Senate Hearings

S. H

. 112–697

Senate Hearings

Before the Committee on Appropriations

Commerce, Justice, Science,

and Related Agencies

Appropriations

Fiscal Year

2013

th CONGRESS, SECOND SESSION

112

H.R. 5326/S. 2323

DEPARTMENT OF COMMERCE

DEPARTMENT OF JUSTICE

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

NONDEPARTMENTAL WITNESSES

Commerce, Justice, Science, and Related Agencies Appropriations, 2013 (H.R. 5326/S. 2323)

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2013

S. H

. 112–697

COMMERCE, JUSTICE, SCIENCE, AND RELATED

AGENCIES APPROPRIATIONS FOR FISCAL YEAR

2013

HEARINGS

BEFORE A

SUBCOMMITTEE OF THE

COMMITTEE ON APPROPRIATIONS

UNITED STATES SENATE

ONE HUNDRED TWELFTH CONGRESS

SECOND SESSION

H.R. 5326/S. 2323

AN ACT MAKING APPROPRIATIONS FOR THE DEPARTMENTS OF COM-

MERCE AND JUSTICE, AND SCIENCE, AND RELATED AGENCIES FOR

THE FISCAL YEAR ENDING SEPTEMBER 30, 2013, AND FOR OTHER

PURPOSES

Department of Commerce

Department of Justice

National Aeronautics and Space Administration

Nondepartmental Witnesses

Printed for the use of the Committee on Appropriations

(

Available via the World Wide Web: http://www.gpo.gov/fdsys/browse/

committee.action?chamber=senate&committee=appropriations

(II)

COMMITTEE ON APPROPRIATIONS

DANIEL K. INOUYE, Hawaii, Chairman

PATRICK J. LEAHY, Vermont

TOM HARKIN, Iowa

BARBARA A. MIKULSKI, Maryland

HERB KOHL, Wisconsin

PATTY MURRAY, Washington

DIANNE FEINSTEIN, California

RICHARD J. DURBIN, Illinois

TIM JOHNSON, South Dakota

MARY L. LANDRIEU, Louisiana

JACK REED, Rhode Island

FRANK R. LAUTENBERG, New Jersey

BEN NELSON, Nebraska

MARK PRYOR, Arkansas

JON TESTER, Montana

SHERROD BROWN, Ohio

THAD COCHRAN, Mississippi, Ranking

MITCH M

CONNELL, Kentucky

RICHARD C. SHELBY, Alabama

KAY BAILEY HUTCHISON, Texas

LAMAR ALEXANDER, Tennessee

SUSAN COLLINS, Maine

LISA MURKOWSKI, Alaska

LINDSEY GRAHAM, South Carolina

MARK KIRK, Illinois

DANIEL COATS, Indiana

ROY BLUNT, Missouri

JERRY MORAN, Kansas

JOHN HOEVEN, North Dakota

RON JOHNSON, Wisconsin

HARLES

J. H

OUY

, Staff Director

RUCE

VANS

, Minority Staff Director

UBCOMMITTEE ON

OMMERCE

, J

USTICE

, S

CIENCE

AND

ELATED

GENCIES

BARBARA A. MIKULSKI, Maryland, Chairman

DANIEL K. INOUYE, Hawaii

PATRICK J. LEAHY, Vermont

HERB KOHL, Wisconsin

DIANNE FEINSTEIN, California

JACK REED, Rhode Island

FRANK R. LAUTENBERG, New Jersey

BEN NELSON, Nebraska

MARK PRYOR, Arkansas

SHERROD BROWN, Ohio

KAY BAILEY HUTCHISON, Texas

RICHARD C. SHELBY, Alabama

MITCH M

CONNELL, Kentucky

LAMAR ALEXANDER, Tennessee

LISA MURKOWSKI, Alaska

RON JOHNSON, Wisconsin

SUSAN COLLINS, Maine

LINDSEY GRAHAM, South Carolina

THAD COCHRAN, Mississippi (ex officio)

Professional Staff

ABRIELLE

ATKIN

ESSICA

M. B

ERRY

EREMY

EIRICH

EAN

OAL

ISEN

AMERON

(Minority)

LLEN

UTLER

(Minority)

OODLOE

UTTON

(Minority)

Administrative Support

ICHAEL

AIN

ATIE

ATTE

(Minority)

(III)

CONTENTS

HURSDAY

, M

ARCH

8, 2012

Page

Department of Justice: Attorney General .............................................................. 1

HURSDAY

, M

ARCH

15, 2012

Department of Justice: Federal Bureau of Investigation ..................................... 111

HURSDAY

, M

ARCH

22, 2012

Department of Commerce: Office of the Secretary ............................................... 143

EDNESDAY

, M

ARCH

28, 2012

National Aeronautics and Space Administration .................................................. 205

Nondepartmental Witnesses ................................................................................... 247

(1)

COMMERCE, JUSTICE, SCIENCE, AND RE-

LATED AGENCIES APPROPRIATIONS FOR

FISCAL YEAR 2013

THURSDAY, MARCH 8, 2012

U.S. S

ENATE

UBCOMMITTEE OF THE

OMMITTEE ON

PPROPRIATIONS

Washington, DC.

The subcommittee met at 10:01 a.m., in room SD–124, Dirksen

Senate Office Building, Hon. Barbara Mikulski (chairman) pre-

siding.

Present: Senators Mikulski, Leahy, Feinstein, Lautenberg, Pryor,

Brown, Hutchison, Shelby, Alexander, Murkowski, and Graham.

DEPARTMENT OF JUSTICE

TTORNEY

ENERAL

STATEMENT OF HON. ERIC H. HOLDER, JR., ATTORNEY GENERAL

OPENING STATEMENT OF SENATOR BARBARA A

MIKULSKI

Senator M

IKULSKI

. Good morning, everybody. The Commerce,

Justice, Science, and Related Agencies Appropriations Sub-

committee (CJS) will come to order. This morning, we welcome the

Attorney General of the United States, and as is the usual and cus-

tomary way, Senator Hutchison and I will make opening state-

ments. We’ll go to you, Mr. Attorney General, for yours, and you

may summarize. With unanimous consent, all statements will be

included in the record.

Senator Shelby, our colleague and former ranking member on

this subcommittee, has a banking hearing. With Senator

Hutchison’s concurrence, we’ll go right to Senator Shelby for the

first question.

Senator H

UTCHISON

. Okay.

Senator M

IKULSKI

. Does that sound okay?

Senator S

HELBY

. Thank you.

Senator M

IKULSKI

. And then we will observe Senators in their

order of arrival, and we expect robust participation. We’re going to

strictly adhere to the 5-minute rule.

So, having laid the groundwork, I just want to say good morning

and welcome to our first CJS subcommittee hearing, the Attorney

General of the United States, in which we will hear his presen-

tation on the Department of Justice (DOJ) budget.

We have a very positive relationship with the Attorney General.

He’s brought to the Justice Department the experience of a career

prosecutor. He’s been dedicated to fighting violent crime and ter-

rorism. He knows that he is pioneering work now, working with

our administration, on how to deal with the new and emerging

threat of cybersecurity, which is, how do we protect our citizens,

and his views and recommendations on protecting our civil lib-

erties.

Well, Mr. Attorney General, before we get into the numbers and

the money, I would just like to thank you, and in thanking you, I

want to thank all the hardworking men and women who do work

at DOJ. There are 116,000 employees who work there; 25,000 are

Federal agents, and people work at the Federal Bureau of Inves-

tigation (FBI), Drug Enforcement Administration (DEA), the U.S.

Marshals Service (USMS), and the Bureau of Alcohol, Tobacco,

Firearms and Explosives (ATF). We have 20,000 prison guards and

correctional staff, and 10,000 prosecutors and investigators.

They’ve had some amazing accomplishments, which I’ll talk about

when I get to my question period.

But we want to thank them, because every day and every way,

they stand sentry, either to do prevention and intervention, to

make sure they are out on the street, doing traditional violent

crime work, to really being all over the world, and then fighting

issues related to white collar crime.

As the chair of the CJS Subcommittee, I have three priorities

when examining the budget: communities security, how does the

budget support the mission of keeping our communities safe; na-

tional security, what resources are needed to keep America safe;

and then, oversight and accountability. No boondoggles on the

watch of this subcommittee. And I want to make sure the Justice

Department has what it needs to do its mission.

As I looked at the President’s budget, I noted that there was only

one new initiative, and that’s the expansion of mortgage and finan-

cial fraud. That request is $611 million. It is a modest $5 million

targeted increase, and we are going to want to hear more about

that. Because we, in our own State of Maryland, have seen such

a rising number of scams, and schemes, and predatory lending

practices, and we need to know what you want to do with the

money.

We can’t have a strong, economically vibrant community unless

they’re safe, whether it’s in our neighborhoods, whether it’s pro-

tecting small business on Main Street. So, I want to know how the

budget will keep America safe at home on Main Street.

The request for $2 billion for grants to State and local law en-

forcement, I wonder if it’s sufficient. This is $32 million less than

the 2012, and we might have to consider, you know, reorganizing

priorities. The State and local funding seems to have borne the

brunt of budget cuts. Since 2010, grants have been cut by $1 billion

in local funding. Now, part of this was the axe and acts of the Con-

gress itself.

Many of my colleagues don’t realize that cuts have consequences

in discretionary spending. So, we need to hear your view on what

we can do. We know the Government Accountability Office (GAO)

has recommended that you should conduct a review and eliminate

unnecessary duplication. We support that.

We also want to work in community security at the protecting of

our children. One of the areas of bipartisan support is in the money

to catch predators who use the Internet to stalk children, break up

children’s pornography rings, and track down and arrest these

child molesters. We understand you are requesting $328 million,

and we’ll look forward to seeing how you will allocate that, and

what to do.

The Southwest Border—my colleague, Senator Hutchison, has

worked assiduously in that area. I want to know that this is not

only bipartisan support—we think it ought to be nonpartisan to

support our border, and I’ll let her raise those questions in there.

In the area of cyberthreats, our Nation faces a growing and per-

vasive threat overseas, from hackers, cyberspies, and

cyberterrorists. We need safe and resilient networks. We worry

about online banking and commerce, the safety of our power grids,

air traffic control systems, digitized records.

Yesterday, with the administration, the Senate held a cyber exer-

cise. The majority of the Senators were there to listen to an exer-

cise on an attack on a major city’s power grid. It was chilling. It

was terrifying to know what happened there, and what we could

do to protect it. So, we need to know about cyber.

PREPARED STATEMENT

Finally, I want to know how the Justice Department is improving

its accountability to taxpayers. You know, you’ve gotten a bad

rap—some of them, about lavish banquets, cost overruns, the In-

spector General doing its audits—and it should. So, we want to

know how we stand sentry over the money we do spend.

We have very specific questions, but with the number of people

here, I’m shortening my statement.

[The statement follows:]

REPARED

TATEMENT OF

ENATOR

ARBARA

A. M

IKULSKI

Good morning and welcome to our first Commerce, Justice, Science, and Related

Agencies (CJS) Subcommittee hearing. We begin our examination of the President’s

fiscal year 2013 budget by welcoming Attorney General Eric H. Holder, Jr.

Today, we’ll discuss how the Justice Department’s fiscal year 2013 budget request

strengthens national security and counter terrorism; protects the safety, security,

and rights of U.S. citizens; and ensures taxpayer dollars are used wisely.

We have a very positive relationship with Attorney General Holder. He has

brought to the Justice Department the experience of a career prosecutor dedicated

to protecting the American people from terrorism and violent crime. Welcome back,

Attorney General Holder, and thank you for joining us today.

I want to begin today’s hearing by thanking all of the hardworking men and

women of the Justice Department’s 119,000 civil servants:

—the 25,000 Federal agents of the Federal Bureau of investigation (FBI);

—Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF);

—the Drug Enforcement Agency (DEA);

—the U.S. Marshals Service (USMS)—and the people who support those agents;

—the 20,000 prison guards and correctional staff; and

—the 10,000 prosecutors, investigators, and legal experts.

They’ve had some amazing accomplishments during the last year. USMS arrested

more than 12,000 fugitive sex offenders. DEA agents put more than 3,000 drug traf-

fickers out of business. FBI dismantled 366 criminal enterprises involved in white

collar crimes. U.S. Attorneys collected $6.5 billion in criminal and civil penalties.

They are the guardians of our justice system, but they are often overlooked and

undervalued. I want them to know that the CJS Subcommittee knows and appre-

ciates what they do every day.

The President’s fiscal year 2013 budget request for the Department of Justice

(DOJ) totals $27.1 billion, which is $110 million less than the fiscal year 2012 level.

The budget request also includes $368 million in cuts to prior year funding for core

Federal law enforcement functions and grants. This year’s budget also relies more

heavily than ever on payments into the Crime Victims Fund, which will finance 30

percent of the Department’s operating budget in fiscal year 2013. The request re-

flects the stringent reality of our times.

As chairwoman of the CJS Subcommittee, I have three priorities when examining

the budget for the Justice Department. The first is community security. How does

the budget support the mission of keeping our communities safe? The second is na-

tional security. What resources are needed to keep America safe from terrorism?

And finally, oversight and accountability. Are tax dollars being spent wisely?

I want to make sure that the DOJ has what it needs to uphold the rule of law

and to protect this country from predatory attacks.

There is only one new initiative in the Department’s budget request this year—

an expansion of mortgage and financial fraud task forces. Our economy depends on

the integrity of our financial markets. Our neighborhoods and communities have

been rattled by mortgage fraud schemes and scams.

The budget request includes $611 million to fight mortgage and financial fraud,

including a modest $55 million targeted increase to hire new FBI agents, new attor-

neys, new specialized support staff, and new forensic accountants and in-house in-

vestigators. This will also be used to combat financial and mortgage fraud, going

after the schemers and scammers who prey on hardworking families and destabilize

neighborhoods.

We can’t have strong, economically vibrant communities unless they are safe. So

I want to know how the budget request keeps Americans safe here at home. The

request is $2 billion for grants to State and local law enforcement. This is $32 mil-

lion less than fiscal year 2012.

State and local funding has borne the brunt of budget cuts. Since 2010, grants

have been cut by $1.5 billion, or 43 percent. This is a time when we must be frugal.

Tough choices have to be made. The CJS Subcommittee is committed to making

sure our police are not walking a thin blue line. We need to know which grants are

truly most effective and which programs we need to take a closer look at before rein-

vesting American taxpayers’ dollars in them.

A recent Government Accountability Office report recommended that the Attorney

General should conduct an assessment to better understand which grant programs

overlap with one another to prevent unnecessary duplication. I think that is an ex-

cellent recommendation, and I encourage the Attorney General to complete this

analysis.

I know how committed the Attorney General is to keeping children safe from

abuse, sexual predators, and cyber stalkers. The budget request includes $328 mil-

lion to catch predators who use the Internet to stalk children, break up child por-

nography and prostitution rings, and track down, arrest, and prosecute child molest-

ers.

The FBI and USMS have crucial roles. FBI’s Innocent Images initiative targets

sexual predators who use the Internet to distribute child pornography. USMS are

charged with tracking down and arresting an estimated 100,000 unregistered sex

offenders.

The Adam Walsh Act called for 500 new Deputy U.S. Marshals to carry out this

mission. But since 2010, we’ve been able to prevent furloughs and layoffs, but we’ve

been in a holding pattern of 160 new Marshals. I want to make sure we’re putting

the right resources in the right places to protect children from these despicable

predators.

The Department’s budget request includes more than $1.8 billion for Federal law

enforcement efforts, including the DEA, ATF, FBI, and USMS, to dismantle drug

cartels that smuggle illegal drugs, guns, and humans along the border, and terrorize

citizens and neighborhoods with fear and intimidation.

Drug trafficking-related homicides in Mexico continue climbing. There were a

sickening 12,100 murders in Mexico last year, up 86 percent since 2009. We are

very concerned about spillover violence. I want to know if the funds requested are

sufficient to shut down the flow of firearms into Mexico, and to stop drugs and vio-

lence from coming into the United States from Mexico.

Our Nation faces a growing and pervasive threat overseas from hackers, cyber

spies, and cyber terrorists. We need safe and resilient networks to protect our online

banking and commerce, electrical and power grids, air traffic control systems, and

digitalized records.

At the Justice Department, more than 1,500 personnel are working to prevent a

broad range of cyber threats, such as computer intrusions, Internet fraud, intellec-

tual property theft, and online child pornography; and to identify the perpetrators.

The FBI is tasked with the most urgent cyber security responsibilities. They are

on the front lines collecting intelligence and investigating computer intrusions that

threaten our critical technology infrastructure. We will hear more details about this

next week, when FBI Director Robert S. Mueller, III testifies before this sub-

committee. But I want to know what you see as the Justice Department’s role as

a key guardian of our Nation’s cyber security.

Finally, I want to know how the Justice Department is improving accountability

of taxpayer dollars so that every $1 spent to secure our communities is $1 well-

spent. The subcommittee has taken steps to prevent waste, fraud, and abuse; pro-

hibit funds for lavish banquets; control cost overruns; and require the Inspector

General to do random audits of grantees. I want to know what concrete steps you

have taken to put these guidelines into practice and give teeth to make sure they

are followed.

Given all of the Justice Department’s important roles and responsibilities, we

must ensure that it has the resources it needs to protect the lives of 330 million

Americans. But we also want to make sure the Justice Department is a good stew-

ard of taxpayer dollars and makes sure every $1 we spend to keep our Nation safe

is $1 well spent.

I thank Attorney General Holder for his leadership, and I look forward to con-

tinuing our work together making a safer, stronger America.

Senator M

IKULSKI

. I’m going to turn now to Senator Hutchison,

and then to you.

STATEMENT OF SENATOR KAY BAILEY HUTCHISON

Senator H

UTCHISON

. Well, thank you, Madam Chairman, very

much, not only for the deference on border security, where I live,

but also on the way you run this subcommittee, which is for us to

do what’s right for America.

Mr. Attorney General, I do want to address some of the areas of

border security. First of all, State Criminal Alien Assistance Pro-

gram (SCAAP) funding is something that continues to be short-

changed by your budgets, and SCAAP, of course, is the reimburse-

ment for local counties that incarcerate illegal alien prisoners. And

along the border, our counties are generally very poor and don’t

have those kinds of resources, and each year, you continue to not

fund.

We did put the money back in last year, $240 million, but I

would hope that you would support increasing that, as we go

through this process, because we must incarcerate these illegal

alien criminals, who are mostly in the drug cartel and operations,

so that this will not be borne by the counties on the border.

In response to Operation Fast and Furious, language was in-

cluded in last year’s bill that would prohibit Federal law enforce-

ment agencies from selling operable weapons to cartels. This re-

quest that you’re giving us removes that language, saying it’s un-

necessary. Mr. Attorney General, we just want to make positively

sure that what happened does not happen again, and I would hope

that you would support our insertion of that language again.

Last year, our Commerce, Justice, Science, and Related Agencies

bill provided $10 million to expand the capacity at the overcrowded

El Paso Intelligence Center (EPIC). And this is critical for our

Southwest Border information sharing, and is the border’s focal

point to help stop the flow of narcotics, combat illegal immigration,

and end human trafficking and firearms smuggling.

It is imperative that EPIC and the DEA take full advantage of

the resources available from DOJ agencies like the FBI, USMS,

and ATF. And I hope that you can give us an update on the status

of this funding and the project.

There have been reports that cartels across the border are at-

tempting to recruit college students to smuggle drugs into the

country, and it says that minors are more appealing, because crimi-

nal penalties are lighter for them. One of the good parts of your

budget request is $312 million for juvenile justice prevention pro-

grams. I will be interested in hearing if you are aware of these bor-

der threats to our youth, and if some of that money that you are

requesting could be put on the border to try to make sure that we

try to help our youth overcome the cartel overtures.

The VALOR program, the Violence Against Law Enforcement

and Ensuring Officer Resilience and Survivability, is one that I ap-

plaud your efforts to put in place. And unfortunately, the number

of Federal, State, and local officers who died in the line of duty in

America last year increased, from 153 to 173.

The feedback from the training and research being conducted

through VALOR is very positive, including the alert center at

Texas State University, which was credited by the two officers who

came into Fort Hood when Major Nidal Hasan started shooting un-

armed military people. Both of those officers survived, even though

Sergeant Munley was shot several times. But they both credited

their swift response that day to the alert active shooter training

program that they had received. So, that’s something that’s very

good that I applaud in your budget.

I want to state a concern that I have about the National Park

Service pushing for construction, which is in progress, on an un-

manned border crossing at the Big Bend National Park, in south

Texas. This is not a DOJ decision, but it is going to affect some of

the personnel, and I’m concerned that this is an area where illegal

immigrants can walk across. The water is knee deep, and you can

walk right across the river, and into Big Bend, and having an un-

manned border crossing, I think, is insufficient. So, we’re going to

talk about that at some point to see if we can get FBI, DEA, ATF,

Border Patrol, somebody to man a place like that, where it is so

vulnerable.

And last, but not least, Attorney General Holder, I’m going to

ask you some questions about your public integrity unit. I’m going

to give you full credit for dismissing the case against the late Sen-

ator Ted Stevens when you learned of the corruption within that

division of your Department. I’m going to ask you questions, be-

cause the report will be public within days, and if there’s anything

that you should take as your major responsibility, it is that the

public corruption unit and DOJ is fair and evenhanded, and, clear-

ly, that was not the case in the prosecution of a great friend to

many of us, and a great patriot for our country, who, unfortunately,

was very badly abused by the DOJ.

But, I will say, you did dismiss the case when you learned of the

misbehavior, and I gave you credit on the Senate floor for doing

that, and will again, but I do want to ask you about the report

when we have time to ask questions.

Thank you.

Senator M

IKULSKI

. Mr. Attorney General.

SUMMARY STATEMENT OF ERIC H

HOLDER

Attorney General H

OLDER

. Thank you. Chairwoman Mikulski,

Ranking Member Hutchison, other distinguished members of the

subcommittee. I want to thank you very much for the opportunity

to appear before you today and for your continued support of the

Justice Department’s critical work.

I look forward to discussing the President’s fiscal year 2013

budget for the Department and how these investments would be

used to build on what I think is our extraordinary record of suc-

cess.

The President’s budget proposal demonstrates a clear commit-

ment to advancing the Department’s core missions and augmenting

our ability to fulfill our most important obligation, and that is pro-

tecting the American people. Despite the significant fiscal con-

straints the Federal Government has faced in recent years, the

116,000 dedicated employees who serve in the Department offices

around the world have made significant, and in many cases, his-

toric progress in safeguarding our citizens from terrorism, from vio-

lent crime, from financial fraud, and from a range of threats that

often disproportionately threaten the most vulnerable members of

our society.

We’ve also proven our commitment to acting as sound stewards

of precious taxpayer dollars. As you can see in the most recent

budget request, proposed spending increases have been exceeded by

proposed cuts. In fact, as a result of numerous steps taken to

streamline operations, almost $700 million worth of savings have

been developed and reinvested in critical mission areas. I believe

that the Department is perhaps more efficient and more effective

than ever before.

Our recent achievements underscore this point, especially when

you consider our national security efforts. By continuing to work

collaboratively alongside U.S. and international partners, we have

identified and disrupted numerous alleged terrorist plots, including

one by two Iranian nationals to assassinate the Saudi Ambassador

to the United States. We have thwarted multiple plots devised by

homegrown extremists, and we have secured convictions and robust

sentences against a number of dangerous terrorists.

In October, the Department obtained a guilty plea from Umar

Farouk Abdulmutallab for his role in the attempted bombing of an

airplane on Christmas Day in 2009. Just last month,

Abdulmutallab was sentenced to four life terms in prison. In No-

vember, we secured the conviction of Viktor Bout, a notorious arms

dealer who sold millions of dollars in weapons for use in killing

Americans. In December, Waad Ramadan Alwan pleaded guilty to

23 charges, including conspiracy to use a weapon of mass destruc-

tion against U.S. nationals abroad, attempting to provide material

support to al Qaeda in Iraq, and conspiracy to transfer, possess,

and export explosive devices against United States troops in Iraq.

The list goes on and on. With the sustained and increased invest-

ments included in the President’s budget for the comprehensive na-

tional cybersecurity initiative, the high-value detainee interroga-

tion group, the joint terrorism task forces, the Render Safe pro-

gram, and other key national security efforts, the Department will

be able to strengthen our critical surveillance and intelligence gath-

ering capabilities.

It will also allow us to bring our fight against financial fraud to

a new level. On Monday, as many of you know, President Obama

issued a proclamation to mark the beginning of this year’s Con-

sumer Fraud Protection Week, and I’m proud to note that the Jus-

tice Department’s Consumer Protection Branch has established a

record of success in defending the interests of American consumers

that is worth celebrating and will be expanded upon.

In 2011 alone, our Consumer Protection Branch attained a 95-

percent conviction rate, recovered more than $900 million in crimi-

nal and civil fines, restitution, and penalties, and obtained sen-

tences totaling more than 125 years of imprisonment against more

than 30 individuals. This represents remarkable and unprece-

dented progress, but it really is only the beginning. In fact, since

the start of the administration, the Justice Department has sig-

naled an unwavering commitment to combating and preventing a

wide range of financial and healthcare fraud crimes, and we’ve

taken bold steps to address the causes and the consequences of the

recent economic crisis.

Through the efforts of the President’s financial fraud enforce-

ment task force, which was launched in 2009, and which I’m proud

to chair, charges have been brought against numerous CEOs,

CFOs, corporate owners, board members, presidents, general coun-

sels, and other executives of Wall Street firms, hedge funds, and

banks who have engaged in fraudulent activity.

In recent months, we have obtained prison sentences of up to 60

years in a variety of fraud cases, including multi-million-dollar

Ponzi schemes, and the largest hedge fund insider trading case in

U.S. history.

Just this week, we secured a conviction against the former board

of directors’ chairman for an international bank for orchestrating

a $7 billion investment fraud scheme. The task force has estab-

lished two new working groups: the Consumer Protection Working

Group, which will enhance civil and criminal enforcement of con-

sumer fraud, and the Residential Mortgage-Backed Securities

(RMBS) Working Group, which bring Federal and State partners

together to investigate and to prosecute abuses in our housing mar-

kets. Both will help to amplify existing efforts, and to foster co-

operation and collaboration in the Department’s response to these

problems.

Just a few weeks ago, a similar collaborative approach led the

Departments of Justice and Housing and Urban Development, as

well as other agencies, and 49 State attorneys general to achieve

a landmark $25 billion settlement with the Nation’s top five mort-

gage servicers, the largest joint Federal and State settlement in

our Nation’s history.

