The Transportation Security Administration's (TSA) Electronic Baggage Screening Programwhich facilitates the development and deployment of checked baggage screening systemsis one of the largest acquisition programs in the Department of Homeland Security. According to TSA, over $8 billion has been made available for enhancing the screening of checked baggage transported on passenger aircraft since fiscal year 2001. In fiscal year 2010, over $1 billion was made available to procure and install screening equipment. The Department of Homeland Security's fiscal year 2011 request amounts to $624 million for procurement and installation in fiscal year 2011.
Through the Electronic Baggage Screening Program, TSA deploys baggage screening systems to best fit security needs and infrastructure at the 462 airports at which TSA performs or oversees screening activities. TSA generally deploys equipment for screening checked baggage in one of two ways: (1) in-line baggage screening systems, which are integrated into the conveyor systems that sort and transport baggage for loading onto an aircraft and (2) stand-alone machines that are typically situated in airport lobbies.
From this amount, TSA also plans to support its Security Technology Integrated Program, Advanced Surveillance Program, and other programs related to the operation and integration of security technologies.
GAO estimates that TSA could achieve up to $470 million in net savings based on reduced TSA staffing costs through the replacement or modification of existing systems with more efficient baggage screening systems at airports over the next 5 years, assuming that funding for procurement and installation under the Electronic Baggage Screening Program continues at TSA-projected levels.
In March 2005, GAO reported that airports benefit from the installation of more efficient systems, such as in-line baggage screening systems, because these systems reduce the time needed for baggage screening and allow airports and TSA to streamline their operations. Moreover, a 2006 Aviation Security Advisory Committee study reported that modifying or replacing existing systems with more efficient systems could reduce the number of screener personnel required to operate these systems. In 2005, GAO also reported that TSA had not conducted a systematic, prospective analysis to determine at which airports it could achieve long-term savings and enhance efficiencies and security by installing more efficient in-line systems. GAO recommended, among other things, that TSA identify and prioritize the airports where the cost-savings benefits of optimizing baggage screening operations by replacing existing baggage screening systems with more efficient in-line systems are likely to exceed the estimated up-front investment costs of installing the systems, or where the systems are needed to address security risks. TSA concurred with this recommendation and published a plan to deploy more efficient systems for 250 airports. As of January 2011, TSA plans to complete its efforts to replace or modify systems at these airports by 2024. TSA officials have not provided GAO with information on its plans at the remaining airports.
Replacing or modifying existing systems with more efficient systems results in net personnel cost savings to the extent all other costs, except for personnelacquisition, installation, modification, and operations and maintenance costsare relatively equal over time. Using TSA data on its planned average annual program budget rate of $448 million and estimated screener personnel costs, GAO estimates that if TSA continues to replace or modify older systems with more efficient systems, including in-line screening systems, it could reduce full-time equivalent baggage screener positions as a result of investments made in fiscal years 2011 through 2015. This reduction in personnel could result in up to $470 million in estimated net cost savings. These estimates are based on airport planning and acquisition costs for 250 airports provided by TSA that are subject to change but are illustrative of the potential magnitude of federal cost savings that could be achieved. More precise estimates could be developed as these plans are further developed and refined.
Net savings account for differences in acquisition, modification, installation, and operation and maintenance costs between existing systems replaced with more efficient systems at airports.
The committee, comprised of government and private sector representatives, examines areas of civil aviation security to develop recommendations for improving aviation security methods, equipment, and procedures.
GAO estimates that these cost savings are equivalent to up to approximately 10,400 cumulative full-time equivalent screener positions resulting from investments for fiscal years 2011 through 2015. To calculate these estimated cost savings, GAO computed an average return on investment by determining the projected 5-year savings TSA could realize by replacing or modifying baggage systems at individual airports in 2009 and comparing the savings to funding made available to TSA in fiscal year 2009 for procurement and installation of the systems. First, GAO calculated the present value of estimated full-time equivalent savings across a 5-year period (i.e., fiscal years 2009 through 2013) which totaled about $117 million in fiscal year 2009. The $117 million assumes differences in acquisition, modification, installation, and operation and maintenance costs between existing systems, and more efficient systems at airports continue to be relatively equal. This assumption is based on TSA's analysis conducted in 2004 and 2005, which was the most recent analysis available. GAO reviewed and reported on this analysis in its March 2005 report. Second, GAO divided the cost savings by the $544 million in funding made available for procurement and installation in fiscal year 2009 (excluding any carry-over balances from prior fiscal years and funds appropriated through the American Recovery and Reinvestment Act). Thus, the average return on TSA's investment or the ratio of cost savings as a share of investment is $117/$544 million, or about 0.21. GAO multiplied this ratio (0.21) by TSA's planned future program budget for replacing or modifying baggage systems for fiscal year 2011 through fiscal year 2015 (assuming TSA receives funding at anticipated levels) to estimate the resulting net cost savings. However, the 0.21 ratio may not necessarily continue into the future depending on changing costs and circumstances. To calculate the average annual program budget, GAO used information TSA provided on its planned annual program budget on acquisition and planning costs for fiscal years 2011 through 2014. GAO did not have information on TSA's planned annual program budget for fiscal year 2015.
By continuing to replace or modify older systems with more efficient solutions, including in-line screening systems, at its planned average annual program budget rate of $448 million, TSA could continue to eliminate baggage screener positions achieving up to $470 million in estimated net costs savings over the next 5 years. TSA agreed that the deployment of more efficient systems offers potential cost savings to the federal government. GAO will continue to assess these issues as part of its ongoing work examining more efficient checked baggage screening systems for the Senate Committee on Commerce, Science and Transportation. GAO plans to report on the final results of this review in 2011.
This analysis is based on GAO's preliminary observations from its ongoing work as well as information contained in the related GAO products listed under the "Related GAO Products" tab. To develop GAO's preliminary observations, GAO reviewed available documentation on TSA's checked baggage screening program, including TSA's estimated cost data for full-time equivalent screeners from fiscal year 2009 to fiscal year 2013; TSA's planned program budget data for continued installation of more efficient systems; and modification costs from fiscal years 2009 to fiscal years 2010. GAO could not independently verify the reliability of all of this information, but it compared this information with other supporting documents, when available, to determine data consistency and reasonableness. On the basis of these efforts, GAO concluded that the data were sufficiently reliable for its purposes.
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