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111th Congress 
 2d Session                      SENATE                          Report
                                                                111-248
_______________________________________________________________________

                                     

                                                       Calendar No. 516


TO ALLOW CERTAIN U.S. CUSTOMS AND BORDER PROTECTION EMPLOYEES WHO SERVE 
 UNDER AN OVERSEAS LIMITED APPOINTMENT FOR AT LEAST 2 YEARS, AND WHOSE 
SERVICE IS RATED FULLY SUCCESSFUL OR HIGHER THROUGHOUT THAT TIME, TO BE 
    CONVERTED TO A PERMANENT APPOINTMENT IN THE COMPETITIVE SERVICE

                               __________

                              R E P O R T

                                 of the

                   COMMITTEE ON HOMELAND SECURITY AND

                          GOVERNMENTAL AFFAIRS

                          UNITED STATES SENATE

                              to accompany

                               H.R. 1517

TO ALLOW CERTAIN U.S. CUSTOMS AND BORDER PROTECTION EMPLOYEES WHO SERVE 
 UNDER AN OVERSEAS LIMITED APPOINTMENT FOR AT LEAST 2 YEARS, AND WHOSE 
SERVICE IS RATED FULLY SUCCESSFUL OR HIGHER THROUGHOUT THAT TIME, TO BE 
    CONVERTED TO A PERMANENT APPOINTMENT IN THE COMPETITIVE SERVICE




                 August 5, 2010.--Ordered to be printed
        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

               JOSEPH I. LIEBERMAN, Connecticut, Chairman
CARL LEVIN, Michigan                 SUSAN M. COLLINS, Maine
DANIEL K. AKAKA, Hawaii              TOM COBURN, Oklahoma
THOMAS R. CARPER, Delaware           SCOTT P. BROWN, Massachusetts
MARK L. PRYOR, Arkansas              JOHN McCAIN, Arizona
MARY L. LANDRIEU, Louisiana          GEORGE V. VOINOVICH, Ohio
CLAIRE McCASKILL, Missouri           JOHN ENSIGN, Nevada
JON TESTER, Montana                  LINDSEY GRAHAM, South Carolina
ROLAND W. BURRIS, Illinois
EDWARD E. KAUFMAN, Delaware

                  Michael L. Alexander, Staff Director
                     Kevin J. Landy, Chief Counsel
               Blas Nunez-Neto, Professional Staff Member
                  Nicole M. Martinez, Legislative Aide
     Brandon L. Milhorn, Minority Staff Director and Chief Counsel
        Amanda Wood, Minority Director for Governmental Affairs
                Matthew L. Hanna, Minority CBP Detailee
                  Trina Driessnack Tyrer, Chief Clerk
                                                       Calendar No. 516
111th Congress
                                 SENATE
                                                                 Report
 2d Session                                                     111-248

======================================================================



 
TO ALLOW CERTAIN U.S. CUSTOMS AND BORDER PROTECTION EMPLOYEES WHO SERVE 
 UNDER AN OVERSEAS LIMITED APPOINTMENT FOR AT LEAST 2 YEARS, AND WHOSE 
SERVICE IS RATED FULLY SUCCESSFUL OR HIGHER THROUGHOUT THAT TIME, TO BE 
    CONVERTED TO A PERMANENT APPOINTMENT IN THE COMPETITIVE SERVICE

                                _______
                                

                 August 5, 2010.--Ordered to be printed

                                _______
                                

Mr. Lieberman, from the Committee on Homeland Security and Governmental 
                    Affairs, submitted the following

                              R E P O R T

                        [To accompany H.R. 1517]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Homeland Security and Governmental 
Affairs, to which was referred the bill (H.R. 1517) to allow 
certain U.S. Customs and Border Protection employees who serve 
under an overseas limited appointment for at least 2 years, and 
whose service is rated fully successful or higher throughout 
that time, to be converted to a permanent appointment in the 
competitive service, having considered the same, reports 
favorably thereon with an amendment and recommends that the 
bill, as amended, do pass.

