DHS' failure to leverage large technology buys costs billions in lost savings

The Homeland Security Department did not routinely attempt to slash costs for equipment through bulk purchasing, especially for billions of dollars' worth of explosive detection tools, according to the DHS inspector general.

For instance, various Homeland Security agencies individually bought $170 million worth of small X-ray machines, metal detectors, and personal and handheld radiation detectors without combining those buys -- through a practice known as strategic sourcing.

The department has no process in place for standardizing equipment purchases or recognizing common product requirements among offices, acting Inspector General Charles K. Edwards told lawmakers at a House hearing Friday. "A DHS joint requirements council is inactive," he added. Agencies are not required to use an established strategic sourcing program, according to DHS officials.

While eight departmental organizations, including Customs and Border Protection, Immigration and Customs Enforcement, and the Transportation Security Administration, used similar equipment for detecting various threats, each agency bought the tools separately, he said. With strategic sourcing, the department would have better managed the purchase of more than $3.2 billion worth of metal detectors, explosive detection systems and radiation detectors on inventory as of 2010, Edwards added.

"Components view detection equipment as unique to their missions and do not attempt to identify common mission requirements, among other components," Edwards testified at the hearing, which was held by the House Homeland Security Subcommittee on Oversight, Investigations and Management. "This results in numerous inefficient purchases by individual components instead of consolidated purchases."

The department apparently is not following a six-year-old Office of Management and Budget directive -- highlighted by Edwards -- that requires agencies to apply strategic sourcing as much as possible. While DHS has a strategic sourcing program that it has used for less costly items, such as firearms, ammunition and office supplies, Homeland Security is not buying detection equipment through this program, Edwards said.

In addition, subcommittee chairman Rep. Michael McCaul, R-Texas, criticized Homeland Security for failing to coordinate with the Defense Department on a now botched $1 billion effort to secure the nation's southwest border with a "virtual fence" of hardened surveillance equipment.

"This administration needs to stop investing in high-risk acquisition programs until they can effectively manage and oversee them," McCaul said. "One of [DHS] Secretary Janet Napolitano's top priorities is unifying the Department of Homeland Security and supporting a one-DHS policy, but unfortunately the secretary and this administration have failed to coordinate and integrate acquisition functions departmentwide. This has led to the failure of multiple acquisition programs and the waste of millions of taxpayer dollars."

At the hearing, Homeland Security officials said they work closely with Defense and the Energy Department on a number of partnerships. The department also participates in a White House-led committee that develops interagency research and development strategies to ensure agencies governmentwide are taking advantage of each other's efforts.

As for not collaborating with the Pentagon to obtain proven military equipment in some cases, Homeland Security officials said DHS and Defense have different operational requirements.

While Homeland Security "always does a horizon scan before starting a new project," which includes reviewing Defense efforts, "it is rare that DoD and DHS mission needs, operating environments and budget constraints line up exactly together," testified Henry I. Gonzalez, acquisitions support and operations analysis director for DHS' Science and Technology Directorate.

Both departments are worried about improvised explosive devices but in different environments, Gonzalez added. "The IED problem in Afghanistan requires very different solutions than those in the United States," he testified. "To continue the example, front-line law enforcement in the United States cannot use wireless jammers in the middle of a city as DoD has done in Afghanistan."

The two departments, however, may be able to partner on acquiring upgraded handheld devices that can detect homemade explosives, Gonzalez said.