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House Foreign Affairs Committee
Testimony of Assistant Secretary of State for Consular Affairs
Maura Harty
July 11, 2007

Chairman Lantos, Ranking Member Ros-Lehtinen, distinguished members of the Committee,

I appreciate this opportunity to discuss how the Bureau of Consular Affairs (CA) is working to provide American citizens with reliable, secure passports while maintaining the integrity of the passport issuance process.

The U.S. passport is one of the most valuable travel documents in the world. CA is responsible for managing an efficient passport application process, and ensuring that passports are issued only to those who have established their identity and citizenship.

Demand for passports is at unprecedented levels. We issued 10.1 million passports in Fiscal Year 2005 and 12.1 million last year. As of July 2, we have already issued 12 million passports this fiscal year - a 34 percent increase over the same period last year. We are on pace to issue over 17 million by the end of the year. Since March we have averaged more than 1.5 million issuances per month.

Throughout the Bureau of Consular Affairs, at our eighteen passport agencies around the country and here in Washington, thousands of dedicated employees are making every effort to ensure that travelers who apply for passports receive them in time for planned travel. We are meeting travelers' needs in the overwhelming majority of cases. I know, however, that over the past several months, many travelers did not receive their passports in the time frame they expected. I deeply regret that. The current situation is untenable, and we are committed to turning it around.

Last week, Americans marked the 231st anniversary of the Declaration of Independence. On July 4th we recalled those patriots who risked their lives, fortunes and sacred honor to establish a government accountable to the people for the decisions it makes. We honor this tradition of transparency and accountability. We have not met the passport production standards that we had set for ourselves and that Americans have come to expect and rely upon. We are taking the steps necessary to correct the current situation and re-establish passport service that is reliable, predictable and secure.

Mr. Chairman, thank you for your visit to the San Francisco Passport Agency on Friday. The staff deeply appreciated your interest, and especially your remarks acknowledging their phenomenally hard work and long hours over the past months. I know your visit to the agency gave you a vivid picture of the challenge we face to get back on top of our workload, as we have promised to do.

I want to brief you on the current passport situation, and what we are doing to restore the six-week passport turnaround time while we continue to ensure the integrity of the passport issuance process and achieve for our nation the security and efficiency benefits of WHTI.

How Did We Get Here? Passport Receipts Exceeded Expectations

We have been planning for increased passport demand since Congress passed the Intelligence Reform and Terrorism Prevention Act (IRTPA) in December of 2004. IRTPA included a provision requiring all travelers to have a passport or other combination of documents establishing identity and citizenship to travel into and out of the United States. WHTI implements that provision.

Following passage of IRPTA, we had two years to plan for the expected increase in passport demand. We analyzed our own figures, and commissioned a survey of projected demand conducted by an independent contractor. Drawing on consultations with DHS and historic demand trends, we projected that we would receive approximately 16.2 million passport applications in FY 2007, 31 percent more than our 2006 receipts.

Over the past two years, we have been in perpetual forward motion to meet the requirements of the new law. We ramped up capacity to meet projected demand, adding staff, expanding facilities, and enhancing service.

Additional Staff

We hired 441 employees in Passport Services in FY 2005, 925 in FY 2006, and 1,222 thus far in FY 2007 - a total of 2,588 in less than three years. These figures include fraud prevention staff, trainers and managers, passport adjudicators, and the contractors who perform critical non-adjudicative functions at our passport agencies. Attrition took a toll, so we are virtually always hiring.

Expanded Facilities

We opened the Colorado Passport Agency in October 2005, and expanded our agencies in Boston, Chicago, Houston, New Orleans, and Seattle. We opened a mega-center in Hot Springs, Arkansas in March of this year. The Arkansas Passport Center (APC) has printed over 260,000 passports since opening its doors, and will be able to produce 10 million passports annually when it reaches full capacity later this year.

We had a setback: Hurricane Katrina had an impact on our operations. Before Katrina, the New Orleans Passport Agency processed approximately 20 percent of our overall workload; in preparation for WHTI we had planned to increase that share to roughly 25 percent. Following Katrina, the New Orleans facility was out of commission for five months. It re-opened in February 2006 with a capacity to process only 10 percent of total passport demand; the remaining workload was transferred to our agencies in Charleston, SC and New Hampshire. Production has since increased, and New Orleans currently processes somewhat more than 10 percent of our (much larger) workload. Our tough and resilient New Orleans staff will continue to work hard to grow their capacity.

Enhanced Service

We implemented a Centralized Appointment System in October 2005, allowing customers to schedule appointments through the National Passport Information Center (NPIC) for any of our domestic agencies nationwide. We also implemented an online status check service. This service, available through the CA website, travel.state.gov, allows customers to check the status of their passport application from their desktop.