                                CONTENTS

                                                                   Page
  I. Purpose and Summary..............................................2
 II. Background and Need for the Legislation..........................2
III. Legislative History..............................................4
 IV. Section-by-Section Analysis......................................4
  V. Evaluation of Regulatory Impact..................................5
 VI. Congressional Budget Office Cost Estimate........................5
VII. Changes to Existing Law Made by the Bill, as Reported............6

                         I. PURPOSE AND SUMMARY

    The purpose of H.R. 1517 is to allow the U.S. Customs and 
Border Protection (CBP) to resolve a longstanding issue 
involving twenty-five employees stationed abroad. These 
employees initially received temporary appointments, but have 
remained in their jobs between eight and twenty years. Under 
international agreements reached after their hiring, and to 
address potential liabilities under the laws of the countries 
in which they work, they now must hold permanent positions or 
face termination of their employment. This bill would give CBP 
a very targeted exception from civil service rules that require 
agencies to use a competitive process to hire for permanent 
jobs. It will thereby allow this small group of long-time 
employees to keep their jobs and allow the United States to 
retain their expertise.

                II. BACKGROUND AND NEED FOR LEGISLATION

    H.R. 1517 will allow CBP to rectify mistakes made by the 
Immigration and Naturalization Service (INS) and the Department 
of Agriculture, which employed the individuals covered by the 
bill prior to the creation of the Department of Homeland 
Security. The twenty-five CBP employees at issue work in Aruba, 
The Bahamas, Bermuda, Canada, and the Republic of Ireland.\1\ 
The INS and the Department of Agriculture originally hired the 
employees, all United States citizens residing permanently in 
these countries, as overseas temporary part-time 
appointments.\2\ Under Department of State rules, such 
appointments are supposed to last a specified period of time, 
not to exceed one year, and are aimed at meeting a temporary 
employment need in a foreign country. Over time, however these 
25 employees' work gradually evolved, and their jobs became 
full-time and permanent but their jobs remained in a gray area 
between typical civil service positions and locally engaged 
staff (who are typically hired locally and compensated in local 
currency). These 25 employees receive compensation as if they 
were in the U.S. civil service system, but since they were 
hired locally, outside the civil service competition rules, 
they are ineligible for actual civil service positions.
---------------------------------------------------------------------------
    \1\One of these employees is in the process of retiring, so the 
overall number of employees affected by this bill may be 24 by the time 
it is enacted.
    \2\17 of these employees were originally hired by the INS to 
undertake immigration inspections. 8 of them were originally hired by 
the Department of Agriculture to undertake agricultural inspections. 
See 5 C.F.R. Part 301.
---------------------------------------------------------------------------
    One unintended consequence of this situation is that it may 
put the United States government in violation of local 
employment laws. Because these individuals' positions are 
technically not considered U.S. government civil service 
positions, the U.S. government's employment relationship with 
these permanent resident employees is subject to the laws of 
the host country in question. The U.S. government could thus be 
in violation of local law if the benefits provided to the 
employees do not meet the requirements of the host country's 
employment laws (e.g., a certain number of holidays per year 
and paid maternity leave, among other things).\3\ The CBP 
employees in question are currently paid in accordance with the 
General Schedule System (GS) rather than the Local Compensation 
Plan developed in accordance with each country's prevailing 
compensation practices. As such, the Department of State has 
raised concerns about this potential violation and has 
requested that CBP correct the employees' status.
---------------------------------------------------------------------------
    \3\CBP believes that this is in fact the case for Ireland.
---------------------------------------------------------------------------
    All twenty-five employees work in ``pre-clearance 
operations,'' an important component of the United States 
government's ongoing efforts to secure international travel. At 
pre-clearance ports in foreign countries, CBP officers conduct 
immigration, customs, and agricultural inspections of travelers 
before they travel to the United States. This allows the U.S. 
government to better identify dangerous or inadmissible 
individuals before they actually board an airplane bound for 
the United States. In order to place a pre-clearance facility 
in a foreign country, CBP must enter into an agreement with 
that country governing how pre-clearance operations will be 
carried out.
    Apart from the Department of State's general concerns about 
