>> the report notes these deficiencies in the program. we had asked for a management review of the program in december of last year. that program review was completed while this particular report was being prepared and was incorporated into the report and the comments that you see are part of an effort by management at the most senior level -- that means me -- asking to make sure that, in fact, this program was working properly. i want to turn to mr. wulf now to talk about what we're going to do about these findings. >> i would just add that we did not find any actual indication of fraud, waste or abuse with

regard to the purchase and tracking. we found a system was not in place, and it's something we have already moved forward to address. >> let me reclaim my time. we know there is action items, we're going to move guaforward,t that obviously is of major concern that we're not going to have to deal with just the committees ourselves but our colleagues in this whole debate. so we will go ahead and follow this. i do appreciate the fact that you, in july, brought ms. anderson and mr. wulf on board. i guess a question would be since you've been on board, undersecretary since june 19, 2009, what took you so long to have an overview of this program? >> the initial indications of

concern surfaced in the following year. prior to that, i had definitely had the sense that the program was an evolving program, that changes were being made, but they were being made in due course with appropriate diligence by the program managers. in july of 2010, i discovered a discrepancy in the way that people were being paid within the program and moved at that point to correct it. in the fall of 2010, we posted a announcement to -- >> let me -- >> -- of the program. >> not to be disrespectful, just to move to another question because the timeline is kind of important for us because you testified before us march 31st of 2011 and statements were made -- again, that's my

comments back to mr. waxman was, you know, we were given a pretty good signal that things were going well. small problems, but nothing major. one of the questions i asked you was about the high-risk tiering process and the reasons for the drop in the number of those facility tiers. at that time, i was not aware of any mistiering problem. were you? >> no, i was not, sir. >> if not, when did you first learn about the tiering problem? >> i first learned about the tiering problem in the beginning of june of this last year. >> was it the earliest time, to your knowledge, that dshs personnel discovered that some facilities had been mistiered, was the month you had given? in other words, was there other folks within the department that knew that this tiering process was all messed up?

>> there was an indication in may of 2010 that there might be a problem with respect to tiering. the individuals within the office looked at the problem and felt that they had resolved the problem and informed people up the chain of command. i did not know that there was a problem at that point in time. i was not informed of that. and the program went forward from there. in 2011 with a new acting director of the office, he asked for a review of the program and he discovered or rediscovered this discrepancy issue and asked for a much deeper dive into that. that deeper dive is what resulted in the problem being identified to the assistant secretary and immediately to me. and that's in june of 2011. >> and my time is expired. just so we can move forward, we're going to continue, obviously. we're going to have to continue to do oversight over this process, and i hope if there's

any relevant activities that folks under your office that have not been doing the job, that through the legal process of removal that some people can be held accountable because i do think there is probably -- if there wasn't waste point of views, there may have been, there may be theft, and that would be helpful to understand that the government can correct bad actors. i'd like to recognize mr. green for five minutes. >> thank you, mr. chairman. secretary beers, thank you for being here. as i said in my opening statement, it seemed like a problem for the last six years is the inability to hire qualified individuals and lack of morale. i think some of that comes from having year-to-year authorization. mr. beers said in his statement, and i apologize, none of us have a copy of your statement, mr. wulf. what has been done since the memo was released or since

mid-december or since it was released on the 23rd? there has been some action that's been done that we haven't heard about except for this morning. mr. beers, you know mr. wulf's statement about some of the things that had been done in the last month or so? >> yes, i do, sir. i want to -- >> we had removed the impediments in the program so that could go forward, and we had begun looking at the training requirements in order to take the people who were hired who may not have adequate training for that position that they are in. but lastly, the other thing that we need to focus on here is we have to define what it is we, in

fact, expect from our inspectors when they are doing the final site authorization inspections and when they are doing compliance inspections. david? >> i would add that we're very excited about the progress we've made in the past couple of months on the reviews of the tier 1 site security plan. i believe the progress we've made and the statistics are moving as well. we've made a commitment to move forward on the site security plans and conduct outreach and give reviews of the lower -- >> i know you gave numbers.

