TSA claims smooth takeoff
Gears up for 100 percent screening manadate, but will miss target for imports.
By Eric Kulisch
The Transportation Security Administration cannot yet verify that it has successfully met the Feb. 1 congressional mandate to screen half of all air cargo on passenger aircraft, but it is developing a system to do so, the Government Accountability Office said in a report released March 18.
The law applies to the piece level, meaning that half the pieces in a multi-lot pallet must be checked.
Members of the House Homeland Security subcommittee on transportation security and infrastructure protection pounced on the news during a hearing as evidence that vulnerability gaps still remain.
'I'm disappointed by what I perceive is the department's intention to provide the appearance of meeting its security mandate without meeting, at least in my mind, the actual mandate. The TSA's use of fuzzy math to artificially inflate aviation screening statistics I think is intellectually dishonest,' Rep. Charles Dent, R-Pa., said in his opening statement.
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TSA personnel do all the screening for passengers at the nation's airports, but the agency has placed on airlines the ultimate responsibility for inspecting cargo. In 2007, 7.6 billion pounds of cargo was transported on U.S. passenger flights ' or about 15 million pounds per day.
To achieve the new goals, the Homeland Security agency last October:
'Ordered airlines to screen all cargo placed on narrow-body planes.
'Instituted a Certified Cargo Screening Program (CCSP) under which shippers or freight consolidators screen cargo at their own facilities near 18 major cities.
'Started a pilot program for a dozen freight forwarders to test various screening technologies in 47 facilities.
Companies can use physical searches or purchase X-ray, explosives detection or explosives trace detection technology to make the inspections.
Results so far are based on anecdotal industry feedback and spot checks by inspectors. But TSA is working to collect data from private sector screening entities to make sure required screening levels are being met, the GAO said. In February, the TSA told airlines and screening facilities to report on the number of shipments in which half of all pieces are screened. The agency began receiving the first set of screening data in mid-March and plans to issue a progress report by mid-April.
Ed Kelly, TSA's general manager for air cargo, explained in an interview that the agency normally reports to Congress about its activities on a quarterly basis, 'and that was our plan all along.'
The law requires that all air cargo on passenger planes be screened by August 2010. About three-quarters of the shipments transported within the United States ride on widebody aircraft in palletized form, a fact that suggests meeting the 100-percent screening threshold poses a much greater challenge for the industry. A pallet can have up to 200 pieces on it.
In related moves, the TSA in March eliminated most exemptions on screening certain types of domestic cargo, such as human remains, and required that air carriers ensure that half of cargo on all passenger aircraft across their fleets is screened.
Kelly said at the hearing he remained confident that industry is screening at least half of all cargo and will meet the 2010 deadline for domestic origin air cargo.
But, he acknowledged, the TSA does not plan to meet the requirement for inbound, international shipments because of the slow process of harmonizing its air cargo security standards with those of other nations and the sheer number of foreign entities that directly ship to the United States on passenger aircraft. The GAO added that exemptions from screening for certain types of international cargo will also keep the number down.
Under existing rules, air carriers operating international flights are required to inspect half of non-exempt inbound cargo. The TSA assumes that this condition is being met, but as with the domestic program it is not collecting screening data from the airlines to verify that the inspection levels are being achieved, the GAO said.
TSA officials are reluctant to impose a hard screening standard that other countries may not be able to meet right away because that could substantially reduce or eliminate cargo transport from certain locations and raise rates. Until last fall, TSA officials did not even interpret the 9/11 law as applying to international inbound cargo.
Kelly said his team is working with Customs and Border Protection to piggyback on its Automated Targeting System for identifying suspicious imports, and has proposed an enhancement to the system to evaluate the risk of explosives in cargo shipments. If the system works, TSA intends to get the information from CBP early enough that cargo reviews can be completed before a flight's departure from a foreign airport, he added.
The GAO noted that no time frame has been released for when the inter-agency collaboration will be completed.
'TSA has the legal authority to require that a given percentage of inbound cargo be screened before it reaches the United States. Given the physical limitations of many airports, however, requiring U.S. and foreign air carriers to screen 100 percent of inbound cargo by a given date would significantly impede the flow of commerce into the United States,' Kelly testified.
There are 98 countries that import freight into the United States via passenger aircraft.
'A unilateral mandate of 100 percent screening would cause significant delays at origin airports because, as is the case in the United States, carriers are not equipped to perform this level of screening,' Kelly said. 'Where all-cargo flights exist as an alternative, shippers would be forced to divert business away from passenger airlines, which rely on cargo as a major generator of revenue and profit. Such a reduction in volume would most likely be reflected in higher passenger ticket prices. Additionally, taking a unilateral approach would significantly undermine TSA's long-term efforts to develop common platforms and standards for air cargo security with our international partners.'
The TSA is working to help create a uniform international system so that other nations have equal levels of screening. Countries such as the United Kingdom (which does 100 percent screening), Ireland, France and Israel already have programs similar to the CCSP, and the TSA is pushing Canada, Australia and the European Union to also adopt a decentralize approach for air cargo screening. The European Commission is in the process of writing regulations to enable private sector screening.
