expand spp unless there's a clear and substantial benefit to do so. >> let me first say, ma'am, obviously we're just assessing this at this point. this is an initial response. obviously it's changing the burden, if you will, and the description i have in terms of making that decision, which is to be in the taxpayer's best interest in terms of cost. obviously the bottom line who is provided best security. so if i'm required to accept something unless i can approve affirmatively it does not meet that criteria, it obviously changes the standard. >> that burden i think makes everyone -- makes it more difficult, not that you're opposed to difficult but more difficult in securing the country. >> obvious lyre the congress passed the law and the president is intending to sign it, so i look forward to working with the committee to look at the best

way forward on this. >> i would argue to say a nonsecurity committee passed the bill. so i make that point. does this language have the potential to increase the cost to taxpayers for administering spp due to the need for increased oversight and management? >> well, clearly if there's a flood of applications we'll have to increase our headquarter staffing to handle those. we have a small staff to handle the 16 and now 17 -- potentially 17 spp airports. yes, hypothetically if every airport, all 450 remaining came in, we would have to -- >> now this process opens it up to all 450 airports in the united states, is that correct? >> these my understanding. >> my comment, we are looking forward to returning to 9/11. requires you to approve an application within 120 days. does that pose a stressful

timeframe? is that adequate to conduct full review of the security implications? >> well, there's a lot of aspects so that but that is a compressed time schedule. for example, if there's one application, much easier to comply with that than if there's 10 or 100. >> i want to go back to the thought that i raised in my opening statement. the language contains a provision waiving the requirement any company contracted with screening services be owned and controlled by a united states citizen. thankfully that language contains a clause that affords you complete discretion. to reject any application that requires this waiver. as you well know, administrator we live in a complex world with shifting allegianceancies and dynamic threat environment.

one need look no further than some of the activities going on going on with our neighbors in the middle east, the pending complexity of iran and nuclearization, some individualized terrorist attacks that occurred over the last decade even after 9/11, though this nation has been very fortunate. and, of course, the concern about, as you mentioned, the idea of sharing intelligence. my question to you, will you commit to us today that during your tenure as administrator you will not approve applications that require a waiver of the citizen requirement on the basis of the need for the securing of intelligence and securing of this nation? >> well, clearly, madam, i would need to review any application. the fact it's a foreign owned company i would need to look at

the intent of congress. but that does give me concern, potential concern about the issues that might be inherent in that business. again, i'm just seeing this language for the first time so i need more time to assess this. >> mr. chairman, let me just follow up with him. >> we have 15 minutes before we have a vote. there's four members that would like to ask questions. can we proceed in the regular order? >> let me do this, and i will defer to you. let me put this question on the record. mr. lungren, you're not the chairman at this time. >> time is expired. we have four other members that would like to ask questions. >> excuse me, mr. lungren, you are not the chairman. i am asking to put the question on the record. i will not ask for an answer. mr. lungren is not the chairman. >> i would ask you to submit it for the record and let's go to mr. thompson for any questions he might have.

>> thank you very much, mr. chairman. mr. pistole, i'm concerned that comments about privatized screening has resulted in a misunderstanding of what this would mean for the flying pub c public. we created this entity, tsa after 9/11. if a similar incident occurred today, would you have the authority to direct private screeners to other locations? >> under the existing contracts, no. they would be limited to the airport to which they are assigned. >> so basically the ability to respond based on incident is hampered by your inability to move private screeners where

that situation could potentially be? >> yes. that is one of the limitations. that is part of the contract process which we could address in future contracts but under existing contracts that would be a voluntary aspect. >> in your experience negotiating public and private contracts, has it been your experience private contract screeners involve more than federal contract screen eers. >> under existing contracts, all cost more than it would cost for federal government to have tsos there. the instance last week where i approved the application from west yellowstone is another exception, because i believe they will be able to come in with a bid that will be less

than what we do because we're sending people in on temporary duty assignment for the four months yellowstone is open. so that would be another exception. can you clarify protocols that must be for privatized screeners? >> the same for all federalized airports. >> do privatized screeners, in your experience, perform better than their federal counterparts? >> i believe every assessmentes they perform comparably to the federalized workforce both in terms of security and in terms of customer engagement. so again, all things being eq l equal, at this point your experience is other than the cost associated with private screeners versus federal contracted screeners, we're pretty much on par? >> yes.