i only gave five minutes, in fact, it's down to three. you gave numbers before. could you reiterate that? >> absolutely. we started two months ago with ten tier 1 site security plans that had been authorized. we're now at 53. >> and that's the only hard number that you gave me in your testimony? we don't have your testimony and it's hard to go over something outside of -- >> absolutely. absolutely. so we've authorized 43 or conditionally authorized 43 additional tier 1 site security plans. >> all those were taken from my testimony. those facts are all in my written testimony. >> was that based on actually site visits, or was that from what's been provided by the companies? >> that's based on what has been provided by the companies. in some instances following compliance of visits conducted by our chemical security. >> let me get to another issue. i mentioned about the personal

security program which was submitted on june 14 of last year, the omb. and listed it as a third priority in the vhs memo. i'm aware of the screened individuals. as opposed to a personal security program would require the facilities to submit background information for existing personnel within 60 to 90 days for existing personnel. any individuals not qualified as personnel, if they have a quick card, they will be provided the information within 48 hours. in the real world, we went through a big rollout of the quick card a few years ago. it was not as smooth as we would have liked. in fact, i think there are 260,000 quit cards distributed in the port of houston. when you are going to overlay it

with a personal security requirement, what did the quit card not cover that you think we need now under the personal security? i'm concerned about reinventing the wheel, even though, like i said, the wheel didn't run too well early, but it's running pretty well now. >> sir, let me clear up some perhaps misunderstanding of the way we intend to use the twick card. we will accept the twick card as proof of a background check. we would like to know the names of the individuals who come onto the site who have twick cards in order to determine that the twick card is, in fact, still valid. but anybody who possesses a twick card, that will be an acceptable standard, and anybody who might have access to getting a twick card can do so and use that in lou of any other

background check. >> i want to make sure that's what was submitted because i have some concern about that. sometimes what we hear and what even passes in law doesn't get to the final stage. was that submitted, that the twick card would be the i.d. when submitted to omb? >> davy? >> the leveraging of twick and other credentials is part of the information collected and submitted to omb. >> i would see comfortable seeing in writing what you said, secretary beers, that the twick card -- again, we have hundreds of thousands around the country, that we don't want to also have a breakdown in redoing something. i know working with the industry and the bargaining units and everything else is something that ought to be important, and i know i'm over my time, mr. chairman. i have a number of other questions i'd like to submit if we don't have time today. >> without objection, i think my

colleague and i would like to recognize mr. murphy from pennsylvania, the undersecretary of the committee, for five minutes. >> thank you, mr. chairman. secretary beers, the memo states that cfas must critically evaluate and conduct mid and long-range planning. so to that end, let me ask for your candid responses. why was this not done until now? >> i beg your pardon? >> why was some of this not done until now in terms of evaluating? why was this not done until now? >> no, there was nothing done. as i indicated earlier, we have had several reviews. this is the most extensive one which we have asked for. but we've had several reviews over the course of the program since i became the undersecretary. >> let me ask this for

clarification. who sets goals and objectives for each year? who is responsible for that? >> i'm sorry, sir? >> who sets the cfas goals and objectives each year? who is responsible for doing that? >> sir, the program directors provide those goals. they go up the chain of command to the assistant secretary and to me. ultimately i'm responsible for them. >> are those public information in terms of those annual goals and objectives? >> i'll have to check, sir. i don't know whether that's public information at this point. >> and how do you measure those goals and objectives? is that something you have in terms of internal documentation of how you review those? >> sir, let me ask david wulf to answer that. >> there are established performance metrics that we prepare and send up the appropriate chain. performance is measured with respect to things such as numbers and sections, the sections conducted compared to

the totality of the regular community. >> in terms of the regular evaluations you're talking about, and my comments to the chairman. we appreciate getting your candor on these. but in addition, we would like to know, are these factors, are these evaluations somehow factored into employee compensation, such as raise os bonuses? >> sir, with respect to the entire mmpd, performance is factored into the issue of bonuses or promotions. dave, do you want to add anything specifically? >> i would echo the undersecretary's sentiment. meeting our performance goals is and will be a significant measure for us in this testing. >> do you know if any of the cfas employees or superiors

