Immigration Officials Opposed DHS Plan to Subject Immigration Functions to Possible Privatization

WASHINGTON – Based on new evidence that immigration officials opposed the possible privatization of 1,100 immigration information positions at the Department of Homeland Security, leading Senate Democrats Tuesday asked the department to cancel the competition.

In a letter to Homeland Security Secretary Tom Ridge, four ranking committee members – Governmental Affairs Ranking Member Joe Lieberman, D-Conn., Judiciary Ranking Member Patrick Leahy, D-Vt., Health, Education, Labor and Pensions Ranking Member Edward Kennedy, D-Mass., and Appropriations Ranking Member Robert Byrd, D-W.Va. – presented evidence that plans to subject the 1,100 Immigration Information Officers’ jobs to competition with private contractors were ill considered.

“New information has come to our attention that reinforces our conviction that the competition will not improve the Department’s performance and is contrary to the national interest,” the Senators wrote.

Documents obtained from DHS and other evidence show that officials of the Bureau of Citizenship and Immigration Services determined the competition should not be held while the department and immigration services were undergoing a major reorganization. The evidence also reveals that BCIS officials determined the competition would not lead to greater efficiency, and that the job functions of the information officers had not been properly classified for possible privatization.

“The concerns of the Department’s experienced immigration agency officials were rejected by DHS leadership,” the Senators wrote. “Evidence indicates that their focus may instead have been at least partly on achieving numerical government-wide quotas which Congress had expressly prohibited.”

Last September, Lieberman, Leahy, Kennedy, Byrd, and 30 other Senators wrote Ridge opposing the competition, suggesting it was designed to fulfill the Administration’s drive to privatize work performed by federal employees. The Senators said the competition could potentially compromise the nation’s security and cause yet more delays in the immigration process. In a separate letter dated October 22, Lieberman, Leahy, Kennedy, and Byrd questioned Ridge on the department’s reliance on outside consultants in structuring the competition.

Along with their Tuesday letter, the Senators released several of the documents obtained from DHS.

Following is a copy of Tuesday’s letter. The supporting documents may be accessed through the Committee website, minority press releases section:

June 15, 2004

The Honorable Tom Ridge
U.S. Department of Homeland Security
Nebraska Avenue Complex
Washington, DC 20393

Dear Secretary Ridge:

Twice in recent months we have written to ask why the Department of Homeland Security is rushing to conduct a public-private competition for 1,100 Immigration Information Officer (IIO) positions within the Bureau of Citizenship and Immigration Services (USCIS). New information has come to our attention that reinforces our conviction that the competition will not improve the Department’s performance and is contrary to the national interest. In light of this new information, we urge you to cancel the competition.

Documents produced by the Department reveal that USCIS officials doubted the wisdom of proceeding with the competition. They argued that it should not be held while the Department, and immigration agencies in particular, were undergoing a major reorganization, and that the competition would not improve the agency’s efficiency. Agency officials also questioned whether the IIO functions were properly classified as “not inherently governmental.” The USCIS Associate Director for Operations, whose responsibilities include managing the 1100 IIOs along with all other domestic operations at USCIS, has confirmed that he and many other immigration officials disagreed with the decision to compete the IIO functions, and they attempted to convince DHS management to cancel or delay the competition. Telephone Interview with Bill Yates, Associate Director for Operations (June 14, 2004) (hereinafter “Yates Interview”). USCIS Director Eduardo Aguirre agreed in early 2003 to discuss with his superior at DHS whether to delay the A-76 competition. Id. The concerns of the Department’s experienced immigration agency officials were rejected by DHS leadership; evidence indicates that their focus may instead have been at least partly on achieving numerical government-wide quotas which Congress had expressly prohibited.

Consultants from Grant Thornton and PEC Solutions, working at the direction of USCIS officials, drafted memoranda and presentations to demonstrate that going forward with the job competition was unwise. The documents persuasively make the case that plans for the IIO competition were structured poorly, and would not improve the agency’s efficiency or effectiveness. Personnel from DHS Legislative Affairs acknowledged that multiple drafts of the memoranda and presentations were prepared at the request of and for the use of USCIS management, particularly Michael Aytes, Director of the Office of Information and Customer Service. E-mails produced to us demonstrate that contractors collaborated closely with agency officials in developing the documents. We are releasing with this letter a small but illustrative sample of the documents provided. Both Grant Thornton and PEC continue to work on the IIO study, and in its first invoice in 2003 Grant Thornton sought a payment of $75,000 for the work it had done on the issue. Although DHS Legislative Affairs personnel claimed that the carefully prepared documents were never formally presented to DHS officials, Bill Yates has confirmed that USCIS officials opposed the A-76 competition, that they had raised their concerns with Director Aguirre, and that he in turn had brought them to the attention of his superior at DHS. Bill Yates Interview.

Collectively, the documents indicate an effort over many months by INS and USCIS officials to dissuade Department leadership from going forward with the competition for IIO jobs. For example, one document noted: “Accomplishing the A-76 study under present scope may achieve the DOJ numerical objectives, but will not achieve the A-76 program’s overarching operational efficiency objectives, and also will not address the current extensive customer service problems.” Bureau of Citizenship and Immigration Services, OMB Circular A-76, IIO Functions, p. 24 (undated) (hereinafter “BCIS Presentation”). The authors of the document warned that “[r]estructuring under the A-76 process could significantly interfere with further restructuring into DHS and with the new processes of mission implementation and execution.” BCIS Presentation at p. 15. The document continues, “[m]oving forward with an A-76 competition based on present business processes limits the agency’s ability to implement substantial organizational and operational improvements expected through restructuring and realignment under DHS.” Id.

