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TheStreet Open House

5 Big Winners from TSA Security Rules

Vendors
Like any government bureaucracy, the TSA depends on billions of taxpayer dollars to fund its personnel and efforts. That has meant a gold rush of sorts among vendors large and small who provide the technology and expertise the agency requires. More than 21,000 contracts have been awarded since the agency was created.

Among the companies that have benefited from multimillion-dollar contracts since the TSA was founded in 2001 are Unisys (UIS), Siemens (SI), Lockheed Martin (LMT), L-3 Communications (LLL), Accenture (ACN), Deloitte & Touche, General Electric (GE), Northrop Grumman (NOC), BearingPoint and IBM (IBM).

Year by year, opportunities keep emerging for private enterprise to grab an even bigger piece of the pie.

Unfortunately -- for taxpayers, at least -- the agency may be spending money without proper oversight.

In March 2010, an audit by the Department of Homeland Security's Office of the Inspector General flagged procedures in place to procure and oversee private contractors for 29 support service contracts totaling $662 million from the TSA's Office of Security Technology. Reviewing the 13 highest-value of these contracts, the auditors found the agency "did not provide adequate management and oversight of acquisitions for support services for transportation security programs."

"TSA did not have reasonable assurances that contractors were performing as required, that it contracted for the services it needed, that it received the services it paid for or that taxpayers received the best value for its tax dollars," the report added.

An infamous example of the TSA wasting money via private contracts was the failed attempt to implement bomb-detecting "puffer machines."

The devices were supposed to use a blast of air on travelers to dislodge and analyze particles that might indicate the possession or handling of explosives.

In 2004, the TSA loaded up on $30 million of the machines, buying 207 from General Electric and Smiths Detection. One catch: they didn't work. Prone to dust-related malfunctions and false readings due to high humidity and the presence of jet fuel, the machines were discarded and are now collecting dust in storage facilities.

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