Although this will not, on its own, cure all that ails our housing

market, this agreement builds on the record fair lending settlement

obtained by the Civil Rights Division’s fair lending unit last year,

and will provide substantial relief to homeowners. It also provides

a blueprint for future collaboration across levels of government,

State borders, and party lines.

There is perhaps no better illustration of our recent progress

than the Department’s groundbreaking work to combat healthcare

fraud. Over the last fiscal year alone, in cooperation with the De-

partment of Health and Human Services, as well as other partners,

by utilizing authorities provided under the False Claims Act and

other essential statutes, we were able to recover nearly $4.1 billion

in funds that were stolen or taken improperly from Federal

healthcare programs. That is the highest amount ever recorded in

a single year.

Over the same period, we opened more than 1,100 new criminal

healthcare fraud investigations, secured more than 700 convictions,

and initiated nearly 1,000 new civil healthcare fraud investiga-

tions. For every $1 that we have spent combating healthcare fraud,

we have returned, on average, about $7 to the United States Treas-

ury, the Medicare Trust Fund, and others.

These numbers are stunning, but my colleagues and I recognize

that we cannot be satisfied, and this is no time to become compla-

cent. That’s why in addition to helping us build on this record of

success, the President’s budget request also would bolster our fight

against drug trafficking, international crime networks, gangs, and

cyber criminals. It would increase our efforts to protect the law en-

forcement officers who keep us safe, and expand upon the work

being done by our Civil Rights Division to guarantee that the

rights of all Americans are protected in border areas, workplaces,

housing markets, and voting booths.

PREPARED STATEMENT

I am committed to building on these and our other many achieve-

ments, and I know that you understand that in this time of uncom-

mon threats and complex challenges, we simply cannot afford to

cut back on the amount and the quality of justice that we are obli-

gated to deliver. The Department must remain vigilant in pro-

tecting this Nation and in enforcing the law, and these efforts must

be appropriately and adequately funded.

I look forward to continuing to work with the members of this

subcommittee and your colleagues throughout the Congress to ac-

complish this, and I would be happy to answer any questions that

you might have.

Senator M

IKULSKI

. Thank you, Mr. Attorney General. And your

full statement will be entered into the record.

[The statement follows:]

REPARED

TATEMENT OF

RIC

H. H

OLDER

, J

Good morning Chairwoman Mikulski, Ranking Member Hutchison, and members

of the subcommittee. Thank you for the opportunity to meet with you today to dis-

cuss the President’s fiscal year 2013 budget for the Department of Justice (DOJ)

and the Department’s key priorities.

I also appreciate the opportunity to tell you more about the good work that is

being done by DOJ employees across the United States and overseas to protect all

of our citizens from harm and to ensure equal protection under the law, in order

to promote ‘‘liberty and justice for all.’’

The President has emphasized his goal to stabilize the economy by creating new

jobs and reducing our national debt through greater revenue generation and spend-

ing cuts. To assist in the economic recovery, we continue to ask even more from our

talented DOJ personnel. This is as true in DOJ as it is in the rest of the Federal

Government.

The President has asked DOJ to do more with less, recognizing that many across

the country are still suffering; I am committed to presenting the Congress with a

serious and thoughtful budget, which clearly reflects this awareness, and allows us

the resources to faithfully carry out DOJ’s mission and fulfill our obligation to the

American people.

Upon careful examination of our mission and the range of the priorities I will

present here we cannot simply ‘‘cut back’’ on the extent or quality of justice that

we are obliged to deliver; we cannot cease to enforce the law. We cannot ignore an

indictment, or choose at the end of the process not to imprison a criminal, if sen-

tenced. We are responsible for enforcing the law, and these efforts must be funded.

What we can and must do, however, is examine the way we do our work, and find

better ways to continue to do it well. In response to my call for savings across DOJ,

my staff developed almost $700 million worth of budget offsets, so that we can rein-

vest that money and protect DOJ’s core mission and priorities. In presenting DOJ’s

fiscal year 2013 budget, we have aligned the entire amount to pay for high-priority,

mission-related needs. Specifically, we have proposed $228 million in program in-

creases. Our overall discretionary budget authority is reduced from $27.2 billion in

fiscal year 2012 to $27.1 billion in our fiscal year 2013 request.

In this fiscal year 2013 budget, we have proposed changes in operational accounts,

as well as leadership offices. We have used balances from prior years that were left

on the books to offset this year’s costs, and we tried to find less expensive ways to

accomplish the same outcome.

Each of our proposed reorganizations and realignments has been developed with

one goal in mind, to save taxpayers money, while remaining dedicated to our mis-

sion to protect our citizens. I can assure you that none of our reorganizations or re-

alignments will compromise this fundamental mission; personnel and resources will

be shifted to achieve the same end, to remake DOJ in ways that make us more re-

sponsive to the American people whom we proudly serve.

To be clear, then, we at DOJ recognize that we are accountable to the American

people, to identify and eliminate areas of waste, fraud and duplication, and also to

marshal limited resources for the greatest return on investment. I have carefully re-

viewed with my staff DOJ’s fiscal year 2013 budget request, and have directed them

to focus resources on programs that have a measurable impact and demonstrate suc-

cess in keeping our citizens safe.

In his fiscal year 2013 budget, President Obama proposes that the Congress fund

the work of DOJ in the amount of $27.1 billion. In this hearing, I would like to focus

on DOJ’s work in six critical areas, namely,

—To sustain our Nation’s security interests;

—To uphold DOJ’s traditional mission programs;

—To combat financial, mortgage, and healthcare fraud;

—To support our State, local, and tribal law enforcement partners;

—To invest in Federal prisons and enhance detention capacity; and

—To streamline programs and operations across DOJ.

NATIONAL SECURITY

The fiscal year 2013 budget includes a total of $4 billion to sustain our first pri-

ority—DOJ’s national security mission. As with our law enforcement mission, the

Department continues to work to build strong ties with intelligence and security

partners around the world, to protect the American people. At the same time, we

are diligent in protecting U.S. technologies, goods, services, and national security in-

terests from illegal tampering, malicious manipulation and acquisition by other

countries, in order to maintain our Nation’s competitive edge.

The funding previously enacted, which the fiscal year 2013 budget maintains, for

our national security programs ensures the continuation of critical investments

made to improve intelligence coordination; expands information sharing efforts with

trusted counterparts; secures our cyber infrastructure; widens investigations of drug

trafficking organizations with ties to terrorist groups; and continues to extend anti-

terrorism training to our law enforcement partners.

In the past year, we were successful in several key national security investiga-

tions. In October, DOJ obtained the conviction against Umar Farouk Abdulmutallab

for his role in the attempted bombing of an airplane full of holiday travelers on

Christmas Day in 2009. He was sentenced to life in prison earlier this month. Work-

ing closely with our United States and international partners, we thwarted a plot

by two Iranian nationals to assassinate the Saudi Ambassador to the United States,

as well as numerous other suspected plots by homegrown violent extremists. We

also secured the conviction of notorious arms dealer Viktor Bout for his efforts to

sell millions of dollars of weapons for use in killing Americans. In May of last year,

a grand jury indicted Waad Ramadan Alwan on 23 charges, including conspiracy to

use a weapon of mass destruction against United States nationals abroad; attempt-

ing to provide material support to al Qaeda in Iraq; and conspiracy to transfer, pos-

sess, and export explosive devices against United States troops in Iraq. In Decem-

ber, Alwan pleaded guilty to all 23 charges.

In the fiscal year 2013 budget, DOJ seeks to maintain critical counterterrorism

and counterintelligence programs, and sustain significant, recent increases related

to intelligence gathering and surveillance capabilities; detecting and deterring cyber

intrusions and fully supporting cybersecurity through the Comprehensive National

Cybersecurity Initiative. We also look to maintain our investments supporting the

High Value Detainee Interrogation Group; the Joint Terrorism Task Forces; and the

Render Safe Program.

TRADITIONAL MISSION PROGRAMS

In the fiscal year 2013 budget, DOJ seeks increases of $31.8 million in support

of programs in DOJ’s traditional core mission of combating violent crime,

cybercrime, crimes against children, and criminal trafficking in persons; and enforc-

ing the Nation’s civil rights and environmental laws.

Criminal Law

In combating organized crime, I announced in January 2011 the single largest op-

eration against the mafia ever undertaken by the Federal Bureau of Investigation

(FBI), the result of unprecedented cooperation among Federal, State, local, and for-

eign law enforcement personnel. The operation resulted in the arrest of more than

100 suspected mobsters—all without a hitch. In July, we announced the results of

Project Delirium, a Drug Enforcement Administration (DEA) operation targeting La

Familia Michoacana (Mee-shoa-CA-na), a violent drug cartel and supplier of most

of the methamphetamines smuggled into the United States. Working with other

Federal, State, local, and foreign law enforcement partners, including the Bureau

of Alcohol, Tobacco, Firearms and Explosives (ATF), DEA oversaw more than 1,900

arrests and the seizure of more than $63 million in U.S. currency; more than 2,700

pounds of methamphetamine; more than 2,700 kilograms of cocaine; 900 pounds of

heroin; nearly 15,000 pounds of marijuana; and $3.8 million in other assets. An ATF

investigation targeting a gang in Philadelphia known as the Young Hit Men or Har-

lem Gang resulted in an 89-count superseding indictment charging 23 members

with an array of Federal violations, including multiple firearms violations. The trial

of these gang members is scheduled for May. And finally, in 2011, the U.S. Mar-

shals Service (USMS) captured nearly 125,000 fugitives, including 7 from their ‘‘Fif-

teen Most Wanted’’ list in 2011. This was the fourth consecutive year that the

USMS captured more than 100,000 fugitives. These are only highlights, but, as you

can see, it’s been a busy year for DOJ.

Investigating cyber crime and protecting our Nation’s critical network infrastruc-

ture is another of DOJ’s top priorities. Successful cyber attacks can have dev-

astating effects on our national security, infrastructure, and economy; and hackers

have been relentless in their efforts to attack U.S. Government agency Web sites,

including ours. In combating these efforts, we continue to build and strengthen our

capabilities to counter and prevent these attacks. Here again, DOJ works on a glob-

al scale to achieve success, in cooperation with our law enforcement partners

abroad. FBI estimates that Americans lose hundreds of millions of dollars to cyber

criminals based in Eastern Europe alone. Working closely with the FBI Cyber Divi-

sion and with our legal attache

personnel in Bucharest, our Romanian counterparts

have arrested more than 300 cyber criminals in the last 3 years. Our efforts to build

relationships with foreign counterparts continue to produce real dividends. FBI, the

DOJ Office of International Affairs, and the Southern District of New York cooper-

ated closely with the Israeli National Police and the Israeli Ministry of Justice. To-

gether, we took down two boiler rooms in Israel that had targeted elderly persons

in the United States in a lottery telemarketing scam, and had swindled them out

of more than $10 million of their hard-earned savings. Thanks to this cooperation,

24 members of the ring were arrested in Israel and the United States; and 19 of

the 21 have been extradited to the United States. Most pleaded guilty, and have

been sentenced.

In fiscal year 2013, DOJ is requesting an increase of $15.2 million within the Jus-

tice Information Sharing Technology program to transform, strengthen, and protect

DOJ internal networks. This will counter newly emerging cyber security threats, in-

cluding insider threats, provide advanced intrusion detection and response capabili-

ties, and implement cost-efficient scalable enterprise architecture.

The fiscal year 2013 budget also includes $3 million in new investments to combat

transnational criminal organizations, and a total of nearly $2 billion to maintain the

security of our Nation’s Southwest Border. The budget also increases funding for

international investigation and deterrence of intellectual property crime by $5 mil-

lion, which brings our investment to nearly $40 million annually to combat online

piracy and otherwise protect our Nation’s intellectual capital and maintain our com-

petitive edge in developing American ideas and technologies to better compete in the

global marketplace.

DOJ’s budget request also supports our continuing work to prevent, investigate,

and prosecute child exploitation crimes. Sadly, our caseload in this area continues

to increase. Our budget request will fund ongoing efforts to investigate and pros-

ecute offenders such as those who participated in the so-called Dreamboard, an

international, members-only, online bulletin board that was dedicated to the sexual

abuse of children. Just as Dreamboard’s members operated across international

boundaries in committing their crimes, so too did law enforcement personnel work

across boundaries to take down this nefarious ring. To date, 72 Dreamboard mem-

bers have been indicted; 53 have been arrested in the United States and abroad.

DOJ has successfully investigated and prosecuted public corruption, not only in

the several high-profile cases that made the news, but across the United States. The

American electorate trusts that their public servants will obey the law; they expect

DOJ to bring to full justice those who abuse that trust.

Civil Rights

A fundamental highlight of DOJ’s budget request for traditional mission programs

is $5 million in new resources for the Civil Rights Division to prevent and combat

human trafficking; hate crimes; and misconduct by law enforcement and public offi-

cials. These issues warrant our greater investment and vigilance as we advocate for

every American—without exception. Safeguarding the civil rights of every American

is at the heart of what we do, and represents our core mission. In this good work,

DOJ continues to achieve success and helps our Nation to create ‘‘a more perfect

union’’.

In seeking redress for the host of inequities uncovered by the mortgage morass,

DOJ has fought especially hard to protect the civil rights of Americans. Recently,

I announced that DOJ had reached a $335 million settlement with a lender to re-

solve allegations of lending discrimination against African-American and Hispanic

borrowers who qualified for mortgage loans, but were charged higher interest fees

or were steered into sub-prime loans, solely because of their race and/or national

origin. More than 200,000 Americans will be entitled to compensation. We have also

acted to protect the civil rights of our servicemembers who have been targeted by

these unconscionable, predatory lending practices. In May 2011, we announced set-

tlements with two lenders to resolve allegations that they had wrongfully foreclosed

upon active-duty servicemembers without first obtaining court orders, in clear viola-

tion of the Service Members Civil Relief Act. The settlements provided more than

$22 million in compensation to our men and women in uniform who were forced to

worry about their families and losing their homes through unlawful foreclosures,

while also having to endure the horrors of war. We fought hard for them because

we believe that, as Americans, we are much better than that, and that our fellow

citizens, who place their lives on the line for all of us, deserve far better than that.

Our other civil rights priorities in fiscal year 2013 include a greater focus upon

combating human trafficking; in uncovering and prosecuting hate crimes that target

Americans for who they are and what they believe; in upholding and enforcing the

constitutional right of every eligible American to participate in our Nation’s political

process and vote freely; and fully implementing provisions of the Civil Rights for

Institutionalized Persons Act.

Environment and Natural Resources

Since 2011, a team of our agents and prosecutors continues to lead the Deepwater

Horizon Task Force, which has investigated the conduct of those involved in the

tragic explosion and oil spill that claimed the lives of 11 people; despoiled the coast-

al waters of the Gulf of Mexico; killed scores of wildlife; and damaged the vibrant

economy of a beautiful region, which our citizens have struggled mightily to restore.

Financial, Mortgage, and Health Fraud

In our fiscal year 2013 budget, DOJ seeks an increase of $55 million, for a total

investment of more than $700 million, to investigate and prosecute financial and

mortgage crimes that have sorely hurt the American people and damaged their trust

in the financial markets they expect to engage in fair play. The abuses by many

in the financial sector have had a devastating effect on the U.S. economy, and have

contributed significantly to the economic suffering of so many Americans. It is es-

sential that DOJ address these abuses forcefully, to hold fully accountable those

who are responsible for these abuses and ensure that they are not repeated. In this

budget, we propose an increase in specialized staffing and technologies to combat

and root out fraud in the area of securities and commodities; investment scams;

mortgage foreclosure schemes; and increasingly, in healthcare fraud.

The program increase of $55 million would provide funding for additional FBI spe-

cial agents, criminal prosecutors, civil litigators, in-house investigators, forensic ac-

countants, and paralegals to hone DOJ’s capacity to investigate and prosecute the

full spectrum of financial fraud. Bringing aboard specialized and dedicated per-

sonnel, especially investigators and forensic accountants, is key to our successful de-

tection and prosecution of complex financial schemes, and helps us to stay well

ahead of the criminals who devise them. Of the $55 million program increase, $37.4

million is to increase criminal enforcement efforts and $17.6 million would increase

civil enforcement efforts. Our total request also includes $9.8 million for technology

tools and automated litigation support.

We have already been actively engaged in these efforts. Since fiscal year 2010,

the Financial Fraud Enforcement Task Force has spurred investigation and prosecu-

tion of financial fraud that has been uncovered by the 2008 financial crisis and eco-

nomic recovery efforts. The task force has charged and sentenced a great number

of defendants involved in securities fraud, investment fraud, Ponzi schemes, and

other financial fraud. In October 2011, the managing member of Galleon Manage-

ment LLC was sentenced to 11 years in prison, based on DOJ’s investigation of the

largest hedge fund insider trading scheme in history. We also continue to aggres-

sively prosecute those who commit mortgage fraud. Mortgage fraud victims include

distressed homeowners preyed upon by fraudsters posing as foreclosure rescue ex-

perts; the elderly who are victimized in Home Equity Conversion Mortgage or ‘‘re-

verse mortgage’’ schemes; U.S. servicemembers; and entire neighborhoods blighted

by blocks of abandoned homes. In fiscal year 2011, the U.S. Attorneys’ offices filed

513 cases against 947 defendants, an increase of 92 percent in just 2 years.

Earlier this month, I joined Housing and Urban Development Secretary Shaun

Donovan and the Attorneys General of Colorado, Indiana, North Carolina, Illinois,

and Iowa to announce the unprecedented agreement reached by the Federal Govern-

ment and State attorneys general with the Nation’s five largest mortgage servicers

to address mortgage loan servicing and foreclosure abuses. This agreement—the

largest joint Federal-State settlement ever obtained—provides substantial financial

relief to homeowners and establishes significant, new homeowner protections. It

holds mortgage servicers accountable for abusive practices and requires them to

commit more than $20 billion toward financial relief for consumers. As a result,

struggling homeowners throughout the country will benefit from reduced principal

amounts and the refinancing of their loans. The agreement also requires substantial

changes in how servicers do business, which will help to ensure the abuses of the

past are not repeated.

Moreover, on January 27, I announced the formation of the Residential Mortgage-

Backed Securities Working Group, supported by current manpower and funds, to le-

verage State and local resources in a nationwide effort to investigate and prosecute

crimes in the residential mortgage-backed securities market. DOJ will join the Secu-

rities and Exchange Commission and the New York State Attorney General under

authority of the Financial Fraud Enforcement Task Force in leading the working

group, which will be staffed by at least 55 DOJ agents, analysts, investigators, and

attorneys from around the United States.

Finally, DOJ remains fully engaged with the Department of Health and Human

Services (HHS) to prevent and combat healthcare fraud. Earlier this month, HHS

Secretary Kathleen Sebelius and I reported the success of our joint efforts, having

recovered nearly $4.1 billion for U.S. taxpayers in fiscal year 2011. The 3-year aver-

age return on investment for healthcare fraud funding in fiscal year 2011 was more

than $7 for every $1 invested—the highest ever for this program.

In fiscal year 2013, we plan to redouble our efforts and ask the Congress for

$294.5 million through the HHS budget for healthcare fraud funding to support

DOJ initiatives to combat civil and criminal healthcare fraud. Increased funding will

permit DOJ to expand Medicare Fraud Strike Force operations and to more effec-

tively target locations where healthcare fraud activities are rampant. We also pro-

pose additional support to bolster civil enforcement efforts, including False Claims

Act matters, to investigate and prosecute fraud by medical and pharmaceutical pro-

viders.

STATE

LOCAL

AND TRIBAL LAW ENFORCEMENT

In our fiscal year 2013 budget, DOJ seeks a total of $2 billion to assist State,

local, and tribal law enforcement personnel, especially in combating violent crime

and violence against women and all other victims of crime, and in supporting victim

programs.

DOJ’s budget request is strong on law enforcement; it’s strong on solid program

research and development; it’s strong on juvenile justice; and it’s strong on innova-

tion. In presenting this budget request, we’ve taken a long, hard look at what has

worked best in these areas, in order to extend these best practices across the broad

range of our work.

The key to DOJ’s success in protecting the American people continues to be in

developing effective partnerships with law enforcement counterparts throughout the

United States and abroad to leverage a more focused and effective law enforcement

response. To put this in perspective, there are 65,000 U.S. Federal agents dedicated

to criminal investigations; by comparison, there are 700,000 State and local law en-

forcement officers in the United States, not to mention scores of others who work

for agencies from other nations. Crime is increasingly transnational and global in

scope, and criminals respect no boundaries. We owe it to the American people to

work closely with our partners—at home and abroad—to prevent these criminals

from harming our citizens, and to ensure that those who do so are brought to jus-

tice.

Here at home, one of our most important partnering programs is the Community

Oriented Policing Service (COPS) grant program. These grants assist State and local

police in hiring officers for targeted patrol and other proven strategies to reduce and

prevent crime. From fiscal year 2009 through fiscal year 2011, the COPS office fund-

ed more than 7,100 positions. More than 5,000 of these positions have been filled

so far; nearly 4,000 of them as new hires. The budget requests an additional $91

million for the COPS hiring program in fiscal year 2013, for a total of $257.1 mil-

lion. Of this amount, $15 million will be dedicated to community policing develop-

ment initiatives and $15 million will be directed to tribal jurisdictions.

It is worth noting that COPS will be giving preference in any fiscal year 2012 hir-

ing grant award to communities that hire post-9/11 veterans of our armed forces.

Put simply, this is the right thing to do, and I assure you that this policy will con-

tinue in grants funded by the fiscal year 2013 appropriation.

To give you an idea of the impact that COPS funding has had within local com-

munities, let me tell you about Fresno, California. Given budgetary constraints, the

Fresno Police Department had lost 100 sworn police officer positions and 265 civil-

ian positions over a 3-year period. COPS funding added 41 front-line officers who

helped Fresno reduce violent crime by targeted removal of dangerous criminals from

the community’s streets. The results are impressive. In 2011, Fresno experienced de-

creases in violent crimes across the board and had its lowest murder rate in a dec-

ade. Without COPS funding, the Fresno Police Department would have been forced

to disband its violent crime impact team and redeploy officers into patrol, and mere-

ly react to crime. Instead, COPS funding helped the people of Fresno become more

active in safeguarding their community.

In this area, too, DOJ seeks funding for grant programs proven to be effective in

preventing crime. Increased funding is requested for the Byrne Criminal Justice In-

novation Program; for residential substance abuse treatment; for Second Chance Act

implementation; for Part B Juvenile Justice Formula Grants; and for a new, evi-

dence-based juvenile justice competitive demonstration grant program.

The Adam Walsh Act significantly enhances DOJ’s ability to respond to crimes

against children and vulnerable adults, and to prevent sex offenders who have been

released back into the community from victimizing others. The fiscal year 2013

budget also includes $20 million for States and local jurisdictions, and an additional

$1 million to develop the National Sex Offender Public Web site.

Finally, a significant outlay under the fiscal year 2013 budget includes increased

funding to squarely address domestic violence and child abuse in rural areas

through support of projects specifically designed to prevent these crimes in rural ju-

risdictions. A significant portion of these funds will be dedicated to implementing

public safety programs in Indian country, to assist tribal law enforcement partners

in reducing the disproportionately high levels of violent crime there.

PRISONS AND DETENTION

In DOJ’s fiscal year 2013 budget, we are seeking $8.6 billion to ensure that pris-

oners and detainees are held in secure Federal facilities and to improve Federal

prisoner re-entry.

Last year, DOJ made strategic investments to enhance the Nation’s security and

make communities safer. There are more than 2 million people incarcerated in the

United States; estimates project the Federal inmate population in the United States

to increase by 6,500, in addition to the estimated 5,000 inmates who will be proc-

essed in fiscal year 2012. The fiscal year 2012 enacted appropriation included par-

tial funding for activation of new prisons in Alabama and New Hampshire. In the

fiscal year 2013 budget, DOJ requests funding to fully activate these facilities and

initiate two others, in Mississippi and West Virginia. In all, DOJ plans to add 2,500

prison beds and 1,000 new, low-security contract confinement beds in fiscal year

2013. DOJ will also direct increased funding to hire additional corrections workers

and cover increased costs to transfer, accommodate, and secure the larger prisoner

population.

While opening the secure facilities we need to confine criminals, DOJ’s budget re-

quest also addresses the parallel need to free up prison space and reduce long-term

detention and incarceration costs. This budget recognizes the need to work with you

in the Congress to make simple changes to the calculation of good conduct time, and

to explore ways to further reduce recidivism. These proposals provide proven incen-

tives for good behavior among certain eligible, nonviolent inmates, and their partici-

pation in programs designed to keep them from returning to prison, and will have

a direct impact in relieving overcrowding in Federal prisons. Beyond the steps pro-

posed in this budget, the Federal Government has an opportunity to build on the

work of States like Texas and Indiana to modernize criminal sentencing, ensuring

that violent and career criminals remain behind bars and off the streets, while

strengthening programs to help eligible, nonviolent offenders to safely and produc-

tively re-enter their communities.

The programs we propose to fund aim to reduce recidivism by expanding partici-

pation in these re-entry programs. DOJ’s fiscal year 2013 budget request includes

expansion of the Bureau of Prison’s residential drug abuse program, which supports

Second Chance objectives. This expansion will enable greater use of the sentencing

credits available to eligible, nonviolent inmates who complete drug treatment pro-

grams. Thus, as this program contributes to reducing crime, it will also result in

fewer taxpayer resources directed at incarcerating inmates.

SAVINGS AND EFFICIENCIES

DOJ’s fiscal year 2013 budget presents a highly streamlined array of programs,

which will help us to achieve our mission more efficiently while protecting the

American people more effectively.

DOJ proposes almost $700 million in efficiencies, offsets, and rescissions. We at

DOJ recognize that we must do our part to help our Nation maintain its sound fis-

cal footing. In our fiscal year 2013 budget request, we seek to balance fiscal respon-

sibility demanded by the American people with DOJ’s national security and law en-

forcement mission to prevent, prosecute, and bring to justice all who would do us

harm.

In leading this effort, I directed DOJ staff to identify areas where we would

achieve significant savings for the American taxpayers by implementing changes in

the way we execute our mission. These changes include improving the way we tar-

get funding, seeking support for programs that work; redirecting funding from the

Department level to component agencies to reduce overhead and increase oper-

ational efficiency; and consolidating offices and redirecting or reducing personnel

and resources.

