Order Code RS21125
Updated June 1, 2006
CRS Report for Congress
Received through the CRS Web
Homeland Security: Coast Guard Operations
— Background and Issues for Congress
Ronald O’Rourke
Specialist in National Defense
Foreign Affairs, Defense, and Trade Division
Summary
The Coast Guard is the lead federal agency for maritime homeland security. For
FY2007, the Coast Guard is requesting a total of about $4.5 billion for missions defined
in The Homeland Security Act of 2002 (P.L. 107-296) as the Coast Guard’s homeland
security missions. This equates to about 54% of the Coast Guard’s total requested
FY2007 budget. The Coast Guard’s homeland security operations pose several potential
issues for Congress, including adequacy of Coast Guard resources for performing both
homeland security and non-homeland security missions, and Coast Guard coordination
with other agencies involved in maritime homeland security. H.Rept. 109-413 of April
6, 2006, the conference report on H.R. 889, the Coast Guard and Maritime
Transportation Act of 2006, contains several provisions relating to the Coast Guard’s
homeland security operations. This report will be updated as events warrant.
Background
The Coast Guard’s Role in Homeland Security. The Coast Guard, which is
a part of the Department of Homeland Security (DHS), is the lead federal agency for
maritime homeland security. Section 888(a)(2) of The Homeland Security Act of 2002
(P.L. 107-296 of November 25, 2002), which established DHS, specifies five homeland
security missions for the Coast Guard: (1) ports, waterways, and coastal security, (2) drug
interdiction, (3) migrant interdiction, (4) defense readiness, and (5) other law
enforcement.1 The Coast Guard, in its proposed FY2007 budget, excludes drug
interdiction and other law enforcement from its definition of its homeland security
missions.2
1 Section 888(a)(1) defines the Coast Guard’s non-homeland security missions as (1) marine
safety, (2) search and rescue, (3) aids to navigation, (4) living marine resources (fisheries law
enforcement), (5) marine environmental protection, and (6) ice operations.
2 U.S. Department of Homeland Security, U.S. Coast Guard [FY]2007 Budget in Brief.
(continued...)
Congressional Research Service ˜ The Library of Congress

---

CRS-2
Under the Ports and Waterways Safety Act of 1972 (P.L. 92-340) and the Maritime
Transportation Security Act (MTSA) of 2002 (P.L. 107-295 of November 25, 2002), the
Coast Guard has responsibility to protect vessels and harbors from subversive acts.3 With
regard to port security, the Coast Guard is responsible for evaluating, boarding, and
inspecting commercial ships approaching U.S. waters, countering terrorist threats in U.S.
ports, and helping protect U.S. Navy ships in U.S. ports. A Coast Guard officer in each
port area is the Captain of the Port (COTP), who is the lead federal official for security
and safety of vessels and waterways in that area.
Homeland Security Missions In The Coast Guard Budget. Table 1 below
shows FY2005-FY2007 funding for the Coast Guard’s homeland security and non-
homeland security missions.
Table 1. FY2005-FY2007 Funding For Homeland Security Missions
(FY2005 actual, FY2006 enacted, FY2007 requested; homeland security missions as
defined in Section 888(a)(2) of Homeland Security Act of 2002 [P.L. 107-296])
PWCSa
Drug
Migrant
Defense
Other law
Total
interdictionb
interdiction
readiness
enforcementb
Funding amounts (millions of dollars, rounded to nearest million)
FY05
1,625
1,017
549
613
95
3,899
FY06
1,735
1,211
462
616
144
4,168
FY07
2,035
1,239
487
603
153
4,516
Percent of total Coast Guard budget
FY05
21.0
13.2
7.1
7.9
1.2
50.4
FY06
20.9
14.6
5.6
7.4
1.7
50.2
FY07
24.2
14.7
5.8
7.2
1.8
53.6
Source: Prepared by CRS using data from U.S. Department of Homeland Security, U.S. Coast
Guard [FY]2007 Budget in Brief. Washington, 2006. (February 2006) Table 1 on p. B-2.
Figures may not add due to rounding.
a. Ports, waterways, and coastal security
b. The Coast Guard, in its proposed FY2007 budget, excludes drug interdiction and other law
enforcement from its definition of its homeland security missions.
Issues for Congress
Potential issues for Congress concerning the Coast Guard’s homeland security
operations include, among others, the following:
! the sufficiency of Coast Guard funding, assets, and personnel levels for
performing both homeland and non-homeland security missions;
! the division of the Coast Guard’s budget between homeland security and
non-homeland security missions;
2 (...continued)
Washington, 2006. (February 2006) Table 1 on p. B-2.
3 For more on port security, see CRS Report RL31733, Port and Maritime Security: Background
and Issues for Congress, by John F. Frittelli.

