oversight

Aviation Security: FAA's Procurement of Explosives Detection Devices

Published by the Government Accountability Office on 1997-05-01.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

      mitedstlltes
GAO   General Accounting Offhze
      Washington, D.C. 20548

      Resources, Community,   and
      Economic Development    Division


      B-275531


      May 1, 1997


      The Honorable Frank Wolf
      Chairman, Subcommittee on
       Transportation
      Committee on Appropriations
      House of Representatives

      Subject:      Aviation Securitv: FAA’s Procurement of Explosives
                    Detection Devices

      Dear Mr. Chairman:

      This report responds to your request regarding the Federal Aviation
      Administration’s (FAA) recent expenditures on advanced security devices at
      U.S. airports. Specifically, you asked us to address (1) how FAA is determining
      which explosives detection devices’ to purchase and where to deploy them and
      (2) the extent to which FAA’s purchase and deployment of these devices is
      adhering to its Acquisition Management System (AMS), which governs major
      capital procurements.

      In summary, FAA’s Security Equipment Integrated Product Team is purchasmg
      explosives detection devices on the basis of the President’s September 12, 1996,
      budget proposal, which called for funding numerous counter-terrorist activities
      during fiscal year 1997. The President’s proposal designated the type and
      number of devices to be purchased, and FAA’s team has followed these
      designations. The proposal did not designate which airports should receive the
      devices. As a result, the team has made most preliminary deployment decisions



      ‘For the purposes of this report, an explosives detection device is defined as a
      device that, in most cases, has an automatic alarm that signals the operator if a
      potential explosive is detected. Jf the device does not have an automatic alarm,
      it has some other advanced capabilities to provide information to the operator,
      such as highlighting or color-coding a potential explosive.
                                         GAO/RCED-97-11lE   Procuring   Explosives   Detection   Devices
B-275531
independently by analyzing information on the overall threat to U.S. civil
aviation and combining it with data on the technical capabilities of the devices.

The team has not prepared certain planning documents required under FAA’s
April 1996 Acquisition Management System procurement guidelines and has
pursued some noncompetitive procurements. However, the procurement
guidelines allow exceptions from these requirements when they are determined
to be in the agency’s best interest. Currently, the team is seeking a formal
waiver from the requirements and is preparing a written request justifying its
approach. This request will document that congressional direction compels the
team to purchase and instaU explosives detection devices under an accelerated
timetable, which requires the devotion of all staff resources to the awarding of
contracts as rapidly as possible. The team expects the Associate Administrator
for Civil Aviation Security to approve its request for a waiver.

BACKGROUND

The unexplained crash of TWA Flight 800 in July 1996 sparked new concern
about aviation security. In response to this event, the President established the
White House Commission on Aviation Safety and Security (the Gore
Commission). Under the direction of the Vice President, the Commission
issued an initial report on September 9, 1996. This report contained 20
recommendations to strengthen aviation safe@ and security and suggested
specific federal funding levels to implement some of them. The President’s
fiscal year 1997 budget proposal for counterterrorist activities largely
incorporated these funding levels. The Congress appropriated $144.2 million for
FAA to purchase and install explosives detection devices at U.S. airports, along
with an additional $21 million for associated research and development
activities. The Gore Commission’s final report, issued in February 1997,
recommended that FAA be appropriated $100 million annually to continue
purchasing these devices.

With the appropriation of funds to procure explosives detection devices,
congressional direction stated that it was imperative for FAA to field the
devices expeditiously and gain operational experience. Jn response, the
Secretary of Transportation directed FAA to have most of the devices in place
by September 1997 and to complete the program by December 1997.

Like other procurements by FAA, this purchase is subject to the agency’s own
set of guidelines governing major capital procurements. These guidelines,
which require that FAA teams adhere to a variety of new principles designed to


 2                              GAOAUXD-97-1llR   Promring   Explosives   Detection   Devices
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ensure timely, cost-effective procurements, constitute FAA’s Acquisition
Management System @MS).

In October 1996, FAA created the Security Equipment Integrated Product Team
(IPT) to purchase explosives detection devices and related services and to
deploy the devices by the Secretary’s deadline. This IPT brings together FAA
staff from the offices of Civil Aviation Security and Research and Acquisitions,
as well as airport and airline industry representatives. Specifically, the IPT is
responsible for (1) developing an acquisition plan, (2) determining the type and
number of explosives detection devices to purchase, (3) selecting the airlines
and airport sites to receive the devices, and (4) overseeing the installation and
integration of the devices into airports’ existing security systems.

