- The Washington Times - Sunday, May 7, 2006

Thousands of applications for security clearances from the private sector have begun to pile up since the Pentagon stopped processing them, blaming insufficient funds — and some are fretting that the moratorium is starting to threaten American security.

“Our national security could be at stake,” said Olga Grkavac, executive vice president of the Information Technology Association of America, in a statement issued last week. Companies fulfilling vital contracts for the U.S. military or intelligence agencies “will not be able to finish the job without the ability to sustain the cleared personnel on the job and to bring in more when needed,” she said.

The decision by the Defense Security Service — the Pentagon agency that vets all U.S. government contractors who need clearances to do classified work — was announced late last month, but has attracted surprisingly little notice, perhaps because the Armed Services committees of both chambers of Congress were busy last week marking up the Pentagon budget authorization bill.

In a statement e-mailed to contractors April 28, the agency, blaming “funding constraints” said they had “discontinued accepting industry requests for new personnel security clearances and periodic reinvestigations effective immediately and until further notice.”

Officials later said the agency had received more than 100,000 applications between October 2005 and March 2006.

The demand for clearances for private-sector contractors has grown hugely since the September 11 attacks, driven by the tsunami of spending that Congress has approved for U.S. military operations and the broader war on terror.

Once a company is cleared to do classified work, anyone it wants to hire for such a project also requires a clearance. The paperwork, security checks and background investigation can take up to 18 months, and costs thousands of dollars — a cost borne by the taxpayer.

The Defense Security Service processes the applications from contractors for the military and 23 other federal agencies. But, since a congressionally mandated reform in 2004, the investigations are done by the Office of Personnel Management, which bills the Defense Security Service for the work. Officials said the agency had run out of money to pay for the investigations and was already holding back some 3,000 applications.

Congressional staffers last week estimated the agency’s shortfall at between $75 million and $100 million.

One person who works for a contractor said they were hoping that the agency would continue to issue interim clearances — as it typically does for applicants assessed as low risk while their background investigation is pending — during the moratorium.

“Almost anyone we send to Iraq needs [a clearance],” the person said. “There are people waiting to go” to do vital national security work. “It’s a nightmare.”

Rep. Thomas M. Davis III, Virginia Republican, wrote to the agency after its announcement, calling the move “both baffling and disturbing.” He asked for more information about the decision, and aides said he planned to hold hearings.

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