---

CRS-3
! whether the Coast Guard is achieving sufficient interoperability and
coordination with other DHS, federal, state, and local authorities
involved in the maritime aspects of homeland security, including
coordination of operations and coordination and sharing of intelligence;
! monitoring compliance with the facility and vessel security plans that the
Coast Guard has reviewed and approved;
! how the Coast guard assesses security risks to various ports and
prioritizes these risks for allocating port-security funding;
! completing foreign port security assessments;
! implementing a long-range vessel-tracking system required by MTSA;
! implementing AIS;
! inland waterway security; and
! response plans for maritime security incidents.
In March 2005, the Government Accountability Office (GAO) testified that:
The Maritime Transportation Security Act of 2002 charged the Coast Guard with
many maritime homeland security responsibilities, such as assessing port
vulnerabilities and ensuring that vessels and port facilities have adequate security
plans, and the Coast Guard has worked hard to meet these requirements. GAO’s
reviews of these efforts have disclosed some areas for attention as well, such as
developing ways to ensure that security plans are carried out with vigilance. The
Coast Guard has taken steps to deal with some of these areas, but opportunities for
improvement remain.
The Coast Guard has three efforts under way that hold promise for enhancing
mission performance but also merit ongoing attention. One is a new coastal
communication system. The fiscal year 2006 budget request includes $101 million
to move the system forward. A successful system would help almost all Coast Guard
missions, but to develop it the Coast Guard must build more than 300 towers along the
nation’s coasts, some of them in environmentally sensitive areas. The second effort
involves restructuring the Coast Guard’s field units — tying resources and command
authority closer together. This effort represents a major organizational change, and
as such, it may be challenging to implement successfully. The third effort, enhancing
readiness at the Coast Guard’s stations for search and rescue and other missions,
remains a work in process.
The Deepwater program, which would receive $966 million under the budget
request, appears to merit the most ongoing attention. GAO reviews of this program
have shown that the Coast Guard clearly needs new or upgraded assets, but the Coast
Guard’s contracting approach carries a number of inherent risks that, left unaddressed,
could lead to spiraling costs and slipped schedules. The Coast Guard is taking some
action in this regard, but GAO continues to regard this approach as carrying
substantial risk. Some expansion of cost and slippage in schedule has already
occurred.4
A January 2005 GAO report on Coast Guard station readiness stated:
4 Government Accountability Office, COAST GUARD[:] Observations on Agency Priorities in
Fiscal Year 2006 Budget Request, GAO-05-364T, Mar. 17, 2005.

---

CRS-4
The Coast Guard does not yet know the extent to which station readiness needs
have been affected by post-September 11 changes in mission priorities, although
increases in homeland security operations have clearly affected activities and
presumably affected readiness needs as well. Following the attacks, stations in and
near ports received the bulk of port security duties, creating substantial increases in
workloads. The Coast Guard is still in the process of defining long-term activity
levels for homeland security and has yet to convert the homeland security mission into
specific station readiness requirements. Until it does so, the impact of these new
duties on readiness needs cannot be determined. The Coast Guard says it will revise
readiness requirements after security activity levels have been finalized.
Increased staffing, more training, new boats, more personal protection equipment
(such as life vests), and other changes have helped mitigate many long-standing
station readiness concerns. However, stations have been unable to meet current Coast
Guard standards and goals in the areas of staffing and boats, an indication that stations
are still significantly short of desired readiness levels in these areas. Also, because
Coast Guard funding practices for personal protection equipment have not changed,
stations may have insufficient funding for such equipment in the future.
The Coast Guard does not have an adequate plan in place for addressing
remaining readiness needs. The Coast Guard’s strategic plan for these stations has not
been updated to reflect increased security responsibilities, and the agency lacks
specific planned actions and milestones. Moreover, the Coast Guard has yet to
develop measurable annual goals that would allow the agency and others to track
stations’ progress.5
A November 2004 report by the DHS Inspector General stated:
The Coast Guard faces three major barriers to improving and sustaining its
readiness to perform its legacy missions. First, the lack of a comprehensive and fully
defined performance management system impedes the Coast Guard’s ability to gauge
its performance, allocate resources effectively, and target areas for improved
performance. The Coast Guard has yet to comprehensively define a performance
management system that includes all the input, output, and outcomes needed to gauge
results and target performance improvements, balance its missions, and ensure the
capacity and readiness to respond to future crisis or major terrorist attacks. Second,
the workload demands on the Coast Guard will continue to increase as it implements
MTSA. This complex work requires experienced and trained personnel; however, the
Coast Guard has in recent years suffered from declining experience levels among its
personnel. Third, sustaining a high operating tempo due to growing homeland
security demands, such as added port, waterway, and coastal security patrols, will tax
the Coast Guard’s infrastructure including its aging cutter and aircraft fleet.6
The report also stated:
The Coast Guard faces challenges in fully implementing MTSA and enforcing
the required vessel, facility, and area security plans.... These plans are to be
5 Government Accountability Office, COAST GUARD[:] Station Readiness Improving, but
Resource Challenges and Management Concerns Remain, GAO-05-161, Jan. 2005.
6 Department of Homeland Security, Office of Inspector General, Major Management Challenges
Facing The Department Of Homeland Security, Nov. 2004, p. 17.

