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Out of Control Policy Blog Archives: 11.18.12–11.24.12

10 is Enough (Years for TSA): How to Provide Better Airport Security at a Lower Cost

This week the Transportation Security Administration reaches its 10-year birthday. But instead of celebrating with a cake, most transportation types are trying to figure out how to blow out the candles for good on many aspects of the TSA. While millions of Thanksgiving travelers take off their shoes and surrender their plastic knives, the problems at TSA continue. 

For the past 10 years, the Transportation Security Administration has had a dual role serving as both the provider of airport screening and the aviation security policy-maker and regulator. In the aftermath of 9/11, Congress built this dual role into TSA’s job description. Unfortunately, this federal agency is answerable to no one. There is little evidence that the TSA has substantially improved security despite dedicating $3 billion per year to security spending. 

TSA has focused on passengers and their bags but not the rest of the airport. Over the past 10 years there have been 25,000 breaches of airport security including 1,300 instances of people trespassing in secure areas. There is no protection from intruders entering the secure side of an airport through a fence or waterway as happened earlier this year at Kennedy International Airport. Two trespassers, one each at Kennedy International and Charlotte, managed to stow away in the wheel wells of airplanes. In Newark a knife-wielding intruder got onto the tarmac by scaling an eight-foot fence. In Dallas a group bypassed all security and posted a video of themselves on YouTube. Unfortunately, a large part of current aviation security is an illusion.

The most effective way to increase the screening quality and eliminate this dual role is to devolve the screening function to the airports, which should be able to carry it out either by creating its own screener workforces (meeting TSA selection, training, and performance requirements) or by contracting with a TSA-approved security company of its choosing. If the cost comparison between TSA screening at Los Angeles International Airport and the outsourced screening at San Francisco International Airport (SFO) is accurate, applying SFO-type best practices nationwide could reduce screening costs by about 40%. Most airport chiefs support devolving screening. A 2005 proposal by then TSA administrator Michael Chertoff which would have kept the TSA in place but contracted out its screening duty was stopped due to political opposition in Congress. 

How would the contracting process work? The recently passed 2012 aviation bill allows airports with TSA's approval to contract their passenger screening and security services if …“Contractors can do the job as good or better than federal screeners without affecting costs.” The wording “Good or better” is vague qualitative language. Although TSA administrator John Pistole approved contracting for Orlando-Sanford airport he has previously said he does not see any clear and substantial advantage to the program. Many aviation researchers are doubtful that the number of airports with contracted screening will increase significantly. Ideally, the next Congress will draft legislation requiring airports to contract service. Currently sixteen airports including San Francisco contract out their screening process. 

In a national program, the airport director would be in charge of securing the airport premises under the supervision of the TSA. The responsibility for screening the baggage and passengers would be shifted from the TSA to each airport. The airport would decide who would conduct the screening. Since screening is similar to other operations where the airports hire their own staff for some duties and contract out other duties, this would not be a problem. The airport would still have to comply with all TSA regulations. 

The hiring and training of screeners would also be devolved. The TSA could do this by providing training requirements and a core curriculum that could be used by airport, certified screening contractors, and screener training firms. 

Funding allocations should be made monthly because passenger levels change based on the time of year. Monthly funding can be targeted more exactly to passenger levels. Airports should receive a lump-sum amount of funding that would be required to be spent solely on airport security purposes. 

Currently the federal government determines the pay for all of its workers. Each airport should be free to set its wage scale based on local living conditions. Some smaller airports may want security workers to monitor perimeter areas to provide better security. These airports may also want employees to work split shifts. Currently unionization rules prevent such freedom. 

Some airports may want to examine the use of automation to improve the screening process. Currently, certain airports use EDS machines for explosive detection. These EDS machines can lead to a personnel reduction from 19 to 4.25; this is a 78 percent reduction. Other automated systems could lead to similar personnel reductions. 

The devolution of funding from TSA to individual airports has another advantage. Airports would have incentives to develop long-term scanning efficiencies something current governmental rules do not encourage. 

Has the contracted screening model been tried anywhere else? European countries offer an example of such a model. Belgium, the Netherlands and the United Kingdom were early adapters. By the late ‘90s 13 countries had switched to a public-private type model. The GAO has visited five countries that use the model: Belgium, France, the Netherlands, Canada, and the United Kingdom. GAO found better overall security system design, higher qualifications and more substantial training requirements for screeners. For example, France requires 60 hours of training and the FAA requires 12. Despite worries to the contrary, privatized security offers better pay and benefits. The U.S. can adopt this model where companies that do not meet the standards have their contracts cancelled. Companies can bid on a whole package of security services not just passenger screening. Bidding on a package avoids undue cost pressures on any one element. Standards are set and enforced by a government agency. The government certifies security companies where the government agency reviews the financial fitness of each firm, licenses the employees, sets standards for compensation and benefit, and trains the managers and the operating personal even setting goals and objectives. In these countries, the government conducts periodic audits and random unannounced testing. 