In all, we identified $646.6 million in administrative efficiencies, nongrant pro-

gram reductions, and rescissions of prior-year balances, which will reduce our bot-

tom line without impairing our mission or capabilities.

In submitting DOJ’s fiscal year 2013 budget request, I emphasize that we con-

tinue to hold the line on expenses, seek to eliminate waste, and promote efficiencies.

In this request, we propose to reorganize DOJ by consolidating offices. In doing so,

we will become a leaner, more agile, and more responsive organization. Our goal is

to enhance our service to the American people, without sacrificing the essential mis-

sion. Instead, we intend to realign our staff and resources to meet the greatest

needs.

In proposing these realignments, we add our efforts to the President’s Campaign

to Cut Waste. In July 2010, I launched DOJ’s Advisory Council for Savings and Effi-

ciencies, or the SAVE Council, to focus these efforts within DOJ. In just the last

2 years, the SAVE Council has helped DOJ realize nearly $60 million in savings

and cost avoidance.

The fiscal year 2013 budget includes savings expected from merging detention

functions currently performed by the Office of the Federal Detention Trustee into

USMS, merging core functions of the National Drug Intelligence Center into DEA,

and transfer management of the Law Enforcement Wireless Communication pro-

gram to FBI, returning funding and the concomitant responsibility for radio oper-

ations and maintenance to DOJ’s law enforcement components.

Additional savings and efficiencies were identified in the areas of information

technology, space requirements, overhead, administration, and operations. For ex-

ample, the IT offset represents savings that will be developed through greater inter-

component collaboration in IT contracting; funds will be redirected to support DOJ’s

cyber security and IT transformation efforts and other high-priority initiatives.

CONCLUSION

In conclusion, I am keenly aware that the President and I have asked DOJ’s dedi-

cated employees to do much more with fewer resources during this period of eco-

nomic recovery. That they have done so with continued dedication to our mission

to protect the American people is truly exemplary and inspiring.

I appreciate this opportunity to tell you about our good work at the Department

of Justice, to thank you for your support to date, and to ask you to fund the impor-

tant work that lies ahead.

At this time, I would be pleased to take your questions.

Senator M

IKULSKI

. As a matter of senatorial courtesy, we’re

going to turn to Senator Shelby, who has a Banking Committee

hearing that he must join, then I’ll pick up, followed by Senator

Hutchison. We will recognize the members in order of arrival, and

we’ll follow the 5-minute rule.

Senator Shelby.

STATEMENT OF SENATOR RICHARD C

SHELBY

Senator S

HELBY

. Thank you. Thank you, Madam Chairman.

Good morning, Mr. Attorney General.

Attorney General H

OLDER

. Good morning.

TERRORIST EXPLOSIVE DEVICE ANALYTICAL CENTER AND NATIONAL

CENTER FOR EXPLOSIVES TRAINING RESEARCH

Senator S

HELBY

. Two key DOJ facilities will soon be operating

on Redstone Arsenal: The FBI’s Terrorist Explosive Device Analyt-

ical Center (TEDAC), and the ATF’s National Center for Explosives

Training Research (NCETR). These two national assets will help

law enforcement officials deal with the growing threat posed by ter-

rorists and criminal use of powerful explosives.

You and I have discussed these facilities previously, and I believe

you agreed then with me that the missions of NCETR and TEDAC

are distinct, but complementary, and that it made sense to colocate

them at Redstone, where there’s a lot of property, a lot of land.

For the benefit of the subcommittee, Mr. Attorney General, can

you describe how DOJ will utilize NCETR and TEDAC?

Attorney General H

OLDER

. TEDAC, run chiefly by the FBI, deals

with the examination of improvised explosive devices (IEDs), that

we see coming out of Afghanistan and other places. NCETR, by

contrast, run by the ATF, deals with other, more common explosive

devices.

Senator S

HELBY

. More prevalent maybe?

Attorney General H

OLDER

. More prevalent explosive devices that

we see. I think that you’re right, they have fundamentally different

responsibilities, but they complement one another, and the location

of them in that place makes a great deal of sense.

Senator S

HELBY

. Could you describe the value of colocating these

facilities on a large Federal arsenal, with lots of range of space?

Attorney General H

OLDER

. Yes. I think there’s a great deal of

cross-pollination, the ability to talk to one another. Although the

purposes are distinct, there are going to certainly be scientific

things, breakthroughs, perhaps, that you can exchange information

about by having people who are relatively close by. Having the two

agencies that are primarily responsible for explosives determina-

tion and prevention close by each other, even though they have dis-

tinct roles that have been pretty well delineated—it is good to have

them there and talking to one another.

Senator S

HELBY

. Also, you’re aware that the community there,

near Redstone, Huntsville, has the highest per capita Ph.D. com-

munities in science and engineering.

Attorney General H

OLDER

. There are a lot of smart people there.

That’s true.

Senator S

HELBY

. You plan to utilize that then.

Attorney General H

OLDER

. Yes. We’ll use smart people wherever

we can find them. There are a lot there. That is fair.

ACTIVATION OF ALICEVILLE FEDERAL CORRECTIONS INSTITUTE

Senator S

HELBY

. Well, I want to go to another question. People

make mistakes and pay for it, I guess.

Attorney General Holder, the Justice Department is seeking

funds this year to activate a new women’s prison in Aliceville, Ala-

bama. This prison was designated as a female-only facility, based

on input from your Department, and it cost nearly $250 million

when it was finished. Does the Department plan to activate this

soon? I know you’ve got a lot in it. The Bureau of Prisons (BOP)

said that was one of their top priorities.

Attorney General H

OLDER

. We want to activate it. It was spe-

cially designed to deal with the unique needs that female prisoners

have. We need to expand our capacity to handle female prisoners

in the Federal system. Given the fact that the facility was specially

configured for female prisoners, it would be our hope to activate it

as quickly as we can, and for the use for which it was designated.

Senator S

HELBY

. Well, you’ve got a lot in it, and it’s finished.

And I’d hope you would do that soon, because to activate it, it costs

hardly anything, compared to what it cost to build.

Attorney General H

OLDER

. No. I don’t disagree with that. The

need is clearly there for the expanding female population, unfortu-

nately, that we see in the Federal prison system.

Senator S

HELBY

. It would be a priority for you?

Attorney General H

OLDER

. Yes.

Senator S

HELBY

. In that area.

Attorney General H

OLDER

. We want to bring online as many of

these facilities we can, and this is one that, as I understand it, is

extremely close, where we’re just about ready to open it.

Senator S

HELBY

. Good. Madam Chairman, thank you very much

for taking me out of order, and I appreciate it very much.

Senator M

IKULSKI

. Mr. Attorney General, I have two questions.

I had many, but we’ll submit them for the record.

FEDERAL PRISON FUNDING

First of all, Federal prisons. As I look at the Department’s budg-

et, almost one-third of the Justice Department money is going into

Federal prisons. That amount is now at $6 billion, and it is rapidly

approaching almost what the FBI budget is, which is $8 billion.

Now, my question is: What’s going on with Federal prisons? First

of all, we want the bad guys and gals off the street. So we want

you to prosecute and incarcerate, particularly where there are peo-

ple who constitute a danger to our country or to our communities.

I don’t know if we can sustain this growth, and then I’m concerned

about once we put them in, it’s a revolving door, and we keep ex-

panding their prisons with the same people. They keep coming

back.

Could you elaborate on your Department’s needs? Are there any

recommendations you’d have to begin to contain the prison popu-

lation? Are we federalizing too many crimes? Is recidivism the

problem? Again, safe streets—but this is really an ever-increasing

part of our appropriations.

Attorney General H

OLDER

. There are a whole variety of reasons

why we see the prison population expanding. We now have about

215,000 people in the Federal system. That number goes up every

year, and it is for that reason that we consistently come back to

this subcommittee asking for additional funds for BOP.

There are a variety of reasons why you see people coming into

the system. We are good partners with our State and local counter-

parts, and we try to help them, to the extent that we can. And so,

some cases violate both Federal and State law, and if they are very

serious criminals, we bring them to the Federal system if there are

evidentiary rules or more harsh sentences that we can give to

them.

I think the point that you hit on, that we really need to focus

on, is how can we rehabilitate people so that we cut down on recidi-

vism rates? One of the things that we have talked about is the Sec-

ond Chance Act, coming up with ways in which we make available

to people re-entry possibilities, so that they have the chance of not

being recidivists, coming up with educational, vocational, drug

treatment programs while we have them in prison.

We’ve actually seen pretty good success being made by some

State systems that has been shared with me by the Pew Research

Foundation. I think we can learn a lot from them in that regard.

Senator M

IKULSKI

. Well, Mr. Attorney General, we would really

look forward to specific recommendations. We want our local and

our Federal law enforcement to prosecute and get bad people off

the street, whether they’re terrorists or whether they’re terrorizing

a neighborhood, like some of the drug dealers in some of my own

communities in Maryland.

At the same time, we don’t want our Federal prisons to be an in-

cubator for more crime, where the lessons that they learn when

they go to prison is not to commit crimes again, but how to be bet-

ter crooks. We want our prisons to teach them how to be better citi-

zens, and then to come back to a community support system where

they don’t fall back into the behavior that got them.

So, I’m concerned that our Federal prisons are such that we need

to really look and evaluate, and learn some of these lessons. So, we

want to work with you. I know you feel that way. You’re very expe-

rienced in street crime, which takes me to the other point.

COMMUNITY ORIENTED POLICING SERVICE GRANTS

Ultimately, you’ve done this fantastic job of fighting terrorism,

keeping America safe. It’s been stunning what our national secu-

rity services have accomplished, both military and civilian. Again,

I’ll come back to streets and neighborhoods. You know, we have

communities that face crime every single day. And we talk to our

local law enforcement, our local prosecutors’ offices, and so on.

They feel they’re under the gun. They need Byrne grants, they

need Cops on the Beat, and so on.

Do you feel that this is sufficient funding? In fiscal year 2010,

we had $3.7 billion that went into State and local grants. Due to

acts of the Congress and so on, now, we’re down to $2 billion. Yet,

everywhere I go in Maryland, from our local police commissioners

to local district attorneys, or States’ attorneys, as they’re called in

my State, people say we need those Justice Department grants.

They give us better technology. They give us tools to deal with vio-

lence against women. They express gratitude for the lethal index.

They need you. They love having you as a partner.

Do we have enough money in the right places to do the job to

protect our communities?

Attorney General H

OLDER

. We have in the budget request $2.04

billion for State and local assistance programs; $1.4 billion for Of-

fice of Justice Programs (OJP); about $290 million for COPS; and

$412 million for the Office on Violence Against Women (OVW).

This is the level that’s about equal to the level we requested last

year. It is lower than numbers that you had said. But, I think that

given the budget realities that we face, the amount that we have

requested is strong on law enforcement. It’s strong for science. It’s

strong for victims.

Would I like to have more money? Yes, but the budget realities

that we confront, and the need to stay within a budget in the exec-

utive branch have gotten us to this point. I think that through the

provision of this money, through the technical assistance that we

can also provide to our State and local partners, we can do the job.

I met with the National Association of Attorneys General just

this week, and I think the partnership that we have is an unprece-

dented one. I think that the combination of that partnership, the

sensitivity that we have to their needs, and the $2 billion that we

are seeking here will allow us to be good partners.

Senator M

IKULSKI

. Well, we have many questions. So, I’m going

to turn to Senator Hutchison.

What I would find very helpful is two things. One, if you look at

your Byrne grants, Cops on the Beat, and so on, what was the

amount of money requested by State and local people to apply for

those grants, and what could you fund?

Attorney General H

OLDER

. Yes. I mean the request—oh. Sorry.

Senator M

IKULSKI

. No. My time’s up. So I’d like that for the

record.

[The information follows:]

UNDS

EQUESTED BY

TATE AND

OCAL

RGANIZATIONS FOR

YRNE

RANTS

COMMUNITY ORIENTED POLICING SERVICE OFFICE

In 2011, the Community Oriented Policing Service (COPS) office made 238 awards

to fund 1,021 law enforcement officer positions, totaling $243,398,709. The total

amount requested was $2,067,924,397 from 2,712 law enforcement agencies.

OFFICE OF JUSTICE PROGRAMS

Because individual Byrne Justice Assistance Grant (JAG) program awards are de-

termined and limited by a specific, statutorily driven crime and population formula,

States, local governments, and tribes cannot request more than the total amount

available in any fiscal year. Because of this, it is not possible to determine what

the unmet need was in fiscal year 2011 under the JAG program. In fiscal year 2011,

there were a total of 56 States and territories and 1,348 local jurisdictions eligible

for JAG funds, with a total of $365.9 million available in prescribed amounts. Of

the local governments eligible for a direct JAG award, all but 127 applied for their

funding allocation. Of the 127 that did not apply for their eligible funding, 120 of

these jurisdictions would have received an award of between $10,000 and $25,000.

As a result of these failures to apply, $1,949,103 in Byrne JAG funding was not

awarded in fiscal year 2011.

However, in fiscal year 2011, Office of Justice Programs’ (OJP) Bureau of Justice

Assistance (BJA) released 63 funding solicitations and received 4,295 funding appli-

cations requesting a total of $3,793,937,608 in Federal funding from BJA. BJA had

sufficient appropriations to meet 19.32 percent of this requested total, funding 51.66

percent of all applications submitted. These figures do not include unmet demand

from programs such as the State Criminal Alien Apprehension Program and the

Bulletproof Vest Partnership, which had additional unmet funding requests.

DUPLICATION OF SERVICES

Improving the effectiveness and efficiency of Federal programs is a critical pri-

ority of the administration and the Department. The Department is committed to

continuing efforts to prevent unnecessary duplication, streamline through ap-

proaches such as the consolidation of grant programs, and identify effective pro-

grams using evidence-based methods.

Department of Justice (DOJ) grantmaking agencies closely collaborate on the de-

velopment and implementation of grant programs to avoid the types of potential

problems cited by the Government Accountability Office (GAO). Managers from OJP

and its bureaus, COPS office, and the Office of Violence Against Women (OVW)

often meet to coordinate programs and objectives. The following selected examples

are illustrative of the Department’s commitment to work collaboratively among its

own components as well as Federal Government-wide to improve government per-

formance and effectively target the public safety needs of our communities.

—In January 2011, I convened the first meeting of the Federal Interagency Re-

entry Council. The council is addressing short-term and long-term goals on pris-

oner re-entry through enhanced communication, coordination, and collaboration

across Federal agencies. OJP is leading a parallel staff-level effort, which in-

cludes 35 people from 17 different Federal agencies—including the Departments

of Health and Human Services (HHS), Housing and Urban Development (HUD),

Labor, Education (ED), Veterans Affairs, Agriculture, and the Social Security

Administration, and others.

—OJP is also spearheading the National Forum on Youth Violence Prevention,

which is an effort launched—at the direction of the White House—by DOJ and

ED, to directly and locally address the needs of communities that continue to

experience high levels of youth violence. Using comprehensive technical assist-

ance, the Forum enables Federal agencies to serve as catalysts for broad-based

positive change at the local level in a very efficient, cost-effective manner.

—All of DOJ’s components and leaders are working together to provide the most

efficient and timely information to tribal communities. As cited in the GAO re-

port, beginning in fiscal year 2010, the Department created the Coordinated

Tribal Assistance Solicitation (CTAS), which consolidates most of the Depart-

ment’s tribal government-specific criminal justice assistance programs adminis-

tered by OJP, OVW, and COPS under one solicitation. Through CTAS, tribes

can apply for funding for many of their criminal justice needs with one applica-

tion.

—The Tribal Law and Order Act enacted in July, 2010, contained amendments

to multiple laws with an impact across DOJ activities in Indian country, in-

cluding a number of OJP programs. The CTAS collaborative experience read-

ied us for statutorily mandated coordination required for law enforcement,

training, increased grants authority, and crime data analysis and reporting.

—We are also partnering with other Federal agencies to conduct inventories of

Federal resources, develop interagency memorandums of agreement, and

long-term comprehensive plans to improve our performance, eliminate dupli-

cation, and identify gaps to better serve tribal governments and their commu-

nities, in consultation with tribes.

—The Defending Childhood Initiative is being coordinated across OJP, COPS,

OVW, the U.S. Attorneys offices, as well as other components within the De-

partment and the Federal Government.

The Neighborhood Revitalization Initiative—which is a White House-led inter-

agency collaboration—is executing place-based strategies to engage and support

local communities in developing and obtaining the tools they need to revitalize their

own neighborhoods of concentrated poverty.

The Federal Government already directs significant resources to these neighbor-

hoods, but we can always look for additional ways to continue to support them. Bet-

ter alignment of Federal programs will help local leaders to use Federal funds more

effectively, making our taxpayer dollars go further.

Additionally, the Department is working as a whole to coordinate and improve our

grants management efforts. There is a DOJ-wide Grants Management Challenges

Workgroup, comprised of grants officials from COPS office, OJP, and OVW, that

meets to share information and develop consistent practices and procedures in a

wide variety of grant administration and management areas. In fiscal year 2011, the

working group successfully implemented the DOJ-wide high-risk grantee designa-

tion program and a DOJ-wide, on-line financial training tool for DOJ grantees.

Through our Byrne Criminal Justice Innovation program, OJP and the Depart-

ment will strengthen partnerships with HUD, ED, HHS, and the Department of the

Treasury in distressed neighborhoods to implement effective strategies to address

persistently high violent crime, gang activity, and illegal drugs.

As mentioned, the Department is equally committed to consolidating grant pro-

grams as appropriate. The fiscal year 2013 budget re-proposes a consolidation that

was also included in the fiscal year 2012 budget but not adopted, the consolidation

(Problem Solving Justice) and expansion of funding for Drug Courts and the Men-

tally Ill Offender Act Program. The fiscal year 2013 budget also proposes the cre-

ation of a 7-percent tribal grant set aside to address the needs of Indian country,

rather than several separate programs.

As resources have become tighter, we are working smarter by promoting evidence-

based approaches and developing and spreading knowledge about what works and

what causes crime and delinquency. Evidence-based knowledge is critical to help

policymakers at the Federal, States, and local levels know what to fund, but per-

haps more importantly right now, what not to fund. For example, OJP has devel-

oped tools such as CrimeSolutions.gov and the Diagnostic Center, which help juris-

dictions focus on evidence-based ‘‘smart on crime’’ approaches to maximize resources

and improve public safety results.

Senator M

IKULSKI

. The second thing is: The GAO report raises

issues related to duplication of services, and I’d like to have your

reaction to the GAO report on how we can streamline, get more ef-

ficiencies. I think you’re already on that road.

But let me turn to Senator Hutchison.

STEVENS

CASE

Senator H

UTCHISON

. Thank you, Madam Chairman. Mr. Attor-

ney General, we will have questions for the record, but I wanted

to pursue this public integrity unit’s misconduct against Senator

Stevens.

After you moved to dismiss the case, the court appointed counsel

to investigate the botched prosecution of Senator Stevens, and

found that the prosecutors engaged in systematic concealment of

evidence, but they were not guilty of criminal contempt. And ac-

cording to the summary that was put out in the public, the full re-

port coming later, the court said, ‘‘Despite findings of widespread,

and at times, intentional misconduct, the special counsel, Mr.

Schuelke, recommended against contempt charges, because pros-

ecutors did not disobey a clear and equivocal order by the judge,

as required under law.’’

Now, Judge Sullivan said, ‘‘Upon review of the docket and pro-

ceedings in the Stevens case, Mr. Schuelke concludes no such order

existed in this case. Rather, the court accepted the repeated rep-

resentations of the subject prosecutors that they were familiar with

their discovery obligations, were complying with those obligations,

and were proceeding in good faith.’’

My question to you is: Does it concern you that the only reason

these prosecutors escaped criminal charges is that the judge in the

Stevens case didn’t file an order specifically telling the prosecutors

that they should follow the law?

Attorney General H

OLDER

. We have to take into account a vari-

ety of things. When I was made aware of the issues that led to the

inquiry that Judge Sullivan ordered, I made sure I ordered that the

case be dismissed.

Senator H

UTCHISON

. Dismissed.

Attorney General H

OLDER

. I also ordered that an Office of Profes-

sional Responsibility (OPR) report be done as an internal DOJ re-

port, which has now been completed. It is now in its final stages

of being worked through.

Senator H

UTCHISON

. Will it be made public, Mr. Attorney Gen-

eral?

Attorney General H

OLDER

. I’m hoping that we can. There are pri-

vacy interests that we have to deal with, but my hope is to get that

report, or as much of the report, made public as we possibly can.

It is an exhaustive study. It is hundreds of pages long. I think the

people at OPR have done a good job, and there are recommenda-

tions with regard to sanctions that ought to be made. I’m hoping

that we will make that available.

Senator H

UTCHISON

. I’m going to request that you do.

Attorney General H

OLDER

. Okay. I’m not really at liberty to dis-

cuss the report that Mr. Schuelke did. We’ve gotten a limited num-

ber of those reports in the Justice Department, 10 or 15 of them,

and we’re under orders by the judge not to discuss those. I’ve had

a chance to review, certainly, the summary and portions of it, and

some of the findings that are made there are disturbing. They were

disturbing when I made the decision to dismiss the case.

We have done a lot since that time to come up with ways in

which we try to prevent those kinds of mistakes from happening

again. We have an extensive training program. We have hired

somebody who is responsible as a coordinator to make sure that

discovery is handled properly in criminal cases and civil cases that

the Justice Department is involved in, so we don’t fall back into

those same kinds of errors. I have spoken to members of the judici-

ary. All to make sure that what happened in the case involving

Senator Stevens is not replicated. I would urge everybody to under-

stand that this Justice Department, this Attorney General, when

we made that determination that mistakes occurred, took the ex-

traordinary step of dismissing that case.

Senator H

UTCHISON

. Which I give you full credit for.

PROSECUTORS IN

STEVENS

CASE

Now, let me ask you: Four of the six prosecutors, according to re-

ports, who were investigated, opposed releasing the report, and

their names have been redacted. I want to ask you if any of these

prosecutors are still in the Justice Department system.

Attorney General H

OLDER

. I have to check that, just to make

sure, but I believe all of the prosecutors who were involved in that

case are still in the Department. I believe that’s true. I’m not to-

tally sure of that.

Senator H

UTCHISON

. Does that trouble you, that there would be

findings of misconduct in such a sensitive area that you would not

let them go outside of our justice system?

Attorney General H

OLDER

. It depends on the nature of the mis-

conduct, what it is that they did, the mistakes that were made. I

think one has to look at the Schuelke report that is about to be re-

leased, combined with the OPR report and the recommendations

for sanctions that are contained in that OPR report, to look at what

exactly should happen to these people. Was the incident an isolated

one? How serious was it? What is the nature of their contribution?

Senator H

UTCHISON

. Are you going to do that, Mr. Attorney Gen-

eral? Are you going to make a decision regarding people who have

clearly exhibited that they do not have the integrity to prosecute

in this sensitive area? Will you tell the subcommittee what your ac-

tions are when you have made that determination?

Attorney General H

OLDER

. I don’t think there was any Privacy

Act interest that prevents us from sharing with this subcommittee

what actions we have ultimately decided to take against those peo-

ple who are found to have been culpable.

Senator H

UTCHISON

. Well, I ask that you report that to the sub-

committee. Thank you, Madam Chairman.

Senator M

IKULSKI

. Senator Brown.

STATEMENT OF SENATOR SHERROD BROWN

Senator B

ROWN

. Thank you, Madam Chair, and thank you, At-

torney General Holder, for your service.

RESIDENTIAL MORTGAGE

BACKED SECURITIES WORKING GROUP

You established the new RMBS Working Group. Thank you for

that. I want to talk a moment about that. But, last week, Phil

Angelides, from Senator Feinstein’s State, former chair of the Fi-

nancial Crisis Inquiry Commission, observed that the number of

lawyers, some 55 lawyers, investigators, and other staff of the

working group I just mentioned, that is far fewer than the 100 law

enforcement professionals dedicated to the Dallas bank fraud task

force during the savings and loan era.

Mr. Angelides also suggested the Congress should extend the

statute of limitations for financial institutions fraud from 5 years

to 10 years, as the Congress did in 1989, when it passed the Fed-

eral Institutions Reform Recovery Enforcement Act after the sav-

ings and loan crisis. And you, of course, are aware of the public

sentiment of anxiety, frustration, outrage—pick your noun—toward

the fact that so few people have been prosecuted.

Talk to me about the working group, the dollars you’re dedi-

cating of the $55 million increase you’re asking for. Is it going to

go into the RMBS Working Group? And comment, if you would, on

Mr. Angelides’ recommendation that the statute of limitations,

similarly 20 years ago on a, if not a similar scandal, surely a scan-

dal, when it was lengthened to 10 years by the Congress then, if

that’s something we should do.

Attorney General H

OLDER

. I would say, first off, that this whole

mortgage fraud scandal that we are dealing with is something that

we have taken extremely seriously. We brought charges against

about 2,100 people last year, all over the course of the last few

years, in connection with the mortgage problem. You mentioned

there are 55 Federal personnel to go to the RMBS task force—

that’s the Federal component. One of the things that I think is

unique about that is that we’re working with our State and local

partners, and, in particular, State attorneys general. So, the num-

ber of people who will be ultimately devoted to that task force will

be substantially greater than that.

I suspect we will also be adding people from various U.S. Attor-

neys’ offices around the country. I think we’re looking at four or

five that will be intimately involved in this, so that number will ul-

timately go up. We’re going to have adequate resources, in terms

of the numbers of people, to do the job that we need to do with re-

gard to the RMBS Working Group.

With regard to the extension of the statute of limitations, that

is something that I’d be more than glad to discuss with the mem-

bers of this subcommittee after I’ve had a chance to speak with the

prosecutors on the ground, to see if, in fact, that is something that

we need. We want to use all the tools that we have, and also con-

sider any possibilities that we might want to acquire, so that we

can hold accountable the people and institutions who really had a

devastating impact on our Nation’s economy, and continue to have

a lingering effect on our Nation’s economy and, in particular, the

housing market, which drags down the recovery.

Senator B

ROWN

. Okay. Thank you for that. And we will be fol-

lowing up with your office on the wisdom, hearing from your pros-

ecutors that might be in the middle of initiating these cases or in

the middle of these cases, about the importance of that extra 5

years of the statute of limitations.