The Situation in 2007 - When Phase I of WHTI Took Effect

As I mentioned previously, we predicted we would receive 16.2 million passport applications in FY 2007. In fact, we are likely to receive between one and one and a half million more than that. We did not foresee that the rapid spike in demand that occurred earlier this year would be so great.

In the three months before WHTI implementation - October to December 2006 - demand increased steadily, in line with our expectations. Then in 2007 it spiked sharply. We received 1.8 million applications in January 2007, 1.7 million in February, and 2 million in March - 5.5 million applications in a very short period of time.

Much of the influx was in response to press reports and our continuing outreach and public education effort regarding WHTI. Not all of the increased demand is attributable directly to the WHTI Air Phase, however. Many applicants indicate travel to Canada or Mexico by sea or land, even though the WHTI requirements for land or sea border crossings are not scheduled to be implemented until 2008 at the earliest. We also receive substantial numbers of applications from people who indicate no overseas travel plans. Increasingly, Americans apply for a passport because they see it as a citizenship and identity document, one that allows the bearer to board an airplane, prove citizenship for employment purposes, apply for federal benefits, and fulfill other needs not related to international travel. We did not take these non-travel-related factors into account when we projected FY 2007 passport demand.

The root of our current situation is the workload that built up when 5.5 million applications arrived within about ten weeks. This far exceeded our ability to keep pace within our traditional timeframe. As a result, despite our best efforts, it began to take longer to process applications. Average processing time lengthened from six weeks in December, to 12 weeks in late spring. It is about ten weeks today.

At the same time as we are receiving record numbers of applications, we are issuing record numbers of passports, averaging 1.5 million or more passports each month since March. We have already issued more than 12 million passports so far this year. With one quarter left in the fiscal year, the Colorado, Connecticut, Charleston, Honolulu, New Orleans, and Washington agencies have already exceeded their FY 2006 production total.

We recognize that is not good enough. Americans need reliable passport turnaround times, so they can plan their travel. They need to know that we can issue passports quickly when emergency situations arise, and they need to be able to reach us by phone or e-mail when those urgent situations come up.

Addressing Record Passport Demand

The Department has committed at the highest levels to return to a predictable six-week process while maintaining the security needs of our nation. We are pulling out all the stops and making the needed resources available to resolve this issue.

Strategies to Increase Passport Production

Additional Staff

To process pending cases and new incoming work, our most urgent need is for more people to review and adjudicate applications, answer telephone and e-mail inquiries, and assist walk-in applicants. We are tapping talent and resources from every part of the State Department to meet this need:

• We are aggressively recruiting staff. We brought 483 government and contract employees on board in May and June. Between May 1 and July 6, we made an additional 549 offers of employment to direct-hire adjudicators and will process them as quickly as people say "Yes!" Government employees can adjudicate passport applications, while contract staff perform critical support functions to print and mail out adjudicated passports.
• While we continue to recruit and train new passport specialists, we are reaching out to experienced and well-trained retired adjudicators to provide critical management support. We are grateful to OPM for lifting the salary cap for Civil Service annuitants. We are seeking authority to bring on additional retired Foreign Service officers who have exceeded mandatory salary and hours caps.
• Qualified State Department employees are volunteering to help process passport applications. These volunteers supplement the Department's corps of passport specialists and are working two shifts during the week and all day Saturday and Sunday, to optimize existing equipment and space resources. Over 240 volunteers have approved over 130,000 passport applications since mid-March.
• We dispatched teams of passport specialists to exceptionally high volume passport agencies to assist with walk-in applicants and to process pending applications. These teams also provide customer support, including locating and expediting applications of customers with urgent travel needs.
• We are sending personnel to fill in behind these teams. Two hundred Presidential Management Fellows, Career Entry program participants, and entry-level officers currently working in bureaus throughout the Department will be reassigned to NPC, New Orleans and the Washington Passport Agency for the remainder of the summer to adjudicate passport applications. Many began training on July 9 and will begin work July 16.
• We have asked Foreign Service Officers overseas to come home temporarily to serve their country here by adjudicating passports. We plan to send two groups of 50 volunteers to regional passport agencies, beginning July 16.
• Twenty experienced consular officers who expected to take a three-week advanced training course will instead adjudicate passports, most in New Orleans. We are postponing the non-hard language training or post assignment of 120 entry-level officers who will complete general consular training this summer, so that they can stay to help adjudicate passport applications.

