Statement of David J. Berteau
President & CEO
Professional Services Council

“Security Clearance Reform”

Select Committee on Intelligence
United States Senate

March 7, 2018

Statement of David J. Berteau, President & CEO, Professional Services Council,
before the Senate Select Committee on Intelligence
March 7, 2018

Introduction
Chairman Burr, Vice Chairman Warner, and Members of the Committee, thank you for
the invitation to testify on behalf of the Professional Services Council’s (PSC) nearly 400
member companies and their hundreds of thousands of employees across the nation. 1
PSC is the voice of the government technology and services industry, supporting the full
range and diversity of government missions and functions across all agencies. I
appreciate the opportunity to discuss with you the current status of the personnel security
clearance process, the impact of the current situation on industry, and the prospects for
reform. These are issues of great significance for our member companies and their
employees, as well as for the success of government missions and support functions.
Today, I will describe some of the opportunities and challenges for Congress and federal
agencies and offer some recommendations to improve the process and reduce the
negative impacts on contractors and our government partners.
I believe there is much this committee can do in legislation and oversight that will lead to
practical and productive improvements.
Contractors Provide Significant Value to the Government
The contractor community plays a vital role in assisting the government in providing
services to the American people. Contractor contributions are necessary to maintaining
government operations. Many of the capabilities that contractors provide do not exist, or
are insufficiently available, within the government, and contractors can quickly expand or
adjust capacity to meet changing mission needs. Contractors draw from a strong,
diversified national interest business base to support current and emerging requirements
for every agency of the government.
To meet these demands, however, contractors need to be able to hire, retain, assign, and
transfer qualified, skilled employees to the missions and functions with greatest need.
Like the federal employees they work aside, contractors come to work every day to do a
1

For over 45 years, PSC has been the leading national trade association of the government technology and
professional services industry. PSC’s member companies represent small, medium, and large businesses that
provide federal agencies with services of all kinds, including information technology, engineering, logistics, facilities
management, operations and maintenance, consulting, international development, scientific, social,
environmental services, and more. Together, the association’s members employ hundreds of thousands of
Americans in all 50 states. See www.pscouncil.org.

job that is vital to the government’s ability to achieve their missions. Both federal workers
and contractors deserve a better system for background investigations and clearances.
Scope of the Problem
The Government Accountability Office (GAO) agrees on the need for a better system. On
January 25, 2018, GAO added the government-wide personnel security clearance
process to its High Risk List of federal areas in need of either broad-based transformation
or specific reforms to prevent waste, fraud, abuse, and mismanagement.
Prior GAO studies highlight not only the extent on the problem but also how the backlog
and wait times have increased within the past year alone.
According to OMB, at the end of FY17, the backlog covered 708,000 individuals. There
are now over 700,000 military, civilian, and contractor personnel who remain in limbo
awaiting a clearance to perform mission-critical work. In FY16, the backlog was 573,000.
In FY17, the average number of days to complete the fastest 90 percent of initial Secret
clearances was 134 days, up from 108 days in FY16.
In FY17, the average number of days to complete the fastest 90 percent of Top Secret
clearances was 331 days, up from 220 days in FY16.
The backlog and wait times are unacceptable and growing. PSC and the industry agree
with GAO on the need for action now.
Industry Impact
The impacts of the security clearance process, the backlog of cases and the wait times
associated with obtaining a clearance affect both government and industry. As other
witnesses today have described, we can and have quantified these impacts on the
contractor community. The government has not, to my knowledge, quantified the impact
on the government workforce and government missions, but we know that it is real. I urge
the committee to ask the leaders of the Department of Defense (DoD), and other national
security agencies about these consequences. Only when they recognize the need to
reduce negative impacts will they make improvements a sufficiently high priority.
From our industry’s perspective, one of the biggest impacts is on our workforce.
Recruitment and retention remain significant challenges. Contractors are often unable to
fill positions requiring clearances, even when the positions are funded under existing
contracts. Essential work goes unperformed, and contractors can even be penalized for
contractual non-performance by the very agencies that are holding up the clearances.
Some agencies have even enforced liquidated government damages on contractors who
have missed staffing deadlines due to delayed processing of contract employees’
clearances.