OIL AND GAS PRICE FRAUD WORKING GROUP

Let me talk for a moment about gas prices. You know, oil prices

are more than $100 per barrel. The Department of Energy and the

Commodity Futures Trading Commission have told us inventories

of oil are sufficient. Domestic production is up. We hear that. The

number of rigs has grown. The consumption is down. All reasons

that gas prices should not be going up, understanding that the tur-

moil in the Middle East and the discussion of Iran.

Some analysts have estimated speculation may be adding 50

cents to the price per gallon of gas. It’s my understanding over the

last year, DOJ organized the Oil and Gas Price Fraud Working

Group to determine the role speculators and potential price manip-

ulation are having on the price of gasoline.

What have you found? What are your next steps? What can we

expect?

Attorney General H

OLDER

. That working group continues to be

in effect. In fact, they’re having a call today to discuss the situation

in which we find ourselves with regard to these rising gas prices.

That working group, itself, will be meeting before the end of this

week. The work of that group has been ongoing and looking to see

if there are inappropriate manipulations of the market.

The Federal Trade Commission (FTC) is also working in this

area. I don’t want to speak for them, but I understand they’re

working on a report of some sort that we should be seeing rel-

atively soon. That is, again, the FTC working independently of us.

But within the Department, that Oil and Gas Price Fraud Working

Group has been active, and as I said, has a call today and a meet-

ing that will happen, I think, by tomorrow.

Senator B

ROWN

. Okay. I would like to request that after the

phone call, and after the meeting today or tomorrow, that task

force brief me and other members of the subcommittee who have

expressed interest.

Attorney General H

OLDER

. All right. To the extent we can, we

will certainly do that.

Senator B

ROWN

. Thank you.

Senator M

IKULSKI

. All right. Mr. Attorney General, we really

would like to see that. This is very, very, very important.

We would now like to turn to Senator Murkowski.

STATEMENT OF SENATOR LISA MURKOWSKI

Senator M

URKOWSKI

. Thank you, Madam Chairman, and Mr. At-

torney General. Welcome this morning.

STEVENS

CASE

I want to follow onto Senator Hutchison’s questions regarding

the prosecution of Senator Ted Stevens. I think so many of us were

absolutely shocked. I was horrified, as a friend, and as an Alaskan,

to read Judge Sullivan’s comments that this ill-gotten verdict not

only resulted in the loss of Senator Stevens losing his seat, but in

his words, tipped the balance of power in the U.S. Senate. Pretty

powerful, in terms of what DOJ did to a great man.

I appreciate, and I recognize, and I thank you for your actions

in dismissing that case, and in your decision to not attempt to

retry, and I join Senator Hutchison with that. But, there are ques-

tions that still remain. You know that. I have a long series of them,

and what I would like to do is submit them to you today, and ask

that you respond to them prior to the release of the report, which

is due to come out next Wednesday, the 15th of March. So, I would

appreciate your attention to that.

ATTORNEY

’

S FEES FOR PROSECUTORS IN

STEVENS

CASE

I have a question regarding what is happening now with the re-

lease of this report. The USA Today reported that DOJ has spent

$1.8 million in defending prosecutors from allegations that they

broke the law in the Stevens prosecution. And Senator Grassley

was one who mentioned that it seems like this is an unseemingly

high amount of money being spent by the taxpayers to defend what

appears to be egregious misconduct. And, again, Senator Hutchison

has noted the words that Judge Sullivan used in his order, saying

that the report demonstrated significant widespread, and at times,

intentional misconduct by the prosecutors.

Now, I understand that the $1.8 million went for attorney’s fees

to defend the actions of the Justice Department prosecutors who

were under investigation for contempt by the counsel appointed by

Judge Sullivan. The report of that counsel, again, is due to be re-

leased on the 15th. In addition to spending taxpayer money to de-

fend your attorneys, did the taxpayers also pay for the attorneys

to argue that the contents of this report should not be publicly re-

leased? You have stated that this is a matter that has risen to a

level of public attention. So, if you can answer that question for

me, and also whether the Justice Department supports the merits

of the appeal that has been raised by Mr. Edward Sullivan, who

is one of the prosecutors who has asked the U.S. Court of Appeals

for an emergency stay to prevent the release of this report next

week.

So, the question is whether you support the merits of that ap-

peal, and, again, whether or not the taxpayers are on the hook to

pay for his attorneys to argue that this report should be kept from

the public.

Attorney General H

OLDER

. I don’t think we take any position

with regard to what he has said about his desire to keep the report

sealed. The Justice Department has indicated that we do not object

to the release of the report. I think that given the issues that we

found there, the magnitude of the case, and, frankly, the mag-

nitude of the errors that led me to decide to dismiss the case, that

there is a legitimate public interest in knowing as much as we can

about what happened, why it happened, what steps the Justice De-

partment has taken in connection with these findings of mis-

conduct.

Senator M

URKOWSKI

. So is the Justice Department paying for his

attorneys’ fees in this matter, to keep this from being made public?

Attorney General H

OLDER

. I don’t know about him, specifically,

but I do know that as a result of the charges that were brought

against them, the determination was made that there would be a

conflict of interest for the Justice Department to defend them,

which would be typically how we would do it, and they were, there-

fore, allowed to get outside counsel. Under the regulations, the Jus-

tice Department then pays for those legal representations, which

has happened in a variety of cases, a variety of circumstances,

former attorneys general and lawyers who have been reimbursed

by the Government. I’m hoping I won’t have to do that, but other

attorneys general have done that.

Senator M

URKOWSKI

. So, even now that the independent counsel

that Judge Sullivan had appointed, even though that counsel has

found that members of the Stevens prosecution had engaged in sig-

nificant, widespread and, at times, intentional, and again, inten-

tional misconduct, does the Government have any recourse to re-

cover the funds that have been paid for their attorneys’ fees, when

they have engaged in intentional misconduct?

Now, you mentioned in your comments to Senator Hutchison

that after the OPR report, that there may be sanctions that we will

see, but is there recourse? Are you pursuing any recourse? It seems

to me that in an instance like this, where it has been made clear

that the conduct was intentional, that it was substantial, and it

was widespread, that we should not be defending and paying for

the attorneys’ fees to again allow these individuals to conduct such

acts, and then to learn that they’re still within DOJ doesn’t give

me much confidence.

Attorney General H

OLDER

. Certainly, one of the things that hap-

pens is that because the Justice Department can’t represent these

people, and they have their own views of what happened, they

want to be able to explain, with counsel, defend themselves. That

is why the expenditure of money actually occurred. That is why

they are allowed to get outside counsel. As I said, that has hap-

pened, not frequently, but it certainly happened in the past, and

we acted with regard to them as we have done in the past with re-

gard to the retention of outside counsel.

Senator M

URKOWSKI

. I would think that $1.8 million to go to de-

fend these attorneys, who have engaged in intentional misconduct,

is just stunning to me. I’d like to think that there could be some

recourse.

Madam Chairman, I’m well over my time. I thank you for your

indulgence.

Senator M

IKULSKI

. It was important that you had the oppor-

tunity to completely pursue your line of questioning. The situation

that has been presented by you and Senator Hutchison, reminding

the subcommittee, is deeply troubling. We must have public integ-

rity. We also must have an independent judiciary. We have to

have, regardless of which party is in the White House, a Justice

Department that we believe in, and that the American people be-

lieve in. So, I know the Attorney General will be responsive, and

then we’ll take it from there.

Senator M

URKOWSKI

. Madam Chairman, I just want to thank

you for those comments, and agree wholeheartedly. And I do think

the Attorney General took a major first step, when he dismissed

the case. That was huge. But, now we must followup, so that there

is no question that the people who did this, and the report will

show whatever it shows, that they’re not able to prosecute ever

again. Ever.

Senator M

IKULSKI

. Thank you.

Senator M

URKOWSKI

. Thank you.

Senator M

IKULSKI

. Senator Pryor.

STATEMENT OF SENATOR MARK PRYOR

Senator P

RYOR

. Thank you, Madam Chair, and Attorney General,

welcome to the subcommittee. Thank you for being here.

PRISON OVERCROWDING

I want to add my voice to something that was said earlier about

prison overcrowding. And I could go through the facts and figures

on that, but you know those better than any of us do. It is just a

real concern.

One of the prisons that’s on the short list is actually in Arkansas,

and back in fiscal year 2010, it was scheduled to be funded in fiscal

year 2014. Well, now, it keeps getting pushed back. Now, it’s fiscal

year 2018. So, it’s an example of us not being able to fund some

of the real needs that we have. I know I’m not alone in that. So,

I want to voice my concern there.

SEQUESTRATION

Let me ask about sequestration. I don’t believe anyone’s had a

chance to ask about sequestration. And I’m curious about what the

Justice Department perceives will happen to DOJ funding if se-

questration does, in fact, take place, and what steps you’re taking

to address that.

Attorney General H

OLDER

. I certainly hope that’s something that

we don’t have to face. As I look at it, we’d be looking at an across-

the-board cut of about 7.8 percent, which would mean a cut of

about $2.1 billion. No Justice component would be exempt from

those cuts. And from an operational perspective, we would have to

cut personnel funding and nonpersonnel funding.

We are estimating that we’d have to furlough all position types,

including agents, Federal agents, FBI agents, DEA agents, ATF

agents, and attorneys, who try cases, investigate cases, for an aver-

age of about 25 days. We would have to lose permanently a pretty

substantial number of jobs. This across-the-board cut would have

a devastating impact on the Justice Department’s ability to protect

the American people, to do investigations. It would be something

that would just simply be devastating. My hope would be that the

Congress will find a way to avoid this sequestration, which, just

from my own parochial interests, which I think actually are the

Nation’s as well, to really avoid the very negative consequences

that could have a permanent impact on our well-being.

Senator P

RYOR

. And so, you’ve mentioned these furloughs, but I

assume, also, you’d have to suspend the funding of many of your

programs that help local and State law enforcement agencies.

Attorney General H

OLDER

. That’s an excellent point. The con-

sequences are not restricted to simply what happens to the Justice

Department here in Washington and in our field offices. Our ability

to be good State and local partners would certainly be impacted by

the reduced amounts of money that we’d be able to share with our

State and local partners, in terms of grants, Cops on the Beat. It

would be a devastating thing for this to happen.

THE JOHN R

JUSTICE PROGRAM

Senator P

RYOR

. And let me ask about personnel in a little dif-

ferent context. The John R. Justice Program has about 1,600 pros-

ecutors and about 1,200 public defenders in the last fiscal year that

received assistance under that program, to help them pay off their

student loans, et cetera. But, this budget, as I understand it, does

not have funding for that program this year. So, my concern there

would be that we want the best and the brightest out there trying

cases on both sides. Again, this is public defenders and prosecutors.

And in our criminal justice system, it’s critical that we have good

representation on both sides. And I’m afraid that we’re going to

lose a lot of talent if we don’t have a program like this. Do you

share that concern, and what steps you think we can take to keep

the best and the brightest coming on board?

Attorney General H

OLDER

. I do share that concern. We want the

best and the brightest to come and take what are low-paying jobs

on the prosecution side, on the defense side. These kids come out

of law school with enormous amounts of debt. And I don’t want

them to make career choices based on how they’re going to repay

those loans, as opposed to following their passions, and taking their

great skills to become members of the Justice Department, State

and local prosecutors offices, or on the other side, to be good de-

fense attorneys. And that is one of the things that I’m concerned

about.

We have a tough budget, and you’re right, the money is not

there, to the extent that it was in the past. To the extent that we

can work on ways in which we come up with creative things to do

to make sure that those career decisions, especially those first job

career decisions, by people coming out of law school, are not a func-

tion of their financial concerns, but really is a function of how they

want to help build a better society.

Senator P

RYOR

. Thank you.

CYBERSECURITY

And Madam Chair, I don’t really have time to ask another ques-

tion, but I would like to just make an observation. The chair of the

subcommittee here yesterday took a leadership role in a cybersecu-

rity exercise in a classified setting, and we appreciate her leader-

ship in getting all of us to go and participate. It was very inform-

ative, very interesting. And I know that DOJ has been very in-

volved in what’s going on with Federal Government cybersecurity

issues, and all the task forces and everything you’re working on.

But, I also hope that you will not neglect the private sector, as well

as the State and local governments, because they have a role to

play in this as well.

Attorney General H

OLDER

. That’s exactly right. This is not some-

thing that the Federal Government can handle by itself. This is a

national security issue, certainly, but it’s also an infrastructure

issue which involves our State and local partners. Then one looks

at just the amount of theft that occurs, intellectual property theft,

in particular, so that the private sector has to be involved as well.

We have to come up with mechanisms, means by which all of

those various components talk to one another, if we ultimately

want to be successful in what I think is the most pressing thing

that we’re going to be facing in the coming years.

Senator P

RYOR

. Thank you. Thank you.

Senator M

IKULSKI

. Thank you, Mr. Attorney General. I want to

go back to the excellent question Senator Pryor raised about the

impact of sequester. Could we have that answer in more detail, in

writing, so that everybody would have a chance to study it, and go

over it in programs and so we can really grasp the full con-

sequences?

Attorney General H

OLDER

. Yes.

[The information follows:]

MPACT OF

EQUESTRATION

The Department of Justice’s (DOJ) supports the fiscal year 2013 President’s budg-

et request, which would avoid a sequestration, if enacted as proposed. Therefore, I

am not describing the impact of a potential sequester, which the administration is

committed to avoiding. However, I can describe the impact of an across-the-board

cut of 7.8 percent, or more than $2.1 billion, to DOJ’s budget authority. To imple-

ment this cut, DOJ would have to cut both personnel and operational funding. Per-

sonnel cuts would require DOJ to implement a hard hiring freeze, which would

mean losing 4,800 positions, and furloughing all DOJ employees for 25 days. These

personnel cuts, along with significant operational cuts, would mean reductions in

the apprehension of violent fugitives, fewer Federal Bureau of Investigation (FBI)

national security investigations, fewer affirmative litigation efforts, and more crowd-

ed prisons. For context, a 7.8-percent cut would mean that the Bureau of Prisons

would be cut by $510 million, FBI by $730 million, the Drug Enforcement Adminis-

tration by $175 million, the U.S. Marshals Service by $90 million, and the U.S. at-

torneys office by $150 million.

Senator M

IKULSKI

. I’d now like to turn to Senator Graham.

STATEMENT OF SENATOR LINDSEY GRAHAM

Senator G

RAHAM

. Thank you, Madam Chairman. I’d like to add

my voice to what you just echoed, and Senator Pryor, that seques-

tration, as it’s set up, would devastate DOJ, our ability to defend

ourselves, and destroy the military, and surely we can find a better

way to do it than that. So, I think you’re dead on. This is just an

ill-conceived idea of cutting money blindly, in my view.

Now, you were in South Carolina couple days ago, is that right,

Mr. Attorney General?

Attorney General H

OLDER

. It was yesterday.

Senator G

RAHAM

. Yesterday. Well, we’re glad to have you. Hope

you spent money while you were there.

Mr. H

OLDER

. I did.

NATIONAL ADVOCACY CENTER

Senator G

RAHAM

. But, the National Advocacy Center (NAC), in

Columbia, that you visited, what would you tell the subcommittee

about the NAC, in terms of being a value to the Nation?

Attorney General H

OLDER

. It is an invaluable resource for us.

Senator G

RAHAM

. Did you all hear that?

Okay. I’m sorry. Go ahead.

Attorney General H

OLDER

. No. I mean it is. It is an invaluable

resource for the training that goes on in the Justice Department.

It is one that I think could actually be expanded. I’m concerned

that we’re not interacting with our State and local partners to the

extent that we once did in doing training with them. We’re trying

to bring into the NAC people from the defense side as well. It’s

where people learn to be good trial lawyers, learn a variety of

skills, learn their ethical obligations. It’s an invaluable resource.

Senator G

RAHAM

. Well, we appreciate your visit, and it will be

a place where, you know, cybersecurity is probably the issue of the

21st century, and whether it’s a crime, an act of war, it depends,

I guess, who’s involved, but a lot of local law enforcement folks

probably have no idea how to handle this, and it would be a good

way to kind of educate the country as a whole. And the collabora-

tion between the University of South Carolina and the NAC, I ap-

preciate.

And I want the subcommittee to know that we took about 200

or 300 DOJ jobs out of Washington, because after 9/11, we were

worried about having every part of our Government in one city.

And we moved those folks down to South Carolina, in Columbia,

and you leased a building from the university. It saved about $35

million. So, I just want to applaud you for trying to be creative to

decentralize DOJ, so that in case we’re ever attacked here, we don’t

lose all of our national assets, and it was a way to save money.

Attorney General H

OLDER

. And we also have that relationship

with the university about the rule-of-law component as well. And

I think that’s been a good synergy.

Senator G

RAHAM

. To my colleagues, and I’ve been to Afghanistan

and Iraq, like many of you, and we’re trying to develop a rule-of-

law program in Iraq, Afghanistan, Africa—you name it. Without

some basic rule of law, no country can develop. And all the lessons

we’ve learned the hard way, from making mistakes, but finally get-

ting it right in many ways, we’re trying to create a center at the

University of South Carolina, where those who have been overseas

can share their thoughts about what worked, what didn’t. You

could train before you went. DOJ, Department of Agriculture, and

the Department of Defense, this is a team.

This war requires a team concept. And we’re trying to reach out

to the Islamic world and create partnerships with lawyers, and at-

torneys general, and judges in the Islamic world, so we can under-

stand them better, and they can understand us. And I’m excited

about it, and I appreciate your support.

REVAMPING THE FEDERAL CRIMINAL CODE

Now, Justice Scalia came out yesterday, or the day before, talk-

ing about, he thought it would be wise if we looked at our Federal

criminal code, particularly in the drug area, to see if we could re-

form it. And I think he’s right. I think we’ve Federalized way too

many crimes, creating work for our judiciary that could probably

be handled better at the State level. What do you think about the

idea of revamping the Federal criminal code, and looking at maybe

undoing some of the over-Federalization?

Attorney General H

OLDER

. When I came into office, I set in place

a number of working groups to look at that issue. Are we bringing

the right people into the Federal system? Are the sentences that

we have for the crimes that are Federal ones appropriate?

Senator G

RAHAM

. Like crack cocaine. We finally fixed that, but

that was just sort of an indefensible sentencing disparity.

Attorney General H

OLDER

. Right. I think the bipartisan effort

that resulted in the lowering of that ratio from 100 to about 16 to

1 was something that was long overdue, and was a great example.

People don’t focus on it, but it was an example of Republicans and

Democrats getting together and doing the right thing, not only for

the system, but it was something that I think was morally right

as well.

RECESS APPOINTMENTS

Senator G

RAHAM

. And an area where we may disagree, we’ll talk

about the law of war later, we don’t have time here, but the recess

appointments made by President Obama a while back to the Na-

tional Labor Relations Board, is there a situation similar to that

in the history of the Senate, or by a previous President, of appoint-

ing someone to a Federal agency under those circumstances, that

you’re aware of?

Attorney General H

OLDER

. If you look at the 23-page report by

the Office of Legal Counsel (OLC), they go through a variety of

precedents. They look at the laws that exist, tradition, and the con-

clusion that they reached was that given the length of the recess,

20 days, or so, that the appointments were, in fact, appropriate.

This is obviously something that the courts are going to ultimately

decide, but I think that the OLC opinion was accurately described.

Senator G

RAHAM

. I think Senator Alexander will have a discus-

sion with you about that, but I take a different view. But, I’ll let

him discuss that with you.

MILITARY COMMISSIONS

And finally, just to note, I think, maybe it was last week, we had

a plea bargain with a military commission detainee who was one

of the Khalid Sheikh Mohammed close confidantes. And I know

Mark Martins is the chief prosecutor, and you’ve got a good defense

team down there. I do support Article III courts for terrorism

trials, when appropriate. But, I just want to acknowledge your sup-

port for military commissions in appropriate circumstances, and

with your help, I think we’ve got these things up and running, and

I look forward to more action coming out of Guanta

namo Bay to get

some of these people through the legal system. So, thank you for

that support. And to all those at Guanta

namo Bay doing your job,

you’re doing the country a great service, particularly the defense

counsels.

Attorney General H

OLDER

. I think that’s right. I think that peo-

ple should understand that the revised commissions that exist, as

I said in my speech at Northwestern, have many of the elements

of due process that we consider vital to the American system. I

think we have great defense lawyers down there.

The military system doesn’t get the credit that it deserves for the

fair way in which it deals with people, and under the direction of

Mark Martins, who’s a person I’ve known for some time, I think

we’ll be proud of the work they do.

Senator M

IKULSKI

. Thank you very much, Mr. Attorney General.

We’re now going to turn to Senator Feinstein. Before Senator

Pryor leaves, I thank you and others for mentioning the cyber exer-

cise yesterday, and all who participated. Next week, we’re going to

hear from the FBI, and we’re going to do an open hearing, and

then we’re going to do a classified hearing. This will be an oppor-

tunity to ask many of your cyber questions and go into the level

of detail I think the subcommittee would like. So, thank you.

Senator Feinstein.

STATEMENT OF SENATOR DIANNE FEINSTEIN

Senator F

EINSTEIN

. Thanks very much, Madam Chairman, and

welcome, General.

I want to associate myself with the comments of Senator Mur-

kowski and Senator Hutchison. To me, the tragedy is that Senator

Ted Stevens died before he knew this was a faulty prosecution. And

that, to me, elevates this to a new height. And so, I think this in-

vestigation is really important. And I think that actions have to be

taken. And I just wanted to express that.

OIL SPECULATION

I wanted to followup on Senator Brown’s comment. It’s my un-

derstanding that there’s more oil available in the United States

than demand calls for. And as a matter of fact, surplus is being

sold outside. This, I think, would bring to special attention the

issue of speculation. And I hope the study that you’re doing is

going to take a good look at the financial marketplace, with regard

to its ability to impact price in this way.

Attorney General H

OLDER

. The Oil and Gas Price Fraud Working

Group that we formed last year as part of the President’s Financial

Fraud Enforcement Taskforce has been meeting. It just happens

that they are having a call today, and a meeting, I think either to-

morrow or on Monday. The full committee will be getting together

to look at the issues that you’ve raised and the issues that Senator

Pryor raised.

Senator F

EINSTEIN

. Good. Thank you.

FOREIGN INTELLIGENCE SURVEILLANCE ACT

As you know, title 7 of the Foreign Intelligence Surveillance Act

(FISA) expires at the end of the year. This allows for electronic sur-

veillance of targets outside the United States. Senator Mikulski

and I both serve on the Senate Intelligence Committee, and we’ve

done extensive oversight of the Government’s use of these surveil-

lance authorities, and look forward to working with you to make

sure Congress can reauthorize title 7 well before the end of 2012.

We need to maintain the collection of critical foreign intelligence

and provide certainty to intelligence professionals in that regard.

For members of this subcommittee that don’t follow this issue

closely, could you explain the need to reauthorize title 7 of FISA

and the efforts taken to protect the civil liberties and privacy of

Americans, as this title is carried out.

Attorney General H

OLDER

. The surveillance authorities that are

in the FISA Amendments Act are absolutely critical to our national

security. On a day-to-day basis, I authorize FISAs, the head of the

National Security Division does, sometimes the Deputy Attorney

General. It is a critical tool that we have in keeping the American

people safe. The administration strongly supports the reauthoriza-

tion, and as you indicated, hopes that it occurs well before the end

of the year, so that the certainty that is needed by the men and

women who are in our intelligence community will have some de-

gree of assuredness that those tools will remain there, and that our

fight against those who would do harm to the United States can

continue.

NATIONAL SECURITY

Senator F

EINSTEIN

. Thank you. I also want to thank you for your

enormous help and the help of FBI with respect to national secu-

rity. FBI now has thousands of agents and analysts located around

the United States, essentially doing intelligence work. So, that

transition has been effectively made.

Director Mueller, at a worldwide threat hearing, indicated to us

that in the past year there have been 20 arrests in the United

States of people in this country planning or participating in at-

tempted terrorist attacks. And as you mentioned in your recent tes-

timony, Umar Farouk Abdulmutallab was recently sentenced to life

in prison.

Now, I also want to say that even though its specific activities

are classified, in your written testimony, you mention the High-

Value Detainee Interrogation Group, or the HIG, as we call it. I

can say that we’ve seen the excellent intelligence the HIG is pro-

ducing. And earlier this week, also, four principle members of hack-

ing groups, Anonymous and LulzSec, were charged with computer

hacking, and a fifth member pled guilty.

NATIONAL SECURITY FUNDING

Now, to my question. It’s two-fold. I think we have to begin to

look for redundancy and duplication of effort. We now have a

counterterrorism center. We now have Homeland Security with in-

telligence, and we also now have FBI. And so I hope you will take

a look at that, because the dollars are precious, and we’re already

experiencing cuts in the intelligence budget.

So, here’s my question. What are, in the national security area,

your budget reductions? What will that mean for counterterrorism,

and are there any gaps in our efforts?

Attorney General H

OLDER

. We have adequate amounts of money

contained in the budget that we have requested. If you look at the

amount of money that has gone to FBI in the national security

sphere, since 2001 we’ve had about a 300-percent increase for the

Justice Department. For FBI, it might have been about 400 per-

cent. So, it’s a very substantial increase over the course of the last

10 years or so. Even with the flat budget that we essentially have

for the Justice Department and its components, including FBI, we

have adequate amounts of money to keep the American people safe.

I will tell you that to the extent that I feel that it is not the case,

my voice will be heard. We have no greater responsibility than

keeping the American people safe.

Senator F

EINSTEIN

. Good. Thank you very much. Thank you,

Madam Chairman.

Senator M

IKULSKI

. Senator Feinstein, we look forward to work-

ing with you on that part of it.

Senator Alexander.

STATEMENT OF SENATOR LAMAR ALEXANDER

Senator A

LEXANDER

. Thanks, Madam Chairman, and General

Holder, welcome. It’s good to see you. I was thinking about a con-

versation we had during your confirmation about Griffin Bell, for

whom you worked, and I know you admired him, and I certainly

admired him. I was a law clerk on a court when he was judge. And

one of the things he used to say and which I’ve heard you say, I

think, too, is that the attorney general is the lawyer for the United

States, not just the lawyer for the President.

RECESS APPOINTMENTS

So, in following up with Senator Graham’s comment on the so-

called recess appointments, I wanted to ask you a question. As the

lawyer for the United States, if the President calls you up and said,

‘‘General Holder, I notice that the Senate’s gone into recess for

lunch. I’ve got a Supreme Court nominee I want to appoint. Can

we put him on the court without their advice and consent?’’ what

would your answer be?