>> thank you. now, one other issue, does maintaining a mixed use public-private model of screening cost taxpayers more or less than if the entire system is federalized? >> it costs slightly more to have federal and spp airports. >> yes. >> yes, it does. >> your testimony basically that one system would allow the taxpayers a greater saving than managing two-part system. >> taxpayers are paying either way, whether to federal employees of tso or privatized screeners. >> but they are paying more. >> in the past -- we have driven that down, in the past it has been 3 to 9% more than federal

contrac contracts. >> would the gentleman yield? >> we need to go on. >> a question they want to put on the record. >> gentleman yields back and gentleman from minnesota is recognized for five minutes. >> mr. chairman, if i could, i would like to yield -- i will not yield at this time. mr. pistole, thank you very much for coming. i appreciate it. just in the spirit of what i believe this committee should be about finding solutions to the problems. i'd like to yield 30 seconds of my time to answer miss jackson lee's question. would that be all right? >> fine with me. >> thank you very much. mr. pistole, thank you very much, i appreciate it. tsa has a veterans preference in privatizing would you be able to ensure there will be a veterans preference for private companies? >> we would be able to negotiate that as part of the contract. as i think you're aware, approximately 24% of the overall

tsa workforce are veterans. >> and would it be an extra cost, sir, for privatize? >> i don't know that. i'd have to look into that. >> we appreciate the yielding of the gentleman, and i'll pursue that further with the administrator and i thank the gentleman for his kindness. >> i appreciate everything you've done. i've gone through that precheck, it's slick. what it does, it's fantastic. it concentrates our limited resources on known and unknown threats, and it's just absolutely awesome. i commend you on that one of the things i want to do, i want to bring up, too, there is a big difference between pre9/11 and post 9/11 security whether you're privatized or federal employee. as an airline pilot that went pre9/11, i can dramatically see the difference. so it's a completely different ball game. much more professional group. much more adherence concentrating on security. as an airline pilot for 16

years, i can see the big difference. one of the questions i just want to really bring out relatively quickly. a while back spp applications for february 2011, tsa denied applications for six, indicated they would not allow expansion for the program. later in 2011 we walked it back a little bit and said there had to be a clear and substantial advantage to the tsa airport like you said. how did the tsa determine threshold for airport participating in the spp and the airport must demonstrate there's a clear and substantial advantage in order to create that determination. >> thank you. thank you for your comments about precheck. the men and women of tsa are excited by that because of the service they are able to provide which frankly they had been hampered on previously. thank you for that. obviously the process is an airport applies. thus far in the 10 years plus the tsa has been in existence, we've only had 30 or so airports

actually apply for the spp status. some of those a couple of times because they were denied. so only 30 out of 450 plus airports. so when they applied, then we evaluate that. under this new criteria, is there substantial advantage to the taxpayer for the one. is there a cost benefit that is improved in some way we can show savings to the taxpayer have to comply with security protocol and regime mince. if there is a clear and substantial advantage, what benefit in changing if it would cost more and provide the same level of security? >> do you have a copy? can you forward those metrics to us. >> i basically outlined what they are, the cost. what do we assess the cost as being. the security protocols should be

actually the same if not better than currently operating procedures for tsa. that's what it comes down to. >> private organizations that applied for spp program, did you get back to them on telling how their applications can be approved, why they were deficient? >> what we asked them to do was come in and provide what they believed would be the clear and substantial information that would indicate why they would ab better proposition. we didn't go back and say a, b, c, d, e address these issues. >> you did not. >> did not. >> i'm running quickly out of time. but i guess the big thing for us, everybody here on this panel wants to make sure we have an effective and efficient tsa. >> i appreciate that. my goal also.

>> a bipartisan issue. we've worked on transportation issues as well. the one thing we want to make public there is a beneficial cost associated with privatized if there is one and, two, we have an effective system you're able to manage. so with that i'm out of time and i yield back. >> thank you. >> we're supposed to call for vote soon. i understand mr. micah joined us chairman of the committee on transportation and infrastructure and would like to sit at the dais. without objection, welcome him. >> thank you, mr. chairman. mr. pistole, thank you for the precheck, i think that's moving in the right direction. >> yes. >> you know my consternation with respect to this program. let me ask you is there any statutory language that reads you must find clear and substantial advantage before you can approve a private contractor? >> none that i'm aware of, no. >> not part of the statute something you have put as your additional requirement. >> try to understand what i