Neither government nor industry partners can recruit for critical national security missions
or compete to hire the best and brightest when those individuals have to wait months or
even years before being able to work.
False Dichotomies of Security Clearance Reform
There are two false dichotomies that may be raised when security clearance reform is
discussed.
The first dichotomy is that a faster process means we are less secure, that applicants
receive less scrutiny, and that risks are heightened. This is simply untrue. Process
improvements can speed up the timelines of clearance approvals without cutting corners
and because they can provide continuous monitoring of cleared personnel, can actually
make us more secure, not less.
The second dichotomy is that a better system costs more. This is also untrue. Over time,
a more efficient system will be more cost effective to operate and would also reduce
money wasted when the government cannot meet mission needs as a result of the
backlog.
Recommendations
The recommendations below include concrete actions that Congress can take and also
includes steps for the executive branch to address deficiencies and risks, reduce the
backlog and speed up processing times, and carry out effective oversight of initiatives at
federal agencies.
Most broadly, PSC recommends adopting and implementing what we call the “four ones.”
These principles can and should apply both to the government and to contractors. The
federal government has made progress, but greater and more rapid results are
necessary. These principles are:
•
•
•
•

One application;
One investigation;
One adjudication;
One clearance.

Adopting policies that will implement the “Four Ones” will provide remedial actions that
touch on all aspects of this issue—including and especially—reciprocal recognition for
existing clearance holders.
Adopt a Whole of Government Approach
The security clearance process is a government-wide problem that requires a
government-wide solution. No one agency can fix this, and cabinet- level leadership and

White House engagement are crucial. This committee can help by focusing continuously
on their roles.
Require Up-to-Date, Publicly Available Data
Unfortunately, as the problem has worsened, the government has made information less
available. This helps no one.
Congress should legislate requirements for all relevant agencies to provide timely,
accurate, publicly available, and up-to-date data on the size and scope of the backlog
and the wait times for individuals seeking a security clearance. Without knowing the
extent of the backlog or the causes, actions to reduce the number of individuals awaiting
security clearances and implementation metrics risk being either insufficient or
mistargeted. From my experience as an Assistant Secretary of Defense, I know that I paid
greater attention to the responsibilities on which I was reporting regularly to Congress
and the public.
On June 15, 2017, the Office of Management and Budget issued memorandum M-17-26
“Reducing Burden for Federal Agencies by Rescinding and Modifying OMB
Memoranda,”2 removing outdated and unnecessary regulatory and administrative
burdens on federal agencies, on government contractors, and on taxpayers. PSC
supported the elimination or modification of many of these OMB burdens, but some
removals were counterproductive.
Under the June 15 OMB Memo, agencies are to discontinue reporting on all previously
covered priority goals for the remainder of fiscal year 2017, even when those goals align
with the Administration’s current priorities, as confirmed to PSC by OMB’s Resource
Management team.
In a June 22, 2017 letter to Director Mulvaney, 3 we detailed our concerns about OMB’s
elimination of reporting requirements under the GPRA Modernization Act, under which
agencies provide quarterly progress reports via performance.gov with respect to both
individual agency and cross-agency priority goals.
These quarterly reports have provided PSC and our member companies with valuable
insight into agency activities, including successes and remaining challenges. In the case
of the cross-agency goal for security clearance, the quarterly reports have provided
critical information on addressing key administration, congressional, and industry
interests.