The TSA also proposed in April that the United Nations' International Civil Aviation Association amend its civil aviation standards to allow screening to take place at various points in the air cargo supply chain, Kelly said. The International Air Transport Association, which represents airlines around the world, is supporting the U.S. effort.
ICAO can recommend the new process as a best practice or mandate that all 190 contracting states implement the screening model. Or it could adopt the procedure as a guideline for a short period as a transition to a mandatory regime.
Achieving full ratification could take two to five years, according to Kelly.
The uncertainty about how to treat import traffic has the air cargo industry worried about potential flight disruptions if countries haven't coordinated their security regimes.
Meanwhile, the congressional watchdog agency said the TSA only has nine cargo inspectors for inbound cargo compared to 475 who do that job for domestic shipments, even though imports account for 40 percent of cargo carried on passenger aircraft.
Stamp of Approval. The idea behind the CCSP program is to relieve airlines from the burden of inspecting everything at the airport, which many believe would create significant backlogs and missed flight connections. Shippers who join the program can avoid delays ' and further opening and handling of their cargo that could lead to product damage, theft or tampering ' by packing their own boxes in secure areas, certifying with a sticker they've been checked, and using tamper-evident tape and secure protocols for handing off the shipment to a trucker or freight forwarder. Freight forwarders are expected to handle a large portion of the screening function, but will have to disassemble pallets or receive loose cargo, and open boxes when hand searches are employed, to meet the piece level screening requirement.
Another benefit of self-screening is that shippers and forwarders can continue to consolidate shipments, instead of tendering loose cargo, which results in reduced rates.
A facility that takes on screening must have its personnel undergo background checks by TSA, meet physical security standards and show it has a secure chain of custody in place to be accepted into the program. The TSA security threat assessments search criminal, terrorist and immigration violation databases.
Many small freight forwarders say the program is cost prohibitive.
The GAO said it is difficult to know whether enough shippers and forwarders will volunteer for the CCSP program to take on the majority of screening by that date, as envisioned by TSA.
As of April 10, TSA said it has certified 296 screening facilities, including 31 independent cargo screening facilities serving firms that don't want to screen themselves, and 25 shipper facilities. More than 1,250 applications, 48 percent from shippers, are on file to be certified, the agency said. If upstream industry partners do not volunteer in sufficient quantities, 'air carriers or TSA may be required to screen more cargo than was projected' or risk missing the deadline, according to the GAO and industry officials.
During February and March American Airlines processed more than 4,000 pre-screened shipments, representing 10 percent to 15 percent of all shipments from the 18 launch cities in the CCSP, spokeswoman Jennifer Pemberton said. Most pre-screened shipments were received in the airline's five largest gateways ' Los Angeles, Miami, Orlando, Dallas-Fort Worth, and John F. Kennedy Airport in New York.
The TSA estimates that its own ability to double-check cargo with inspectors and canine teams will increase to about 6 percent of cargo volume by the 2010 deadline, up from 4 percent today. It is in the process of adding 48 explosives detection canine teams dedicated to air cargo to the 37 teams it already has in place at 20 major airports.
Shippers were caught off guard during the first few weeks of the program by requests from forwarders, otherwise known as indirect air carriers, that they sign authorization forms giving consent to have their cargo screened. Part of the problem stems from the fact that there is no standard TSA form, and forwarders are drafting their own versions on company letterhead or directly on the shipping document itself.
Kelly told American Shipper that the confusion appears related to the perception that the authorization is a new requirement when in fact shippers have always been required to give their authorization to open a package if an inspection is necessary. The new guidance adds permission to do screening to the authorization form. The process also seemed new because indirect air carriers were given clearance to seek blanket consent instead of the previous practice of obtaining the consent for each individual shipment from a person signing the airway bill at the loading dock.
Part of the problem is also due to the fact that instructions to forwarders are considered Sensitive Security Information not available to unregulated parties or the general public. So shippers do not have a clear understanding of whether the consent is required by TSA or is simply an effort by some forwarders to protect themselves from liability.
TSA officials said they plan to soon post a clarification about the authorization process on the agency's Web site, www.tsa.gov/what_we_do/layers/aircargo/index.shtm.
Some shippers who use routed export transactions are refusing to sign the authorizations because shipping arrangements under those circumstances are made by the foreign customer, who takes control the moment title transfers at the point of pickup, said Albert Saphir, who heads ABS Consulting in Marietta, Ga.
On March 1, the TSA allowed carriers to accept screened cargo in secondary markets beyond the original 18 cities that handle the majority of air freight. TSA officials said the program was opened up nationwide sooner than originally planned at the request of airlines after the Feb. 1 implementation took place without any noticeable problems.
'As long as they have the proper acceptance procedures and training there's no reason not to allow' them to receive screened cargo from certified shippers and forwarders, Kelly said in the interview.
