Senate Committee Approves Bill with FY 2012 Funding Increase for CBP

(The House passed its own version of H.R. 2017 on June 1, 2011. See ITT’s Online Archives or 06/01/11 and 06/03/11 news, 11060116 and 11060316, for BP summary of House version of H.R. 2017.)

The following are highlights of the provisions for U.S. Customs and Border Protection (CBP) in the text of the bill (as reported by the Senate Appropriations Committee) and the Committee’s report¹. (See future issue of ITT for details on the provisions affecting the other DHS agencies, such as TSA, etc.)

Funding Specified for Cargo Scanning Pilots, Add’l Officers

The Committee-reported version of H.R. 2017 would provide funding for an additional 300 CBP officers at new and expended ports of entry, additional canine units, and cargo container scanning pilot projects (all as requested by the President’s budget). The Committee would also provide additional funding for expanding integrity training for CBP officers, conducting investigations, etc.

Add’l Funds for CBP’s Office of Trade for Enforcement, Compliance Activities

As a result of the Committee’s concern that CBP may not be providing sufficient resources and personnel to the Office of Trade, the Committee-reported version of H.R. 2017 would provide additional funds above what the President requested for trade enforcement and compliance activities in CBP’s Office of Trade. Such activities include additional trade enforcement and compliance personnel and trade targeting systems (i.e, at the National Targeting Center (NTC) and the Automated Targeting System (ATS).).

Urges CBP to Encourgage or Require Broker “Know Your Customer” Programs

The Committee urges CBP to investigate ways to work with the broker community to encourage or require brokers to develop "know your customer" programs to promote integrity within the importer community. .

Directs CBP to Consider U.S. Agent for Foreign Importer Requirement

The Committee also directs CBP to work with Commerce on the feasibility and impacts of requiring foreign importers of record to have a U.S. agent that is financially liable.

Provides Funds for Cargo Inspection Improvement Pilots

The Committee-reported bill would also provide funding for pilots designed to improve cargo inspections. The Committee directs CBP to provide a detailed briefing on the plans for use of the additional NTC and ATS funds as well as the proposed pilots by November 1, 2011.

Funding for C-TPAT, CSI, Urges Better Coordination with Importers, OGAs

In its report, the Committee says that it provides funds for programs such as the Container Security Initiative and the Customs-Trade Partnership Against Terrorism (C-TPAT) prior to their authorization because these programs were intended to meet both trade and security requirements. Specifically, the Committee-reported bill would provide $45 million for C-TPAT, the same as passed by the House, but $5 million less than FY 2011.

The Committee notes that recent activities, including the Importer Self Assessment (ISA), may not be implemented as effectively as they could be and stresses the importance of CBP working with the importing community and other government agencies, such as the Food and Drug Administration (FDA) and the Consumer Product Safety Commission (CPSC), to communicate guidelines defining what constitutes low-risk cargo and what additional steps importers can take to meet them and be considered a certified importer. The Committee recognizes that potential impediments to separating and clearing low risk cargo from cargo requiring greater inspection at individual ports given their different configurations and inspection processes. CBP is encouraged to engage more regularly with industry on these issues.

Provides Same Automation Modernization Funding as House

The Committee-reported bill contains $334.3 million for automation modernization, the same amount that was passed by the House, and slightly less than was appropriated in FY 2011. Not less than $140 million would be for the Automated Commercial Environment ($16 million of that for the International Trade Data System (ITDS)). The Committee’s legislation would condition $50 million of the ACE development funds on the submission of a comprehensive expenditure plan. CBP is also directed to continue providing Congress quarterly reports on ACE and brief Congress on its plan to decommission the Automated Commercial System, the updated program plan and schedule for ACE, etc.

Requires 3-Year Trade Strategy for CBP’s Office of Trade

The Committee directs DHS to submit a 3-year strategy on a trade compliance enforcement framework that includes a detailed hiring and staffing plan for the Office of Trade to fill critical trade enforcement and administrative positions, including those dedicated to trade targeting and analysis of trade trends, such as CBP officers; trade specialists; Fines, Penalties, and Forfeitures officers; and auditors. The strategy would also address antidumping and countervailing (AD/CV) duty training requirements, an AD/CV risk model, the use of single transaction bonds to target higher-risk importers, and ‘new shipper' rules.

Directs CBP to Review Use of AD/CV “Jump Teams”

Due to their success in the area of textiles, the Committee directs CBP and Immigration and Customs Enforcement (ICE) to work with the U.S. Trade Representative and the State Department to review the possible uses of product verification (aka jump) teams to combat AD/CV transshipment violations and how to make better use of and expand such teams.

Directs CBP to Increase AD/CV Collections, Report on Bonding, Etc.

CBP is directed to work with other agencies to improve AD/CV collections and provide a report to Congress on issues such as whether CBP can adjust its bonding requirements to further protect the revenue without imposing unreasonable costs on importers or violating U.S. or international law. CBP is also directed to work with Commerce to improve the timeliness, accuracy and clarity Commerce’s AD/CV liquidation instructions, increase CBP collections of AD/CV duties, and report on the $1 million in outstanding uncollected AD/CV duties.

CBP Directed to Report IPR Progress, Improve Outbound Inspections, Etc.

In its report, the Committee directs CBP to:

• Cargo inspection pilots -- conduct pilots designed to improve cargo inspections and brief the Committee on plans to use additional NTC and ATS funding, as well as the proposed pilots (see above).
• Information sharing - develop a legislative proposal to remove any legal barriers to sharing appropriate and necessary information with trade compliance and enforcement agencies, such as Commerce.
• IPR strategy - brief the Committee on progress in implementing CBP’s 5-year Intellectual Property Rights Enforcement Strategy.
• Outbound inspection technology -- submit a 3-year strategy to improve the technology available to conduct outbound inspections along the land border and deploy such technology.
• Rail car screening -- brief the Committee on the status of existing rail car screening technologies and on how it intends to develop a strategy to work with the private sector on ways to perform such screening.
• Invasive species control -- fund activities associated with the control of invasive species, such as carrizo cane, and any mitigation efforts.
• Northern border staffing-- submit a plan with the FY 2013 budget detailing specific staffing and funding for, and implementation of, planned Northern Border enforcement initiatives and brief the Committee.

¹Although the Appropriations Committee’s report does not have statutory force; departments and agencies are not legally bound by their declarations. It does, however, explain congressional intent and frequently have effect because departments and agencies must justify their budget requests annually to the Appropriations Committees.

S. Rept. 112-74 available here

H.R. 2017 as reported by Committee available here