"Key activities in the development of (the system) have been delayed and the Transportation Security Administration has not yet completed important system planning activities," says a draft summary of the report prepared by Congress' investigative arm, the General Accounting Office.
The damning report may prevent funds for the system, known by the acronym CAPPS II, for Computer Assisted Passenger Pre-screening System phase two, from being released by Congress.
CAPPS II would divide passengers into three categories: green, screened normally at the gate; yellow, given extra screening; and red. TSA officials say passengers given a red rating will be forbidden to fly and will be questioned at the airport by law enforcement officials.
The summary says that -- as of Jan.1 -- the Transportation Security Administration also had not finalized exactly how the system would work, or identified a timetable or budget for its implementation. It says that the agency has failed a series of tests set by Congress last year as a condition for the release of funding for the system.
"I'm disappointed," said Rep. John Mica, R-Fla., chairman of the House Aviation Subcommittee, and an advocate of threat screening. "We may have to send them back to the drawing board."
"I'm even more worried now about the implementation of this system than I was before," said former Georgia GOP congressman Bob Barr, a long-standing critic of the proposal. "This should be the death knell for this idea, but I think it will take a great deal of courage and perseverance by congress to kill this off."
"I hope they take a long hard look at this report."
CAPPS II is supposed to compare personal data about passengers collected by airlines -- name, address, date of birth and telephone number -- with commercial databases held by marketing companies and others.
Mathematical formulas called algorithms would be used to combine and cross check all kinds of information about every passenger -- how long they have lived at their address, for example -- but also intelligence held by U.S. agencies about individuals and groups. The program then comes up with a threat score -- a bit like a credit rating -- for each traveler.
CAPPS II -- plans for which were announced in January 2003 -- would replace two earlier systems administered by airlines. The "no-fly list," naming individuals suspected of terror links or barred for other reasons, and CAPPS I, which checks a range of data about the trip -- whether the ticket is one-way, bought with cash or purchased at the last minute, among other factors -- and runs the passenger's name against a federal "watch list" of terrorist suspects.
But planning for the system ran into a firestorm of criticism from civil liberties and privacy advocates from both sides of the political spectrum. Critics contended that it would violate travelers' privacy and Fourth Amendment rights; brand some citizens terror suspects on the basis of potentially inaccurate data that they cannot challenge; and was being expanded for use against all kind of law-breakers and suspects, not just terrorists.
Concerned lawmakers set a series of eight tests -- enacted into law in several funding bills -- that the system had to pass before money could be released to fund its implementation. The tests included establishing a process for correcting erroneous information and restoring the right of wrongly labeled innocent passengers to travel by air; assuring the security of the system from hackers and internal abuse; addressing privacy concerns; and -- crucially -- providing evidence that the screening will actually turn up potential terrorists.
The summary says the Transportation Security Administration failed on all these counts. It says it made sufficient progress on only one of the tests -- establishing an oversight board for the system.
The summary identified what it called "three other challenges ... that may impede the success of CAPPS II." These were getting passenger data from foreign airlines, ensuring that identity theft could not be used to get around the system and "managing the expansion of the program's mission beyond its original purpose" -- a reference to what critics have called "mission creep."
Last year, officials said that CAPPS II would also be used to check for serious and violent offenders wanted by authorities, as well as terrorists.
The Department of Homeland Security, of which the Transportation Security Administration is a part, became embroiled in a long-running dispute with the European Union last year over access to passenger data. Although a deal was reached, it has not yet been ratified by the European parliament.
As part of the deal, EU authorities agreed to provide passenger data for testing the CAPPS II system later this year, but privacy advocates in Europe, angered to learn subsequently that U.S. airlines had refused to do likewise for privacy reasons, have vowed to derail the deal when it comes before the parliament as it is expected to do shortly.
Identity theft was a problem, acknowledged Mica, "We need a system in place that can identify the bad guys," he said, "but how much data do you need to collect? What identification measures do you need to take?"
The TSA referred a request for comment to the Department for Homeland Security, but no one there was immediately available for comment.