The 100 Percent Solution

After a long hiatus, the U.S. government is again focusing on the statutory requirement to scan 100 percent of inbound containers. But challenges remain.

By Steve Caldwell

After the terrorist attacks of 9/11, U.S. Customs and Border Protection (CBP) took a number of steps to improve the security of cargo containers bound for the U.S. For example, its Container Security Initiative placed CBP officers overseas to work with foreign officials to identify and scan high-risk containers before they were laden on U.S.-bound vessels.

In the ensuing years, there were increased concerns about terrorists using maritime containers to smuggle nuclear weapons into the country. Adding to the concerns were some inconvenient truths about the technology needed to detect such nuclear weapons. One type of technology, radiation portal monitors (RPMs), could quickly scan containers to determine whether they emitted radioactive signatures. But they could not detect nuclear materials shielded in dense materials such as lead.

A second type of technology, x-ray (or gamma-ray) scanners, could “see inside” containers to reveal their contents (like a medical x-ray) and detect dense matter but could not detect radioactive signatures. And using this second technology was much slower. To provide certainty, both technologies had to be used together.

So Congress passed the SAFE Port Act in 2006, requiring CBP to run a pilot program in foreign ports to test the concept of scanning all U.S.-bound containers using both types of technology. The next year it went even further, passing the 9/11 Commission Act, which required that, beginning in July 2012, all U.S.-bound containers had to be scanned before lading.

Instant Opposition

The reaction was immediate. The international community objected because the new statutory requirement unilaterally shifted risks and costs to them. European and Asian government officials stated that the U.S. requirement could result in calls for reciprocity (i.e., 100 percent scanning of containers leaving the U.S.).The World Customs Organization (representing national customs agencies) unanimously passed a resolution opposing the 100 percent requirement.

Looking back, Michael Schmitz, then Director for Facilitation at the WCO and former General Counsel at CBP, notes that “The concerns about 100 percent scanning were so serious that WCO took the unprecedented action of sending its senior leaders to Washington to directly engage staff of the Senate and House committees so they would understand the negative impact it would have.”

CBP itself questioned the wisdom of 100 percent scanning even as it ran pilots in several foreign ports to test the concept. In a statement at a congressional hearing in April 2009, Acting Commissioner Jayson Ahern noted the limited results of the testing, saying that “Scanning all 11.3 million containers that enter U.S. seaports from a foreign port presents significant operational, technical, and diplomatic challenges.” During the hearing, he added that “100 percent scanning is not 100 percent security.”

Congress’ watchdog agency, the U.S. Government Accountability Office, raised questions about the requirement as early as June 2008. GAO subsequently examined the results of CBP’s pilot operations and found a number of limitations. Smaller pilot ports were scanning from 76 percent to 84 percent of U.S.-bound containers with both x-rays and RPMs. But the larger pilot ports, the ones that accounted for the vast majority of inbound containers, were only scanning three to five percent.

With the pilot largely unsuccessful and the deadline for implementation approaching, the Department of Homeland Security (DHS) invoked a section of the statute allowing an extension of the deadline by two years in both 2012 and 2014. Based on the widespread international opposition and DHS’s apparent willingness to extend the deadline ad infinitum, many who viewed the requirement as malignant thought it had gone into full remission.

Back on the Radar

But 100 percent scanning is back. In May, DHS Secretary Jeh Johnson informed Congress in a letter that the department would again invoke an extension of the 100 percent deadline but indicated a new willingness to eventually enforce the statute. Previous letters about extending the deadline tended to dismiss the requirement.

For example, in his 2014 letter Secretary Johnson stated, “I must report, in all candor, that DHS’s ability to fully comply with this unfunded mandate of 100 percent scanning, even in [the] long term, is highly improbable, hugely expensive, and in our judgement, not the best use of taxpayer resources to meet the country’s port security and homeland security needs.”