Improved Service

• We expanded the hours of operation at all of our passport agencies, including evenings and weekends. Most are open on Saturdays for emergency appointments, which we are scheduling through our call center. For faster service, we continue to provide same-day service to as many travelers as we can accommodate with evidence of imminent departure dates.
• The National Passport Center in Portsmouth, NH and the Charleston Passport Center, which together issue over 50 percent of all passports nationwide, both operate 24 hours in three shifts per day. Several agencies now operate two shifts.
• In response to heavy call volume, the National Passport Information Center increased staff to over 400 customer service representatives, extended operating hours, and installed 432 additional lines.
• We also stood up temporary phone task forces at the Department and at the Kentucky Consular Center. More than 100 State Department task force volunteers provide information, respond to urgent requests, and help Americans get their passports seven days a week.
• More recently, we also expanded our presence at the Federal Information Center in Lakeland, Florida, which previously had been handling American Citizen Services. Lakeland began taking passport-related calls on June 28. 165 operators are available to assist callers seven days a week. As of July 5, Lakeland had answered 27,522 calls.
• We are making changes to our expedited handling service to ensure that customers know exactly what to expect when they pay the expedite fee, and that we meet our commitments. This will require changing our regulations and procedures. We will also ensure that guidelines and procedures for refunding expedite fees are transparent.

These additional resources and procedures will give us the time, staffing and physical capacity to eliminate the older applications pending in the system.

The Future of Passport Processing

It is clear that implementation of the Western Hemisphere Travel Initiative has created a permanent increase in passport demand. Today's record-breaking demand is not an anomaly; we believe it will continue to grow. We currently project the demand for passports to be approximately 23 million in 2008, and as high as 30 million by 2010. Over 78 million Americans currently have passports - somewhat more than 25 percent of all citizens. Within a few years, fully half of all Americans will have passports or passport cards, and every indication is that demand will continue to climb. We are engaged in a study now to further refine these projections.

Additional resources will be needed. On June 8, the Department sent a formal Congressional Notification regarding plans to re-program nearly $37,000,000 for the FY 2007 Border Security Program. We are using these funds to hire 400 new passport adjudicators this fiscal year, and fund expansion of NPC and the Miami Passport Agency.

We are also implementing long-term strategies to increase production. Chief among these is a new approach to passport production represented by the Arkansas Passport Center (APC). APC differs from our other passport agencies in that it focuses solely on printing and mailing passports. Applications which have been reviewed and adjudicated at other agencies are transmitted electronically to APC, which prints and mails the passports within 24 hours. Eight agencies currently transmit their work to Arkansas. The remaining agencies will get the necessary retrofit to transmit their work by the end of September.

The centralization of passport book printing and mailing frees up space and personnel at our existing passport agencies to focus on the critical areas of customer service and adjudication, and process more passport applications. The agencies that have begun remote issuance are already reporting significantly improved efficiency.

Building on our successful experience with APC, we plan to open a similar printing and shipping facility, also with the capacity to produce 10 million passports per year, in 2008. When ready, passport cards also will be prepared at these two bookprint facilities.

We are increasing capacity at existing passport agencies, as well. Because we have outgrown the current facility in Miami, we will move to a new facility that will expand our footprint there from 18,000 to 28,000 square feet. We are on a fast-track process to acquire additional space that will more than double the size of the National Passport Center to more than 100,000 square feet. This will allow us to more than double the staff size to over 1,000, and more than double NPC's capacity to receive, adjudicate and issue passports from 5 million today to over 11 million. Expansions are also in the works for the Seattle, Boston, and Washington agencies. We hope to complete these renovations and expansions by the end of this year. We are also exploring opening additional passport agencies later in FY 2008 and FY 2009.

Just as important as increased production numbers is the need to maintain the high quality and integrity of the passport process. As we bring on large numbers of new staff, we are providing them with excellent training. We have secured space to establish a Western Consular Training Center, co-located with our Colorado Passport Agency in Denver. With the large numbers of new employees we expect to hire over the next two years and the need for ongoing training of current employees, we need multiple training sites.

Cost of Travel Documents

All consular activities, including passport services, are part of the Border Security Program and are funded by retained consular fees. The passport fees charged by the Department correspond with the cost of providing the documents, as determined by a series of cost of service studies commissioned by CA. The cost of the passport book is determined by examining the direct costs (e.g. printing, supplies, postage) and indirect costs (e.g. facilities, management support, security) costs associated with providing this service to American citizens. For public policy reasons, there are certain services for American citizens for which CA charges no fee, or for which the fee recovers only a portion of the cost of providing the service. The remaining cost is either included in another fee or covered by an appropriation. For example, there is no fee for welfare and whereabouts services provided on behalf of American citizens overseas. The costs incurred are recovered through the passport fee.