2

Executive Office of the President, Office of Management and Budget. Reducing Burden for Federal Agencies by
Rescinding and Modifying OMB Memoranda (M-17-26). Issued on June 25, 2017. Text from:
https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/memoranda/2017/M-17-26.pdf
3
Professional Services Council (PSC) letter to Office of Management and Budget Director Mick Mulvaney. June 22,
2017. Text from:
http://www.pscouncil.org/Downloads/documents/PSC%20Letter%20on%20OMB%20Memos%206.22.17.pdf

Section 925 of the FY18 National Defense Authorization Act (NDAA) does include many
reporting requirements on the size and scope of the backlog. Yet—unlike previous
government reporting—under current practice, this information will be seen only by the
congressional committees of jurisdiction—leaving the heavily-impacted contractor
community in the dark, along with many of their government customers, as well as state
and local officials. PSC believes the best way to fix this is to expand statutory reporting
requirements and to make the information public.
Speed up Vetting and Clearance Process
The vetting and clearance process can be accelerated while maintaining system integrity
and without cutting corners. Let’s look at how it is now. Currently, to verify an applicant’s
educational background, an investigator must draft, print and hard mail a letter to the
college or university citied. The investigator then waits for the college or university to
respond—again via hard mail—with a verification of the applicant’s information. Once the
verification letter is received, the investigator scans it into their system and adds it to the
applicant’s file. This example highlights the outdated, cumbersome, and lengthy process
now used to simply confirm that an applicant attended the college they claim to have
attended. There are much faster and more reliable ways to do this.
Much of the backlog problem comes from using an antiquated, time-consuming
background investigations process. Investigators ask basically the same questions they
did 40 years ago, often going door-to-door and relying on face-to-face meetings with
neighbors and friends. The government still relies too much on paper records and closed
systems for collecting and sharing information. Investigators are often required to take
notes on paper, then type those notes into an antiquated computer system. They are not
even allowed to use a computer or electronic tablet.
The amount of manual effort required in the investigation process for a majority of
personnel can be dramatically and significantly reduced though the use of technology that
automatically pulls in previously verified information and other publicly available
information.
Provide the Necessary Resources for Federal Agencies
OPM’s NBIB operates under a revolving fund, which is replenished by the transferring
funds appropriated to each of the 20-plus agencies that use NBIB. There is often no
specifically identified request or justification for those funds in the President’s budget,
making it unclear for Congress to be sure adequate funding is provided. This makes it
more important that Congress provide the agencies conducting the investigations and the
adjudications the necessary resources.
Right now, there are too few well-trained people processing clearances and too little
money to meet the demand. As a result, PSC member companies regularly report that
cases are delayed further by lost forms, communication disconnects, failure by agencies
to process responses, and inadequate tracking of cases or reporting of their status.

The entire system across the federal government needs a workforce that is trained and
appropriately sized with the necessary funding for investigations and adjudications, as
well as the authorities to prioritize and allocate resources based on risk. They also need
a strategic implementation plan that will improve overall performance through
predetermined metrics and milestones with strong accountability mechanisms.
For the FY18 and FY19 appropriations bills, Congress should account for and support full
funding for all of the relevant components.
Conduct Aggressive Oversight of the Sec. 925 Transfer
Section 925 of the FY18 NDAA requires DoD to conduct its own background and security
investigations by transferring certain clearances from the National Background
Investigations Bureau (NBIB).
This will require the Committee to participate with the other committees of jurisdiction in
regular, detailed oversight of the three-year process to transfer authority. The timeline is
demanding, and detailed plans are not yet available, at least to us, which we see as
increasing risk. Congress can and should ensure that DoD stays on track, while funding
and processing the remaining clearance requests at NBIB must remain a priority. We also
recommend that, as Senators, you should also raise these issues with every nominee
and every witness in the affected agencies.
Prioritize Continuous Evaluations
Congress should require that agencies prioritize continuous evaluations, both as a timely
response to insider threats and to reduce the burden of periodic reinvestigations. This is
where process improvements offer the greatest payoff.
PSC strongly supports the continuous evaluations (CE) approach and urges Congress—
through regular reports and oversight—to incentivize and reward government-wide
moves toward more robust CE. The current process of reevaluations is based on the
calendar, not on risk or need. To be successful, CE must be part of the personnel system
as well as security clearance, suitability, and credentialing procedures. Moving to CE will
significantly reduce current and future backlogs by removing periodic revaluations from
the queue. Moving from a timeline-based process to continuous monitoring will also
increase security and reduce insider threats in a timely manner.
The Departments of Homeland Security and Defense are currently operating CE pilot
programs that monitor available databases for information on security clearance holders.
Although the results of these pilots have not been made public, we believe they show that
the technologies and processes already exist and are in use by federal government
agencies—making it practical to expand CE government-wide.