received a bonus in 2009? >> i'm sorry, sir. could you repeat that? >> do you know if any of the cfas employees or supervisors or superiors received any bonuses in 2009? >> i don't have that information. >> it may be helpful to this committee if you'll let us know in conjunction with some of the information you've given us. we would appreciate that. let me say that the wulf memo that you have says that they were uncomfortable delivering bad news to superiors. so to what extent is the failure to inform you contributed to this chilling environment. who in the chain of command had that effect? secretary beers? >> let me start in answering that. i have said as a management principle based on my 40 years in government that i appreciate hearing bad news, and i don't want to hear bad news from anybody else. this particular issue has been used as a teaching moment by me

for the entirety of my work force, because no one -- no one -- should feel that they can't tell me bad news, because bad news is usually something that we can do something about. and if we don't hear it, we can't do anything about it. i can't speak to the culture within the office and the words in the report, but i want you to understand that to all of the people who work for me, i say that time and again. imperfectly prepared to hear bad news and i really don't want to hear it from somebody outside the organization. >> as a navy officer, i admire a marine officer saying that. i recall former chairman mullens saying that in the chain of command, the food got better and the news got better, too. it is unfortunate that bad news coming up. are you confident now that you're getting full and accurate information, full disclosures on cfas information? >> sir, i have complete

confidence in penny and david making sure that that information comes to me, and they know that i want to hear it, and they know i want to fix problems that they surface to me to the extent i have the power to fix it. so yes. >> could i ask mr. wulf to answer the same question? >> yes. sir, i can confirm that director anderson and i received the message the undersecretary was just discussing, that he wants the bad news within the first week or two of our arrival on the job. and that's very much the spirit in which this report was written for him. yeah, within the organization, i can't necessarily speak to how the culture evolved, but i can tell you that penny and i have gone to great lengths to create

a culture of transparency, a culture in which our employees are not afraid to raise issues that they view as problems. we have an open door policy, we have meetings on a regular basis, and we have made clear that we don't tolerate repressions of concerns that folks may have. >> before i yield to the chairman, mr. dingell, may i ask for consent of five days for members to submit opening statements for the record. without objection, so ordered now. i recognize mr. dingell for five minutes. >> mr. chairman, thank you for your courtesy. secretary beers, why did you commission a top to bottom study of this program? >> sir, when it became evident

to me that, one, we had a recurring issue that was brought to my attention in june and that we had had an issue about locality pay and we had had a slowness in terms of the approval of site security plans that i needed to make sure that the new management, which we had brought in to take over the program and make sure that it was running solidly, brought their full attention to giving me as accurate a picture as possible in this program. as i said earlier, we had already commissioned a management study which was completed during the time that the report was prepared, and that was part of the report as well. so the final request of penny anderson and david wulf was the result of increasing concern on my part that the program was not running well. >> thank you, mr. secretary.

now, is the department of homeland security working to engage the industry in helping to get this program successfully implemented, yes or no? >> absolutely, yes. >> mr. secretary, i know there has been some controversy recently regarding some misclassified facilities. can you assure me and the members of this subcommittee that you have properly addressed this issue and that you have correctly identified high-risk facilities? please answer yes or no. >> yes. >> now, these questions to mr. wulf. mr. wulf, as your internal memo points out, there have been a number of challenges in implementing this program. do you believe that the program is fixable? yes or no. >> yes. >> you do believe it is. >> absolutely. >> thank you. what are the top two or three things that need to be addressed to bring this about, in your

opinion? the top two or three things. >> i would say the site security plan review process which we have already begun to move forward considerably over the last two months, and preparing our inspectors' and our. >> what progress have you and the department made in addressing these issues? >> we have quad rurupled the nur of tier 1 site security plans that we have conditionally authorized just over the last two months. we have commissioned an inspector tools working group as well to develop standard

operating procedures, other policies, and to determine what tools our inspectors will need as we move forward to the next stages of this program to actually conduct authorization inspections and to get into the regular cycle of compliance inspections moving forward. >> thank you, mr. chairman. i left one minute and 27 seconds. >> now i would like to recognize the chairman from new hampshire, mr. bass, for five minutes. >> thank you, mr. chairman. i'm not as familiar with the substance of this program and its history and so forth. i don't have a lot of facilities in my area. i am, however, very concerned about this memo.

