Newsday (New York) March 22, 2004
Antiterrorism Products: Sales to feds are slow going
Local companies are having a hard time getting Homeland Security to look at their innovations
By James Bernstein
After the attacks on Sept. 11, 2001, the U.S. government created a Department of Homeland Security and urged large and small companies to develop products that could be used in the war against al-Qaida and other groups.
The train bombing in Madrid two weeks ago that took more than 200 lives and injured at least 1,400 further boosted the government's drive to stamp out terrorism.
So it should be easy for metropolitan area companies working on antiterrorism devices to get encouragement, support and feedback from Homeland Security, right?
Not exactly. As companies develop equipment that could help fight terrorism, they say it's difficult to know what exactly the new federal agency wants, or even to get someone there to pick up the phone.
"The process is very difficult," said Jay Fraser, who owns Tracer Detection Technology Corp. in Syosset and has been trying to sell the department on an anticounterfeiting device. "It's not even easy finding the right person to talk to."
Nonetheless, the companies are forging ahead. The reason: Homeland Security's budget is about the fastest-growing in the federal government.
The march toward selling equipment to the department - items like fiber optics, power amplifiers, sensors, monitoring devices or implements to collect suspected anthrax and ricin - has only just begun.
Homeland Security still new
For starters, the Homeland Security Department is still getting itself together. Consisting of 180,000 employees from 22 federal agencies, it began operating only a year ago this month.
The nascent agency has handed out few contracts, but executives are hoping the spigots will open soon.
In the hope of helping companies connect with the department, Rep. Steve Israel (D-Huntington) sponsored a "Homeland Security Exhibit" at Brookhaven National Laboratory in November that attracted executives from about 60 companies in the region.
One of them, Daniel Myer, started Communications Power Corp. a decade ago in Hauppauge. A manufacturer of radio- frequency power amplifiers used in machines that scan the human body for abnormalities, the company has 20 employees.
At the Brookhaven Lab forum, Myer told Homeland officials the amplifiers could also be used to jam enemy communications systems or to detonate explosives.
"They're [Homeland Security] in the process of going through trials for what they need," Myer said. "Whether they go with us remains to be seen. It's all going to take time."
But executives are not being patient simply to be nice. The payoff for the wait could be worthwhile.
Homeland Security budgets are soaring. The Bush administration is asking Congress for $40.2 billion for Homeland Security in fiscal 2005, which begins in October. That's a 10 percent increase over the department's fiscal '04 budget. In its first year, Homeland Security's budget was $31.2 billion.
Events such as the deadly terror attack in Madrid can only prompt Congress to go along with the administration's request, said James Jay Carafano, an analyst with the conservative-leaning Heritage Foundation in Washington, D.C.
The additional money requested for the next fiscal year is intended to expand security at borders, ports and airports, beef up immigration enforcement and develop ways to combat biological and chemical attacks.
Department will get money
There is little doubt among experts that the department will get the money.
"They've got a blank check here," said John Pike, an analyst with GlobalSecurity.org, which studies defense budgets and programs. "The American people will support this."
Many businesses don't doubt it either.
Alex Boukas, a dentist who lives in Setauket and owns a company called Sopho Inc., developed a device originally to suction an object lodged in a child's throat that he says could be used to vacuum up anthrax or ricin. Armed with what he now calls Tox Vac, Boukas showed up at Brookhaven Lab. "We spoke to a whole bunch of people," Boukas said recently. "But the sense was it's too new. They [Homeland Security officials] said, 'OK, but what do we do with it?'"
Homeland officials were interested, he said, but didn't offer a contract. So, Boukas said, "we're going ahead with our own private funding" to develop it.
Not too many small companies do that, said Paula Scalingi, co-director of the Forum on Global Security, a think tank at Stony Brook University. "Companies say, 'Where's the money and how do I get it'?" Scalingi said. "Everybody is beating down the doors to try to sell their widgets, their tool, their approach. What they don't realize is that they need to help [Homeland Security] develop strategies and spend a little of their own dollars."
However, Israel, a member of the powerful House Armed Services Committee, charges that the department has already become a bureaucracy. Israel said about $900 million in Homeland Security research contracts nationally has yet to be awarded. Michelle Petrovich, a department spokeswoman, said it has awarded at least $60 million in contracts nationwide.
"We are using our budget appropriately and to support our programs," Petrovich said.
Not all companies thrilled
To be sure, not every company is excited about the prospect of working for Homeland Security.
Marty Kupferberg, president of Kepco Electric in Flushing, said he has not seen as much Homeland Security business materialize as he once thought might.
"We expect [homeland security] is going to be part of our business, but it won't be that much," Kupferberg said. "I'm a little bit less optimistic about it now."
Even many large companies with big research budgets are only in preliminary stages of homeland security work. Phil Teel, a Northrop Grumman Corp. vice president who heads the company's Long Island operations, said that for now, the company is writing a "white paper" for the Homeland Security Department on what buildings or sites in the metropolitan area might be "high-value targets," and how they could be better protected.
Lockheed Martin Corp.'s maritime systems and sensors unit at Mitchel Field in Uniondale proposed that Homeland Security buy its MetroGuard system, which detects biological, chemical or radiological weapons. Tom Notaro, the company's manager of advanced products, said Homeland Security officials expressed interest. But there has not yet been a sale.
Symbol Technologies of Holtsville, which makes bar-code scanners, suggested its technology for security checks at air and seaports, said Brian Lehmann, senior director of global government solutions.
But even a multibillion-dollar company like Symbol can't say when it will might get to sign on the dotted line. "I don't think anyone can answer that question," Lehmann said. "Everyone is working as hard as they can to apply technology to very difficult problems. But when contracts will flow? Gosh, I have not been given any dates."
© Copyright 2004, Newsday, Inc.
