Two years after its creation, the Department of Homeland Security has a new secretary and new restructuring plans. It's still missing a permanent home, however.

The department runs its core operations out of the Nebraska Avenue Complex, a former Navy installation in Northwest Washington not far from the vice president's home. But many of the department's more than 10,000 Washington area employees are scattered in offices throughout the city and adjoining suburbs.

"There's no question that at least a medium-term, if not a long-term, challenge is for us to settle on a final location for the department," Michael Chertoff, the secretary of homeland security, told the House Homeland Security Committee on Monday.

Chertoff said his staff is looking into "moving the entire department someplace," probably to a campuslike area. "I think there's a strong argument that it ought not to be located in downtown Washington because of the desire to have some distance, you know, between ourselves and some other buildings," he added.

Pulling the agency's leadership team into one place will not happen "within the next couple of years," Chertoff said. But he expressed hope that, in the short term, the department will be able to move several operations centers, housed in buildings across Washington, to the Nebraska Avenue campus.

"That would not only, I think, save money in duplication, but it would have the very real virtue of bringing together all the leadership of the department in one place during a crisis, which, I can tell you from even my own experience in the last five months, would be a very positive development."

Chertoff is not the only Bush administration official looking to consolidate operations.

John D. Negroponte, the director of national intelligence, operates out of a government building near the White House and has a few members of his staff in borrowed space at CIA headquarters in Langley.

The administration plans to move Negroponte's operation to Bolling Air Force Base, along the Potomac River in the District, until officials can decide on a permanent home for the national intelligence staff. Some officials hope that permanent quarters will be found downtown.

Money for MaxHR

The Department of Homeland Security is moving ahead with plans for a performance-based pay system, but the plans could be delayed if Congress does not provide $53 million in fiscal 2006 to finance the system, called MaxHR.

The Senate's appropriations bill would provide the money and specifies that $10 million of the total should go for training and communication with employees on how the system will work. The House appropriations bill proposes a $96.1 million reduction in the department's management account, which probably would slow MaxHR's development.

Chertoff, speaking at the annual Excellence in Government conference Monday, said the department needs all of the money requested "to inaugurate this process in a way that is efficient and actually alleviates anxiety among the workforce."

Chertoff said: "It's important as we bring this system forward that we make sure supervisors are properly educated and trained in what it means to evaluate performance. . . . We have to assure people that we're going to have adequate feedback, that there's going to be a system of making [pay and performance] determinations that is fair and transparent."

The launch of the system also may hinge on a federal judge's ruling next month. Federal unions have filed a suit to stop officials from introducing labor-management rules that union officials contend would effectively gut collective bargaining rights.

Retirement

Julia T. Duncan, an office receptionist, will retire July 29 from the office of general counsel at the General Services Administration after 42 years of federal service. She was a telephone operator early in her career at GSA.

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E-mail: barrs@washpost.com