The National Intelligence Reform and Terrorism Prevention Act of 2004 addressed the ongoing problem of backlogs in the processes for obtaining security clearances and designated oversight for the process to the Office of Management and Budget. OMB, in turn, delegated responsibility for day-to-day security clearance oversight and monitoring of investigations to OPM, which is now responsible for about 90 percent of all federal background inquiries.

Last February, OPM took over background investigations for the Defense Department, which faced a large backlog. As part of the merger, more than 1,300 former federal field investigators for DOD’s Defense Security Service last year joined OPM’s contractor staff of about 4,000 field investigators.

Since then, OPM has cut the investigations backlog for top secret clearances in half, said Kathy Dillaman, associate director of OPM’s federal investigative services division.

“Things are getting better every day. The get-well plan is solid,” she said. “For the first time probably ever, under OMB’s umbrella, all of the players have come together to deal with the issue. Everybody’s being held accountable.”

In order to keep pace with rising workloads, OPM has expanded its contractor base to meet demand for investigations, which spiked after the attacks of Sept. 11, 2001.

Dillaman expressed confidence that OPM will meet the requirements of the Intelligence Reform and Terrorism Prevention Act to reduce investigation processing time in 80 percent of the cases to 90 days by the end of 2006.

However, resolution of the problem is not entirely within OPM’s control, sources said. “The biggest problem that’s going to influence whether this program ultimately works with OPM is [DOD’s] inability to project its workload requirements,” said Derek Stewart, director of Defense capabilities and management for the Government Accountability Office.

Because most of the requests come from DOD, and DOD has underestimated the number of clearances needed by 100,000 or more annually in recent years, it’s next to impossible for OPM to adequately plan its investigative assignments, Stewart said.

DOD recently has begun to take steps to improve the reliability of its forecasts, but the backlog will remain until DOD is done fixing its forecast methodology, he said.

While the intelligence agencies handle their own clearances, and the bulk of the backlog consists of less-sensitive secret, but not top-secret cases, “the effect of the backlog on national security is detrimental, and it’s real,” Stewart said.

GAO has documented in its reports that, because of the backlog, some important government work is not being done and that private-sector firms raid each other or pay extraordinary bonuses just to get enough employees with security clearances to be able to bid on defense contracts.

The quality of the investigations also is an issue. Stewart testified last November before the Senate subcommittee on oversight of government management, the federal workforce and the District of Columbia that OPM’s system of measuring the quality of investigations simply by counting the number of returned incomplete case files is insufficient. He recommended that OPM sample cases using its own staff to ensure the quality of the investigations by contract employees.

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"The effect of the backlog on national security is detrimental, and it’s real." – GAO’s Derek Stewart

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Dillaman told Government Leader that she and her team at OPM “review all work completed by our federal agents and, at a minimum, 3 to 5 percent of the work completed and reviewed by the contractors. If quality concerns are identified, additional review ... is completed.”

Moreover, she said, sampling is more intensive with new contractors until she is satisfied that quality standards are being met.

Dillaman said she is looking into whether additional efficiencies are to be gained from further automation, such as the electronic submission of state law enforcement records or the procurement of public records from commercial database aggregators.

GAO’s Stewart said his office is evaluating OPM’s automated system “from soup to nuts” and expects to issue a report this summer.