believe congressional intent was in terms of creating tsa after 9/11 as a federalized workforce with the exception of the spp, initial five and that assessment of whether privatized airports could add value. >> so it's not part of the statute. >> not to my knowledge new york city. >> would you think it unreasonable for an airport in my district to not have applied for this yet because they believe this is disfavored by you and by tsa? >> well, i would hope that each airport would make a business decision to assess what would be best for their passengers. >> i understand that. let me ask you, if you were told they have to prove a clear and substantial advantage, even though everything else must be equal, if you observe that the tsa in trying to make a comparison of the cost initially said there were double digit but the government accounting office when they looked at it said, you

know, tsa, you've forgotten about the cost of federal retirement. then you brought that in and brought i think the difference down to 3%. if you saw what happened in kansas city where the court -- i'd be embarrassed if the court said this about me or my client, that it was an 81-page decision which reversed, in the court's word a fundamentally flawed source selection by the tsa, they said the tsa did not conduct a proper value analysis. they said the court found tsa arbitrarily deviate freddie their own procedures they had put in place. it said tsa did not document its evaluation and decision. it said tsa's price evaluation scheme was irrational. the only way you could overturn something like this is if you find it arbitrary and

capricious. they found tsa to be arbitrary and capricious. then it's extended out over time. if i'm the operator of an airport, that doesn't suggest to me tsa is going to be objective in this. it sounds to me that tsa is going to make it extremely difficult for me. so i've got an airport in my district that would want to do it. they have not applied to you at this point in time. i want to say for the record that is not because they do not wish to. you keep quoting this number that out of 400 some-odd airports only so many have applied, then you told me you don't want to approve very many. you just approved west yellowstone? >> yes. >> have you ever been to west yellowstone? >> no, i have not. >> i have been there. it's not one of the large metropolis in america.

i did get good ice shaving out of there. if you want good ice shavings if you're coming out of yellowstone, you'll find that works very, very well. there are things said on this dais that do not insult the federal employee and i did not wish to insult the federal employee. so insult the private employee -- to suggest they cannot do a good job. are you suggesting the security at san francisco airport, the largest airport that has a private contractor is less than any other airport? >> absolutely not. >> would you allow that to be the case? >> absolutely not. if they didn't do the job, we would seek another company or other options. >> i don't understand why we have to sit here and suggest if you have a private employee that private employee is less than a public employee. frankly, we ought to federalize the entire american workforce

and have 138 million people working for the federal government if that happens to be the case. i know you opposed the proposition that was in the law but you have said you will work to enforce that chl i know from your record you will do that. >> absolutely. >> i just hope you will not add any things like clear and substantial advantage or whatever else you would come up with to undo the intent of congress as you suggest we're trying to follow the intent of congress. with that i see my time is over and i thank the chair. >> i thank the gentleman. we're called for vote. i want to recognize mr. micah. you're rec flifd for five minutes. >> thank you very much, members of the committee, for affording me a few minutes. hopefully -- i will definitely finish within my five. i'm pleased you have administrator pistole. he's probably one of the toughest jobs in washington.

it's very difficult. of course you know my history being involved i was chairman of the aviation subcommittee. the good lord gave me that task in 2001 and the president wanted a bill on his desk by thanksgiving after the attacks in september. of course we don't have jurisdiction. i try to conduct oversight, on government reform and try to do our good job in protecting the taxpayer and the flying public. that's an important mission. that being said we're here now. there is great frustration, as you know. you probably heard some of it today. we've talked and i think we need to get to a risk-based system. i was pleased also -- i wasn't here but heard of your willingness to work with a committee to implement the new

language and that's important. i will work with you. we want this to be successful. want to work with you, tried to work with members of the homeland security committee in that regard. you know, i've got the most recent meltdowns, honolulu was a meltdown, charlotte, douglas, most recently liberty international. it's not just a couple. it's quite a few of the tsa employees you have problems w every time you pick up the paper, theft, tsa arrested for stealing ipads. that's a couple from last week. then the recruitment and training we spent $2.4 billion on recruitment and training, we trained 137,000 people and actually more people have left. i think we need to find a more efficient way. if we can incorporate that into the spp model, i think we can have great savings there.