THE IPT FOLLOWED THE PRESIDENT’S PROPOSAL
WHEN MAKING PURCHASING DECISIONS
BUT HAS MADE DEPLOYMENT DECISIONS INDEPENDENTLY

The President’s budget proposal for counter-terrorist activities designated which
type of explosives detection devices should be selected to screen checked and
carry-on bags, as well as how many devices of each type should be purchased.
The IPT used the proposal’s designations as its basis for making purchasing
decisions. However, the budget proposzil did not designate where these devices
should be deployed. The President’s proposal followed recommendations made
in the Gore Commiss ion’s initial report, which were based on FAA’s estimates
of the number of devices needed to cover key screening points at higher-risk
airpOrts.


The IPT’s planned purchases have mirrored the number of devices designated in
the President’s proposal For example, the proposal specified that 54 FAA-
cetied devices that use a computed tomography technique to screen checked
bags should be installed at airports nationwide, and the IPT has purchased 54
of them.3 In addition, the President’s proposal designated that 489 devices
designed to screen passengers’carry-on bags be instaRed, and the IPT plans to
purchase at least this number. (See enc. I for a complete list of the purchases.)



2Higher-risk airports are those that FAA classifies as Category X and Category 1
airports. These airports have a high traffic volume and complex security
programs.
3Computed tomography can develop a clear multidimensional image of an
object located inside a piece of baggage.

3                              GAO/RCED-97-11lR   Procuring   Explosives   Detection   Devices
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FAA’s IFT has independently made most decisions about where to deploy the
explosives detection devices. To develop its preliminary deployment plan, the
IPT sponsored a 4day workshop in January 1997. At the workshop, all team
members, including representatives of major airlines and airports, were invited
to help develop the plan. Workshop participants were provided information
about overall threats to civil aviation and the technical capabilities of
explosives detection devices. In addition, participants reviewed individual
airports’ plans for counteracting identified security vulnerabilities.

Workshop participants used this information to make preliminary decisions
about which airports should receive the devices and when installation would be
feasible. Although participants found that information on overall threats and
the capabilities of the devices was helpful, they were largely unable to use the
data contained in the airports’ action plans. According to the leader of the IPT,
only a limited number of action plans were meaningful to the team during its
deliberations on deployment because many airport officials do not have access
to crucial information on threats or do not possess sufficient expertise about
these devices to determine their own equipment needs.

The IPT has received comments on its draft deployment plan from a variety of
interested parties, including other FAA officials and representatives of aviation
industry groups. It expects to release a iinal deployment plan in May 1997.

FAA IS USING AN EXPEDlTED PROCESS
TO MAKE PURCHASES QUICKLY

FAA’s IPT plans to comply with guidelines governing the procurement of major
capital equipment and is moving quickly to purchase and deploy explosives
detection devices in response to congressional direction and the Secretary’s
December 1997 deadline. The team plans to request a waiver from planning
requirements ordinarily called for under the AMS and expects FAA’s Director of
Civil Aviation Security to grant this waiver. The request will explain that the
IPT must devote all of its resources to contract awards in order to respond to
congressional direction, which calls for the devices to be purchased and
installed as rapidly as possible. Planning requirements ordinarily include
preparing (1) a mission needs statement; (2) a requirements document; (3) an
investment analysis report, (4) an acquisition program baseline report; (5) an
acquisition strategy paper; and (6) an integrated program plan4 Together, these
documents are designed to assist any FAA team in ensuring that a project is



 4Seeenc. II for descriptions of the six major planning requirements.
 4                              GAOIRCED-97-11lR   Procuring   Explosives   Detection   Devices
B-275531
consistent with the agency’s overall mission, which includes maximizmg cost-
effectiveness when selecting and deploying capital equipment. According to the
IPT’s acquisition manager, the time required to prepare these documents would
have kept the team from completing its purchases during 1997.5

