Norton, ICE Officials and FPS Contractor Announce Reforms (7/17/07)

Washington, DC— Congresswoman Eleanor Holmes Norton (D-DC) today held a joint news conference with Julie Myers, Department of Homeland Security Assistant Secretary for Immigration and Customs Enforcement (ICE), to release reforms the agency is making to restore public confidence in contract operations and vendor payments for contract guards charged with security for federal buildings, employees and sites. Norton also announced that she has filed the Federal Protective Service Guard Contracting Reform Act to prohibit FPS from contracting with any security guard service that is owned, controlled or operated by an individual who has been convicted of a felony, “to assure that contractors are capable, responsible, and ethical as required by the Federal Acquisition Regulations.” Dennis Chapas, the newly appointed FPS contract payment ombudsman, and Robert Jenkins, a D.C. resident and owner of a District-based private security guard company contracted by the FPS also spoke at the news conference.

As Chair of the Subcommittee on Economic Development, Public Buildings, and Emergency Management, Norton introduced her bill following concerns raised at hearings and meetings she called with DHS officials. DHS has jurisdiction over FPS and both agencies, in addition to the General Services Administration, fall under the subcommittee’s oversight. Dramatic examples of separate problems have surfaced as evidence to private guard contracting operations, involving Jenkins Security Consulting and STARTECH International, where security guard payrolls were at risk or unmet. “At stake in both these quite different cases were not only the serious security issues involved, but wages that families, particularly in this income bracket, must have; major benefits payments for pensions, healthcare, union dues and the like; and of course, the vitality and ability of the small business contractors to survive, themselves,” Norton said.

At today’s news conference, Norton applauded several new ICE initiatives: the appointment of an ombudsman for security guard contracts; outreach to vendors in the National Capital Region, where disruptions have brought particular concern; and the steps the agency has taken to centralize contracting operations for improved implementation, prompt payment, and monitoring of invoices from guard contracting businesses. However, she got ICE, as well, to agree to clear the back log of payments to all contract vendors nationwide by August 3rd, when Congress is due to adjourn for summer recess, and to provide additional training of FPS regional directors and contracting officers. The full text of Norton’s statement follows.

I am pleased to be joined by Julie Myers, Department of Homeland Security Assistant Secretary for Immigration and Customs Enforcement, Dennis Chapas, Federal Protective Service (FPS) ombudsman for contracts, and Robert Jenkins, of Jenkins Security, all of whom have worked with me and the Subcommittee to assure the changes we jointly announce today. The oversight of our Subcommittee on Economic Development, Public Buildings, and Emergency Management has brought forward several concerns that we are pleased to announce have moved toward successful resolution in restoring public confidence in the private contracting operations of the FPS. The resolutions we are announcing are vital to the security and safety of federal employees and sites: first, substantive reform in contracting operations by the agency and second, a bill that I believe Congress must pass forthwith to assure that contractors are capable, responsible, and ethical as required by the Federal Acquisition Regulations.

Contract security officers are a critical component to federal strategies to protect the safety and security of federal employees and vital federal facilities as well. In the federal sector, security guards, many of whom carry guns, are as essential to protecting federal employees and sites as members of the FPS. Although not a replacement for public law enforcement officers, whether local police officers, or FPS law enforcement officers, private security guards, like peace officers are engaged in counter-terrorism activities in the post 9-11 environment. It was 9-11 and the creation of the Department of Homeland Security that led to the transfer of the FPS from the General Services Administration to the new Department of Homeland Security. Since the transfer, however, FPS has become even more dependant on contract guards, who have grown rapidly to 15,000 while the FPS is down from an authorized 1,450 to about 1,000. In passing appropriations for the FPS this year, the Appropriations Committee indicates that the administration is seeking to totally eliminate the FPS, the official police force for federal government work sites and facilities. The appropriation takes action to assure that FPS officer levels as of 2006 remain in place unless certain strong conditions are met. Today’s announcements concerning the vitality and integrity of contracting operations assume even greater importance in light of FPS downsizing.

