The High Cost of a Rush to Security
Thursday, June 30, 2005
The money was spent in the name of improving security at the nation's airports:
· $526.95 for one phone call from the Hyatt Regency O'Hare in Chicago to Iowa City.
· $1,180 for 20 gallons of Starbucks Coffee -- $3.69 a cup -- at the Santa Clara Marriott in California.
· $1,540 to rent 14 extension cords at $5 each per day for three weeks at the Wyndham Peaks Resort and Golden Door Spa in Telluride, Colo.
· $8,100 for elevator operators at the Marriott Marquis in Manhattan.
· $5.4 million claimed for nine months' salary for the chief executive of an "event logistics" firm that received a contract before it was incorporated and went out of business after the contract ended.
Those details are contained in a federal audit that calls into question $303 million of the $741 million spent to assess and hire airport passenger screeners for the newly created Transportation Security Administration after the terrorist attacks of Sept. 11, 2001. The audit, along with interviews with people involved in the passenger-screener contract, paints a rare and detailed portrait of how officials at the fledgling agency lost control of the spending in the pell-mell rush to hire 60,000 screeners to meet a one-year congressional deadline.
The audit, performed by the Defense Contract Audit Agency at the TSA's behest, spotlights scores of expenses: $20-an-hour temporary workers billed to the government at $48 per hour, subcontractors who signed out $5,000 in cash at a time with no supporting documents, $377,273.75 in unsubstantiated long-distance phone calls, $514,201 to rent tents that flooded in a rainstorm, $4.4 million in "no show" fees for job candidates who did not appear for tests.
The audit faulted the prime contractor, NCS Pearson Inc., which was hired by the TSA to test, interview, fingerprint, medically evaluate and pre-certify the candidates. The audit said Pearson failed to properly justify costs and improperly awarded subcontracts without competitive bidding. The audit also said the company demonstrated a "lack of management or oversight of subcontractors."
One of the audit's key revelations is that a decision to move the hiring process from Pearson's 925 U.S. private assessment centers to 150 hotels and other meeting facilities added at least $343 million to the cost of the contract, according to an estimate by Pearson. The company said it was ordered to make the change by the TSA, which said it made the decision in collaboration with Pearson.
The decision also reduced the time Pearson had to evaluate and hire 60,000 screeners from 32 weeks to 14 because the TSA delayed the schedule, the company said. Pearson later said the decision forced the company to hire a small army of subcontractors, whose invoices and charges are at the heart of the spending highlighted in the audit.
"It was a waste of taxpayer's money," said Patrick Cowan, of Denver, who supervised hiring efforts for Pearson at 43 sites in the central part of the country. "There was abuse of the taxpayers' trust. We didn't get the bang for our buck."