In addition, under the AMS guidelines, an IPT may make noncompetitive
procurements when there is a rational basis and when they are determined to
be in FAA’s best interest. This IPT has purchased and plans to purchase some
explosives detection devices and related services through a noncompetitive
process. For example, the team has purchased computed tomography devices
without soliciting competitive bids. According to the leader of the IPT, the
price that the team has paid for these devices is fair and reasonable. Only one
vendor, InVision Technologies of Foster City, California, currently manufactures
FAA-certified devices that use computed tomography to screen checked
baggage. The IPT conducted a price comparison analysis, which AMS
procurement guidelines require. Specifically, it used data from the sale of
identical InVision devices to six foreign customers during 1996. On the basis of
these data, the IPT negotiated a per-unit base price of $900,000,which
compares favorably with the average per-unit base price of about $995,000 paid
by the foreign customers. Likewise, the PI% price compares favorably with
InVision’s own published catalog price of $1,028,000per unit. In addition,
according to FAA’s Deputy Assistant Chief Counsel, Procurement Law Division,
the $900,000 base price is for equipment with certain capabilities and features
that the models sold to foreign airports do not contain.

FAA’s IPI’ is also contracting for the purchase of at least 489 devices designed
to screen carry-on items for explosives. These devices can detect minute
amounts of explosives’ residue on the surfaces of various objects.
Congressional direction has encouraged FAA. to provide for operational testing.
Accordingly, the IPT has already purchased 40 devices from five vendors.
During 1997, the PI’ will solicit bids for the remaining devices. The team
intends to award contracts, in part on the basis of results of the initial tests, to
any vendor whose device can perform to FAA’s requirement for effectiveness in
airport operations. Vendors whose devices perform to this level will be listed
as qualified to compete for an FAA contract According to the 3PT acquisition
manager, the team is likely to purchase devices from each of the qualified
vendors, but will use price and inMa3 performance data to determine the
number of each device to be purchased. The PT plans to install these devices



‘Jn April 1997, the IPT team leader acknowledged that the installation of the 54
checked-baggage screening devices wipl not be complete until February 1998.
5                               GAO/RCED-97-111R   Procuring Explosives   Detection   Devices
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at major U.S. airports and will select 94 high-risk checkpoints for priority
delivery. By December 1997, FAA and the airports will have generated airport-
specific operational data for approximately 1 year on the performance of these
devices.

The market for some explosives detection devices promises to become more
competitive during the coming year. This should benefit FAA’s ongoing effort
to receive a good value for its investment. For example, the leader of the IFT
has told us that by January 1998, the Lockheed-Martin Specialty Components
Corporation is expected to have ready for commercial use an FAA-certified
checked-baggage screening device that uses computed tomography. According
to FAA and aviation industry officials, this device may contain several new
features that enhance performance.



We provided copies of a draft of this report to the Department of
Transportation for review and comment. The Department generally agreed with
the facts presented. FAA’s Security Equipment IPT, which is procuring
advanced security devices and related services on the Department’s behalf,
provided some suggested technical and clarifying language. We have
incorporated these changes as appropriate.

We discussed the issues addressed in this report with members of FAA’s
Security Equipment IPT and with the Associate Administrator of FAA’s Office of
Civil Aviation Security and his staff. We also reviewed FAA’s April 1996
procurement guidelines, as embodied in the AMS, and identified key elements
for comparison against the IPT’s decision-making process. Furthermore, we
reviewed files relevant to all contracts awarded through March 31, 1997, as well
as data related to the IFTs decisions about deploying explosives detection
devices. Finally, we held discussions with officials representing major
commercial airlines, higher-risk U.S. au-ports, and manufacturers of explosives
detection devices. We conducted our review from November 1996 through
April 1997 in accordance with generally accepted government auditing
standards.




 6                             GAOIRCED-97-1llR   Procuring   Explosives   Detection   Devices
B-275531
As requested, unless you publicly announce its contents earlier, we plan no
further distribution of this report for 30 days. At that time we will send copies
to appropriate congressional committees and make copies available to others
on request. If you or your staff should have any questions about the
procurement of explosives detection devices, please caJl me at (202) 512-3650.
Major contributors to this report were Mike Bollinger, Aaron Casey, Dave
Hooper, Marnie Shaul, and Howard Veal.