Attorney General H

OLDER

. Going to lunch? That would not be a

sufficient recess.

Senator A

LEXANDER

. Well, what if he said they’re going to recess

for lunch and for dinner, and they won’t be back until tomorrow?

Would that be a sufficient recess?

Attorney General H

OLDER

. What we’re getting at, if you look at

that OLC opinion, they would——

Senator A

LEXANDER

. I’m asking your opinion, Mr. Attorney Gen-

eral.

Attorney General H

OLDER

. Well, I associate myself with that

OLC opinion.

Senator A

LEXANDER

. Does that mean you agree with it?

Attorney General H

OLDER

. With the OLC opinion?

Senator A

LEXANDER

. Yes.

Attorney General H

OLDER

. Yes.

Senator A

LEXANDER

. You do agree with it.

Attorney General H

OLDER

. Yes.

Senator A

LEXANDER

. Then that means that the President, not

the Senate, can decide when it’s in session for purposes of advice

and consent.

Attorney General H

OLDER

. Well, one has to look at the reality,

the totality of the circumstances, in determining whether or not the

Senate is actually in session, as that term has historically been

used, and the determination made by OLC was that given the——

Senator A

LEXANDER

. Well, if we look at that, Mr. President, was

your deputy solicitor wrong when he told the Supreme Court in a

letter 2 years ago that the Senate may act to foreclose recess ap-

pointments by declining to recess for more than 2 or 3 days at a

time? And was Senator Reid wrong in 2007 when he really devised

the plan for pro forma 3-day sessions, because he said he heard

that President Bush was about to make recess appointments. And

Senator Reid said on November 16, 2007, ‘‘With the Thanksgiving

break looming, the administration has informed me they want to

make several recess appointments. As a result, I’m keeping the

Senate in pro forma to prevent recess appointments until we get

back on track.’’ And the next year he said, ‘‘We don’t need to vote

on recess. We’ll just be in pro forma session. We’ll tell the House

to do the same thing.’’ President Bush didn’t like it, but he re-

spected it.

So, are you saying that the President, not the Senate, can decide

when it’s in session for purposes of a recess appointment?

Attorney General H

OLDER

. What we have to do and what we

have done in this OLC opinion is look at history, look at precedent,

look at the law, use some common sense when it comes to the ap-

proach of whether or not the Senate is actually in session.

Senator A

LEXANDER

. Well, was Senator Reid wrong?

Attorney General H

OLDER

. The determination that we made here

was that with regard to that 20 days in which those pro forma ses-

sions were occurring, that those were, in fact——

Senator A

LEXANDER

. But the Senate had decided it was in a 3-

day session, according to the Reid formula. So, was Reid wrong

about that?

Attorney General H

OLDER

. I’d have to look at exactly what oc-

curred during that 3-day period, but given the facts that were pre-

sented to OLC in this instance, I think the determination that they

made was correct.

Senator A

LEXANDER

. So, I don’t see why the President couldn’t

look at the Senate and say, ‘‘I’m going to send up a Supreme Court

justice, and I’m going to skip advice and consent.’’ I’m astonished

by this, really. And I would think Democratic as well as Republican

Senators would honor the Reid formula that President Bush hon-

ored. The Senate did the very same thing in January, and the

President, nevertheless, made four appointments during the time

when constitutionally he shouldn’t have, according to all the prece-

dent that I’ve seen.

Attorney General H

OLDER

. The only thing I’d correct is that the

determination was not made by the President. The determination

was made by OLC, we then shared that opinion with the President,

and the President made the decision as to what he wanted to do.

Senator A

LEXANDER

. He made the decision not to respect the

Senate’s decision about when it’s in session or when it’s not, which,

to me, is a blatant lack of regard for the constitutional checks and

balances, and something that we ought to avoid.

METHAMPHETAMINE LABS

May I ask quickly a question? Last year, the Department found

money to support the work against methamphetamine, and I com-

pliment the Department for that. I know it’s getting increasingly

harder. In our State, we had the highest number of meth lab sei-

zures in the Nation. The money’s running down. The State’s in-

creasing its funding. Will the Department again be able to try to

help States that are working on this, as you were able to do last

year?

Attorney General H

OLDER

. We are certainly going to try to, as

best we can. I know one of the things that we have seen with re-

gard to the cleanup of meth sites is that there have been a number

of these container activities. I think this is right, that Tennessee

is actually a leader in that effort.

Senator A

LEXANDER

. Yes.

Attorney General H

OLDER

. There have been a number of States

that have come up with things, and instead of it costing, I don’t

know, $3,000, $4,000, $5,000 to do that, it actually comes down to

$200 or $300. The experience that we have seen there is something

that we have to extrapolate and use in other parts of the country

as well.

Senator A

LEXANDER

. Thank you, General Holder. Thank you,

Madam Chairman.

Senator M

IKULSKI

. Senator Lautenberg.

Senator L

AUTENBERG

. No. I think——

Senator M

IKULSKI

. Oh. I’m sorry. Wait. Wait. It’s a little rock-

and-roll in here today. First of all, Senator Leahy, the chair of the

Judiciary Committee, excuse me, and then Senator Lautenberg.

STATEMENT OF SENATOR PATRICK J

LEAHY

Senator L

EAHY

. Thank you, Madam Chair.

RECESS APPOINTMENT

Attorney General Holder, good to have you here. If I could just

follow-up a little bit on what my good friend from Tennessee, Sen-

ator Alexander, said on the recess appointments. There is an easy

way out of all of this. It requires a little cooperation on both sides.

And I suggested this in the Judiciary Committee, that the Presi-

dent resubmit the nominations, and the Republicans agree to have

an up or down vote, say, within 1 week or 2 weeks. The President

did this, because even though everyone knew there were more than

50 votes, which is normally what it takes to confirm somebody,

available, my friends on the other side of the aisle were blocking

having a vote.

I understand the President’s frustration, but I think the easy

way out of this is simply if the Republican leadership would agree

to an up or down vote, say, within 1 week or 2 weeks, whatever

amount of time needed for it to be, and resubmit them and have

the up or down vote. That takes care of all the problem. I just

would suggest that as an easy way out. It’s not as much fun on the

talk shows, but it helps the Government.

GRANT PROGRAM DUPLICATION

Mr. Attorney General, your Department administers many cru-

cial grant programs that help victims and law enforcement, includ-

ing ones that I’ve been very heavily involved with, the Violence

Against Women Act programs. And as you know, Senator Crapo

and I have a reauthorization bill on the COPS grants and the bul-

letproof vest partnership program. GAO has said there’s duplica-

tions and inefficiencies in some of the grant programs.

Will your Department work to make sure if there are any dupli-

cations that they be removed? Because these are good programs,

but there’s only so much money to go around.

Attorney General H

OLDER

. That’s exactly the problem that we

have. There’s limited amounts of money to go around, and we have

to make sure that there’s not duplication. Managers from OJP,

from COPS, OVW regularly meet to coordinate their programs,

their activities. I think that one thing that people should not as-

sume is that because, for example, you see the word ‘‘victim’’ in a

number of the things that we do in the Department, that nec-

essarily means that we’re duplicating efforts there. They have very

distinct responsibilities. We are working to make sure that the

money that we have is being used in an efficient and appropriate

way.

BULLETPROOF VESTS

Senator L

EAHY

. One of the things I’m very proud of for my time

here in the Senate is a bill that I wrote with then-Senator Ben

Nighthorse Campbell on bulletproof vests, so much so, that I

walked down the street in Denver, Colorado, 1 year or so ago, a po-

lice officer came up, asked if I am who I am. And I said, ‘‘Yes, I

am Senator Leahy.’’ He just tapped his chest and said, ‘‘Thank

you.’’

But, we’ve been told by GAO that there’s some funds that have

not been obligated on the bulletproof vest partnership grant pro-

gram. Law enforcement—especially in the smaller communities,

where they do not have the budget to buy the bulletproof vests,

which are $500, $600—need these funds. Can you check to make

sure these funds are obligated as quickly as possible?

Attorney General H

OLDER

. Yes. To the extent that funds were

not drawn down, we are taking steps to allow jurisdictions to use

that unused funding, and have the time period with which they

could drawdown extended, so that we can get these bulletproof

vests out to these officers.

Senator L

EAHY

. And I would reiterate what I had told you when

we chatted earlier this week, when I was in Vermont, about your

speech earlier this week in guiding drones and targeting of U.S.

citizens, I still want to see the OLC memorandum, and I would

urge you to keep working on that. I realize it’s a matter of some

debate within the administration.

Attorney General H

OLDER

. That would be true.

Senator L

EAHY

. And please keep my staff and me updated on the

progress of the review of the NYPD surveillance of Muslim Ameri-

cans.

Attorney General H

OLDER

. We will.

SAME

SEX IMMIGRATION PETITIONS

Senator L

EAHY

. And last, I wrote to you and the Secretary of

Homeland Security, Janet Napolitano, to encourage you to hold

marriage-based immigration petitions for same-sex spouses in

abeyance, in light of the administration’s decision to no longer de-

fend the constitutionality of the Defense of Marriage Act. I heard

it may be granting individual cases. I hope you will reconsider the

administration’s position.

We have a case I’ve written to you about, Frances Herbert and

Takako Uedo, who are married in Vermont lawfully. We have a

number of States where same sex marriages are legal, but then

they run up against the immigration problem. So, please review

that.

Attorney General H

OLDER

. Okay. I will look at that case, and

we’ll get back to you, Senator.

Senator L

EAHY

. Thank you. Thank you, Madam Chair.

Senator M

IKULSKI

. Those were excellent points, Senator Leahy,

and thank you very much.

Senator Lautenberg.

STATEMENT OF SENATOR FRANK R

LAUTENBERG

Senator L

AUTENBERG

. Thanks very much, Madam Chairman,

and welcome, Attorney General Holder. The job doesn’t seem to be

getting easier, and I’m not blaming you. I’m just sympathizing in

some ways.

Attorney General H

OLDER

. It’s a good observation.

VIOLENT CRIME

Senator L

AUTENBERG

. Not so much that I won’t ask for more, be-

cause we’re doing with less, and we see it in my State of New Jer-

sey, 246 gun murders in 2010; 12 percent more than the previous

year. We’ve had layoffs galore from cities that can’t afford to main-

tain their police force structure. So, when I look at the things that

we’re doing, I worry about what it is that we can do from your De-

partment and from others. What can we do to help these commu-

nities? State budget cuts have caused Newark, Camden, and other

cities in New Jersey to cut their police forces at alarming rates;

one-third of the police force in Camden, more than 100 termi-

nations of police officers in Newark.

In December, I wrote asking if you could provide Federal re-

sources to assist our ailing cities, and I am pleased, Mr. Attorney

General, to see an increase in the budget for COPS grants. Is DOJ

planning other steps that we can use to help protect New

Jerseyans from violent crime?

Attorney General H

OLDER

. We’re certainly making sure that in

terms of COPS grants we do the best that we can there. We have

a substantial amount of money in the budget. I spoke to the mayor

of Camden. I was at a reception and I saw her. We have certainly,

with regard to Camden, in 2011 made available monies to hire 14

officers, $3.79 million; 2010, 19 officers, $4.2 million. We’ll be look-

ing at that kind of unique situation again this year. We certainly

are putting into New Jersey, and in other places, task forces, so

that the DEA, the ATF, the FBI are helping to the extent that we

can, as well.

There are a variety of ways in which the Federal Government

can help, given the economic situation that many cities around the

country are facing. We want to be good partners in that way. Cam-

den is a place that deserves special attention, given the unique

problem that we see there.

Senator L

AUTENBERG

. Can I ask your view on whether or not you

think we’re doing enough between your Department, the FBI, our

State and local police people? Are we doing enough, based on what

we see with the statistics? Do you think that we’re doing enough

to say honestly that we’re protecting our people appropriately?

Attorney General H

OLDER

. We have crime rates that are at his-

toric lows, 40- and 50-year lows, and yet, I’m still troubled by the

number of police officers, for instance, who have been killed in the

line of duty in the last 2 years, where we’ve seen a 16-, 20-percent

increase there. That is something that we have to work on.

I’m concerned about the fact that although the numbers of mur-

ders are down, 67 percent of them occur by people who are using

firearms. That’s an issue that we have to deal with. Too many of

the wrong people have access to guns, and they use them in inap-

propriate ways. The targets of many of those people are law en-

forcement officers, who are sworn to protect us, and we have to do

everything that we can to try to protect them.

HIGH

CAPACITY AMMUNITION

Senator L

AUTENBERG

. Well, the wrong people or wrong laws? The

man who shot Congresswoman Giffords last year used a gun with

a high-capacity ammunition clip to kill 6 people, wound 13. It was

only when he fired all 31 rounds in his clip that people were able

to subdue him. And these high-capacity magazines were banned by

the Congress until 2004. Last year, you said that you thought that

reinstating this ban should be examined. What’s the result of that

examination?

Attorney General H

OLDER

. We’re still in the process of working

our way through that. I think there are measures that we need to

take. We need to be reasonable, understanding that there is a sec-

ond amendment right with regard to firearms, but even the dissent

in the Heller case indicated that reasonable restrictions can be

placed on the use of weapons. What this administration has tried

to do is to come up with ways in which we are respecters of the

second amendment, and yet come up with reasonable, appropriate

firearms laws that will ultimately protect the American people.

Senator L

AUTENBERG

. Madam Chairman, your indulgence for one

more question, please.

NEW YORK POLICE DEPARTMENT SURVEILLANCE

Over the past several years, the NYPD has been engaged in sur-

veillance of New Jersey’s communities and universities searching

for those who might be accused of terror; Governor Christie and

Newark Mayor Cory Booker both were apparently unaware of this

large-scale investigation. How can the law enforcement agencies

spy on another State’s residents without notifying the authorities,

the Governor, the mayor even knowing about it?

Attorney General H

OLDER

. I don’t know. We are in the process

of reviewing the letters that have come in expressing concerns

about those matters. There are various components within the Jus-

tice Department that are actively looking at these matters. I talked

to Governor Christie. Actually, I saw him at a reception a couple

days or so ago, and he expressed to me the concerns that he had.

He has now publicly expressed his concerns, as only he can. I

think, at least what I’ve read publicly, again, just what I’ve read

in the newspapers, is disturbing, and these are things that are

under review at the Justice Department.

Senator L

AUTENBERG

. Thank you, General Holder. Thank you,

Madam Chairman. I assume the record will be kept open.

ADDITIONAL COMMITTEE QUESTIONS

Senator M

IKULSKI

. The record will be kept open for questions,

and we then ask the Department to respond within 30 days. Sen-

ators may submit additional questions. We ask the Department to

respond within 30 days.

[The following questions were not asked at the hearing, but were

submitted to the Department for response subsequent to the hear-

ing:]

UESTIONS

UBMITTED BY

ENATOR

ARBARA

A. M

IKULSKI

Question. The Department’s request for State and local grants is $2 billion. This

is down from roughly $3.7 billion funded for grants in fiscal year 2010.

What is the total amount of money applied for in these competitive grant pro-

grams versus the amount actually awarded to States and localities?

Answer. In fiscal year 2011, Office of Justice Programs (OJP) received a total re-

quest of more than $7.1 billion in discretionary applications; OJP awarded more

than $850 million in discretionary funding.

In fiscal year 2011, the Office on Violence Against Women (OVW) OVW had appli-

cations totaling $1,150,510,742; OVW awarded $457,900,491 in grants. OVW’s year-

ly budget requests seek funding to support four core priorities of OVW:

—preventing violence against women;

—addressing sexual assault;

—extending our programming to underserved communities; and

—restoring and protecting economic security to victims of violence.

For fiscal year 2012, $412,500,000 was appropriated to OVW to further the De-

partment’s efforts to improve the Nation’s response to domestic violence, dating vio-

lence, sexual assault, and stalking. The fiscal year 2013 overall request for the OVW

totals $412,500,000, making the fiscal year 2013 total resource request for OVW

equal to the fiscal year 2012 enacted appropriation.

In fiscal year 2011, the Office of Community Oriented Policing Services (COPS)

received applications totaling $2,067,924,397. COPS awarded more than $313 mil-

lion in grants funding. The COPS office received $243,439,595 for the COPS Hiring

Program in appropriated funds for fiscal year 2011 and awarded $243,398,709. All

agencies were asked to cap their request at no more than 5 percent of their current

actual sworn force strength, up to a maximum of 50 officers. However, in order to

provide funding assistance to the largest number of eligible agencies, the COPS of-

fice decided to further reduce the cap from a maximum of 50 officers to 25 officers.

Had this methodology not been adopted as part of the hiring program solicitation,

the total amount that would have been requested would have been $5,354,837,329.

For fiscal year 2012, $166,000,000 was appropriated for the COPS Hiring Program.

The COPS office will make 2012 hiring awards later this summer. The fiscal year

2013 budget request includes $257,087,000 for the COPS Hiring Program.

DUPLICATION IN GOVERNMENT PROGRAMS

Question. The Government Accountability Office (GAO) recently released an up-

dated version of its 2011 report on duplicative Government programs, ‘‘Opportuni-

ties to Reduce Potential Duplication in Government Programs, Save Tax Dollars,

and Enhance Revenue’’, as well as a new 2012 version of the report. In 2011 and

2012, GAO counted Department of Justice (DOJ) programs among those that are

potentially duplicative.

Has the Attorney General conducted an assessment to better understand which

State and local grant programs overlap with one another to prevent unnecessary du-

plication, as the GAO report recommended?

Answer. Improving the effectiveness and efficiency of Federal programs is a crit-

ical priority of the administration and the Department. The Department is com-

mitted to continuing efforts to prevent unnecessary duplication, identifying overlaps

in programs, and streamlining where it would ensure more effective grant assist-

ance. The Department will initiate an assessment to better understand the extent

to which Department grant programs may overlap and identify ways to mitigate the

risks for unnecessary duplication. This assessment will be conducted by OJP’s Office

of Audit, Assessment, and Management.

Question. Has Department staff reviewed the report and conducted the analysis

of grants recommended by GAO?

Answer. The Department appreciates the work of GAO and has carefully consid-

ered the findings and recommendations presented in GAO’s report. The Department

agrees that preventing unnecessary duplication in Government programs is a crit-

ical priority. The Department’s grant agencies have significantly improved collabora-

tion and information-sharing to mitigate the risk of duplicative Federal spending.

The DOJ grantmaking agencies closely collaborate on the development and imple-

mentation of grant programs and share information with each other to improve co-

ordination prior to making awards. The Department components will continue to co-

ordinate with one another to ensure sound stewardship and management of its

grants.

Question. What independent steps have the Justice Department taken—prior to

the release of the GAO report—to identify potentially duplicative grant programs?

Answer. DOJ grantmaking agencies closely collaborate on the development and

implementation of grant programs to avoid the types of potential problems cited by

GAO. Managers from OJP and its bureaus, COPS, and OVW meet regularly to co-

ordinate their programs and objectives, and they pay particular attention to those

areas where they have complementary joint programs. Additionally, the executive

branch annual budget process provides a multi-level review of all component budg-

ets and requires programs to be modified or deleted if overlap or duplication is iden-

tified. It is important to note, however, that overlapping activities do not necessarily

signify duplication. For example, the following selected examples demonstrate the

Department’s commitment to work collaboratively among its own components as

well as Federal Governmentwide to improve performance and effectively target the

public safety needs of our communities.

—In January 2011, the first meeting of the Federal Interagency Reentry Council

convened. The council addressed short-term and long-term goals on prisoner re-

entry through enhanced communication, coordination, and collaboration across

Federal agencies.

—OJP is leading a parallel staff level effort, which includes 35 people from 17

different Federal agencies including the Departments of Health and Human

Services (HHS), Housing and Urban Development (HUD), Labor (DOL), Edu-

cation (ED), Veterans Affairs, Agriculture, and the Social Security Adminis-

tration, and others.

—OJP is also spearheading the National Forum on Youth Violence Prevention,

which is an effort launched, at the direction of the White House, by DOJ and

ED, to directly and locally address the needs of communities that continue to

experience high levels of youth violence. Using comprehensive technical assist-

ance, the Forum enables Federal agencies to serve as a catalyst for broad-based

positive change at the local level in a very efficient, cost-effective manner.

—For the first time, all of DOJ’s components and leaders are working together

to provide the most efficient and timely information to tribal communities. As

cited in the GAO report, beginning in fiscal year 2010, the Department created

the Coordinated Tribal Assistance Solicitation (CTAS), which coordinates the

applications of most of the Department’s tribal government-specific criminal jus-

tice assistance programs administered by OJP, OVW, and COPS under one so-

licitation. Through CTAS, tribes can apply for funding for many of their crimi-

nal justice needs with one application.

—The Tribal Law and Order Act enacted in July 2010, contained amendments to

multiple laws with an impact across DOJ activities in Indian country, including

a number of OJP programs. The CTAS collaborative experience readied us for

statutorily mandated coordination required for law enforcement, training, in-

creased grants authority, and crime data analysis and reporting.

—We are partnering with other Federal agencies to conduct inventories of Fed-

eral resources, develop interagency memorandums of agreement, and long-

term comprehensive plans to improve our performance, eliminate duplication,

and identify gaps to better serve tribal governments and their communities,

in consultation with tribes.

—DOJ is an active participant in the Senior Policy Operating Group (SPOG),

which coordinates Federal strategies and programs to combat human traf-

ficking. National Institute of Justice and the State Department co-chair the

SPOG Committee on Data and Research.

—The Attorney General’s Defending Childhood Initiative is being coordinated

across OJP, COPS, OVW, the U.S. Attorneys offices, as well as other compo-

nents within the Department and the Federal Government.

—The Neighborhood Revitalization Initiative, which is a White House-led inter-

agency collaboration, is executing place-based strategies to engage and support

local communities in developing and obtaining the tools they need to revitalize

their own neighborhoods of concentrated poverty.

—The Federal Government already directs significant resources to these neigh-

borhoods, but we can always look for additional ways to continue to support

them. Better alignment of Federal programs will help local leaders to use

Federal funds more effectively, making our taxpayer dollars go further.

—Through our Byrne Criminal Justice Innovation program, OJP and the Depart-

ment will strengthen partnerships with HUD, ED, HHS and the Treasury in

distressed neighborhoods to implement effective strategies to address persist-

ently high violent crime, gang activity, and illegal drugs.

—The COPS office is heavily invested in the White House initiative, Strong Cities

Strong Communities, where it provides technical assistance to the Chester,

Pennsylvania police department on issues such as crime analysis, faith-based

partners, and community-based government problem-solving.

—To further advance national discussion regarding these important topics, the

COPS office and OJP’s Bureau of Justice Assistance have convened an Officer

Safety and Wellness Group that brings together law enforcement leaders, crimi-

nal justice practitioners, Federal agencies, professional organizations, and aca-

demics to share perspectives on improving officer safety and wellness.

Additionally, the Department is working as a whole to coordinate and improve our

grants management efforts. The Associate Attorney General’s Office leads the DOJ-

wide Grants Management Challenges Workgroup. The Workgroup is comprised of

grants officials from COPS, OJP, and OVW, to share information and develop con-

sistent practices and procedures in a wide variety of grant administration and man-

agement areas. In fiscal year 2011, the working group successfully implemented the

DOJ-wide high-risk grantee designation program and a DOJ-wide, online financial

training tool for DOJ grantees.

Question. Have you met with any roadblocks in the Department’s attempts to

eliminate or consolidate potentially duplicative programs?

Answer. The Department is committed to continuing efforts to consolidate grant

programs as appropriate and use ‘‘evidence-based’’ approaches to identify programs

that work, as well as those that do not. An example of this effort is the fiscal year

2013 President’s budget proposal for the consolidation and expansion of funding for

Drug Courts and the Mentally Ill Offender Act Program. A similar proposal also was

included in the fiscal year 2012 President’s budget, but not adopted.

In fiscal year 2012, the Congress supported the Department’s budget proposal to

merge several youth-oriented programs under OVW into one single program.

We are working smarter by promoting evidence-based approaches and developing

and spreading knowledge about what works and what causes crime and delinquency

because of limited resources. Evidence-based knowledge is critical to help policy-

makers at the Federal, State, and local levels know what to fund, what not to fund.

For example, OJP has developed tools such as CrimeSolutions.gov and the Diag-

nostic Center, which help jurisdictions focus on evidence-based ‘‘smart on crime’’ ap-

proaches to maximize resources and improve public safety results.

Question. Does the Department think that the programs listed in the report are

duplicative? Why or why not? What grant programs do the Department view as du-

plicative?

Answer. In its comments to the GAO on the report, the Department expressed sig-

nificant concerns with GAO’s methodology and identified flaws in its analysis. This

flawed methodology resulted in a substantial overstatement of the number of pro-

grams that might potentially be operating in the same policy area. GAO categorized

253 solicitations into broad justice areas to identify ‘‘evidence of overlap’’ in justice

areas. This approach is oversimplified and imprecise, resulting in a large number

of solicitations in each broad category. Narrowing the justice areas would have pro-

vided for a more informative analysis of where DOJ funding is being applied. For

example, the ‘‘technology and forensics’’ category is extraordinarily and unneces-

sarily expansive. Refining this justice area—such as information sharing standards

development, criminal intelligence sharing, DNA backlog reduction, equipment and

materials testing—would have been more informative, accurate, and less mis-

leading.

Additionally, the GAO report identified 56 solicitations providing victim assist-

ance, citing these as overlapping. While some might look at DOJ and see overlap-

ping programs related to crime victims, what we actually have are programs di-

rected at providing direct assistance and counseling to victims and their families;

programs directed at training community law enforcement entities to better address

the needs of victims; academic and forensic programs directed at research on victim

issues; and statistical collections providing national data on the incidence of victim-

ization and the consequences to crime victims.

GAO did not identify actual duplication; rather it cited examples of potential du-

plication. DOJ examined the award information of these grants and found no in-

stance of grantees receiving funding to carry out the same activities. Although GAO

acknowledges DOJ’s review, the examples remain in the report to support its ‘‘find-

ings.’’ One example cited in the report as potential duplication involves the Office

of Juvenile Justice and Delinquency Prevention and COPS grants to the Georgia

Bureau of Investigation. DOJ determined that each of three grants is being used

to target different issues:

—child prostitution and potential sexual slavery issues in Georgia;

—Internet crimes against children; and

—identification of sex offenders.