The most recent cost of service studies, completed in June 2004 and March 2006, determined that the appropriate fee for adjudicating, producing and issuing a passport is $97 for an adult and $82 for a minor. The Department retains $18 of this amount through two fees fully dedicated to covering a portion of the cost of generating passports:

• a $12 Passport Security surcharge (enacted through the Consolidated Appropriations Act of 2005);
• a $6 WHTI surcharge authorized by the Passport Services Enhancement Act of 2005.

These fees fund passport book stock, priority mail services, and some contractual services. The costs for printing, security investigations, and passport center staffing are primarily covered through other consular fees, as part of the overall Border Security Program.

The $18 in passport revenue retained by the Department does not cover fully the costs the Department incurs to adjudicate, produce, and deliver a passport. Passport production is covered in large part by other consular revenues retained by the Department through the Border Security Program - principally fees collected from the issuance of Machine Readable Visas. The remainder of the application fee ($49 for an adult and $34 for a minor) is currently retained by the Department of the Treasury. The application execution fee ($30), paid by applicants who must apply in person, is retained by Treasury or the passport acceptance facility where they make their application - typically a post office, public library, or clerk of the court.

The consular fees that support Passport Services have no fiscal year limitation, which allows any surplus funding to be carried over into the next fiscal year for use in that year or future years. This ensures operational costs can be covered at the beginning of any given fiscal year. In cases in which the combination of new consular revenue and prior year carry-over projections were not sufficient to cover operating requirements, the Department sought new revenue sources (i.e., the Passport Security and WHTI surcharges). Where necessary the Department has sought appropriated funds to meet Border Security Plan requirements, as was the case after September 11, 2001.

Maintaining the Integrity of Passport Issuance

We are adjusting substantially our staff numbers and passport production processes to meet the unprecedented demand and reduce passport turnaround times. Even as we do this, Mr. Chairman, we will never shortcut our obligation to the integrity of the system or the document.

The laws regarding who needs a passport have changed, but not the eligibility requirements. Every successful applicant must unequivocally establish his or her identity and claim to American citizenship. Each application must be individually reviewed and adjudicated by a qualified passport examiner.

We of course recognize that there will be mala fide individuals who will seek to take advantage of the current situation in the mistaken belief that increased demand means decreased scrutiny. CA has robust fraud prevention procedures in place to ensure only those entitled to a passport receive one.

• Many employees working on the task force are consular officers with experience adjudicating passport applications overseas. Task force volunteers without prior passport experience work in small groups, side-by-side with their more experienced colleagues. Experienced passport adjudication managers are available at all times to answer questions, provide guidance and monitor their work;
• The week-long passport adjudicator training covers not only how to review an application and adjudicate on-line, but also how to spot fraud indicators and when to refer a case to more experienced examiners;
• Specialists from CA's Office of Fraud Prevention Programs and our Passport Services' fraud prevention division accompany the adjudication teams deploying to agencies around the country;
• As part of our standard procedures, a passport application goes through several steps: data entry, namecheck, adjudication, book print, quality control. At each step, a fresh pair of trained eyes scrutinizes the application, giving us multiple opportunities to spot and suspend production of a suspect case;
• As soon as we data enter the application, the information is automatically checked against several databases maintained by CA and other agencies such as HHS, FBI, and the U.S. Marshals Service. These databases include the names of individuals who are not entitled to a passport for law enforcement, delinquent child support payment and other reasons;
• Every passport adjudicator has access to electronic records of previous passport applications and issuances to verify the photos and data provided with an application;

CA's fraud prevention program is managed at each agency and center by a Fraud Prevention Manager (FPM) dedicated to training passport specialists and identifying fraud trends and techniques. FPMs are generally former passport specialists who have received extensive fraud prevention training throughout their careers and garnered much first-hand experience with fraud indicators as adjudicators. CA works closely with the Department's Bureau of Diplomatic Security (DS) on passport fraud prevention. FPMs refer suspected fraudulent passport applications to DS for possible investigation. Between October 2006 and May 2007, for example, FPMs referred 2,123 such cases to DS.

As we ramp up staffing throughout the passport system, CA and DS are coordinating to determine the number of additional DS staff that will be needed.

The Impact of WHTI

As we process new and pending passport applications, we continue to work with our colleagues in DHS to implement WHTI. The goal of WHTI is to enhance our border security and at the same time to facilitate the flow of legitimate trade and travel. WHTI will reduce the number of documents used to prove identity and citizenship from the current 8,000 local, state, and provincial driver's licenses, birth certificates and other documents to a handful of secure documents in which officers at ports-of-entry can have confidence, such as a passport book, passport card, NEXUS, SENTRI or FAST cards, and eventually state-issued "enhanced" drivers licenses.