whether the U.S. is violating local employment laws, there is a 
specific issue relating to an international agreement between 
the United States and Ireland, where 15 of the employees in 
question work. The agreement between the United States and 
Ireland that allows U.S. personnel to conduct pre-clearance 
operations requires that the CBP employees stationed in Ireland 
be in the U.S. civil service system. Because the CBP pre-
clearance individuals addressed by H.R. 1517 were hired in 
Ireland to work there on overseas limited appointments, even 
though they are receiving pay and benefits as if they are 
permanent employees, CBP is technically in violation of the two 
countries' agreement.
    Unfortunately, the executive branch cannot solve this 
international disagreement on its own. Civil service laws 
prohibit agencies from non-competitively promoting an 
individual from a limited overseas appointment to a permanent 
civil service position.\4\ To provide an equitable solution 
that recognizes the work done by these employees for the United 
States, H.R. 1517 provides CBP the authority to convert this 
select group of employees non-competitively to the competitive 
service. Congress has previously granted the Internal Revenue 
Service\5\ and the Library of Congress\6\ the authority to 
convert employees from limited positions to permanent, civil 
service positions.
---------------------------------------------------------------------------
    \4\5 CFR Part 301.
    \5\P.L. 105-206, section 1201, 112 Stat. 685, 717 (1998).
    \6\P.L. 106-554, 114 Stat. 2763 (2000).
---------------------------------------------------------------------------
    In late 2007, the Department of State requested that CBP 
either convert the employees to Locally Engaged Staff (LES), 
who work for the U.S. government but are compensated in local 
currency and typically pay local taxes, or to place the 
employees into competitive positions. Since then, CBP and the 
Department of Homeland Security have been working with the 
Department of State and the Office of Personnel Management to 
develop a solution that would allow the employees to continue 
their work in their current positions and avoid adverse impacts 
to the employees.
    In June 2009, an interim administration action was taken to 
bring the affected positions under the purview of the National 
Security Decision Directive (NSDD) 38, which gives the Chief of 
Mission--the head of our diplomatic representation in a foreign 
country (usually the Ambassador)--control over the size, 
composition, and mandate of overseas full-time mission staffing 
for all United States government agencies. With respect to the 
employees working in Ireland, this interim action brought the 
positions under the umbrella of the U.S. Embassy in Ireland to 
allow CBP additional time to take official action to convert 
these positions to competitive status, while allowing CBP to 
increase staffing at pre-clearance operations, per the United 
States government's agreement with Ireland. The Department of 
State has given CBP a June 2011 deadline for adhering to the 
requirements of the international agreement.
    Neither CBP nor the Department of State have been able to 
provide the Committee with a satisfactory answer as to how 
these individuals could have been hired outside of State's 
usual process for overseas limited appointments and why their 
status has not been addressed before now. Nevertheless, the 
individuals in question have, by all accounts, been exemplary 
employees and should not be held responsible for irregularities 
and inconsistencies in the hiring processes for overseas 
limited appointments at the INS, the Department of Agriculture, 
and the Department of State.
    H.R. 1517, as passed by the House, provides discrete 
authority to the CBP Commissioner to convert these positions 
from limited overseas appointments to permanent civil service 
positions. The Senate substitute to H.R. 1517 makes two minor 
changes to the bill: it clarifies that the bill should not be 
construed as allowing for grants of retroactive pay or 
benefits, and it places a two-year sunset on CBP's authority to 
convert temporary employees. CBP has assured the Committee that 
converting these employees will not take longer than two years.
    The Committee urges CBP and the Department of State to work 
together in order to minimize the impact on these individuals 
and their families.

                        III. LEGISLATIVE HISTORY

    H.R. 1517 was introduced on March 16, 2009, by Congressmen 
Eliot Engel and Peter King. The bill was passed by the House on 
December 14, 2009, and referred to the Committee on Homeland 
Security and Governmental Affairs in the Senate. The Committee 
considered the bill on July 28, 2010, and ordered the bill 
reported favorably by voice vote with an amendment in the 
nature of a substitute. Members present for the vote on the 
bill were Senators Lieberman, Levin, Akaka, Carper, Pryor, 
Landrieu, McCaskill, Tester, Kaufman, Collins, and McCain.

                    IV. SECTION-BY-SECTION ANALYSIS

Section 1. Definitions

    This section defines, for the purposes of this Act, the 
terms `Commissioner', `U.S. Customs and Border Protection', 
`competitive service', and `overseas limited appointment'.