A second example reports that one applicant received funding under two awards

from OVC and OVW to support child victim services through its child advocacy cen-

ter. DOJ reviewed these grants, to the Tuilpe Tribes of Washington, and determined

that the tribe sought multiple funding sources because one source did not ade-

quately cover the costs to establish the center and then carry out its activities in

subsequent years.

Further, the Department was concerned with the lack of understanding that GAO

showed related to the Department’s ‘‘leveraging’’ and sustainability funding strat-

egy. GAO concluded that DOJ’s granting agencies have awarded multiple grants to

the same communities for the same or similar purposes. Although GAO acknowl-

edges, ‘‘there may be times when Justice’s decision to fund grantees in this manner

may be warranted’’, the content and tone of the report wrongly infers that recipients

receiving related grant funding from more than one agency is wasteful or unneces-

sary. Due to limited funding, DOJ encourages grantees to use multiple funding

streams in a complementary manner to support local needs and implement com-

prehensive programs. DOJ and other agencies encourage this as a ‘‘leveraging’’ and

sustainability strategy.

Question. What steps are the Department and the administration taking—both

independently and together—to eliminate duplication, abuse, and waste in the De-

partment’s grantmaking process in response to the GAO report?

Answer. The Department has been proactive in identifying and addressing unnec-

essary duplication. During the program design and the annual budget formulation

process, the Department carries out the following actions to avoid duplication and

overlap:

—Components regularly collaborate during the budget formulation process.

—DOJ’s Justice Management Division Budget Division and senior officials review

all component budgets prior to their submission to the Office of Management

and Budget and require programs to be modified or deleted if overlap or dupli-

cation exists.

In addition, there are systems and tools in place that can be used to ascertain

if duplication of awarded funds exists. Such as:

—All three DOJ major grantmaking components (OJP, COPS, and OVW) use the

same accounting system and OJP and OVW both use the Grants Management

System (GMS). All GMS users can access detailed program information.

—OJP’s Office of the Chief Financial Officer conducts financial monitoring of

grants of all three DOJ grantmaking components (OJP, COPS, and OVW) and

identifies potential areas of overlap between programs and related funding.

—DOJ grantee audits (both single audits and Office of Inspector General grant

audits) represent an independent examination of funding at the grantee level.

Single audits, which are mandatory for grant recipients who expend more than

$500,000 in Federal funds during a fiscal year, provide the auditors with an op-

portunity to examine funding and related expenditures for all grant programs.

As it relates to existing program areas that cross components:

—OJP, COPS, and OVW regularly collaborate with other DOJ components in

areas where programs overlap to ensure that efforts are efficient and effective.

For example, the Attorney General has convened the Federal Interagency Re-

entry Council in which 18 Federal agencies participate.

—DOJ coordinates intra-agency working groups to develop and improve programs

and reduce the possibility of duplication and overlap. For example, CTAS in-

volves DOJ, OJP, COPS, and OVW in development of a single solicitation for

all DOJ grants for tribal governments.

—OJP also leads interagency coordination groups to strategically utilize each com-

ponent’s strengths and minimize duplication. For example, OJP leads the Na-

tional Forum on Youth Violence Prevention with strong participation from

COPS, OVW, and other Federal agencies such as DOL, HUD, and ED.

For grants management activities, DOJ grant components participate in the

Grants Management Challenges Working group as previously described in another

section.

The Department has tackled the challenges of grants management aggressively,

establishing policies, procedures, and internal controls to ensure sound stewardship,

strong programmatic and financial management, and effective monitoring and over-

sight of its grants and grant programs. These policies and internal control frame-

work position the Department to carry out statutory mandates and requirements

and to detect and prevent potential waste, fraud, and abuse of the billions of tax-

payer dollars the Department awards in grants each fiscal year.

The Department is dedicated to continuously improving its oversight and moni-

toring of grantees and grant programs. The Department reduces risks for fraud and

abuse by identifying high-risk and at-risk grantees and ensuring compensating con-

trols are implemented. The DOJ high-risk grantee program requires appropriate

controls to be in place to ensure that grantees with outstanding noncompliance

issues implement timely corrective actions to address the issues; a grantee’s risk

status is addressed during the grant award process; enhanced oversight and moni-

toring is provided to the grantee. The Department ensures grantees have access to

financial and grant fraud training. The OJP Office of the Chief Financial Officer

provides training to grantee participants through its Regional Financial Manage-

ment Training Seminars. These seminars cover critical topics such as subrecipient

monitoring, cost principles for allowable and unallowable costs, reporting require-

ments, grant fraud, waste, and abuse, audit requirements, and prohibition of excess

cash on hand. In December 2011, DOJ launched an on-line financial management

training tool for all DOJ grantees and grant management staff.

The Department’s Office of Inspector General works closely with the grant compo-

nents to provide training on detecting and preventing grant fraud to its grantees

and staff. For example, since fiscal year 2009, more than 600 OJP employees have

participated in grant fraud training.

FEDERAL PROGRAMS FACING CUTS

Question. Under the terms of the Budget Control Act of 2011 (Public Law 112–

25), funding for virtually all Federal programs will face an across-the-board cut in

January 2013 if the Congress fails to reduce the national debt by $1.2 trillion. Ac-

cording to CBO estimates, this would result in a cut of roughly 8 percent to pro-

grams across DOJ.

How would these cuts affect the Department?

Answer. Under the terms of the Budget Control Act of 2011 (Public Law 112–25),

virtually all Federal programs will face an across-the-board cut in January 2013 if

the Congress fails to enact legislation that would reduce the national debt by an

additional $1.2 trillion. According to CBO estimates, such an across-the-board cut

would result in a reduction of at least 7.8 percent to programs across DOJ. A 7.8-

percent reduction equates to a loss in funding of approximately $2.1 billion.

Question. Please provide a list of expected workforce furloughs, cuts to grant pro-

grams, and other reductions at DOJ if sequestration is implemented.

Answer. The Department supports the fiscal year 2013 President’s budget request,

which would avoid a sequestration, if enacted as proposed. However, the impact of

an across-the-board cut of 7.8 percent would mean a reduction of approximately $2.1

billion to the Department’s budget authority. To implement this cut, the Depart-

ment would have to cut both personnel and operational funding. While the specific

implementation of a 7.8-percent across-the-board cut cannot yet be determined, such

a cut to DOJ’s budget could result in the loss of more than 15,000 personnel, includ-

ing furloughing all DOJ employees for 25 days. These personnel cuts, along with sig-

nificant operational cuts, would mean reductions in the apprehension of violent fugi-

tives, fewer Federal Bureau of Investigation (FBI) national security investigations,

fewer affirmative litigation efforts, and more crowded prisons. For context, a 7.8-per-

cent cut would mean 5,400 fewer Federal agents and nearly 1,250 fewer attorneys

available to investigate and prosecute violent criminals, perpetrators of fraud, fugi-

tives from justice, transnational criminal organizations, and cartels and terrorists.

In addition, the Bureau of Prisons would have 2,500 fewer correctional officers to

operate prison facilities in a manner consistent with officer and inmate safety and

the Department’s grant programs would be reduced by $110 million compromising

relationships with State and local law enforcement organizations and programs crit-

ical to advancing public safety.

Question. How would these cuts affect the Department’s ability to carry out its

mission?

Answer. An across-the-board cut of 7.8 percent would jeopardize the Department’s

ability to fulfill its missions to prevent terrorism, enforce Federal law, and ensure

the fair administration of justice.

While the specific implementation of a 7.8-percent across-the-board cut cannot yet

be determined, such a cut to DOJ’s budget could mean:

—49,654 fewer immigration matters completed by immigration judges;

—5,430 fewer matters opened by the National Security Division;

—7,713 fewer cases filed by U.S. Attorneys;

—9,705 fewer investigations conducted by the FBI;

—$335 million more revenue in the pockets of drug trafficking organizations;

—79 fewer local police hires;

—300 fewer Foreign Intelligence Surveillance Act applications filed by the Na-

tional Security Division;

—$1.6 million decrease in restitutions, recoveries, and fines related to FBI white

collar crime investigations; and

—6,495 fewer bulletproof vests for State and local law enforcement personnel.

UESTIONS

UBMITTED BY

ENATOR

ATRICK

J. L

EAHY

OFFICE OF LEGAL COUNSEL MEMORANDUM

—

COUNTERTERRORISM OPERATIONS

Question. Earlier this week, you gave a speech outlining some of the legal ration-

ale for the use of lethal force against American citizens overseas in terrorism cases.

In your speech, you stated that ‘‘the executive branch regularly informs the appro-

priate Members of Congress about our counterterrorism activities, including the

legal framework, and would of course follow the same practice where lethal force

is used against United States citizens.’’ While your speech was a welcome step to-

ward more transparency about the legal rationale for these actions, it is no sub-

stitute for an independent review by the Congress of the actual legal opinion under-

pinning such actions. As Chairman of the Judiciary Committee, I have made re-

peated requests for the legal opinions upon which the administration has relied in

taking such extraordinary actions against American citizens.

Can you tell me when you will be sending me a copy of the Office of Legal Counsel

(OLC) memorandum authorizing the use of lethal force against American citizens

in counterterrorism operations, including the operation that killed Anwar al-Awlaki?

Answer. OLC regularly publishes opinions that the office determines are appro-

priate for publication. The opinion in question is currently covered by executive

privilege and therefore will not be released beyond the Department. Moreover, the

Department does not comment on any specific case or individual. However, as noted

before, the conduct and management of national security operations are core func-

tions of the executive branch, as courts have recognized throughout our history. In

order to ensure proper oversight, and in keeping with the law and our constitutional

system of checks and balances, the executive branch regularly informs the appro-

priate Members of Congress about our counterterrorism activities, including the

legal framework, and would of course follow the same practice where lethal force

is used against United States citizens.

NEW YORK CITY POLICE DEPARTMENT SURVEILLANCE PROGRAM

Question. In recent months, we have heard troubling information about the sur-

veillance operations of New York City Police Department (NYPD)—particularly tar-

geting the Muslim-American community. According to press accounts, the NYPD

has been compiling databases of information concerning Muslim Americans residing

throughout the northeast, and has used informants called ‘‘rakers’’ and ‘‘mosque

crawlers’’ to infiltrate mosques and Muslim student groups. There have also been

reports of CIA involvement in NYPD’s surveillance program. Last week, you told a

House Appropriations subcommittee that the Department of Justice (DOJ) was re-

viewing complaints it had received concerning the NYPD’s surveillance program, in

order to determine what actions should be taken by DOJ.

I would request that you keep me and my staff updated as to the progress of this

review. Can you tell me the current status of the Department’s review into these

allegations of civil rights violations by the NYPD?

Answer. At this time, the Civil Rights Division is continuing its review into alle-

gations of civil rights violations by the NYPD Surveillance Program. The Attorney

General has authority to bring litigation to address patterns or practices by law en-

forcement agencies that deprive persons of rights, privileges, or immunities secured

or protected by the Constitution or laws of the United States (42 U.S.C. 14141). This

authority has been delegated to the Civil Rights Division of DOJ and the Division

often works with the local U.S. Attorney’s office. Each allegation of misconduct is

reviewed and in a portion of cases, a formal investigation or another response is au-

thorized. Investigations typically involve site visits, hundreds of interviews, and the

review of tens of thousands of pages of documents. In addition to Division attorneys

and investigators, the Division engages experts, typically well-respected law enforce-

ment executives, to assist in the investigation. There is no way for us to provide

a general timeframe for a preliminary inquiry or a formal investigation. Timelines

for inquiries and investigations are controlled by the facts found.

Question. As the Department conducts its review of these complaints, I also ask

that you evaluate the extent of coordination between the NYPD and the Federal Bu-

reau of Investigation (FBI). I am particularly interested in whether data obtained

through NYPD surveillance methods is shared with and used by FBI in accordance

with DOJ guidelines. Will you do that?

Answer. FBI and NYPD work together on the Joint Terrorism Task Force, share

investigative information, and exchange queries for operational and tactical de-con-

fliction purposes in accordance with DOJ and FBI policies. However, FBI does not

receive NYPD surveillance information.

SAME

SEX IMMIGRATION PETITIONS

Question. On April 6, 2011, I wrote to you and the Secretary of Homeland Secu-

rity, Janet Napolitano, to encourage you to hold marriage-based immigration peti-

tions for same-sex spouses in abeyance in light of the administration’s decision to

no longer defend the constitutionality of the Defense Against Marriage Act (DOMA).

The response I received on May 17, 2011, suggested that discretion may be granted

in individual cases, but that the agencies would not exercise discretion in a categor-

ical manner. Subsequently, the Department of Homeland Security (DHS) denied the

spousal-based petition of a Vermont couple, Frances Herbert and Takako Ueda who

are lawfully married under Vermont statute. Particularly in States such as

Vermont, where same-sex marriages are legally recognized, we believe that DHS

has the legal authority to hold such cases in abeyance, and to exercise prosecutorial

discretion for those in removal proceedings. I ask that you reconsider the adminis-

tration position articulated in the May 17, 2011 letter. Will you do so?

Answer. While we cannot comment on the specific example cited, DOJ and DHS

are continuing to follow the President’s direction to enforce DOMA. Both DHS,

through U.S. Citizenship and Immigration Services and Immigration and Customs

Enforcement (ICE), and DOJ, through the Executive Office for Immigration Review,

have discretion to make individual case determinations, and have used that discre-

tion in a number of recent cases. The agencies have not, however, granted any form

of blanket relief to the entire category of cases affected by DOMA. As ICE Director

Morton described in a June 17, 2011 memorandum, ‘‘Providing Guidance on the Ex-

ercise of Prosecutorial Discretion Consistent With the Department’s Civil Immigra-

tion Priorities’’, ICE’s current enforcement priorities are aliens who pose a clear risk

to national security or to public safety and those with an egregious record of immi-

gration violations.

UESTIONS

UBMITTED BY

ENATOR

RANK

R. L

AUTENBERG

PAN AM 103 BOMBING

Question. Only one person has ever been convicted in connection with the Pan Am

103 bombing, and that person has since been released from prison. On February 28,

2012, Secretary Clinton testified that the United States ongoing investigation into

the bombing is primarily a Department of Justice (DOJ) responsibility. What

progress has been made on the investigation of the Pan Am 103 bombing?

Answer. We remain committed to pursuing justice on behalf of the victims of this

terrorist attack that took the lives of 189 Americans and many others.

We continue to seek more information, as well as access to those who might have

been involved in the planning or execution of the bombing. We have made clear—

and will continue to make clear—to the Government of Libya the great importance

of this case to the United States and our determination to bring all of those respon-

sible to justice.

The investigation into the Pan Am 103 bombing remains open, and we will con-

tinue to follow any leads that could result in evidence to support a criminal prosecu-

tion.

As this is an ongoing investigative matter, we cannot comment on specific inves-

tigative steps that are being taken.

ILLEGAL TRAFFICKING OF TOBACCO

Question. Reports from the Government Accountability Office have identified an

estimated tax loss of $5 billion a year due to the illegal trafficking of tobacco. The

tremendous profits and low criminal penalties have attracted the involvement of or-

ganized criminal and terrorist groups. The Federal Bureau of Investigation (FBI)

has primary jurisdiction on terrorism and organized crime, while the Bureau of Al-

cohol, Tobacco, Firearms and Explosives (ATF) holds primary jurisdiction on ciga-

rette trafficking. How does DOJ ensure that the FBI and ATF work together to pre-

vent illegal tobacco proceeds from financing organized crime and terrorists?

Answer. DOJ’s agencies have strong and effective working relationships with their

DOJ partners as well as other Federal, State, and local agencies and a history of

highly successful joint investigations. Supervisors in the field regularly review in-

vestigations on a case-by-case basis and involve other agencies as appropriate. For

example, recently the ATF and the FBI worked together on ‘‘Operation Secondhand

Smoke’’, an undercover investigation into a nationwide network of retailers, whole-

salers, distributors, importers, and manufacturers who were avoiding cigarette taxes

to make millions of dollars in profits.

UESTIONS

UBMITTED BY

ENATOR

AILEY

UTCHISON

DEPARTMENT OF JUSTICE

’

S PREVENTING VIOLENCE AGAINST LAW ENFORCEMENT AND

ENSURING OFFICER RESILIENCE AND SURVIVABILITY INITIATIVE TRAINING

Question. Violence against law enforcement officers is at an all-time high. Accord-

ing to National Law Enforcement Officers Memorial Fund statistics, Texas leads the

Nation with most police officers killed the in the line of duty—1,594. Ensuring the

safety of law enforcement is a top priority for all of us in this subcommittee’s bill.

During the Fort Hood shooting rampage in 2009, Department of the Army civilian

Police Sergeants Kim Munley and Mark Todd were two of the first officers to arrive

on the scene. Sergeant Munley was shot multiple times. Sergeant Todd was able to

wound and incapacitate the shooter before he could shoot Sergeant Munley again.

Both officers credited their swift and heroic actions to the active shooter training

they received through the Advanced Law Enforcement Rapid Response Training

(ALERRT) Center at Texas State University, which is a partner of the Department

of Justice’s (DOJ) Preventing Violence Against Law Enforcement and Ensuring Offi-

cer Resilience and Survivability (VALOR) Initiative. Their heroic actions show how

a small investment in training can have an impact on the safety of our Nation’s law

enforcement officers.

Can you tell us about the successes of the VALOR Initiative and DOJ’s plans to

expand this training?

Answer. More than 3,100 law enforcement professionals have received the VALOR

Initiative training, in 17 sessions across the country. We have heard from sheriffs

and police chiefs that this curriculum has been successfully used in the field. There-

fore, we plan to continue promoting, refining, and expanding its availability along

with the VALOR Initiative officer toolkit. There have been 8,100 toolkits placed in

the field and the Web site has received 2.5 million hits.

The feedback from the training has been positive from the field. Some of the feed-

back includes:

‘‘It was truly some of the best training I’ve attended in 12 years as a peace officer

here in Georgia. I truly hope and urge you to bring this training back to Georgia

for more officers to attend, I would definitely push this training for as many as my

colleagues as I could through the chain of command.’’——Cartersville, Georgia

‘‘This training was excellent, and every officer needs to take it. It’s an eye-opening

experience! Excellent training!’’——Arlington, Texas

‘‘Most relevant training ever to help prepare and heighten awareness.’’——Arling-

ton, Texas

‘‘I was involved in an incident where the training in pre-attack indicators really

helped prevent a violent struggle with a suspect.’’——San Diego, California

‘‘The training has helped me with being more vigilant and looking for pre-incident

indicators of violent attacks and armed persons. Cops become complacent as time

goes on. This type of training helps rid the complacency and reopens the eyes of

a patrol cop.’’——San Diego, California

Texas State University and its ALERRT active shooter training has been, and is,

an extremely important component of the VALOR Initiative training.

In fiscal year 2011, the Institute for Intergovernmental Research (IIR) received

an award as the Bureau of Justice Assistance’s (BJA) VALOR Initiative grantee.

IIR, through its internal awarding processes, provided a sub-award of $200,000 to

Texas State University for the delivery of 11 ALERRT Active Shooter hands-on

training sessions. In fiscal year 2012, IIR will receive its second supplemental award

for the VALOR Initiative. IIR has discussed with BJA how it intends to use the fis-

cal year 2012 funding, including awarding a second subcontract to Texas State Uni-

versity for an anticipated additional $200,000 to continue delivery of ALERRT

trainings across the country. BJA has discussed and is in agreement with the over-

all proposed work plan. IIR follows its internal subcontracting guidelines as well as

Office of Justice Programs’ (OJP) guidelines with regard to the expenditure of Fed-

eral funds and subcontracting.

Question. Is the Department able to keep up with the requests for this training?

Answer. Given existing resource constraints, it is a challenge to satisfy the high

demand of requests for this training. However, BJA is working closely with our

grantees to ensure that we are maximizing attendees at each event. To better meet

the demand, we are requesting $5 million in fiscal year 2013, an increase of $3 mil-

lion more than the fiscal year 2012 enacted level of $2 million.

Question. Last year there were 31 cases of violence against U.S. Marshal Task

Forces. Seven of these instances resulted in fatalities of Deputy U.S. Marshals or

State and local officers working on the task forces.

Is there any type of training being conducted with our Federal law enforcement

agencies? (Bureau of Alcohol, Tobacco, Firearms and Explosives [ATF] and U.S.

Marshals Services [USMS] conduct training)

Answer. DOJ, through BJA, reached out to Federal law enforcement agencies as

the VALOR Initiative was being developed. Specifically, leadership levels of USMS

have been briefed on the VALOR Initiative, and coordination and joint efforts, in-

cluding exchanges of curricula to ensure consistent messaging, are in progress. A

team from USMS was invited to and participated in the first VALOR Intiative class

held in Tampa, Florida. BJA recently met with USMS staff to further develop co-

ordination and information sharing between both the BJA and the USMS trainings.

Leadership of ATF was also briefed on the VALOR Initiative, and collaborative dis-

cussions are planned. Staff from the Federal Bureau of Investigation (FBI) was sig-

nificantly involved in the development of the VALOR Initiative, in particular, the

research that supports the program. Coordination with Department of Homeland

Security (DHS) law enforcement agencies is also expected. BJA has also coordinated

VALOR Initiative trainings through U.S. Attorney’s offices, pursuant to the Attor-

ney General’s direction that the U.S. Attorneys be engaged in assessing and re-

sponding to the officer safety issues in their districts.

Question. Is there any type of coordination with DOJ and our Federal law enforce-

ment agencies to ensure that best safety practices are being shared?

Answer. BJA has made specific outreach to Federal law enforcement agencies to

create best safety practices. BJA’s VALOR Initiative representatives will attend the

current USMS training. USMS representatives will attend a VALOR Initiative

training to ensure that best safety practices are shared. Additionally, leadership of

the ATF was also briefed on the VALOR Initiative and further discussions are

planned.

DOJ law enforcement components participate in DOJ-wide working groups related

to agent safety issues, such as body armor standards and requirements. DOJ law

enforcement components also compare, collaborate, and share training techniques

and methodologies, both formally and informally.

The ATF, Drug Enforcement Administration (DEA), and USMS purchase software

licenses for three of the same online courses. Through cross-component discussion

and collaboration, these courses have been established as important elements of

safety training for agents of all three components.

Components utilize co-located training facilities at Quantico and Federal Law En-

forcement Training Center (FLETC) and agents train using driving and firearms

ranges as well as simulators. FBI has traveled to other law enforcement component

training sites to establish liaison contacts and share best practices.

Furthermore, BJA and Community Oriented Policing Services (COPS) have estab-

lished the National Officer Safety and Wellness Group. This group brings together

law enforcement thought leaders, criminal justice practitioners, and colleagues to

share their knowledge and perspectives on improving officer safety and wellness.

The group’s mission is to contribute to the improvement of officer safety and

wellness in the United States by convening a forum for thoughtful, proactive discus-

sion and debate around relevant programs and policies within the law enforcement

field. Information and insight gained and shared will help enhance programs, poli-

cies, and initiatives related to officer safety and wellness.

NATIONAL ACADEMY OF SCIENCES FORENSICS STUDY

Question. Prior to becoming ranking member, this subcommittee commissioned

the National Academy of Science (NAS) Forensics Study. The intent was to show

where DOJ lacked in supporting crime labs and how it could provide more support

to the forensics community. Unfortunately, it evolved from a narrowly focused non-

binding study into a more far-reaching study than what the Congress intended.

While the NAS study did produce some positive results, there are questionable

and unrealistic ones, such as creating an independent bureaucracy responsible for

oversight of forensics, excluding DOJ from oversight.

Some special interest groups have even used a few of the individual bad cases in

the NAS study to attack the credibility of all crime labs and law enforcement, re-

sulting in impulsive and knee-jerk legislative proposals.

I would also note that some of these same organizations were also at the forefront

of support for the Webb Crime Commission, which is an example of another ‘‘non-

binding’’ study to go bad and result in overreaching and unnecessary legislative pro-

posals.

Does the Department have a position on the NAS forensics study?

Answer. DOJ believes the report from the National Research Council, ‘‘Strength-

ening Forensic Science in the United States: A Path Forward’’, is a helpful addition

to the public discourse on the state of the forensic science community. The report

recommends many useful steps to strengthen the community and enables it to con-

tinue to contribute to an effective criminal justice system. The report did conclude,

‘‘that forensic science, as a whole, produces valuable evidence contributing to the

successful prosecution and conviction of criminals, as well as to the exoneration of

the innocent.’’ However, the report does not, and was never intended to:

—comprehensively assess the forensic science disciplines;

—undermine the use of forensic science in the courtroom;

—offer any judgments on any cases currently in the judicial system; or

—recommend any rule or law changes in the area of evidentiary admissibility.

Question. Does DOJ support creating an independent agency responsible for hav-

ing jurisdiction over forensics?

Answer. The Department concurs with the need for a concerted national invest-

ment to advance forensic science and its utility, which underlies all recommenda-

tions cited in the NAS report. However, the Department does not believe that a new

forensics agency is necessarily needed to serve the interests of the criminal justice

community at the Federal, State, and local levels.

DISCREPANCIES BETWEEN DEPARTMENT OF JUSTICE AND PRESIDENT

’

S REQUESTS

Question. Attorney General Holder, there are a number of discrepancies between

your fiscal year 2013 budget request and the President’s fiscal year 2013 budget re-

quest in the Office of Management and Budget’s (OMB) appendix. This can only

mean that OMB littered DOJ’s request with programs and funding proposals up

until the last minute before releasing the budget.

This is evidence of part of the budget process that is not transparent and should

be made public. OMB and the White House are able to adjust program funding lev-

els and direct agencies through ‘‘passback’’ communications that they refuse to pub-

licly disclose, hiding behind the veil of ‘‘executive privilege’’.

The White House and OMB insert unrequested programs into an agency’s budget

request, forcing the agency to cut their own priorities to make room for it. A perfect

example of this is the White House inserting $600 million for COPS Hiring into

DOJ’s budget last year. We know you did not request that funding level and it

forced you to cut other programs to make room for it.

OMB has authored numerous memos promoting transparency. Since agencies are

already required to postcongressional communications online, I hope that the chair-

woman and my other colleagues will work with me in helping OMB close the circle

of transparency by requiring all Federal agencies to post their OMB passback com-

munications online.

During these tough fiscal times, taxpayers, the media and watchdog groups de-

serve to have full transparency and understand how the White House and OMB in-

fluence the budget process and sometimes override what agencies request.

Would you be supportive of being transparent and all OMB budget-related com-

munications being available for the taxpayers to see?