that's something that i don't think was in the gao reports. then you know, you've resorted, i know the difficulty in hiring people. you've advertised on the top of pizza boxes. this is pizza boxes. that is on the top -- i saw this on a national -- i buy cheap gas. i went to a discount gas station and actually took the picture. i was stunned to find washington reagan national, one of our most targeted, probably, and need to be secured airports is now hiring transportation security officers. it tells all the benefits above the cheapest gas in town pump. you've gone to a huge number of screeners, 51,000, pretty substantial administrative staff, somewhere between 12 and 14,000 out there. but right now, folks, we're looking for everyone in the

administrative realm, we're looking at about 30 people -- i'll say 25 people, the lower, in administrative, because you've got marshals and others. we don't want to count them in, overseeing this. we've looked at all the models. i've looked at them before. i've looked at them around the country. the united states is one of a few western countries, poland, romania, united states, libya had an all federal screening force. you went and saw the models in israel. i went before and back after you were there. the uk which had huge incidence of terrorists, probably faced terrorism far worse than we did, they all retain private screenings. no one is saying do away with federal government. no one is saying federal employees do a bad job. i want to get you out of the personnel business and into the security business.

i think that's important because we do have a threat so you can focus. again, the union issue, spps they joined unions before the federal employees. and those under -- in san francisco and other places we looked at, sometimes the private screeners pay more money to retain people. the turnover is great. maybe we can submit this comparison if it has it between san francisco and los angeles. there's room for that. my only question, sir, you had stated to the committee you would work with us, and i hope you'll work with me to try to improve this and implement the law the president, we expect to sign in a few days. >> absolutely. >> i think the gentleman -- i would like to ask you open endedly before we go to vote, where do you see this going? do you envision a time horizon in which you see expansion of

spps or is this something you don't want to see? >> it's hard to forecast and it's a good question. we frankly don't know before my decision not to expand beyond 16 unless there's clear and substantial benefit, as i mentioned, only the handful, less than three dozen that applied. even before the decision it wasn't like they were knocking down our doors. to congressman lungren's point, maybe there was a belief we weren't accepting. i don't know what it will look like. obviously we have to be prepared for any substantial number. if i could comment -- >> certainly. >> a number of good points, obviously philosophical differences. i don't know, i don't have visibility into the private work forces but just as there are some outstanding security officers within the federal government and not so, i assume the private sector, what we don't hear about, for example, great stories, for example security officer in new york that found $5,000 and turned it

in. another officer saw a second officer taking the 5,000, reported that. so good with the bad there. just last week in harrisburg, pennsylvania, a security officer whose apartment that he lives in caught on fire, the apartment building, and he went back in and helped save the lives of 10 people. those things aren't out there. it demonstrates we have great people within the federal government, great people in the private sector. so to answer your question -- >> i don't argue -- i think we all admire the great employees we've got in the federal system but we do have good examples in san francisco where the private contractors are working wonderfully. i'm anxious to see over the next few months unfold if more people do pursue it. if so, how you view it. i don't want to close the door. i think there are great opportunities out there for us to transition. as long as we can maintain comfort it's being done well. there is a real concern on my part we've seen the ratio of

supervisors at the airports where we have spp programs be pretty high. forty or 50 folks supervising airports. >> at sfo with over 1,000 security officers, i think 40 to 50 is probably right. the private company is doing frontline workers and leads and supervisors. all the managers and all the -- refers to administrative staff. the private company is paying for that. >> you contracted, the private company could do it but you chose to maintain that authority? >> i don't know the specific contract provision on that, chairman, so i'd have to take that back and look at that. that is the model whether by

design. obviously federal security directors and deputies in all the airports are still tsa employees. but there is certain efficiency of doing that. for example, whether it's one of the small, has to be some tsa presence in order for us to oversee and make sure protocols are being followed accordingly. i'll look into that. >> i probably need to get back to you in a classified setting. i've got some glaring examples. they may be legitimate. they may be wrong. also they may have security reasons why. i would like to know more about this ratio of tsa personnel to contract personnel in airports as well as some tsa folks that are in other airports. i don't want to bring that up in a public setting and compromise anything that might be inappropriate from your

perspective. i hate that votes have been called. i've got a whole lot of things i want to talk to you about and these other guys and gals did, too, we don't have control. i don't want to inconvenience you any further. i'd hate to delay the second panel but i've got to go vote. as soon as we get back we'll have our second panel. with that, mr. pistole, thank you for being here. we're in recess.