Sincerely yours,




Gerald L. Dillingham     .
Associate Director, Transportation Issues

Enclosures - 3




7                              GAO/RCED-97-111R   Procuring   Explosives   Detection   Devices
ENCLOSURE I                                                                                                ENCLOSURE I

                                  THEF'EDERALAViATlONADMINISTRA~ON'S
                                  SECURITYEWIPMENTPROCUREMENTPLAN



                                                                                (dollars in
     vent                                                 Contractor(s)           millions)       Quantity           Award date


     Wcurement of screening devices for checked baggage
        Computed tomography devices                       InVision                  $52.3      54 devices             12124i96
        Advanced X-ray devices                            EG&G, Heimann,               7.1     20 devices                  s/30/97
                                                          Vivid
        Quadrupole resonance devices                      Quantum                      1.0       5 devices                 5/30/97
                                                          Magnet&


     %curement of screening devices for carry-on items    Bardnger, CPAD,            40.0     489 devices                   5l2J97
                                                          Graseby, ion
                                                          Track, Therrnedice


     nstaflation of equipment at airports                 Lockheed-Martin,            17.0     2 contracts             12/20/96
                                                          Raytheon


     Wxxuement of training services for operators of      TBD                         10.2       1 contract                9130197
     x#mputed tomography devices

     Mditionaf funding for ail equipment installation     N/A


     %curement of training services for operators of      EG&G, Rap&can                 5.3      1 contract                5/30/97
     zonventionai X-ray equipment (SPEARS)


     Procurement of passenger-profiling services
       Pilot project                                       Northwest Airlines           2.1         1 grant            1 OJ22l9E
       Remainder of project                                T5D - multiple               7.6        multiple                 a/30/95
                                                           awards                                  awards


     Procurement of technical support services             JIL                          0.7      1 contract                11/27/9f
     Procurement of quality assurance services             TBD                          0.3      1 contract                 5/30/9i
     Procurement of analytical evaluation services         Raytheon                     0.4       1 contract                4/25/g;


                                                                                     81442




 8                                                        GAO/RCED-97-111R        Procuring   Explosives       Detection      Devices
ENCLOSURE II                                                                               ENCLOSURE II


                    DESCRIPTIONS OF REQUIRED PLANNING DOCUMENTS
                       FOR THE ACQUISlTION MANAGEMENT SYSTEM

Mission      need statement:  This document describes the current capability of systems,
facilities, equipment, and other assets needed to fulfill an identi.fied mission.

Requirements    document:    This document establishes the performance baseline for an
acquisition program. Critical performance parameters are incorporated into a baseline
report and are then used as a basis for operational testing. The document serves as the
basis for condu&ng market research to identify the commercial availability of capital
equipment and for determinin g the best overall approach to satisfying the iden%ed
mission.

Investment    analysis report: This document is key to making investment decisions. It
addresses all reasonable alternative solutions impartially. Its intent is to quantify and
display the strengths and weaknesses of various investment options. The evaluation
criteria should include the cost, schedule, performance, benefits, supportability,
infrastructure requirements, and risk.

Acquisition     program    baseline      This document establishes the .&amework withjn
                                      report:
which an acquisition program will be implemented. It establishes critical performance
parameters for a program and sets boundaries for the cost and schedule within which the
program is authorized to proceed.

Acquisition     strategy       This document defines the strategy by which the acquisition
                           paper:
program will be executed. It describes the contracting strategy that will be employed (e.g.,
competitive or sole-source contracting). It also describes the testing strategy that will be
used to integrate systems and equipment in a facility and to cert@ them for operational
use.

Integrated   program plan: This document is the key planning instrument for all aspects
of a program’s implementation. It describes all essential elements of implementation,
including funding allocations, the schedule, the roles and responsibilities of key personnel,
internal controls and review, contracting, maintenance, logistical support, and testing and
evaluation.




9                                               GAOBCED-97-IIIB   Procuring   Explosives   Detection   Devices
ENCLOSURE III                                                                    ENCLOSURE III

                              RELATED GAO PRODUCTS                .

Aviation Securitv: Technolorrv’s Role in Addressing Vulnerabilities (GAO/T-RCED/NSIAD-
96-262, Sept. 19, 1996).

Terrorism and Drug Trz&&irt~: Technologies for Detect&       Exolosives and Narcotics
(GAO/NSIAD/RCED-96-252, Sept. 4, 1996).

       Securitv: DeveloDment of New Securitv Technoloq Has Not Met Expectations
Aviation
(GAO/RCED-94142, May 19, 1994).




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 10                                      GAO/RCED-97-111E   Procuring   Explosives   Detection   Devices
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