---

CRS-5
implemented in concert with the national security and homeland defense strategies
and plans. The Coast Guard must ensure that these plans are effectively implemented,
including its key and unique role of ensuring the MTSA regulations are enforced. In
addition, the Coast Guard must identify, target, track, board, inspect, and escort high
interest vessels that may pose a substantial risk to U.S. ports due to the composition
of the vessel’s crew, passengers, or cargo.... The Coast Guard faces a major
management challenge to validate and fully implement these targeting procedures.7
A June 2004 GAO report stated:
Owners and operators have made progress in developing security plans for their
port facilities and vessels. However, the extent to which the Coast Guard will have
reviewed and approved the approximately 12,300 individual plans by July 1, 2004,
varies considerably. About 5,900 plans were being developed under an option
allowing owners and operators to self-certify that they would develop and implement
plans by July 1, using industry-developed, Coast Guard-approved standards and
templates. These individual plans will not be reviewed before July 1 unless owners
or operators choose to submit them for review. The remaining 6,400 plans went
through a review process established by the Coast Guard. Every plan required
revisions, some of which were significant. As of June 2004 — 1 month before the
deadline for implementation — more than half of the 6,400 plans were still in process.
The Coast Guard took steps to speed up the process and to allow facilities and vessels
to continue operating with less than full plan approval after July 1, as long as the
Coast Guard was satisfied with their progress. The Coast Guard’s strategy for
monitoring and overseeing security plan implementation will face numerous
challenges. Whether the Coast Guard will be able to conduct timely on-site
compliance inspections of all facilities and vessels is uncertain because questions
remain about whether the Coast Guard will have enough inspectors; a training
program sufficient to overcome major differences in experience levels; and adequate
guidance to help inspectors conduct thorough, consistent reviews. Another challenge
is to ensure inspections reflect assessments of the normal course of business at
facilities and aboard vessels.8
Legislative Activity in 2005
H.R. 889 (Coast Guard and Maritime Transportation Act of 2006). The
conference report (H.Rept. 109-413) on H.R. 889 was filed on April 6, 2006.
! Section 102 authorizes an active-duty end strength of 45,500 for the
Coast Guard for FY2006.
! Section 201 extends the Coast Guard’s vessel and anchorage movement
authority to U.S. territorial waters out to 12 nautical miles from shore.
! Section 202 permits the Coast to provide technical assistance (including
law enforcement and maritime safety and security training) to foreign
navies, coast guards, and other maritime authorities.
! Section 206 expands the Coast Guard’s reserve recall authority.
7 Ibid., p. 17.
8 U.S. General Accounting Office, Maritime Security: Substantial Work Remains to Translate
New Planning Requirements into Effective Port Security, GAO-04-838, June 2004.

---

CRS-6
! Section 211 inserts a new phrase into 14 USC 3 so that it reads as
follows (with the inserted phrase noted in italics): “Upon the declaration
of war if Congress so directs in the declaration or when the President
directs, the Coast Guard shall operate as a service in the Navy, and shall
so continue until the President, by Executive order, transfers the Coast
Guard back to the Department of Homeland Security.”
! Section 213 requires the Coast Guard to report on “opportunities for cost
savings and operational efficiencies that can be achieved through and the
feasibility of colocating Coast Guard assets and personnel at facilities of
other armed forces throughout the United States.”
! Section 305 amends 46 USC 70106 to permit Coast Guard maritime
safety and security teams to be used for any Coast Guard mission.
! Section 309 requires the Secretary of the department in which the Coast
Guard is operating to establish a review process before administration
law judges to consider an appeal of a denial of an application for a
transportation security card.
! Section 404 directs the Coast Guard to conduct a three-year pilot
program for a long-range vessel tracking system, subject to the
availability of appropriations.
! Section 406 requires the Coast Guard to review and report on the
adequacy of Coast Guard assets and facilities at certain locations for
performing the Coast Guard’s missions, and to review and report on the
adequacy of Coast Guard end strength for performing the Coast Guard’s
missions.
! Section 411 requires a report on the availability and effectiveness of
software information technology systems for port security, the data
evaluated by such systems, and the costs associated with implementing
such technology at all Sector Command Centers, Joint Harbor Operations
Centers, and strategic defense and energy dependent ports.
! Section 419 authorizes a competitive grant to design, develop, and
prototype a device that integrates a Class B Automatic Identification
System (AIS) transponder with an Federal Communications Commission
(FCC)-approved wireless maritime data device. The section also
expresses the sense of the Senate that the FCC should quickly resolve the
disposition of its rulemaking on the AIS and licensee use of AIS
frequency bands.
FY2007 DHS Appropriations Bill. This bill will make FY2007 appropriations
for DHS, including the Coast Guard. For discussion of this bill, see CRS Report
RL33428, Homeland Security Department: FY2007 Appropriations, coordinated by
Jennifer E. Lake and Blas Nuñez-Neto.

---