that the budget does not support project management, personnel training, operational and maintenance costs.

Training, operational and maintenance costs associated with security projects can be significant. For example, if a city agency receives $25 million in federal funds, it may take 10 percent ($2.5 million) to operate and maintain the security installation. Compounding this problem is the fact that most federally funded grant programs do not pay for operations or maintenance, and these costs typically increase annually.

Local government agencies also have control over determining the appropriateness of security projects. With pressure from the private industry to deploy security equipment and the federal government to fund construction of security infrastructure, some projects may not be necessarily appropriate for a particular government entity. To determine appropriateness, the government agency needs to ask itself several questions, which may require a bit of homework. For example: Does the project involve unproven technology? Is the project in the local FSP (required by the USCG)? Does the project address priorities outlined in the AMSP? Does the project meet the vision of the local Captain of the port? How does the project rate based on national risk-based evaluation model (Risk = Consequence × Vulnerability × Threat)?

To answer these questions and to stay on course, local government agencies should consider developing Grant Project Evaluation Criteria. By including an evaluation process, the government agency can weed-out projects that may not have its best interest in mind. Also, the local government agency should create a subcommittee that would act as a “clearing house” for suggested security projects. The subcommittee's tasks would include ensuring that budgets take into account total costs and are appropriate.

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David Cruz is senior port planner at Moffatt and Nichol, Long Beach, Calif., which assists local government and public/private port agencies in avoiding the pitfalls related to implementing security projects. The firm has an in-depth understanding of the specialized operations of ports and marine terminals. Cruz can contacted by telephone at (562) 590-6500 or by e-mail at dcruz@moffattnichol.com

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