On April 5, 2005, State and DHS announced the WHTI as the Administration's plan for implementing Section 7209 of the IRTPA. At that time, we envisioned a three phase implementation plan based on region: December 31, 2005 for all air/sea travel to or from Bermuda, the Caribbean, Central and South America; December 31, 2006 for all air/sea travel to or from Mexico and Canada; and, December 31, 2007, for all land border crossings. In May 2005, in response to concerns about the impact of this plan on the Central America Free Trade Agreement (CAFTA), the plan was amended to collapse the requirement for air and sea travel to the Caribbean, Mexico and Canada into one phase to be implemented in January 2007 and the land borders in a second phase in January 2008. In October 2006, the Homeland Security Appropriations Act of 2006 revised Section 7209 to allow but not require an extension until June 1, 2009 and merged the sea implementation date with the land.

Since implementation of the Air Phase, DHS figures and polling data indicate the public is complying with and supports WHTI. When the sharp spike in passport applications in the first few months of this year resulted in longer passport turnaround times, we worked with DHS to identify a flexible strategy to address the issue. To ensure that travelers would be able to carry through with travel plans, State and DHS announced on June 8 that DHS would use its existing authority to exercise flexibility in determining the documentation Americans must present to enter or depart from the United States.

Under these temporary measures - which will be applied through September 30, 2007 - American citizens traveling to Canada, Mexico, Bermuda, or countries in the Caribbean region, who have applied for, but not yet received their passports, can re-enter the United States by air with a government-issued photo identification and Department of State official proof of application for a passport that can be downloaded from our website, www.travel.state.gov. Children under the age of 16 traveling with their parents or legal guardian will be permitted to travel with the child's proof of application status.

The joint State-DHS announcement had an immediate impact. The number of telephone and e-mail inquiries to our National Passport Information Center declined precipitously. Although some airlines were initially reluctant to board passengers, these incidents were promptly addressed and have declined. Since introducing this flexible strategy, there have been approximately 2,713,000 hits on the website where the proof of application can be downloaded.

In response to the expressed concerns of American citizens who live in border communities for a more portable and less expensive document than the traditional passport book, we are developing a wallet-sized passport card. This passport card will contain a vicinity-read RFID electronic chip with a unique reference number which will be read as the vehicle approaches the port of entry. CBP officers will access personal data of the card bearer, extracted from a secure government database, which will provide the basis for an informed decision about the identity and citizenship of those wishing to enter the United States. The chip itself will not contain any personal information.

Mexico and Canada have expressed concerns about WHTI implementation, and we have worked closely with our counterparts and stakeholder groups in those countries to address those concerns.

Mexican nationals are required under current immigration law to obtain a visa or border crossing card in order to enter the U.S. The Mexican Ministry of Tourism has expressed some concern about the ability of American citizens to continue to travel to Mexico for business and tourism when U.S. passport rules take effect, although local authorities have been very proactive in advertising the impending document requirements to encourage Americans to obtain passports. Anecdotal evidence indicates that arrivals to Mexico from the U.S. have not declined significantly since introduction of the WHTI Air Phase.

The Canadian government acknowledges our legitimate security concerns but has called for legislative or administrative modifications to the program on the grounds that a document requirement could have potentially adverse effects on cross-border traffic. Both State and DHS are working closely with Canadian authorities, especially the Canada Border Services Agency, to address their concerns and find mutually acceptable solutions.

Conclusion

Mr. Chairman, the world of U.S. passport production has changed fundamentally. The Bureau of Consular Affairs is changing with it. There have been growing pains as we adjust to the new realities of passport production. We have learned important lessons from this experience. We are taking action to correct the situation and ensure we have the needed capacity to meet travelers' needs as we move forward. We are committed to meeting the American public's demand for reliable, secure travel documents. We are committed to achieving for our nation the security and efficiency benefits of WHTI. And we are committed to constantly improving the efficiency, transparency, and integrity of the passport process.

We appreciate the support and understanding we have gotten from Members and their staffs as we work to meet new challenges. We hear from Congress and the American public regularly - and we have heard the message. As we have worked hand in hand with Congressional offices to resolve specific cases, we have charted a course for the future that will restore public faith in our ability to deliver. We pledge to work together with Congress to achieve our shared purpose to help American citizens to travel, while guaranteeing the security of our nation.

I thank you for this opportunity to discus the current situation with regard to U.S. passports and what we are doing to meet unprecedented demand. I am happy to answer any questions you may have.