we're as subject to criticism in performing oversight and abusing taxpayers' funds, and that's why this memo is bipartisan buecaus we all know we have a responsibility to have this program run well. i'm also a businessman. i have to hire and fire people to do things. i don't like to fire people, but it happens. mr. beers, if you were in my position looking at this report, would you consider yourself to have done a good job in your role to date? >> as i said publicly before, i hold myself responsible for this set of problems, and i'm committed to fixing them. >> if you were your own boss, would you keep you on the job? >> i can't answer that question, sir. >> i mean, have you considered the possibility this might not

be the right role for you? it might be time for you to step aside? mr. barton referred to it in his opening statement. >> sir, i've considered that every day i work for the federal government. i swore an oath of office on at least three occasions to protect and defend the constitution of the united states, and i believe in that. and if i believe i can't do the job, then i will walk away from it as i have done before. >> do you think it's unusual to have an action memo that, for all intents and purposes, you're not really disputing, with 70 different recommendations, a lot of which are noted in progress. you also noted in your testimony -- or answer to the question a minute ago that you could address these issues, quote, to the extent i have the power to fix it. do you have the power to fix all of these problems? >> as far as issues within this particular action plan, yes. with respect to mr. green's

comment about twick card, no, i can't make the twick card be broader than the current integration of the twick card, which means you have to be a transportation worker. >> well, mr. beers, this is a disturbing memo. we appreciate the fact that it's come to our attention, and i certainly hope that you understand that most of us haven't seen anything like -- this is a very unusually poorly run agency. and if it's not going to -- if at any time you believe that you're not the right person to turn this troubled agency around, that maybe there ought to be a different managing structure. so having made that point, i hope that the committee will carefully watch the progress in this action plan, because the

american taxpayers are not going to stand for this kind of alleged or perceived incompetence for this very important nation and security. >> i want to follow up. we really got to get a handle on this card issue. we would like for you to provide us your legal opinion of why you cannot deal with the twick card. we think you can. we -- and that's the energy and commerce committee having discussions with homeland security for months trying to resolve this, we think it's within your jurisdiction, and if it's not, we'd like to see the legal reasoning why it is not so that we can change the law. we think it's within your power now, and i think my friend mr.

green would be very pleased if we can get a handle on this. so work with us -- this is an issue, again, that was brought up in the march -- in march of last year's hearing that we thought we were moving in some direction, and there's been multiple consultations with homeland security, and we're not any further than we were march of 2011. so -- i'd like to yield my time. >> i know we went through this last year, and because the twick card is through transportation and coast guard, i know there is an issue with homeland security. i just don't want to reinvent the wheel, because so many times those workers that work on the dock side are also at an inland plant. and that's why i would hope with

interagency agreement, although in '08, we gave that language in there but it hadn't passed the senate. >> in reclaiming my time, i would just say that coast guard is under the department of homeland security. this should not be difficult to do. now, i'd like to recognize mr. plome, my colleague from new jersey, for five minutes. >> thank you, mr. chairman. we're here this morning to discuss issues facing the chemical facility, anti-terrorist standards or cfas program. we're talking about this league internal memo from 2011 that clearly shows that dhs faces serious implementation problems with the cfas program, most notably that the department has received 42 site security plans but has yet to approve a single

one. they were part of the appropriations bill in order to give congress time to enact legislation. we did just that in the 11th congress bypassing hr 2868 in the house. that bill provided a comprehensive security program to protect americans living near these facilities, but unfortunately, mr. bennett did not take it up. i'm not here to claim that hr 2868 would have automatically fixed all the problems outlined in the dhs memo, but it certainly provided more of a framework to protect the 111 families that lived in the danger zone of a temperature ch facility. they had the chance once again to exercise jurisdiction and had authorization to replace the vague and inadequate cfas program enacted in 2007. unfortunately, the committee decided not to address shortfalls with the cfas program and simply moved the extension of the current law. mr. chairman, in