But the May 2016 letter lacked such negative language and said, “I have committed the Department to work towards meeting the 100 percent scanning requirement mandated by Congress” and “We have made important progress over the past two years.” Significantly, DHS concurrently issued a Request for Information on “Strategies to Improve Maritime Supply Chain Security and Achieve 100% Overseas Scanning,” an indication that this time around it means business.

In June, the Congressional Budget Office issued a report on 100 percent scanning and identified options for meeting the requirement. Option 1 would install and operate scanners in the 453 ports that ship containers to the U.S. and cost between $22 billion and $32 billion over 10 years. Option 2 would limit scanning to the 121 ports that ship 97 percent of containers to the U.S. and cost $12 billion to $22 billion over 10 years, a savings of $10 billion. If other countries decide to retaliate and require CBP to scan all containers leaving the U.S. for their ports, total costs over 10 years increase to $59 billion to $95 billion for Option 1 and $39 billion to $75 billion for Option 2, a significant jump.

CBO also proposed alternative options that would shift more of the burden (and costs) of scanning inbound containers on domestic U.S. ports. And like the legislation itself, CBO made no assumption about who pays such costs. CBO also noted that the impact on security is not clear because terrorists could decide instead to smuggle nuclear materials by truck or rail or through tunnels at land borders, or in non-container vessels, private yachts or aircraft, thereby avoiding the scanning process altogether.

In July Congress held one of its most comprehensive hearings on maritime nuclear smuggling in years. Several representatives said the Iran nuclear deal and the rise of ISIS increased the risk substantially. According to Chairman Duncan Hunter (R-CA) of the Subcommittee on Coast Guard and Maritime Transportation, “It seems clear that Islamic extremists aspire to carry out a radiological attack, so this is a threat we need to take seriously. If they succeed even once, the consequences would be catastrophic.”

To Scan or Not to Scan

It’s too early to determine whether the recent focus on the 100 percent solution is a clear trend toward implementation or a transitory blip in interest that will again go dormant. And who will foot the bill? Container carriers and terminal operators are understandably reluctant with the industry mired in its worst recession in decades.

But if it does go forward, one group to benefit are the manufacturers of scanning equipment since ports all over the world will need many more scanners. And even if it stalls, many of CBP’s current scanners in U.S. ports are reaching the end of their operational lives. At the July hearing, Todd Owens, CBP’s Assistant Commissioner for Field Operations, testified that “As part of CBP’s [x-ray] recapitalization plan, older technology will be phased out and replaced with more modern and state-of-the-art technology.”

Prospects are especially bright for companies that can integrate solutions by combining both RPMs and x-ray imaging technology. One company looking at such integration is Passport Systems and its SmartScan™ technology. According to Dr. Steve Korbly, Vice President for Research & Development, “The key to increasing efficiency is the use of new technologies to discriminate and identify a broad range of materials so CBP officials can not only detect radiological and nuclear materials but also drugs and other contraband at the same time.”

Korbly joined Passport Systems twelve years ago after receiving his Ph.D. in physics from MIT. He adds, “While I have no illusions that we are on the cusp of achieving 100 percent scanning in the short term, technologies are definitely advancing to improve the effectiveness of the scanning process itself. Increasing the fraction of containers scanned to 20 percent to 30 percent in the immediate future is achievable.”

It is critical that new technologies be tested under operational conditions. Previous work by GAO has shown that “state-of-the-art” technologies pushed by agencies and companies to improve RPMs (e.g., the Advanced Spectroscopic Portal) or x-ray scanners (e.g., the Cargo Advanced Automated Radiography System) could not transition successfully from the research lab to the real world of container terminal operations. And since the overall impact of 100 percent scanning remains unclear in the first place, we should at least make sure that the technologies themselves work effectively before proceeding too far down the path to implementation. – MarEx

Steve Caldwell is a member of the National Maritime Security Advisory Committee and a frequent contributor to The Maritime Executive.