Another recent program fix involved a question on the background check form asking for an applicant's state of birth, which caused delays for non-U.S. or naturalized citizens receiving clearance to work in a secure facility, said Douglas J. Brittin, TSA's air cargo manager, at a trade compliance conference in Anaheim, Calif.
Tech Test. Under the technology demonstration, the participating warehouse facilities are employing X-ray, 3-D explosives detection and explosives trace detection machines used for passenger checked baggage to see how they work in high-volume air cargo environments. The technology was designed for luggage, not cargo, which differs in size, weight, variety of contents and configuration.
The GAO said the TSA is providing up to $375,000 for each of the 47 facilities to purchase detection equipment. Not all facilities will receive that much because explosives trace detection machines ' or swab testers ' cost about $55,000. Last year, TSA said it had $12 million in seed money for the technology pilot.
The TSA is gearing up to expand the technology pilot with a second round of 42 companies at 83 facilities eligible to participate, Kelly said. A handful of companies are expected to drop out of the program as they go through the implementation process, as some did in the first phase.
Forwarders not in the pilot complain that they are at a disadvantage by having to buy their own equipment or resort to airlines to do the work, and want the government to subsidize purchases for everyone. Those who can't afford equipment face the prospect of lost revenue or customers if airport screening delays cause their cargo to be bumped from certain flights. Plus, some airlines are charging customers to screen their cargo.
'This lost revenue, in the current economic environment with high fuel surcharges and razor-thin profit margins, could force forwarders out of business. This consolidation of the market, with the resulting impact on competition, is bad for forwarders, manufacturers and the American consumer,' testified Brandon Fried, executive director of the Airforwarders Association.
Its position is supported by The International Air Cargo Association (TIACA), which said airlines need help too, considering cargo volumes are down 25 percent, and the Air Transport Association, representing airlines, which testified that federal funding or tax breaks would enable small and medium-size companies to participate in CCSP and large companies to continue to invest in screening equipment.
Based on the pilot and other testing, TSA will determine what technologies qualify for screening cargo after August 2010. Forwarders are worried that if they purchase equipment at their own expense now, the agency could change its mind about what is acceptable for use after that date.
The GAO said that simultaneous testing and deployment of technologies is not ideal, but the TSA feels it has no other choice in order to meet the mandate.
Further complicating the matter is the fact that there is no technology available yet capable of screening full pallets or air cargo containers so that loads do not have to be broken down to the piece level. Research and development is ongoing, but TSA does not expect to qualify such technology prior to the 2010 deadline, the GAO said.
'Breaking down consolidated shipments at an airport cargo facility is not practical,' ATA President James May testified. 'Shipment size, time constraints and facility limitations are the main difficulties ' Dismantling it and screening each piece is labor intensive and time consuming. To place this in some perspective, it can take 75 minutes for two employees to break down and reassemble a pallet. In addition, airport cargo facilities were never designed to be high-volume disassembly and reassembly locations. They are not big enough to perform that role, especially at peak times.'
Industry groups urged the TSA to speed up its review of air cargo screening technologies to find a viable alternative to the current small bore systems. Jack Boisen, former long-time vice president of cargo at Continental Airlines and current TIACA chairman, said the main reason TSA has lagged on finding new technologies is that its focus until recently was almost exclusively on security technology for passengers.
As part of that effort, the Department of Homeland Security is setting up sites at American Airlines facilities in New York and Miami to test the effectiveness of non-standard explosives screening technologies such as metal detectors, vapor trace detectors, radio wave devices, and hand-held explosives trace detection equipment, Kelly told the subcommittee.
The GAO also drew attention to the fact the small size of TSA's cargo inspection staff (420) may hamper its ability to oversee what could potentially be thousands of facilities involved in doing screening. The agency is still recruiting to fill vacancies and plans to conduct a staffing study this year to determine if it has enough manpower to make sure private companies are meeting TSA screening requirements.
The TSA has said it intends to use third-party validation services to conduct reviews of facilities seeking to join the program or get their certification renewed. The TSA provides the validations free of charge, but when private sector auditors take over they will charge a fee. The TSA will limit itself to overseeing the program and conducting follow-up inspections to make sure companies are following the rules.
Kelly suggested that TSA may not wait until the interim final rule finalizing program details is issued to start outsourcing facility security reviews. The agency plans to issue by the end of May a request for information looking for interested candidates, and will regulate the inspection services through a special contractual agreement until the rule is published.
The costs of background checks will also change for shippers at that point. Indirect air carriers pay $28 apiece for their security threat assessments because they are regulated entities. The TSA is absorbing the cost of validating employees for certified shippers, but they will have to pay for background checks once the agency issues its interim final rule later this year, Kelly said.
Congress should consider helping TSA by providing more funding, expediting the procurement of screening technology and directing TSA to use inspectors to help screen cargo, Subcommittee Chairwoman Sheila Jackson-Lee said after the hearing, according to Congress Daily.