THE MEO MOST EFFICIENT ORGANIZATION

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Security Clearance ReformImplications of the
Intelligence Reform and Terrorism Prevention Act
of 2004
Thomas M. Abbott Partner and National Chair,
Government Contracts Practice Group
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A Brief History

• Sept 11, 2001 Al Qaeda attacks the United States
• Oct. 26, 2001 USA PATRIOT Act (Public Law
  107-56) becomes law
• Nov. 25, 2002 Homeland Security Act (Public Law
  107-296) becomes law
• Spring/Summer/Fall 2004 9/11 Commission holds
  hearings on attacks
• May 6, 2004 House Government Reform Committee
  hears testimony on clearances Rep. Davis sends
  letter to DOD requesting action on clearance
  backog.
• Dec. 17, 2004 Intelligence Reform and Terrorism
  Prevention Act of 2004 (Public Law 108-458)
  becomes law

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Summary of 2004 Changes (1 of 3)

• Section 1011 new National Intelligence Director
  will prescribe uniform procedures for access to
  sensitive compartmentalized information (SCI)
• Section 3001 addresses the security clearance
  process.
• Within 90 days (Feb. 17), ID a single agency to
  manage clearances and standardize policies,
  investigations and adjudications OPM ? New
  Natl Intel Director?
• Within 180 days, ID a single agency to perform
  investigations
• Agency can delegate to other agencies outsource

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Summary of 2004 Changes (2 of 3)

• Standardization of clearance procedures
• Explicitly applies to special access programs,
  clearance forms, financial disclosure rules, and
  polygraph policies may apply to more.
• What will this mean in practice?
• Reciprocity of clearances
• Agencies may still establish separate
  requirements under certain circumstances
• Central security clearance database

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Summary of 2004 Changes (3 of 3)

• Reduce investigation and adjudication times for
  security clearances
• Designated agency must develop a plan for
  reducing clearance wait times
• Starting on Dec. 17, 2006, agencies must complete
  80 of clearances within 120 days of application
• 90 days to complete the investigative phase
• 30 days to complete the adjudicative phase
• Starting on Dec. 17, 2009, agencies must complete
  90 of clearances within 60 days of application
• 40 days for the investigative phase
• 20 days for the adjudicative phase
• Shorter times should be beneficial to applicants
  and companies.
• However, the burden of proof rests on the
  applicant at the adjudication, so the faster
  schedule may make it harder for applicants to
  produce evidence and make their cases.

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Trends in Clearance Cases (1 of 2)

• New guideline need to address post-9/11 changes
  which have resulted in dramatic changes in
  security clearance adjudications
• Guideline B (Foreign Influence)
• 2001 88 hearings (44 clearances granted)
• 2002 120 hearings (55 clearances granted)
• 2003 280 hearings (140 clearances granted)
• 2004 170 hearings
• Guideline C (Foreign Preference)
• 2001 90 hearings (21 clearances granted)
• 2002 127 hearings (53 clearances granted)
• 2003 153 hearings (65 clearances granted)
• 2004 104 hearings
• In 2004 more adjudications diverted to DISCO?
• The trend is to target countries of interest

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Trends in Clearance Cases (2 of 2)

• The Money memo applicants must formally
  surrender their foreign passports
• Reinvestigations having a past clearance or
  successful adjudication is no guarantee
• DOHA Appeal Process
• Large gap for success rates
• 12 of pro se applicants prevail
• 40 of applicants with counsel prevail

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Future Developments?

• Which agency will manage clearances?
• Which set of clearance guidelines will be used
  across agencies, if any?
• Will future guidelines be promulgated using
  rulemaking? (notice, comment, etc.)
• How will NIDs rules for access to SCI
  interact/overlap with regular clearance rules?

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• Thomas M. Abbott
• McKenna Long Aldridge LLP
• 444 South Flower Street
• Los Angeles, CA 90071
• [phone]
• tabbott_at_mckennalong.com