Answer. While DOJ supports transparency, the process involved in the formula-

tion of the President’s budget request requires unimpeded, back-and-forth dialog

within the executive branch. These discussions are considered ‘‘pre-decisional’’ and

allow the frank and open consultation and discussion that is necessary to reach the

most cost-effective and efficient resourcing decisions for the American taxpayer.

These internal confidential discussions are not intended to shield dialog, but rather

allow the consideration of a wide range of possible options and alternatives. This

is based on section 22 of the OMB Circular No. A–11 (2011) ‘‘Communications with

the Congress and the Public and Clearance Requirements’’. The executive branch’s

internal deliberations regarding the various issues and options that were considered

in the process leading to the President’s decisions, we believe, should remain a mat-

ter of internal record. This deliberative process is intended to promote free discus-

sion between agencies and the President and is supported by the doctrine of the sep-

aration of powers. It also ensures policy consistency between the President’s budget

and budget-related materials given to the Congress.

Question. What are the discrepancies between the DOJ request and the Presi-

dent’s budget in the appendix?

Answer. There are several small discrepancies between the Department’s budget

materials, including the fiscal year 2013 budget and performance summary and the

individual congressional justifications, and the President’s budget appendix; these

discrepancies have been footnoted where appropriate in the DOJ’s budget materials.

The cancellation language proposed for USMS, FBI, DEA, and ATF included in

DOJ’s budget materials differs from the language included in the budget appendix

regarding the types of balances proposed for cancellation. DOJ’s budget materials

reflect the correct language.

The language included in DOJ’s budget materials for OJP, State and Local Law

Enforcement Assistance, differs slightly from the language included in the Budget

Appendix regarding funding levels for certain programs (i.e., National Criminal His-

tory Improvement Program, National Instant Criminal Background Check System

Improvement Act Grants, and Prison Rape Prevention and Response). The Depart-

ment’s budget materials reflect the correct language.

The number of full-time equivalent (FTE) reported in the DOJ budget summary

varies slightly from the numbers reported in the President’s budget appendix due

to a difference in the methodology used to calculate the base FTE levels.

While the DOJ chapter of the President’s budget states that a task force offset

is proposed in fiscal year 2013, DOJ is just now finalizing its review of task force

operations and an offset is instead anticipated for fiscal year 2014.

Question. What do you attribute these discrepancies to?

Answer. The majority of these discrepancies can be attributed to timing con-

straints during production of these separate documents, as it is the intent of both

the language proposed in the Budget Appendix and the language proposed in the

Department’s budget materials to accurately report the same information.

The difference in FTE between the DOJ congressional budget submission and the

President’s Budget Appendix can be attributed to a difference in the methodology

used to calculate the base FTE levels. The DOJ congressional budget submission

used the authorized FTE level to calculate the base for the enacted FTE in fiscal

year 2011 and fiscal year 2012 and the request in fiscal year 2013. The President’s

Budget Appendix used the actual fiscal year 2011 FTE level as a baseline for devel-

oping the fiscal year 2012 and fiscal year 2013 FTE levels, as opposed to using the

authorized FTE levels. This leads to a slight discrepancy in the reported FTE level,

as footnoted in the Department’s budget and performance summary.

DANGER PAY FOR MEXICO

Question. DOJ has given the subcommittee its word that it would be advocating

danger pay for USMS and ATF. What is the status of DOJ’s negotiations on this?

Why is OMB opposed to supporting law enforcement in Mexico receiving danger

pay?

Answer. DOJ is continuing to monitor the issue of differential rates of pay for

DOJ agents and employees working in danger posts. We are actively engaged in dis-

cussions with the Department of State, which has jurisdiction over danger post de-

terminations. The Department of State is acutely aware of our concern and has as-

sured us that it is closely monitoring the situation in Mexico and will add additional

danger posts as necessary.

DEPARTMENT OF JUSTICE TASK FORCES

Question. Task forces play a major role in the DEA, USMS, FBI, and ATF mis-

sions. I support the consolidation of duplicative efforts, but I am concerned that

there may be confusion on the part of the administration in past proposals to con-

solidate task forces.

Specifically, the USMS Fugitive Task Forces come to mind. USMS have made

three times the arrests of all other Federal law enforcement agencies combined.

Can you tell us about the uniqueness of USMS’s fugitive task forces and other

task forces?

Answer. USMS plays a unique role in implementing DOJ’s violent crime reduction

strategy as USMS is the Federal Government’s primary agency for conducting fugi-

tive investigations, and it apprehends more Federal fugitives than all other law en-

forcement agencies combined. USMS has also been named the lead DOJ component

to investigate and prosecute crimes involving the noncompliance of sex offenders.

While USMS is responsible for investigating and apprehending individuals wanted

for escaping from Federal prison and for Federal parole and probation violations,

it has a long and distinguished history of providing assistance and expertise to other

Federal, State, and local law enforcement agencies in support of fugitive investiga-

tions. This support is coordinated though the USMS’s Domestic Investigations and

Sex Offender Investigations Branches, 75 district-based task forces, and 7 regional

fugitive task forces, supplemented by three foreign field offices and a wide range of

technical surveillance and criminal intelligence capabilities. USMS also participates

on Organized Crime Drug Enforcement Task Forces (OCDETF); the OCDETF pro-

gram has reported that its operations are substantially more effective when sup-

ported by USMS.

The 75 district fugitive task forces operate areas not covered by the regional fugi-

tive task forces. The seven regional fugitive task forces operate in the National Cap-

ital region, gulf coast region, Great Lakes region, New York-New Jersey region, Pa-

cific-Southwest region, Southeastern U.S. region, and Florida. The combined re-

gional fugitive task force has proven to be a vital tool in ensuring the safety of com-

munities by arresting violent fugitives who prey on society.

USMS’s task forces combine the efforts of Federal, State, and local law enforce-

ment agencies to locate and arrest the most dangerous fugitives. All USMS task

forces are designed and managed to ensure the highest levels of cooperation, coordi-

nation, and deconfliction among participating agencies. While some of this coordina-

tion is informal in nature, in other cases, task forces use formal national and local

information sharing and deconfliction systems to coordinate investigations and pro-

tect officer safety.

USMS locates and apprehends Federal, State, and local fugitives both within and

outside the United States. The warrants include but are not limited to:

—homicide;

—rape;

—aggravated assault; and

—robbery; or

—if there was an arrest or conviction in the fugitive’s record for any of these of-

fenses; or

—for any sex offense as defined in the Adam Walsh Child Protection and Safety

Act.

In fiscal year 2011, USMS task forces:

—arrested 36,268 Federal fugitives;

—arrested 86,449 State and local fugitives;

—cleared 39,398 Federal warrants;

—cleared 113,287 State and local warrants;

—arrested 3,867 homicide suspects;

—arrested 5,005 gang members;

—arrested 12,144 sex offenders;

—arrested 299 fugitives in Mexico; and

—the seven regional fugitive task forces made 41,654 arrests and cleared 52,078

warrants.

DOJ’s other primary task forces include DEA’s regional task forces, ATF’s violent

crime impact teams, and FBI’s Safe Streets task forces. As these task forces act as

the primary investigative and operational arm for their respective agencies, they

each leverage unique expertise in fulfilling their missions. For example, DEA’s re-

gional task forces have unparalleled knowledge and experience related to identi-

fying, investigating, and ultimately dismantling drug trafficking organizations,

which DEA brings to bear in cases throughout the country.

Question. Are there any task forces that you feel may be considered for consolida-

tion or elimination?

Answer. The fiscal year 2013 President’s budget does not contain plans to consoli-

date or eliminate additional task forces. Currently, DOJ is finalizing its comprehen-

sive assessment of task force performance in coordination with ATF, DEA, FBI,

USMS, the National Institute of Justice and the Executive Office for U.S. Attorneys.

The review will also take into account the extent to which there is overlap or dupli-

cation between DOJ-led task forces and those led by other departments and agen-

cies or State, local, or tribal led task forces. This assessment will review all violent

crime, drug, gang, and fugitive task forces to determine their effectiveness and will

culminate in recommendations to maximize performance and reduce duplication and

overlap. The Department anticipates that the assessment will result in the elimi-

nation or consolidation of some task force operations.

FAST AND FURIOUS LANGUAGE REMOVED FROM THE REQUEST

Question. As I mentioned in my opening statement regarding Fast and Furious,

language was included on the floor in last year’s bill that would prohibit Federal

law enforcement agencies from selling operable weapons to cartels. The fiscal year

2013 request removes that language saying it’s unnecessary. The amendment

passed 99–0.

This budget proposes to eliminate a provision that prohibits facilitating the trans-

fer of operable firearms to agents of drug cartels unless those firearms are continu-

ously monitored. The budget request’s justification for removing this language only

says this ‘‘is not necessary.’’ That’s hard to explain to the families of the Federal

agents killed by those weapons.

Can you elaborate on why the administration doesn’t think it’s necessary?

Answer. In the fiscal year 2013 President’s budget, consistent with past practice

of removing prohibitive language that limits executive branch discretion, we pro-

posed not to continue the Fast and Furious provision, which was enacted in fiscal

year 2012 with the intention of preventing future ‘‘gun walking’’ operations. The

Fast and Furious provision does not need to be continued because, as stated on sev-

eral occasions, the Department does not intend to engage in any such operations in

the future.

Question. Doesn’t the fact that it happened in the past suggest that legislation

to block it in the future may well be necessary?

Answer. The Attorney General has stated on several occasions that the Depart-

ment has no intention of engaging in such operations in the future. Indeed, appro-

priate steps have been implemented to ensure that this type of operation does not

occur again. However, given the sensitive nature of this issue, and in recognition

of congressional intent to ensure appropriate oversight, DOJ would not object to this

language being reinstated in the fiscal year 2013 bill.

CARTELS RECRUITING COLLEGE STUDENTS AND MINORS

Question. There have been reports that cartels are attempting to recruit college

students to smuggle drugs into the country, and college campuses could serve as an

easy recruiting ground. It’s understandable how young students could be enticed by

large sums of cash. The reports say that minors are more appealing because crimi-

nal penalties are lighter for them. One of the bright spots in your budget request

is $312 million for Juvenile Justice Prevention programs. It’s imperative that we

educate our children and students on the potential dangers of being involved in car-

tels.

Are you aware of these threats to college students and Southwest Border youth?

Answer. DOJ has become aware of the threats posed by drug cartels to both col-

lege students and students in elementary and high schools along the Southwest bor-

der through those who attend and conduct AMBER Alert Southern Border Initiative

trainings.

Question. Are any Juvenile Justice Prevention dollars being focused toward edu-

cation and awareness programs for the Southwest Border youth to understand the

dangers of cartels and the drug trade?

Answer. The Office of Juvenile Justice and Delinquency Prevention (OJJDP) has

not focused Juvenile Justice Prevention dollars toward education and awareness

programs for the Southwest Border youth. However, OJJDP’s AMBER Alert Train-

ing and Technical Assistance program has developed a partnership with the Boys

& Girls Clubs of America, a national nonprofit organization which provides expan-

sion and development of sustainable Boys & Girls Clubs within tribal communities

and other communities across the Nation. While OJP does not fund Boys & Girls

Clubs activities directly through the AMBER Alert Training and TA program, we

have awarded funding to a training and technical assistance provider that has a for-

mal, established partnership with Boys & Girls Clubs of America. Through that

partnership, Boys & Girls Clubs have been the conduit for information about gang

and drug resistance education to youth who participate in Boys & Girls Clubs activi-

ties, and this may include education and awareness about the dangers of cartels and

the drug trade for youth along the Southwest Border.

OJJDP also has supported Boys and Girls Clubs. Boys & Girls Clubs provide a

variety of prevention programs and activities for youth that help them develop char-

acter, education, social, and leadership skills. In addition, the Boys & Girls Clubs

provide the Delinquency and Gang Prevention/Intervention Initiative. This commu-

nity-based initiative targets young people ages 6 to 18 that are at high risk for in-

volvement or are already involved with delinquency and gangs. These youth and

teens are directed to positive alternatives and learn about violence prevention.

OJJDP supports gang prevention education in schools. The Gang Resistance Edu-

cation and Training (G.R.E.A.T.) Program, funded under title V, is a school-based,

law enforcement officer-instructed, classroom curriculum administered by OJP’s

BJA and OJJDP. The delivery and support of the G.R.E.A.T. Program is coordinated

through the four Regional Training Centers, the National Policy Board (NPB), a Na-

tional Training Team and two Federal agency partners:

—FLETC;

—DHS; and

—ATF.

The goal of the G.R.E.A.T. Program is to help youth develop positive life skills

that will help them avoid gang involvement and violent behavior. G.R.E.A.T. uses

a communitywide approach to combat the risk factors associated with youth involve-

ment in gang-related behaviors. The curricula was developed through the collabo-

rative efforts of experienced law enforcement officers and specialists in criminology,

sociology, psychology, education, health, and curriculum design and are designed to

reinforce each other. The lessons included in each curriculum are interactive and

designed to allow students to practice positive behaviors that will remain with them

during the remainder of their developmental years. There are 495 law enforcement

agencies in California, New Mexico, Arizona, and Texas that are teaching G.R.E.A.T

and 151 of those agencies are within 150 miles of the border of Mexico.

BIG BEND

Question. Attorney General Holder, as I mentioned in the statement, I’m con-

cerned about opening an unmanned border crossing in Big Bend National Park. The

negative and unknown variables seem to outweigh the few and minimal benefits.

Not to mention that during these tough fiscal times, these funds could be used more

wisely elsewhere. It seems to me that if terrorists were to smuggle weapons across

the border, they would do so in place that have easily accessible roads with the few-

est amount of border officials.

Although it’s not under DOJ’s jurisdiction, an incident involving criminal activity

after the fact very well would be. What is DOJ’s position on an unmanned border

crossing in this area or any other area?

Answer. DOJ does not administer day-to-day activities regarding U.S. border pa-

trol and defers to DHS in making determinations regarding the installation of bor-

der crossings. However, DOJ law enforcement components collaborate daily with

Federal, State, and local law enforcement via field offices located throughout the

country, including the Southwest Border, to combat crime and deter, detect, and dis-

rupt any national security threats to the United States. DOJ stands ready to work

with DHS to address any security concerns regarding border crossings or any other

issue involving national security.

SWB COMMUNICATIONS

Question. Big Bend Telephone Company (BBTC) is applying to the Federal Com-

munication Commission (FCC) for a waiver from new rules that would lower the

amount of Universal Service Fund (USF) subsidies that BBTC receives. BBTC is lo-

cated in far West Texas, serves an area the size of Massachusetts, and covers 25

percent of the United States-Mexico border. Without a waiver, we believe that

BBTC may go out of business, with no other companies likely to serve the region

because the area is so rugged and sparsely populated. Because BBTC provides net-

work transport for the cell phone providers in the area, if BBTC goes dark, so too

do the cell phones. Furthermore, BBTC provides critical communications service to

numerous DHS facilities along and near the border (including two ports of entry)

and to many State and local law enforcement agencies in the area. Without a waiv-

er, these facilities would be at risk of losing their critical phone and broadband ca-

pabilities.

If a waiver is not granted by the FCC to BBTC, and if BBTC goes out of business

and thus its customers lose service, what would the impact be on national security

and public safety if Federal, State, and local law enforcement agencies in the Trans-

Pecos region lost its voice and broadband Internet capabilities? Without such critical

communications, would these agencies be able to maintain their effectiveness in pa-

trolling and securing nearly 500 mountainous miles of the border? More specifically,

how would this impact the safety of Texas communities in the border region? What

impact would this have on any DOJ entities or communications?

Answer. Should BTTC go out of business, DOJ would work closely with stake-

holders, including DHS, to ensure that any negative impacts on public safety and

national security are appropriately addressed.

SENATOR STEVENS CASE

Question. Attorney General Holder, first, I want to compliment you for dismissing

the case, and cooperating with the investigation of misconduct and mishandling of

evidence in the Government’s case against former Senator Ted Stevens.

After your request that the case be dismissed in April 2009, U.S. District Judge

Emmett G. Sullivan appointed a team to investigate and report on the misconduct.

Henry F. Schuelke III, who was appointed by Judge Sullivan to investigate the case,

concluded in a 500-page report DOJ hid evidence that would have helped the Alaska

Republican prove his innocence. Most notably, it was called a ‘‘systematic conceal-

ment’’ of evidence that could have helped Senator Stevens defend himself.

Despite findings of widespread and intentional misconduct, Schuelke rec-

ommended against contempt charges because prosecutors did not disobey a ‘‘clear

and equivocal’’ order by the judge, as required under law—which I question.

Four of the six prosecutors who were investigated for their role in the case op-

posed releasing the report and their names were redacted.

Since Judge Sullivan has ordered that the investigative report in the disgraceful

prosecution of Senator Stevens be made public, can you promise this subcommittee

that the report by Justice’s Office of Professional Responsibility (OPR) will also be

made public?

Answer. As DOJ’s disciplinary review process has not yet been completed, and due

to limitations on public disclosure contained in the Privacy Act, DOJ is unable to

release the relevant OPR report at this time. As I have stated previously, the De-

partment will release as much as we can of the OPR report and DOJ findings, at

the appropriate time and in a manner consistent with law and due process.

Question. Are any of the prosecutors who engaged in ‘‘systematic concealment’’ of

evidence in the Stevens case still in prosecutorial roles?

Answer. Mr. Schuelke’s report examined the conduct of a number of current and

former DOJ attorneys and found evidence of willful nondisclosure of Brady and

Giglio materials involving two of those attorneys, Assistant United States Attorneys

(AUSAs) Joseph Bottini and James Goeke. Mr. Bottini is an AUSA in District of

Alaska and handles criminal prosecutions. Mr. Goeke is an AUSA in the Eastern

District of Washington and likewise handles criminal prosecutions.

Question. Are any of their legal bills also being paid by the taxpayers? If so,

please explain how much and the legal justification.

Answer. It is DOJ’s long-standing policy to provide representation to Federal em-

ployees for conduct performed within the scope of their employment. The purpose

for providing representation is to protect the interests of the Government by assur-

ing adequate representation with respect to legal issues in which the United States

has a concern and by freeing its employees from the fear that proper and vigorous

performance of their duties may result in substantial personal legal expenses. This

may be so even where the employee has erred or where, regardless of the lawfulness

of the conduct, there is concern that failure to provide representation may result in

the establishment of a legal principle that compromises the Government’s ability to

perform its functions in a proper and lawful manner in the future. Moreover, where

there are disputed facts regarding the conduct giving rise to the claim—or where

the facts are under investigation—the employee is afforded the benefit of the doubt

to the extent it is reasonable to do so. In all cases, the decision of whether or not

to provide representation is based upon the currently available information.

Consistent with this long-standing practice, 28 CFR 50.15 and 50.16, and Civil

Division Directive 2120A, DOJ received representation requests from six individuals

with respect to two matters. At the time representation was needed for the matters

referenced below, the facts that it took the Special Counsel several years to gather

were not available. In accordance with the usual processes available to Federal exec-

utive, legislative, and judicial branch employees, DOJ determined at that time that

the prosecutors were acting within the scope of their employment and representa-

tion was in the interest of the United States. Private counsel was authorized be-

cause direct DOJ representation was not appropriate.

DOJ utilized standard retention agreements that the Department commonly uses

in its representation of other Federal employees. Those retention agreements im-

posed caps on the number of hours of work for which, absent unusual cir-

cumstances, counsel would be reimbursed. Those agreements also set hourly rates

that are based on the attorney’s experience and are well below—and in some cases

less than 50 percent of—the rates that DOJ uses when determining rates to pay

prevailing parties against it in Washington, DC, under the Equal Access to Justice

Act. With respect to the six individuals for whom representation was authorized, to

date DOJ has spent $282,982.51 in connection with the contempt order entered by

U.S. District Judge Emmet G. Sullivan on February 8, 2009, in United States v. Ste-

vens, No. 08–cr–0231 (D.D.C.), and $1,633,298.29 in connection with the subsequent

investigation by Special Counsel Henry F. Schuelke III, who was appointed by

Judge Sullivan on April 9, 2009, and who ultimately produced a 500-page report re-

garding the investigation.

Question. Does it concern you that the only reason these prosecutors escaped

criminal charges is that the judge in the Stevens case did not file an order telling

the prosecutors to follow the law?

Answer. Yes. DOJ expects its prosecutors to fully comply with their discovery obli-

gations in every case regardless of the existence of a court order directing such com-

pliance. As a result, when the nature of the undisclosed information was brought

to my attention in 2009, I authorized DOJ to move to vacate Senator Stevens’ con-

viction and to dismiss the indictment.

DOJ takes its discovery obligations seriously as evidenced by the policies and

training requirements that have been implemented since the dismissal of the Ste-

vens case. While DOJ continues to review the Schuelke report, and all of the facts

and circumstances surrounding the discovery violations that occurred in the Stevens

prosecution, DOJ prosecutors are expected to comply with their discovery obligations

regardless of the existence of a court order.

Question. What are the names of these individuals? Please list what positions and

where these individuals have worked since this came to light—to present.

Answer. The publicly filed version of the report identifies all of the subjects in the

report. As noted, Mr. Schuelke found evidence that 2 of the 6 subjects willfully with-

held discoverable evidence. DOJ understands this series of questions to pertain only

to those two individuals. AUSA Joseph Bottini has continued to prosecute cases in

the District of Alaska since the Stevens trial. After the Stevens trial, AUSA Goeke

continued as an AUSA in the District of Alaska until May 2009, when he assumed

the same position in the Eastern District of Washington.

Question. Please list the cases that these individuals have participated in and the

results. For example, one participated in the Alabama Bingo case which resulted

in acquittals. Another involved the National Security Agency. Please list each case,

the outcome, the individuals’ names, and what their roles in the cases are.

Answer. We do not think it would be appropriate or useful to list every case on

which each attorney has worked. We can tell you that since the Stevens trial, AUSA

Joseph Bottini has handled a varied criminal caseload, and there have been no find-

ings of prosecutorial misconduct in any of the cases that he has prosecuted. Simi-

larly, AUSA Goeke has continued to handle a routine criminal caseload, and there

have been no findings of prosecutorial misconduct in any cases that Mr. Goeke has

prosecuted since the Stevens trial. If you can identify a specific need for additional

information, we will be happy to consider it.

Question. Will any investigation occur if the pending OPR recommends further ac-

tion?

Answer. No further investigation will occur, but OPR findings are part and parcel

of the Federal disciplinary process. Whenever OPR reaches findings of misconduct

involving current DOJ employees, imposition of any disciplinary action as a result

of those findings must comport with the requirements of Federal law. Federal law

requires generally that employees receive at least 30 days’ notice of any proposed

disciplinary action and that they have an opportunity to respond both orally and

in writing to the proposed action. After considering the response, the designated de-

ciding official would determine whether the evidence supports the misconduct

charge or charges in the proposal and, if so, whether the recommended discipline

is appropriate. If a deciding official determines to suspend the employee for more

than 14 days, the employee can appeal that suspension to the Merit Systems Protec-

tion Board. If the employee is suspended for 14 days or less, then the employee can

file a grievance of the suspension with the agency. If the disciplinary process results

in the affirmation of OPR’s findings of misconduct, then OPR would ordinarily refer

the matter to the appropriate State bar disciplinary authorities for any action they

deem appropriate.

UESTIONS

UBMITTED BY

ENATOR

AMAR

LEXANDER

METHAMPHETAMINE IN TENNESSEE

Question. Tennessee had the second-highest number of methamphetamine lab sei-

zures in the country in 2011 (1,687 labs), second only to Missouri. In 2010, Ten-

nessee had the highest number of methamphetamine lab seizures in the Nation

with 2,082 seizures. The average cost to clean up a methamphetamine lab is $2,300,

and these costs are putting tremendous strain on State and local law enforcement.

Last November, the Department of Justice (DOJ) helped Tennessee and other

States by providing $12.5 million to address methamphetamine lab cleanup costs.

However, this funding will run out in October 2012 according to the statewide Ten-

nessee Methamphetamine Task Force. Without cleanup funds, there is a real incen-

tive to avoid seizing these labs.

Given that this is one of the most urgent drug problems, especially in rural com-

munities with limited resources, DOJ should find a way to help address this prob-

lem. In this year’s budget will DOJ continue to support methamphetamine lab

cleanup efforts in Tennessee?

Answer. DOJ’s budget includes $12.5 million in funding to continue to support

methamphetamine lab cleanups in Tennessee and other States. Funding will be

prioritized for States, like Tennessee, that have established container programs be-

cause these container programs allows DOJ and its State and local partners to com-

plete cleanups in a more cost-effective manner.

In fiscal year 2013, the Office of Community Oriented Policing Services (COPS)

requests $12.5 million to provide assistance to help stem clandestine methamphet-

amine manufacturing and its consequences, including the cleanup of clandestine

laboratories. As in previous years, DOJ assumes that these funds will provide for

meth lab cleanup activities.

Question. What is DOJ doing to help State and local law enforcement deal with

mobile methamphetamine labs, which account for a growing number of lab seizures?

Answer. Over the past several years, Drug Enforcement Administration (DEA)

has developed a container-based cleanup program. Under this program, DEA trains

and certifies law enforcement officers to remove gross contaminates from labs (in-

cluding mobile labs) and dumpsites; secure and package the waste pursuant to State

and Federal laws and regulations; and transport the waste to a centrally located,

secure container for storage. In States participating in the container program, haz-

ardous waste contractors travel periodically to a central location to remove meth lab

contaminates from across the State. In noncontainer States, hazardous waste con-

tractors must travel to each individual lab or dumpsite to secure, package, and re-

move meth lab contaminates.

DEA will be supporting cleanups in container and noncontainer States in fiscal

year 2012 through its various hazardous waste contracts. Currently, eight States

have operational container programs (Alabama, Arkansas, Illinois, Indiana, Ken-

tucky, Nebraska, Oklahoma, and Tennessee), and DEA is working with five other

States (Michigan, Mississippi, North Carolina, Ohio, and Virginia) to implement the

container program during fiscal year 2012. DEA expects these additional five States

to have operational container programs in fiscal year 2013. Thus far, the program

has resulted in significant cost savings per lab in States that have the containers

deployed; a contractor cleanup averages $2,230 while a container cleanup averages

$320.