Implement True Reciprocity among Federal Agencies
Perhaps the problem that should be easiest to fix, is the delay in granting reciprocal
recognition of clearances to contractors and government personnel who move from
agency to agency (or even in some cases from contract to contract within the same
agency.)
At the government-wide level, the NBIB, established on October 1, 2016, is currently the
primary provider of background investigations (BIs), including processing of electronic
questionnaires, conducting national agency record checks, and maintaining a central
clearance repository. In most cases, the NBIB processes the forms, schedules and
conducts BIs, and delivers results to the agencies to adjudicate employee suitability,
contractor fitness, and, when needed, a security clearance determination. Agencies can
and do impose unique requirements on personnel who have already been granted a
clearance by another federal agency, delaying and sometimes denying the transfer of a
clearance.
Existing regulations already provide guidance for implementing reciprocal recognition.
These include language in the January 17, 2017, executive order to modernize the
executive branch-wide governance structure and processes for security clearances,
suitability and fitness for employment and credentialing, and the Director of National
Intelligence’s (DNI) Strategy and Schedule for Security Clearances Reciprocity.
Legislatively, Congress should task the head of each federal Department and the Director
of the Office of the Director of National Intelligence to account for, and then justify, each
distinct exception among components within their jurisdiction. PSC understands that
reciprocity is culturally hard, but implementation would be easy to implement with big
payoff.
Reciprocity is another area where data are lacking—we do not know the extent of the
problem, its contribution to the backlog and wait time estimates, and the reasoning behind
why certain adjudications may take one day, one month, longer or never granted at all.
Executive Order 13764 states: “Any additional requirements approved by the appropriate
Executive Agent shall be limited to those that are necessary to address significant needs
unique to the agency involved, to protect national security, or to satisfy a requirement
imposed by law.”4
PSC agrees with the criteria but urges the committee to better define when the situations
occur. Currently, there is no central tracking of compliance with existing regulations or
documentation on the justification for exceptions to reciprocity guidelines and the
frequency of their use.
4

Federal Register. Amending the Civil Service Rules, Executive Order 13488, and Executive Order 13467 To
Modernize the Executive Branch-Wide Governance Structure and Processes for Security Clearances, Suitability and
Fitness for Employment, and Credentialing, and Related Matters (Executive Order 13764). Issued on January 17,
2017. Text from: https://www.gpo.gov/fdsys/pkg/FR-2017-01-23/pdf/2017-01623.pdf

For example, at a Professional Services Council event, the Department of Justice (DOJ)
alone cited at least five different required sets of background information, with each of
those DOJ agencies failing to recognize the validity of similar investigations from any of
the others, even within the same department.
There is a related problem under which personnel with active clearances are delayed for
months or even a year or more when being considered for a separate determination of
suitability or fitness for a position. Fixing that may also require Congress to act.
These actions would focus attention on risk to the government rather than on rote
application of rules. Further, they may lead to efficiencies in the process and
synchronization of requirements Department-wide or Intelligence Community-wide.
Conclusion
As you will hear from the second panel today, NBIB has plans for process changes that
offer hope for improvement. DoD, implementing Sec. 925, is working on similar plans.
Nevertheless, the failures and shortcomings of the current personnel security process
impact uniformed personnel, civilian employees, and contractors across the country—in
every state and congressional district—and weaken our national security.
The backlog and wait times add risk to government missions, contract performance, and
the ability to recruit and hire. Security clearance processes need to be better and faster.
PSC applauds the committee for holding this hearing and for emphasizing the need to
improve the security clearance systems. Yet one hearing is simply not enough to address
the scope and scale of this problem. These issues have arisen time and again. While the
recommendations above can help address the problems, only Congress, through
sustained oversight, can produce agency implementation of these reforms.
On behalf of PSC and our members, I thank you for your time and consideration of these
matters. As always, PSC is available at your convenience to address any questions or
concerns you have, now and in the future.