Order Code RS21125
Updated August 14, 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. 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.
Washington, 2006. (February 2006) Table 1 on p. B-2.
Congressional Research Service ˜ The Library of Congress

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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;
! whether the Coast Guard is achieving sufficient interoperability and
coordination with other DHS, federal, state, and local authorities
3 For more on port security, see CRS Report RL31733, Port and Maritime Security: Background
and Issues for Congress, by John F. Frittelli.

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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.
A July 2006 report from the DHS Inspector General on Coast Guard mission
performance in FY2005 stated:
Since FY 2001, more [Coast Guard] resource hours have been dedicated to homeland
security missions than for non-homeland security missions. However, after an initial
drop in FY 2002, non-homeland security resource hours have increased every period,
and have now returned to within 3% of baseline levels....
The Coast Guard has been more successful in meeting goals for its traditional non-
homeland security missions, meeting 22 of 28 goals (79%) where measurable goals
and results existed, but still leaving room for improved performance. Not including
the Ports, Waterways, and Coastal Security mission, by far the largest user of resource
hours of any Coast Guard mission, the Coast Guard achieved only 26% of its
homeland security goals (5 of 19)....
Growth in total resource hours has leveled off. Since resource hours are based on the
limited and finite number of available assets, the Coast Guard will be unable to
increase total resource hours without the acquisition of additional aircraft, cutters, and
boats. Consequently, the Coast Guard has a limited ability to respond to an extended
crisis, and therefore must divert resources normally dedicated to other missions. To
improve performance within their overall constraints, the Coast Guard must ensure
that a comprehensive and fully defined performance management system is
implemented, and that experienced and trained personnel are available to satisfy
increased workload demands.4
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.
4 U.S. Department of Homeland Security, Office of Inspector General, Annual Review of Mission
Performance, Untied States Coast Guard (FY 2005), July 2006. (OIG-06-50) p. 1.

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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.5
Legislative Activity in 2006
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. 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
5 Government Accountability Office, COAST GUARD[:] Observations on Agency Priorities in
Fiscal Year 2006 Budget Request, GAO-05-364T, Mar. 17, 2005.

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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.
H.R. 5681 (Coast Guard Authorization Act of 2006). As reported by the
House Transportation and Infrastructure Committee (H.Rept. 109-614 of July 28,
2006), Section 102 authorizes an active-duty end strength of 45,500 for the Coast Guard
for FY2007. Section 212 amends section 2 of title 14, United States Code, to direct the
Coast Guard to enforce regulations ensuring the maritime safety of nuclear power
facilities located adjacent to navigable waters of the United States not specifically
delegated by law to some other executive department. H.Rept. 109-614 states:
Following the events of September 11th, the Coast Guard has been designated as the
lead Federal agency with responsibilities for maritime homeland security. The Coast
Guard has quickly incorporated these new missions with the Service's many
traditional missions of search and rescue, illegal drug and migrant interdiction,
icebreaking operations, oil spill response and prevention, maritime safety, marine
environmental protection, and fisheries law enforcement. However, the addition of
these new mission demands in combination with the Service's rapidly deteriorating
fleet of vessels and aircraft is severely testing the Coast Guard's capabilities to carry
out its many important missions....
The Committee will also continue to oversee the Coast Guard to ensure that the
Service is achieving a balance between its traditional and homeland security
missions.... It is imperative that the Service's non-homeland security functions remain
priorities for the Coast Guard.... As a result of concerns that the service will not have
the funding it needs for traditional missions, the Committee has placed a ‘floor’ on
funding that will be used for marine safety programs and search and rescue.
The Committee continues to oppose the Administration's request to transfer a portion
of the Coast Guard's Research, Development, Training and Evaluation (‘RDT&E’)
funds from the Coast Guard budget to the Science and Technology Directorate of the
Department of Homeland Security. The Administration proposed to fund the Coast
Guard's Research and Development Center and the Service's non-homeland security
research projects within the Service's budget; however, the funding for the Coast
Guard's homeland security research programs has again been transferred to the
Science and Technology Directorate with the Department of Homeland Security.
Under Section 888 of the Homeland Security Act, the Coast Guard is to remain intact
with all authorities, functions, and capabilities remaining under the authority of the
Service. The Administration's proposal to remove RDT&E from the Coast Guard's
control would violate Section 888. The Committee will continue to take steps to
maintain the integrity of the Coast Guard as an independent entity within the
Department.

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The Committee is also concerned by the Coast Guard's lack of research and
development programs to enhance the service's capabilities to carry its traditional
missions. The Coast Guard's non-homeland security research and development budget
has consistently decreased over the last five-year period; however the need to improve
the Coast Guard's search and rescue, oil spill response and prevention, drug
interdiction and maritime domain awareness missions has not decreased. The
Administration has requested only $900,000 for non-homeland security research and
development programs for fiscal year 2007. The Committee recommends that the
Coast Guard continue to carry out a robust research and development program to
support each of its many missions and to continue to develop new technologies and
procedures to ensure the security and safety of lives and property at sea.
H.R. 5441 (FY2007 DHS Appropriations Bill). The House and Senate reports
on H.R. 5441 recommend various changes to requested funding amounts for the Coast
Guard, including items related to the Coast Guard’s homeland security missions. The
House Appropriations Committee report (H.Rept. 109-476 of May 22, 2006) states:
The Committee recommends $15,000,000 [for the Coast Guard] for port security
inspections, $15,000,000 above the President's budget request. Funding shall be
allocated to two activities. First, this funding shall be used to double the amount of
foreign port assessments, as required by MTSA. The Committee anticipates that, with
these additional funds, the Coast Guard will be able to reduce the amount of time it
will take to complete all foreign port assessments by half. Second, the funding will
permit the Coast Guard to conduct unannounced inspections of domestic port facilities
to ensure that they are maintaining agreed upon security levels. This funding is
provided to strengthen the Department's overall port, container, and cargo security
initiatives.... Currently, the Coast Guard does not gather complete ownership
information as part of its facility and vessel security plans. The Committee directs the
Coast Guard to amend these plans so that it may gather ownership information in
addition to information about the immediate entity running the facility or vessel.
The Senate Appropriations Committee report (S.Rept. 109-273 of June 29, 2006)
states:
The Committee notes [DHS’s] change in policy regarding the homeland security
designation of the Coast Guard's drug interdiction mission. In previous budget
submissions, the drug interdiction mission was considered to be a homeland security
function. In the fiscal year 2007 budget submission, the administration classifies the
mission as non-homeland security. The Committee challenges the logic behind this
change in policy given recent intelligence which claims ties exist between terrorist
financing and the illegal drug trade. The Committee does not concur with this change
in policy and encourages the administration to re-visit this decision in the fiscal year
2008 budget request.
The report also states that “The Committee disagrees with the President's budget proposal
to transfer a portion of the funding for Coast Guard research and development to the
Science and Technology ‘Research, Development, Acquisition, and Operations’ account.”
For additional discussion of H.R. 5441, see CRS Report RL33428, Homeland
Security Department: FY2007 Appropriations, coordinated by Jennifer E. Lake and Blas
Nuñez-Neto.

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