Other transportation types have suggested reforming TSA along similar lines. My colleague Bob Poole detailed how to privatize some aspects of Airport Security in Annual Privatization Report 2011: Air Transportation. RAND released a report titled Aviation Security: After Four Decades, It's Time for a Fundamental Review. The traveling public has suffered through a bloated pointless bureaucracy for long enough. Instead of celebrating any more TSA birthdays, travelers can lift a glass to an eliminated or substantially reformed TSA.

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Innovators in Action: FDOT Secretary Ananth Prasad on Delivering Florida's 21st Century Transportation System Through Tolling, Managed Lanes and Public-Private Partnerships

Like most states, Florida faces a significant challenge in delivering future transportation infrastructure, given the declining purchasing power of the federal gas tax, uncertain future revenues resulting from the increasing efficiency of automobiles, and other challenges that are making it increasingly difficult for most states to even maintain the infrastructure they already have, much less expand and modernize their transportation systems to meet the demands of the 21st century economy.

The Florida Department of Transportation (FDOT) has been working to meet that challenge in recent years, increasingly embracing innovations in project finance, road pricing and other areas of transportation policy that allow them to better control costs, as well as deliver major projects to reduce congestion and improve mobility amid an uncertain transportation funding future.

In our latest interview in the Innovators in Action 2012 series, I sat down with Florida Department of Transportation (FDOT) Secretary Ananth Prasad to discuss how his agency has embraced innovations like public-private partnerships, cutting-edge tolling projects, private highway maintenance and more.

Here's a brief excerpt from the interview:

Leonard Gilroy, Reason Foundation: Florida has become one of the leading states in the U.S. with regard to embracing innovations like public-private partnerships, private infrastructure financing and cutting-edge tolling projects. What challenges prompted this shift? And can you explain why partnering with the private sector makes sense for FDOT?

Ananth Prasad, Secretary, Florida Department of Transportation: As you know, Florida is a very outsourced state, and we rely on the private sector to deliver a lot of our projects. As with most states, 100% of the construction is done by the private sector in Florida, but we’re also at upwards of 80% when it comes to planning, design, engineering, inspections and the like. So in our work, we rely a significant amount on the private sector to help us deliver.

When it comes to public-private partnerships (PPPs), I think it’s just another tool in the toolbox, trying to leverage what private investment is out there, what innovations may be there when it comes to a procurement or contract management or a delivery technique. That’s basically what prompted us going into PPPs.

At the outset, Design-Build was our first foray into trying to take a traditional design function that was done by a department—either in-house or by consultants—and combine it with a construction contractor and package it together. And that evolved into “OK, if you can do design and build together, why can’t you operate and maintain together?” And that morphed into “why can’t you finance it, if it’s a long-term, corridor-type project?” It’s a natural evolution of what various departments of transportation do, and we’re just trying to make sure that we utilize all of the tools in the toolbox to deliver infrastructure improvements.

When we look at unfunded transportation needs, we estimate Florida would need in excess of $131 billion for the state’s most critical assets between now and 2040. PPPs are not going to close that gap, but they can help us deliver long corridors today by leveraging private equity and financing, and then also bringing innovations through combining the design and the operations and maintenance into a contract so that we’re designing and building a project with a holistic view rather than just designing it or just building it or just operating and maintaining it.

When it comes to tolls, we obviously have a long track record with our toll road—the [Florida] Turnpike—and in the last few decades with the various expressway authorities. Tolling allows us to diversify the revenue stream to fund transportation. As you know, the gas tax is not keeping pace and while Florida’s gas tax is indexed [to inflation], the federal gas tax is not. And with fuel efficiency standards going up and with alternative fuel vehicles, people will be driving the same amount of miles but not contributing to the upkeep and future improvements to the infrastructure. Toll roads answer that question because if you use it, you pay for it.

The full interview is well worth a read and is available here. The topics discussed include the state's current public-private partnership projects, the expansion of managed lanes in different regions, the use of "toll lanes within toll lanes," the state's efforts to capitalize on the expansion of the Panama Canal, and much more. 

[Note to readers: In previous years, we have published Innovators in Action in an annual report format, the last edition having been released in early 2010. The publication was on a temporary hiatus in 2011, but we have resumed publication in a slightly different format. In order to deliver timely content to our readers on a more frequent schedule, we're publishing one Innovators article per month on reason.org. Other articles featured in the Innovators in Action 2012 series are available here.]

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