Section 2. Authority to convert certain overseas limited appointments 
        to permanent appointments

    This section grants special authority to the Commissioner 
of CBP to adjust the appointment for certain CBP employees 
stationed overseas in order to correct their employment 
category and protect their Federal benefits and retirement.
    Specifically, this section gives the Commissioner authority 
to noncompetitively convert CBP employees hired under an 
overseas limited appointment to permanent status if the 
employee has two or more years of continuous service and the 
service has been rated successful or an equivalent.
    The section also requires the United States to indemnify 
and hold harmless employees covered under the Act from claims 
arising from the exercise of their duties before, on, and after 
enactment of the Act, including, but not limited to, claims 
arising from their residency status.
    Further, the section requires that employees covered under 
this Act and their dependents receive services and monetary 
payments equivalent to those provided to other CBP employees in 
similar positions in the same country of assignment.
    Lastly, the section provides guidance to the Commissioner 
with regard to the implementation of the conversion of an 
employee under this Act and specifically states that the 
implementation should meet the operations needs of CBP while at 
the same time, and to the greatest extent practicable, not be 
disruptive to the affected employees.

Section 3. Rule of construction

    This section clarifies that nothing in the bill shall be 
construed as intending to authorize the payment of back wages 
or benefits to employees who undergo a status conversion.

Section 4. Termination

    This section states that the authority of the Commissioner 
to covert the status of employees shall terminate 2 years after 
the date of enactment.

                   V. EVALUATION OF REGULATORY IMPACT

    Pursuant to the requirements of paragraph 11(b) of rule 
XXVI of the Standing Rules of the Senate, the Committee has 
considered the regulatory impact of this bill. The 
Congressional Budget Office states that the bill contains no 
intergovernmental or private sector mandates as defined in the 
Unfunded Mandate Reform Act and would not effect state, local, 
and tribal governments. The enactment of this legislation will 
not have significant regulatory impact.

             VI. CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

                                                     July 30, 2010.
Hon. Joseph I. Lieberman,
Chairman, Committee on Homeland Security and Governmental Affairs, U.S. 
        Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1517, an act to 
allow certain U.S. Customs and Border Protection employees who 
serve under an overseas limited appointment for at least two 
years, and whose service is rated successful or higher 
throughout that time, to be converted to a permanent 
appointment in the competitive service.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Mark 
Grabowicz.
            Sincerely,
                                              Douglas W. Elmendorf.
    Enclosure.

H.R. 1517--An act to allow certain U.S. Customs and Border Protection 
        employees who serve under an overseas limited appointment for 
        at least two years, and whose service is rated successful or 
        higher throughout that time, to be converted to a permanent 
        appointment in the competitive service

    CBO estimates that implementing H.R. 1517 would have no 
significant cost to the federal government. Enacting the 
legislation would not affect revenues or direct spending; 
therefore, pay-as-you-go procedures would not apply.
    H.R. 1517 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would not affect the budgets of state, local, or tribal 
governments.
    H.R. 1517 would authorize U.S. Customs and Border 
Protection (CBP) in the Department of Homeland Security to 
change the employment status of certain individuals stationed 
overseas; this authority would expire two years after enactment 
of the legislation. The act would change those employees' 
status from ``overseas limited appointment'' to ``permanent 
appointment in the competitive service'' to comply with certain 
international agreements between the United States and other 
countries. The legislation would apply to 35 employees who 
began service with the former Immigration and Naturalization 
Service. H.R. 1517 would not change the salaries or 
significantly alter the benefits of those individuals. Thus, 
CBO estimates that implementing the act would have no 
significant effect on spending by CBP.
    On December 3, 2009, CBO transmitted a cost estimate for 
H.R. 1517 as ordered reported by the House Committee on 
Homeland Security on November 17, 2009. The two versions of the 
legislation are similar, as are the CBO cost estimates.
    The CBO staff contact for this estimate is Mark Grabowicz. 
This estimate was approved by Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.

       VII. CHANGES TO EXISTING LAW MADE BY THE BILL, AS REPORTED

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
H.R. 1517 as reported are shown as follows (existing law 
proposed to be omitted is enclosed in brackets, new matter is 
printed in italic, and existing law in which no change is 
proposed is shown in roman):
    H.R. 1517 does not make any changes to existing law.