Senate Appropriations Committee Approves FY 2011 Bill to Cut CBP Funding by $210 Million

Although the Senate Appropriations Committee has approved S. 3607, it is not yet in effect. Generally, in order for a bill to be implemented, identical versions of that bill must be passed by both the House and Senate, and then the bill must be approved (enacted) by the President.

The following are highlights of the CBP provisions in the Senate Appropriations Committee's (Committee's) bill (S. 3607) and report² (S. Rept. 111-222). (See future issue of ITT for details on ICE, TSA, etc. provisions in the Committee's bill and report.)

Committee Approves $210 Million Less in Total Appropriations for CBP

According to the report, the Committee is recommending $9.9 billion in total appropriations for CBP in FY 2011 (for salaries and expenses, automation modernization, air and marine interdiction, etc.), $210 million less than what was appropriated in FY 2010.

(The House Appropriations Committee’s Subcommittee approved FY 2011 DHS appropriations on June 24, 2010 which would cut CBP funding, other than automation modernization, by $282 million. The Subcommittee did not provide funding information on automation modernization. See ITT’s Online Archives or 07/02/10 news, 10070217, for BP summary of the House Subcommittee's less detailed information on the bill.)

$225 Million Increase for CBP Salaries, Expenses for Enforcement, Inspections, Etc.

S. 3607 would provide $8.29 billion, an increase of $225 million from what was appropriated in FY 2010, for salaries and expenses for the enforcement of laws relating to border security, immigration, customs, agricultural inspections and regulatory activities related to plant and animal imports, etc.

$75 Million Funding Decrease for ACE

S. 3607 would provide CBP automated systems with $347.6 million ($75 million less than what was appropriated in FY 2010), of which not less than $153 million would be for the development of the Automated Commercial Environment (ACE). Of that $153 million, $16 million would be for the International Trade Data System (ITDS). This appears to be the same total amount that was requested by the Administration in its FY 2011 budget request.

S. 3607 also states that $50 million of the automation funding could not be obligated for ACE until 30 days after the House and Senate Appropriations Committees receive a report on the results to date and a detailed expenditure plan for the program from DHS.

ACE decrease sought due to problems, would give CBP time to solve them. In light of the continued problems with ACE oversight, management, and development, the Committee agrees with the Administration that the reduction in automation funding is appropriate and believes that CBP should take this opportunity to address and resolve these problems. (See ITT’s Online Archives or 03/05/10 news, 10030505, for BP summary of the Administration’s FY 2011 budget request for ACE and other modernization funding.)

Increased Funding for C-TPAT and International Cargo Screening

The Committee expressed disappointment that the President proposed deep cuts in effective programs which accomplish the goals of “pushing the borders out.” The Committee strongly supports programs which provide this layered border security and adds funding above the request for a number of these programs.

Of the total $8.29 billion, the Committee’s bill would provide $62.6 million for C-TPAT (an increase of $7.5 million over what was enacted in FY 2010), and $162 million for international cargo screening (an increase of $53.5 million over what was enacted in FY 2010) for FY 2011.

Committee requests briefing on allocation of C-TPAT, CSI funds. While unable to fully restore the reductions to the Container Security Initiative (CSI) and the Customs-Trade Partnership Against Terrorism (C--TPAT), the Committee recommends increases and requests a briefing within 90 days of enactment on how these additional funds will be allocated to enhance security as well as what steps will be taken to mitigate the impact on security of the remaining cuts.

Insufficient Resources for CBP “Office of Trade” Concerns Committee

The Committee expresses concern that CBP may not be providing sufficient resources and personnel to the Office of Trade. The Committee fully funds the President’s request for trade enforcement and compliance and encourages CBP to increase hiring of trade enforcement and compliance personnel to the greatest extent possible. The Committee directs CBP to submit to the Committees on Appropriations the updated resource optimization model (ROM) required to be prepared under the SAFE Port Act.

IPR Funding Would be Held Until 5-Year IPR Enforcement Strategy is Submitted

The bill would provide $20 million in intellectual property rights (IPR) funding. The Committee also includes language in the bill withholding $20 million from obligation until the CBP Commissioner submits the 5-year IPR enforcement strategy required in the joint explanatory statement accompanying the FY 2010 DHS Appropriations Act.