The documents also question the agency’s decision to define all Immigration Information Officer functions as commercial activities, noting that when it made the designation the agency “was unaware that their designation included workers at INS call centers, where there had already been extensive work done to identify and open to competition all inherently governmental work,” and that the decision contradicted other agencies’ interpretations of the same job category. BCIS Presentation at pp. 16, 17. Furthermore, the document notes that the IIO functions were initially categorized as a commercial activity for the FAIR Act inventory “with limited coordination and GIN [government-in-nature] analysis from INS.” Id. at p. 21. This demonstrates that immigration agency officials had concerns similar to those expressed by us and 30 other senators in a letter to you dated September 4, 2003. Our letter noted that IIOs perform functions essential to national security, including the detection of fraud and the adjudication of applications for immigration benefits, and that these functions must be considered “inherently governmental.”

The documents also strongly suggest that the decision to conduct the competition at least partly grew out of Department officials’ desire to comply with numerical goals for privatization imposed by the Administration. The documents make repeated reference to the numerical goals as the reason both the Department of Justice and DHS decided to subject the jobs to a competition. See, e.g., BCIS Presentation at pp. 5, 6, 7, 18, 22. According to Bill Yates, the initial decision by the Department of Justice to subject the IIO jobs to a competition was particularly ill considered. In 2001, OMB directed that DOJ identify 1200 jobs to be subjected to competition, pursuant to the Administration’s numerical quotas. The Department delayed making a decision, arguing that it should be credited for jobs converted in the previous year. The OMB rejected that argument, and DOJ was given hours to identity 1200 positions in order to satisfy an OMB deadline. Then-INS Commissioner James Ziglar was informed by DOJ management of the decision to subject the IIO positions to a competition. There was no consultation with INS officials below Ziglar, and no opportunity to review and discuss the appropriateness of the competition. Although DHS subsequently went through the motions of re-evaluating the decision, there was by then a widespread perception within the agency that the decision on the IIOs would be difficult for DHS to reverse. Yates Interview.

In appropriations legislation enacted in February of 2003, Congress prohibited agencies from applying or enforcing any numerical goals or targets for subjecting employees to public-private competition, although Administration and agency officials continued to rely on the 15% government-wide quota imposed by the Administration. The DHS decision to subject the jobs to a competition was announced in August of 2003, and the evidence suggests that OMB’s quotas were an important reason for the decision. At a meeting held on October 16, 2003, to discuss plans for conducting the competition, the DHS Chief of Competitive Sourcing and Privatization, David Childs, discussed the need to meet OMB’s 15% goal and described ongoing pressure by the Administration to conduct competitive sourcing studies. According to the minutes paraphrasing his remarks, he also indicated that the Cabinet “requests studies to be completed by elections in November.” CIS A-76 Study, Meeting Minutes – October 16, 2003, p. 1. Similarly, in a meeting held on August 13, 2003, with union representatives, Mr. Childs spoke of the Department’s need to meet its “targets.”

Finally, we question the Department’s ability to successfully run an A-76 competition of this size, and then engage in appropriate administration and oversight of any resulting contract should the IIO work be privatized. A recent briefing provided by the Department’s Chief Procurement Officer revealed that the contracting office is severely understaffed. USCIS is at a particular disadvantage, as it is one of the DHS agencies that did not inherit any contracting officers from a previously existing agency. In a very similar situation, the DHS Inspector General reported serious problems with the administration of a TSA contract, in which contractors inappropriately performed adjudications on background checks for potential TSA employees, without adequate oversight by TSA employees. A Review of Background Checks for Federal Passenger and Baggage Screeners at Airports, Department of Homeland Security, Office of Inspector General, OIG-04-08, January 2004. The DHS IG noted that the use of contractors to make final decisions on adjudications contradicted the practices of most agencies, as well as a legal opinion by TSA’s Office of Chief Counsel. Id. at pp. 22-24. Indeed, Bill Yates reports that he was shocked by a DOJ legal opinion that the work performed by IIOs was not inherently governmental; for years previously, government lawyers counseling INS had concluded that performing adjudications was an “inherently governmental” function. Yates Interview. Should a private contractor win the work currently performed by IIOs, it will be responsible for adjudicating immigration benefits and detecting fraud and criminal activity, requiring the contractor to make decisions both sensitive to national security and having a huge impact on the lives of millions of immigrants.

In summary, there is a great deal of evidence that DHS decided to subject the work of 1100 Immigration Information Officers to possible privatization partly in pursuit of numerical quotas, and in possible violation of a law prohibiting such quotas. That decision overruled the views of experienced immigration officials within USCIS, who had developed a number of forceful arguments that the competition was ill-advised. We have heard no convincing arguments addressing the concerns held within USCIS, and by many members of Congress, that the work performed by Immigration Information Officers is inherently governmental, that the competition will not achieve more efficient operations, and that the DHS should not be engaging in such a large-scale competition with potentially serious consequences in the midst of a restructuring of our immigration agencies.

We ask you again to prevent the harm that will be caused by the privatization of work now performed by Immigration Information Officers. We appreciate your consideration of our letter, and look forward to your response.


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Senator Joseph I. Lieberman Senator Patrick J. Leahy

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Senator Edward M. Kennedy Senator Robert C. Byrd