Washington Notebook: Industry tries to drive stake through scan-all law

   Homeland Security Secretary Jeh Johnson last month formally notified Congress that his department will exercise its right to extend for another two years the deadline to scan all inbound ocean containers for nuclear weapons or other terror-related contraband at foreign ports, and business groups are now rising up to kill the mandate altogether.
   The moves come as some lawmakers seek to revive a law that was left for dead because most House and Senate members, realizing their vote was an overreaction, haven’t pressed the Department of Homeland Security to meet the timetable for x-raying the contents of U.S.-bound containers.
   On Monday, 70 trade associations from a cross-section of industries penned a letter to Johnson and key congressional leaders requesting the controversial law be scrapped because there is no realistic way to implement it and it distracts from effective risk-based security programs. Trade and security experts, as well as foreign governments, have strongly argued the law would cause a logistics nightmare and raise the cost of international shipping to unacceptable levels.
   “The statutory provision calling for 100-percent container scanning has always been, and remains, impractical and does not actually improve security. If implemented, this provision would have a significantly negative impact on global commerce and cause significant conflict with the governments of our foreign trading partners, many of which have stated their opposition to the requirement previously,” the letter, drafted by the U.S. Chamber of Commerce, World Shipping Council and National Retail Federation, stated.
   The 9/11 Recommendations Act in 2007, which required x-ray imaging and radiation sensing of all sea boxes, included authority for the homeland security secretary to waive the deadline under certain conditions, such as whether necessary technology is commercially available.
   Two years ago, then-secretary Janet Napolitano opted-out of the mandate.
   The industry coalition said it agreed with Johnson’s decision to postpone implementing the law, but recommended he pursue its repeal.
   “We fully support your waiver; however, instead of going through this exercise every two years, we urge you and the administration to recommend to the Congress that the statutory 100-percent container scanning requirement be repealed. That would be the most appropriate way to address this flawed provision and allow the department, industry and our trading partners to focus on real solutions to address any security gaps that remain in the global supply chain,” the letter said.
   The Department of Homeland Security, going back to the Bush administration, strongly resisted the scan-all law when it was introduced and worked hard after the fact to educate lawmakers about the logistical, financial, jurisdictional, diplomatic, economic and technological challenges involved in implementing such a program at hundreds of overseas ports where the United States lacks legal power. A pilot program to test full-scale inspections on U.S.-bound freight at six foreign ports reinforced the department’s position on the implementation hurdles. DHS estimated it would cost $16.8 billion just to deploy high-tech inspection equipment and associated technology at foreign ports.
   Many lawmakers in recent years have remained quiet about following through on their votes and instead publicly supported continuation of the department’s risk-based, layered approach for screening advance data and intelligence to selectively target shipments for inspection. That is the approach favored by transportation service providers and importers. Congress acknowledged in the conference report accompanying the DHS fiscal year 2010 appropriations law that “it has become increasingly clear that, at least for now, a 100-percent scanning goal is not feasible, and even if it were, would come at an unacceptably high cost monetarily and in the displacement of other efforts.” Legislation was introduced earlier this decade that would have pushed back the 100-percent inspection deadline by three years and only required use of x-ray or radiation detectors, not both. Another bill would have eliminated the box-scan mandate if DHS certifies that existing security programs are doing the job, but neither proposal has gone forward.
   Current supply chain security programs include the Importer Security Filing (advance cargo and origin data 24 hours prior to vessel loading), the advance manifest rule for carriers (filing to be done 24 hours prior to loading), the Container Security Initiative (59 ports where containers identified as high risk can be inspected by a domestic customs service, often with the onsite assistance of U.S. Customs officers), the Customs-Trade Partnership Against Terrorism (industry partnership program that offers incentives to importers and their suppliers to implement plans to ensure shipment integrity from point of origin), and drive-through radiation portal monitors for all containers upon exiting a U.S. port.
   The only foreign port where all boxes are checked with detection technology is Port Qasim in Pakistan because of the high-risk terrorist environment. DHS has long insisted that similar operations at other ports are not feasible.
   But congressional ambivalence towards the inspection law is not universal and Johnson has come under some pressure to figure out how to make the measure work.
   The DHS fiscal year 2014 appropriation includes language instructing the department to re-evaluate various options for 100-percent scanning and during Johnson’s confirmation hearing in the Senate late last year he was asked about the inspection policy. In the spring he visited the ports of Los Angeles and Long Beach to learn about the equipment used for non-intrusive inspections and how cargo flows through CBP checkpoints.
   Last week Johnson testified before the House Judiciary Committee where Rep. Jerald Nadler, D-N.Y., asked what the department is doing to advance container scanning and whether he would commit to implement the law. Nadler said Congress understood the challenges involved and that’s why it gave DHS five years to comply and allowed for extensions.
   Johnson said the law “is a very large unfunded mandate,” but that he is exploring a plan to address Congress’ intent. He did not promise to scan all import boxes, saying the plan would include “raising the percentage of cargo that is scanned, to move in the right direction on this, and demonstrate we’re making our best efforts at trying to comply.”
   U.S. Customs inspects about 5 percent of containers using non-intrusive equipment and most of the inspections take place after offloading at a U.S. port.
   The industry letter raised several problems with the comprehensive inspection requirement. The law, for example, does not define whether images of scanned containers must just be taken and stored or whether personnel resources would need to be devoted to analyzing each image before loading on a vessel. There are more than 10 million containers per year arriving at U.S. ports and the industry groups questioned whether CBP has the capacity to process the data or whether the private sector is supposed to carry out the function.
   Other questions raised in the letter include:

•   What are standards for scanning technology deployed in overseas ports?
•   Who is responsible for paying for the equipment and installation?
•   Who is responsible for operating, maintaining and monitoring the equipment and who will pay for operations?
•   What protocols will be used in a foreign port when when a container is scanned?
•   Does DHS have the consent of foreign governments to impose such a requirement in their jurisdiction? 
•   What would the United States’ response be if and when foreign governments insist on a reciprocal or “mirror image” requirement that all U.S. containerized exports be scanned?  

   “Congress was made aware of all these questions when it considered this statute, and it did not answer them. It passed a statute that it knew was wholly impractical, which is why it included the provisions allowing the secretary of the department to waive the 100-percent scanning requirement every two years,” the industry coalition said.