As container programs are more cost efficient and more States have operational

container programs in fiscal year 2013, $12.5 million in funding, requested in the

fiscal year 2013 President’s budget in the COPS appropriation, will continue to be

sufficient in fiscal year 2013. DEA has also contacted an additional eight States for

potential container program expansion. For those States without container pro-

grams, DEA assesses whether or not the program is a cost-effective option. If the

state has only limited cleanups, the upfront equipment and training costs can ex-

ceed potential container program savings. In these cases, DEA will provide cleanup

services through its hazardous waste contractors.

JUSTICE DEPARTMENT ENFORCEMENT AND WIND FARMS

Question. In 2009, Exxon admitted to killing approximately 85 protected birds, in-

cluding waterfowl, hawks, and owls. The company paid a $600,000 fine and was re-

quired to implement an environmental compliance plan.

The U.S. Fish and Wildlife Service (FWS) has referred similar cases to the De-

partment involving wind farms. I am concerned that wind farms are not being treat-

ed the same as oil and gas companies with respect to enforcement of the Migratory

Bird Treaty Act (MBTA).

What concerns me the most is that the Justice Department’s lack of enforcement

betrays a willingness to prosecute certain disfavored groups while giving others a

pass. This kind of selective prosecution contradicts the Department’s promise of

‘‘equal justice under law’’.

Since it is a criminal violation to kill birds protected by the MBTA and we know

that wind mills kills hundreds of thousands of birds each year, including protected

bald eagles, why hasn’t DOJ taken action? Will DOJ step up enforcement for wind

producers in the same way it has oil and gas companies?

Answer. FWS’s Office of Law Enforcement (OLE) has primary responsibility for

investigating potential criminal violations of MBTA, and refers appropriate matters

to DOJ for prosecution. FWS’s OLE has stated publicly that, in the context of indus-

trial takings of migratory birds, it focuses its resources on investigating and pros-

ecuting those who take migratory birds without identifying and implementing rea-

sonable and effective measures to avoid the take.

In the context of the electric and oil and gas industries, reasonable and effective

measures to avoid the taking of migratory birds have long been identified, and refer-

rals have been made and legal action has been taken when companies knowingly

fail to use such measures for avoiding bird mortality. Guidance on preventing bird

deaths in the wind energy context has been more recent. However, some reasonable

and effective measures for avoiding taking in this industry have been identified. The

Department of the Interior released interim guidelines in 2003, and in March 2012,

released final Land-Based Wind Energy Guidelines designed to help wind energy

project developers avoid and minimize impacts of land-based wind projects on wild-

life and their habitat.

DOJ reviews each referral from OLE carefully, and determines whether to initiate

a prosecution based on the principles set forth in DOJ’s Principles of Federal Pros-

ecution. DOJ is committed to the fair and evenhanded administration of the MBTA

and other criminal wildlife protection laws.

NATIONAL FORENSIC ACADEMY

—

UNIVERSITY OF TENNESSEE

Question. The National Forensic Academy (NFA), which is located at the Univer-

sity of Tennessee in Knoxville, has been providing hands on forensic training since

2001 at one of the Nation’s only training centers where officers and investigators

can practice forensic techniques in the classroom and in the field.

NFA works closely with the Bureau of Justice Assistance (BJA) and the National

Institute of Justice (NIJ) to provide training courses to Federal, State, and local law

enforcement and crime scene investigators, and this cooperation needs to continue.

In 2009, the National Academy of Sciences released a comprehensive report on the

needs of the forensic sciences community and concluded that we are not doing

enough to support forensics. The report recommended new training and certification

initiatives, among others.

At a time when we are trying to control Federal spending, doesn’t it make sense

to support programs with a proven track record, like those at NFA, instead of cre-

ating new Federal training programs to support our forensic training needs?

Answer. NIJ is not creating any new Federal training programs to support the

forensic science community. Providing high-quality educational opportunities for fo-

rensic science practitioners continues to be a critical goal to maintain high-quality

forensic services. In order to increase the number of forensic science training oppor-

tunities available to the forensic science, law enforcement, medical, and legal com-

munities, NIJ invested approximately $12 million in fiscal year 2010 and $5 million

in fiscal year 2011.

In 2011, NIJ’s Forensic Science Training and Delivery Program released a solici-

tation that sought proposals in two major areas: ‘‘Delivery of Training’’ and ‘‘Tar-

geted Research on Forensic Science Training Programs.’’

One goal of the solicitation was to increase the number of no-cost educational op-

portunities for public crime laboratory personnel and practitioners in forensic

science disciplines and provide forensic science training to other relevant criminal

justice partners and professionals involved in treating victims of sexual assault. NIJ

sought to fund grant awards for the delivery of courses leveraging existing forensic

science training curricula or courses developed under a previous NIJ award. Foren-

sic disciplines supported by the program include, DNA, pattern evidence (e.g., fin-

gerprints and firearms), trace evidence, digital evidence, and medicolegal death in-

vestigation.

The solicitation conveyed the importance of cost-effectively leveraging existing

curricula. For example, the 2011 training solicitation delineated that proposals

should not include costs associated with further curricula development or modifica-

tion.

The University of Tennessee’s NFA received one award for $450,000 for ‘‘Special-

ized Crime Scene Investigator Training in Forensic Digital Photography and Crime

Scene Mapping’’ in fiscal year 2011 (2011–DN–BX–K567. NIJ has competitively

funded numerous trainings geared toward crime scene investigators, forensic sci-

entists, prosecutors, defense attorneys, law enforcement officers, and judges. Addi-

tionally, the University of Tennessee’s NFA, with grant funding from BJA, has pro-

duced successful and popular training courses for many years. The University of

Tennessee’s Law Enforcement Innovation Center and its instructors do an excellent

job training crime scene investigators during an intensive 10-week in house course.

NIJ will not be offering a targeted solicitation for training in fiscal year 2012 in

order to evaluate the various training programs, and it will conduct a gap analysis

of critical needs. We hope to initiate this evaluation during fiscal year 2012 to deter-

mine how best to proceed with training in the future. However, there are still var-

ious training opportunities available through the ongoing training grants from past

years. Moreover, there are various Federal grants that may be used for the purpose

of training individuals at State and local agencies, such as the DNA Backlog Reduc-

tion and Coverdell Forensic Science Improvement programs. For example, Paul

Coverdell funds may be used to bring in a trainer to provide specialized training

in-house or funds may be used to attend trainings/meetings related to improving the

timeliness and quality of forensic and/or medical examiner services.

In the fiscal year 2011 proposal from the State of Tennessee, one of the goals of

the Office of the Acting State Chief Medical Examiner (OCME) is to educate county

medical examiners, medical investigators, and/or regional forensic center nonphysi-

cian employees who serve as death investigators in basic death scene investigation

techniques. Priority would go to individuals without any formal training in death

investigation. While each grand division of Tennessee is included, this grant focuses

on the smallest offices in the eastern division, because of a recognized need for very

basic training in those regions. The OCME intends to send seven participants from

across the State to either the winter or spring session of the Medicolegal Death In-

vestigation Course in St. Louis, Missouri.

BUREAU OF PRISONS

Question. The Federal Bureau of Prisons (BOP) is estimated to be operating at

43 percent more than rated capacity by the end of fiscal year 2013, and over-

crowding at high- and medium-security facilities is projected to be 52 percent and

63 percent, respectively. DOJ’s fiscal year 2013 budget submission states:

‘‘In light of overcrowding and stresses on prison staffing, BOP’s ability to safely

manage the increasing Federal inmate population is one of the Department’s top 10

management and performance challenges identified by the Office of the Inspector

General in the DOJ [Performance and Accountability Report].’’

Additionally, the Inspector General Performance and Accountability Report states:

‘‘In sum, the Department continues to face difficult challenges in providing ade-

quate prison and detention space for the increasing prisoner and detainee popu-

lations and in maintaining the safety and security of prisons.’’

I recognize the fiscal year 2013 budget submission includes funding for an addi-

tional 3,496 beds (2,496 beds in Federal facilities and 1,000 new beds in contract

facilities). However, BOP is projecting its population will grow by 6,500 inmates

during that time, which means crowding will only get worse.

What additional resources are needed to provide the beds required to meet capac-

ity?

Answer. Continuing increases in the inmate population pose ongoing challenges

for BOP. The administration has taken several actions to control Federal prison

crowding including expanding capacity and supporting legislation that will control

prison population growth.

The fiscal year 2013 budget requests $81.4 million in program enhancements to

acquire 1,000 private contract beds and to begin activating two institutions, the

United States Penitentiary at Yazoo City, Mississippi and the Federal Correctional

Institution at Hazelton, West Virginia. These new contract beds and the two prisons

will increase BOP’s capacity by 3,496 beds once fully activated. (Exhibit O, Status

of Construction, in the fiscal year 2013 President’s budget request for buildings and

facilities gives additional information on pending construction projects.)

In addition, the administration supports two prisoner re-entry provisions included

in the Second Chance Reauthorization Act of 2011 (S. 1231), which was voted favor-

ably out of the Judiciary Committee but has not yet been scheduled for Senate floor

action. The bill contains provisions to increase inmate good conduct time by 7 days

per year and to provide a 60-day per year incentive for participation in recidivism-

reducing programs. If enacted, these legislative proposals will help control the long-

term prison population growth and result in an estimated cost avoidance of $41 mil-

lion; the President’s budget assumes enactment of these proposals and the cor-

responding savings.

Question. Is contract confinement a cost-effective solution for housing low to min-

imum security offenders? Given current costs at contractor and BOP facilities, is

contract confinement a cost-effective way to deal with overcrowding issues?

Answer. Contract confinement can be cost-effective when used for housing low-se-

curity male criminal aliens. These inmates are particularly well-suited for contract

confinement because their typically short sentence lengths and alien status gen-

erally preclude them from participating in sentence and recidivism reducing pro-

grams. Adding low-security private contract beds increases total system capacity

and helps control overcrowding in low-security BOP facilities. At the end of fiscal

year 2011, low-security overcrowding was 39 percent, which equates to about 80 per-

cent of low-security inmates being triple bunked, and in some cases regularly being

housed in television rooms, open bays, program space, etc.

UESTIONS

UBMITTED BY

ENATOR

ISA

URKOWSKI

INDEMNIFICATION OF LEGAL FEES INCURRED BY

STEVENS

PROSECUTORS

Question. How much money was in fact spent defending the prosecutors, what the

money was spent defending the prosecutors from, and why did the Justice Depart-

ment spent the money?

Answer. It is the Department of Justice’s (DOJ) long-standing policy to provide

representation to Federal employees for conduct performed within the scope of their

employment. The purpose for providing representation is to protect the interests of

the Government by assuring adequate representation with respect to legal issues in

which the United States has a concern and by freeing its employees from the fear

that proper and vigorous performance of their duties may result in substantial per-

sonal legal expenses. This may be so even where the employee has erred or where,

regardless of the lawfulness of the conduct, there is concern that failure to provide

representation may result in the establishment of a legal principle that compromises

the Government’s ability to perform its functions in a proper and lawful manner in

the future. Moreover, where there are disputed facts regarding the conduct giving

rise to the claim—or where the facts are under investigation—the employee is af-

forded the benefit of the doubt to the extent it is reasonable to do so. In all cases,

the decision of whether or not to provide representation is based upon the currently

available information. Those facts revealed that in the referenced matters the pros-

ecutors were acting within the scope of their employment and representation was

in the interest of the United States. Private counsel was authorized because direct

Department representation was not appropriate.

DOJ authorized representation of six individuals with respect to two matters and

used standard retention agreements that the Department commonly uses in its rep-

resentation of other Federal employees. Those retention agreements imposed caps

on the number of hours of work for which, absent unusual circumstances, counsel

would be reimbursed. Those agreements also set hourly rates that are based on the

attorney’s experience and are well below—and in some cases less than 50 percent

of—the rates that DOJ uses when determining rates to pay prevailing parties

against it in Washington, DC, under the Equal Access to Justice Act. With respect

to the six individuals for whom representation was authorized, to date DOJ has

spent $282,982.51 in connection with the contempt order entered by U.S. District

Judge Emmet G. Sullivan on February 8, 2009, in United States v. Stevens, No. 08–

cr–0231 (D.D.C.), and $1,633,298.29 in connection with the subsequent investigation

by Special Counsel Henry F. Schuelke III, who was appointed by Judge Sullivan on

April 9, 2009.

Question. Did DOJ enter into any agreement with the prosecutors or their counsel

prior to expending these funds? If so, please provide copies of all such agreements.

Answer. DOJ did not enter into any agreement with the prosecutors. In accord-

ance with our usual practice, we sent our standard retention letter to the private

counsel retained to represent the prosecutors and received back DOJ’s standard re-

tention agreement signed by private counsel. As noted above, the retention agree-

ments imposed caps on the number of hours of work for which, absent unusual cir-

cumstances, counsel would be reimbursed. The agreements also set hourly rates

that are based on the attorney’s experience and are well below—and in some cases

less than 50 percent of—the rates that the Department uses when determining

rates to pay prevailing parties against it in Washington, DC, under the Equal Ac-

cess to Justice Act. Copies of the retention letters and executed agreements are at-

tached. (see Attachment 1)

TTACHMENT

IVIL

IVISION

U.S. D

EPARTMENT OF

USTICE

Washington, DC 20530, April 21, 2009.

ENNETH

L. W

AINSTEIN

O’Melveny & Myers, 1625 Eye St., NW, Washington, DC 20006.

RE: Special Counsel Criminal Contempt Investigation Arising from United States v.

Stevens, 08–cr–0231 (D.D.C.)

EAR

. W

AINSTEIN

: The Department of Justice has concluded that it reason-

ably appears at this time that representation of Joseph Bottini in connection with

a Special Counsel criminal contempt investigation in the above-referenced action is

in the interest of the United States. It also appears at this time, however, that rep-

resentation of Mr. Bottini by attorneys employed by the Department of Justice is

inappropriate. Mr. Bottini has requested that the Department agree to reimburse

you for his representation in this matter. Pursuant to 28 C.F.R. § 50.16(c)(1), your

reimbursement will be subject to the applicable statutes, regulations, and the terms

and conditions set forth in the enclosed addendum, which is incorporated into and

made a part of this agreement.

You and Mr. Bottini should be aware that, by entering into this agreement, the

Department of Justice in no way assumes responsibility on the part of the United

States Government for any monetary liability that might be imposed against Mr.

Bottini in connection with this matter. Although the Department of Justice has as-

sumed responsibility for remunerating you in the course of representing him to the

extent specified in the addendum, your responsibility, of course, is solely to your cli-

ent.

Should you have any questions concerning the terms of this agreement, including

the enclosed addendum, please contact Attorney Advisor Virginia G. Lago at (202)

616–4328.

If you find the provisions of the agreement acceptable, please return the signed

addendum, along with your firm’s tax identification number, to the following ad-

dress:

Virginia G. Lago, Esq.

Torts Branch, Civil Division

U.S. Department of Justice

P.O. Box 7146

Washington, DC, 20044

The Department of Justice is continuing to experience delays in its mail delivery,

as mail addressed to the Department continues to be forwarded to out-of-State fa-

cilities for irradiation. Therefore, please e-mail the signature page of the retention

agreement to the attention of Ms. Lago at [email protected]. In addition,

please e-mail your invoices to [email protected], or you may

mail them to Ms. Lago’s attention at P.O. Box 7146, Washington, DC 20044. Reim-

bursement of allowable fees and expenses will become available on the Civil Divi-

sion’s receipt of the signed addendum.

In addition, enclosed you will find a copy of the ACH VENDOR Direct Deposit

Form. Please fill out the blank areas on the form and fax the completed form to:

Accounts Maintenance Unit

Attn: Gina McLaughlin

FAX: (202) 616–2207

The Debt Collection Improvement Act of 1996 requires that most payments by the

Federal Government, including vendor payments, be made by electronic funds trans-

fer. If you have any questions regarding the delivery of remittance information,

please contact the financial institution where your account is held. If you have any

questions regarding completion of this form, please contact Ms. McLaughlin at (202)

616–8103.

Thank you for your assistance in this matter.

Very truly yours,

IMOTHY

P. G

ARREN

Director, Torts Branch.

CONDITIONS OF PRIVATE COUNSEL RETENTION BY THE DEPARTMENT OF JUSTICE FOR

REPRESENTATION OF CURRENT AND FORMER FEDERAL EMPLOYEES

The following items and conditions shall apply to the retention of a private attor-

ney’s legal services by the Department of Justice to represent current and former

Federal employees in civil, congressional, or criminal proceedings.

1. NATURE OF RETENTION

Subject to the availability of funds, the Department of Justice agrees to pay an

attorney, or other members of his or her firm, for those legal services reasonably

necessitated by the defense of a current or former Federal employee (hereinafter

‘‘client’’) in civil, congressional, or criminal proceedings.

The Department will not honor bills for services that the Department determines

were not directly related to the defense of issues presented by such matters. Exam-

ples of services for which the Department will not pay include, but are not limited

to:

a. administrative claims, civil actions, or any indemnification proceedings against

the United States on behalf of the client for any adverse monetary judgment, wheth-

er before or after the entry of such an adverse judgment;

b. cross claims against co-defendants or counterclaims against plaintiff, unless the

Department of Justice determines in advance of its filing that a counterclaim is es-

sential to the defense of the employee and the employee agrees that any recovery

on the counterclaim will be paid to the United States as a reimbursement for the

costs of the defense of the employee;

c. requests made under the Freedom of Information or Privacy Acts or civil suits

against the United States under the Freedom of Information or Privacy Acts, or on

any other basis, to secure documents for use in the defense of the client;

d. any legal work that advances only the individual interests of the employee; and

e. certain administrative expenses noted in paragraph number 4 below.

The retained attorney is free to undertake such actions as set forth above, but

must negotiate any charges with the client and may not pass those charges on to

the Department of Justice.

THE ABOVE LIST IS NOT EXHAUSTIVE. The Department of Justice will not

reimburse services deemed reasonably necessary to the defense of an employee if

they are not in the interests of the United States.

To avoid confusion over whether the retained attorney may bill the Department

for a particular service under this retention agreement, the retained attorney should

consult the Justice Department attorney assigned to the case, mentioned in the ac-

companying letter before undertaking the service.

2. BILLABLE HOURS

The Department of Justice agrees to pay the retained attorney for any amount

of time not exceeding 120 billable hours per month for services performed in the de-

fense of the client. The retained attorney may use the services of any number of

attorneys, paralegals, or legal assistants in his or her firm so long as the aggregate

number of billable hours in any given month does not exceed 120 hours. The client

is free, however, to retain the attorney, or members of the firm, to perform work

in excess of 120 hours per month so long as the firm does not bill the excess charge

to the Department of Justice.

The Department will consider paying for services in excess of 120 hours in any

given month if the press of litigation (e.g., trial preparation) clearly necessitates the

expenditure of more time. The retained attorney must make requests for additional

compensation to the Department in writing in advance of such expenditures.

3. LEGAL FEES

The Department agrees to pay the retained attorney up to $200.00 per lawyer

hour, plus expenses as described in paragraph 4 below. The charge for any services

should not exceed the retained attorney’s ordinary and customary charge for such

services. This fee is based on the consideration that the retained attorney has been

practicing law in excess of 5 years.

In the event the retained attorney uses the services of other lawyers in his or her

firm, or the services of a paralegal or legal assistant, the Department agrees to pay

the following fees.

a. Lawyer with more than 5 years practicing experience: $200.00 per lawyer hour

b. Lawyer with 3–5 years of practicing experience: $160.00 per lawyer hour

c. Lawyer with 0–3 years of practicing experience: $133.00 per lawyer hour

d. Paralegal or legal assistant (or equivalent): $78.00 per hour.

The Department of Justice periodically reviews the hourly rates paid to attorneys

retained to defend Federal employees under 28 C.F.R. § 50.16. If, during the period

of this agreement, the Department revises the schedule of hourly rates payable in

such cases, the Department will pay revised rates for services rendered after the

effective date of the revision in rates.

4. EXPENSES

While the Department will pay normal overhead expenses actually incurred (e.g.,

postage, telephone tolls, travel, transcripts), the retained attorney must itemize

these charges. The Department will not accept for payment a bill that shows only

a standard fee or percentage as ‘‘overhead’’. The retained attorney must describe,

justify, and clear IN ADVANCE unusual or exceptionally high expenses.

In addition, the retained attorney must describe, justify, and clear in advance any

consultations with or retention of experts or expert witnesses.

The retained attorney must secure advance approval to use computer-assisted re-

search that involves charges in excess of $500.00 in a given month.

The retained attorney must separately justify and obtain advance approval for

services such as printing, graphic reproduction, or preparation of demonstrative evi-

dence or explanatory exhibits.

The retained attorney must itemize and justify in-house copying costs exceeding

$150.00 in a given month. The Department will pay up to a per page copying cost

of $.15 per page.

The retained attorney must itemize and justify facsimile transmission costs ex-

ceeding $150.00 in a given month.

The Department will pay expenses such as secretarial overtime or the purchase

of books only in exceptional situations. The retained attorney must obtain advance

approval for such expenditures.

Travel expenses may not include first class service or deluxe accommodations. The

retained attorney may not bill time spent in travel unless it is used to accomplish

tasks related to the litigation. The retained attorney must specifically identify such

tasks.

The Department will not pay for meal charges not related to out-of-town travel.

The Department will not provide compensation for client or other entertainment.

The Department will not pay expenses for meals incidental to overtime.

The Department will not pay for expenses that can normally be absorbed as cler-

ical overhead, such as time spent in preparing legal bills and filing papers with the

Court. The retained attorney must separately list and justify messenger services.

The retained attorney must enumerate the expenses incurred for hiring local

counsel by rate, hour, and kind of service. These hours must fall within the 120-

hour monthly maximum. The hourly rates paid to local counsel may not exceed the

rates listed in paragraph 3 above.

5. FORMAT OF BILLS

The retained attorney must submit bills on a monthly basis, stating the date of

each service performed; the name of the attorney or legal assistant performing the

service; a description of the service; and the time in tenths, sixths, or quarters of

an hour, required to perform the service. Because of the limitation on reimbursable

hours, a bill must include all services rendered in a given month. The Department

will not consider subsequent bills for services rendered in a month for which it has

already received a bill.

In describing the nature of the service performed, the itemization must reflect

each litigation activity for which reimbursement is claimed.

The retained attorney must attach copies of airline tickets, hotel bills, and bills

for deposition and hearing transcripts to the billing statement.

The retained attorney must itemize local mileage costs (e.g., purpose of travel and

number of miles). The Department will pay the standard government cost per mile

rate for the use of privately owned vehicles.

Before the Department of Justice will pay a bill, Department attorneys with sub-

stantive knowledge of the litigation will review it. If the retained attorney believes

that the detail of the legal bill would compromise litigation tactics if disclosed to

Department attorneys assigned to the case, the retained attorney should list those

particular billing items on a separate sheet of paper with an indication of the spe-

cific concern. Department attorneys uninvolved with this case will independently re-

view the separated, sensitive portion of the bill solely to determine if payment is

appropriate under applicable standards. The individuals reviewing the bills will not

discuss these items with the Department of Justice attorneys having responsibility

for the case, nor will those responsible attorneys review the items in question.

After Department attorneys complete the review of a bill, the Department will no-

tify the billing counsel if the Department deems any item or items nonreimbursable

or if any item or items require further explanation. When further information or ex-

planation is needed, the Department will hold the entire bill until the retained at-

torney responds. Only after the Department receives and reviews the response will

the Department certify the bill in whole or in part for payment. For that reason,

the retained attorney must respond promptly.

Should the Department determine that any items are not reimbursable under this

agreement, the billing counsel may request further review of the Department’s de-

termination. The retained attorney shall make such a written request to the appro-

priate Branch director at the address indicated in the forwarding letter. The billing

counsel must submit such requests for further review within 30 days, unless addi-

tional time is specifically requested and approved. Thereafter, the Department will

not reconsider its determination.

6. BILLING ADDRESS

The retained attorney should submit all bills to:

Director, Office of Planning, Budget and Evaluation

Civil Division

United States Department of Justice

Washington, D.C. 20530

Attn: Room 9042, L Street Building

7. PROMPT PAYMENT

The Prompt Payment Act is applicable to payments under this agreement and re-

quires the payment of interest on overdue payments. Determinations of interest due

will be made in accordance with provisions of the Prompt Payment Act and Office

of Management and Budget Circular A–125.

8. GAO REVIEW

Periodically, the Department of Justice may ask the retained attorney to submit

copies of time sheets to the General Accounting Office (GAO) for purposes of audit-

ing the accuracy of corresponding monthly bills, copies of which the Department will

forward directly to GAO.

9. TERMINATION

The Department of Justice reserves the right to terminate its retention agreement

with the retained attorney at any time for reasons set forth in 28 C.F.R. § 50.16.

ACCEPTANCE

I agree that my retention by the Department of Justice to represent Joseph

Bottini, in connection with a Special Counsel criminal contempt investigation in

United States v. Stevens, 08–cr–0231 (D.D.C.) will be in accordance with the applica-

ble statutes, regulations, and the foregoing terms and conditions. This written in-

strument, together with the applicable statutes and regulations, represents the en-

tire agreement between the Department of Justice and the undersigned, any past

or future oral agreements notwithstanding.

Signature: K

ENNETH

L. W

AINSTEIN

Date: April 23, 2009

Tax Identification Number: llllllllll

IVIL

IVISION

U.S. D

EPARTMENT OF

USTICE

Washington, DC 20530, June 16, 2009.

ATTHEW

I. M

ENCHEL

Kobre & Kim, 800 Third Avenue, New York, NY 10022.

RE: Special Counsel Criminal Contempt Investigation Arising from United States v.

Stevens, 08–cr–0231 (D.D.C.)

EAR

. M

ENCHEL

: The Department of Justice has concluded that it reasonably

appears at this time that representation of James Goeke in connection with a Spe-

cial Counsel criminal contempt investigation in the above-referenced action is in the

interest of the United States. It also appears at this time, however, that representa-

tion of Mr. Goeke by attorneys employed by the Department of Justice is inappro-

priate. Mr. Goeke has requested that the Department agree to reimburse you for

his representation in this matter. Pursuant to 28 C.F.R. § 50.16(c)(1), your reim-

bursement will be subject to the applicable statutes, regulations, and the terms and

conditions set forth in the enclosed addendum, which is incorporated into and made

a part of this agreement.

You and Mr. Goeke should be aware that, by entering into this agreement, the

Department of Justice in no way assumes responsibility on the part of the United

States Government for any monetary liability that might be imposed against Mr.

Goeke in connection with this matter. Although the Department of Justice has as-