AD/CV Duty Enforcement

In its bill, the Committee ensures that there will be sufficient funds to administer the ongoing requirements of 19 U.S.C. 1675c (the Byrd Amendment).

Annual report on Byrd Amendment disbursements. The Committee directs CBP to continue to work with the Departments of Commerce and Treasury, and the Office of the U.S. Trade Representative (and all other relevant agencies) to increase collections, and provide a public report on an annual basis, within 30 days of each year’s distributions under the law. The report should (i) summarize CBP’s efforts to collect past due amounts and increase current collections, particularly with respect to cases involving unfairly traded U.S. imports from China; (ii) provide the amount of uncollected duties for each AD and CV duty order, and indicate the amount of open, unpaid bills for each such order; and (iii) provide advice from the DHS Secretary, in consultation with other relevant agencies, including the Secretaries of the Treasury and Commerce, as to whether CBP can adjust its bonding requirements to further protect revenue without violating U.S. law or international obligations, and without imposing unreasonable costs upon importers.

ID opportunities to improve ITA liquidation instructions to CBP. The Committee further directs the Secretary to work with the Secretary of Commerce to identify opportunities for the Commerce Department to improve the timeliness, accuracy, and clarity of liquidation instructions sent to CBP. Increased attention and interagency coordination in these areas could help ensure that steps in the collection of duties are completed in a more expeditious manner.

Adequate resources to address customs fraud, including duty circumvention. The Committee directs CBP to ensure that adequate resources are directed to the field and to key seaports to address issues of customs fraud, including circumvention of duties and misclassification on entries of imports of goods from China. CBP should work with its counterparts at ICE to address aggressive targeting of unfairly traded imports of steel pipe and tube from China to ensure that appropriate actions are taken to end these illegal activities. The Committee requests a briefing from CBP on steps it is taking to address this issue as well as other options it can explore with other agencies and departments to further improve targeting.

Committee is Concerned About CBP Officer Staffing for Northern Border POEs

The Committee remains concerned about CBP officer staffing levels for Northern border ports of entry. The Committee believes that many of the concerns about Northern border staffing could be allayed by more complete reporting to Congress about CBP’s Northern border staffing plans. The Committee directs CBP to submit a plan with the FY 2012 budget detailing specific staffing and funding for, and implementation of, planned Northern border enforcement initiatives.

Inspection and Detection Technology Funding Includes NII Systems

The Committee’s bill would provide $155 million for “Inspection and Detection Technology Investments” (the same amount as appropriated in FY 2010). The Committee understands that in addition to ongoing operations and maintenance of CBP’s inventory of technology systems, $44.7 million will be used to procure and deploy new and replacement nonintrusive inspection (NII) systems.

CBP 5-Year Plan for Land Border Port of Entry Projects Would be Required

S. 3607 would require, for FY 2012 and thereafter, that CBP’s annual budget submission for ‘‘Construction and Facilities Management’’ must , in consultation with the

General Services Administration, include a detailed 5-year plan for all Federal land border port of entry projects with a yearly update of total projected future funding needs

delineated by land port of entry.

Additional CBP Officers Would be Funded by Southwest Border Initiative

The Committee’s bill would provide a total of $66.4 million in various CBP accounts to hire more CBP officers and pilots, and procure one additional unmanned aerial system (UAS). With these additional funds, combined with funds requested in the President’s budget, and those in the inventory or awaiting delivery, CBP will have a total of nine UAS to patrol U.S. borders. The Committee recommends $20 million to hire no fewer than 80 new CBP officers and $10 million to hire the 62 CBP officers funded by the Congress in the FY 2010 Act but not hired due to overall CBP fee revenue shortfalls. Finally, the Committee recommends funding for hiring 86 pilots, marine enforcement agents, and operational support staff, as well 5 new positions in support of the additional UAS.

S. 3607 would also provide $574 million for expenses for border security fencing, infrastructure, and technology.

Committee Urges DHS to Clarify Jones Act in Rulemaking

The Committee urges DHS to expeditiously complete the ongoing rulemaking process to establish clarity in the law regarding the application of the Jones Act to the offshore energy sector.

¹FY 2011 is from October 1, 2010 through September 30, 2011.

²Although reports such as S. Rept. 111-222 do not have statutory force and departments and agencies are not legally bound by their declarations, they do explain congressional intent, and executive branch agencies take them seriously because they must justify their budget requests annually to the Appropriations Committees.