Today’s actions emerged first from our hearing on June 21, 2007, when Weldon Waites, a felon who ran STARTECH, an FPS contractor for security guards services, testified. On two recent but separate occasions in this region, security guard payrolls were at risk or unmet. In the STARTECH case, the contractor, who has since been dismissed as an FPS contracting vendor, had received the necessary funds but had failed to pay security personnel for five weeks. Jenkins Security, on the other hand, borrowed to meet payroll when FPS failed to forward the contracted funds. At stake in both these quite different cases were not only serious security issues but wages that families, particularly in this income bracket, must have; major benefits payments for pensions, healthcare, union dues and the like; and of course, the vitality and ability of the small business contractors to survive, themselves. We are indebted to the contract security officers, most of who continued to protect federal workers, the visiting public and work sites alike during these episodes.

This subcommittee treats issues that are revealed through oversight not as “gotcha” moments but as problem solving challenges. We are pleased that Assistant Secretary Julie Myers and Robert Jenkins have worked closely with us to achieve a remedy for Jenkins Security that in turn has served as a template for Immigration and Customs Enforcement (ICE) and the subcommittee to agree on contracting changes at the agency now underway.

I applaud several ICE initiatives, particularly the appointment of an ombudsman for FPS security guard contracts, Dennis Chapas, who will speak shortly; ICE’s outreach to vendors in this vital National Capitol Region, where there have been reported disruptions that had brought particular concern; and the steps ICE has taken to centralize contracting operations for improved implementation, prompt payment, and monitoring of invoices from guard contracting businesses. Thereafter, our discussions with ICE have produced additional steps that we consider especially vital. Most important, ICE has agreed to clear the back log of payments to all contract vendors nationwide by August 3rd, when Congress is due to adjourn for summer recess. ICE also has agreed to do additional training of FPS regional directors and contracting officers. The subcommittee believes that the new contracting system requires training of these agency personnel if the improvements envisioned from the new system are to take hold throughout contracting operations. ICE will also develop and distribute guidance to contract guard companies to help them conform their own invoicing procedures to the new contracting system. Taken together, we expect these changes to produce the needed changes desired by the Subcommittee and ICE alike. As required, of course, the subcommittee will monitor implementation of the changes. We commend Deputy Secretary Michael Jackson and Assistant Secretary Julie Myers for working closely with us on these reforms.

We now turn to a vital security contractor issue that emerged from our hearings that can be solved only by Congress itself. During the June 21^st hearing, we learned that Weldon Waites, who had served five years in prison for money laundering and fraud was the de facto owner, with his wife, of STARTECH despite federal law barring felons from owning companies that do business with the federal government. In fact, it was Waites, not his wife, who came forward to defend the company after it failed to pay its 600

D.C. based guards despite receipt of funds for payment from FPS. Mr. Waite’s testimony concerning his operational control of the company was nothing short of a case study in evasion of existing law by merely taking advantage of obvious loopholes. Today I am filing the Federal Protective Service Guard Contracting Reform Act to prohibit FPS from contracting with any security guard service that is “owned, controlled or operated by an individual who has been convicted of a felony.” My bill would eliminate proxy ownership by relatives or spouses of vital FPS contracting operations. The bill would be effective immediately upon passage and therefore would mean that FPS would be required to dismiss any felon exercising control over an FPS contracting operation now, not merely future contractors. My bill reminds us that we must not lose sight of the mission of private contract guards who serve the federal government to guard federal employees and sites as vital as nuclear plants and military posts against terrorism and crime, and in the case of Jenkins Security, two secure federal power plants here. The STARTECH example of unpaid contract guards and apparent misuse of federal funds directed to pay them demonstrated why these businesses are required to have a “satisfactory record of integrity and business ethics.” Jenkins Security , who has never missed a payroll, met this definition. STARTECH did not. My bill would eliminate future STARTECH’s and improve the safety and security of federal sites.

The reforms announced today are different in kind. Some are internal to the agency, one is a change in law. Together they show how our Subcommittee seeks to effect change through oversight followed by action achieved through cooperation between one agency under our jurisdiction and our Subcommittee on Economic Development, Public Building and Emergency Management.