The plan by President George Bush to elevate almost all US domestic security functions into a cabinet level agency has left US airlines and airports wondering what will come next in dealing with the bureaucratic challenges they have faced since 11 September.

The new department, to be called the Department of Homeland Security, which would require extensive Congressional review and approval, would take the recently created Transportation Security Administration (TSA) out of the Department of Transportation (DoT), along with around 41,300 workers, and about $4.8 billion in annual funding. But many worry that the move would only make it harder to deal with an already difficult regime, says J E "Sandy" Murdock, a Shaw Pittman attorney in Washington, who was chief FAA counsel and acting deputy administrator in 1981-5.

Murdock says of the TSA: "They've shown little interest in soliciting industry opinion. Industry groups are furious. It has not taken within its body a lot of ex-aviation people." He told a Homeland Security & Defence conference in Washington: "More often than not, you learn what it did after they did it."

Beyond the TSA's reputation for being difficult to deal with, it is also far from inexpensive, having already doubled its size and its budget demands since its creation last year. Since then it has become a drain on airlines through increased fees. A $5 TSA-mandated security fee that was to be collected from passengers is, in a highly competitive pricing atmosphere, a cost that some airlines have had to absorb.

Delta Air Lines chief executive Leo Mullin says the fee alone has cost Delta around $260 million because it is unable to raise prices instead, while traffic deterred by security hassles has cost another $600 million. Northwest Airlines chief executive Richard Anderson says that when the TSA moves to the new Homeland Security Department, it must not "bring demands for more fees".

Echoing Mullin, Anderson says that security expenses already constitute an "unfunded mandate". This is Washington-speak in favour of an argument for fresh sums of federal aid. It was deployed successfully a decade ago in winning billions in federal dollars for cities and states to meet environmental standards.

Mullin also told a Merrill Lynch investors conference that he has recently been to the White House to express "at a very high level" his concerns about rising security costs, and the possibility that the new cabinet department will exacerbate the trend.

But there is a brighter side. Once relieved of the coastguard and its $7.3 billion annual budget under the plan, the DoT will be able to focus on core tasks like air traffic control. For US transportation secretary, Norm Mineta, who sources say fought to keep the TSA but not the coastguard, the move reduces friction with TSA administrator John McGaw, a former secret service chief. McGaw, like the airline industry, has quarrelled with Mineta over passenger profiling or screening.

Mineta, a deeply committed civil libertarian, has opposed almost any form of profiling as potentially racially discriminatory. The move may also make it easier for the airlines to win government approval for some form of traveller identification card to speed up processing, which current homeland security czar Tom Ridge has endorsed. It may also encourage data pooling with private companies that might have been reluctant to share with a civilian agency such as the DoT.

But the new agency - and it is far from certain that Ridge will be nominated to lead it - will still face deadlines that TSA is struggling to meet. House Aviation Subcommittee Chair Republican John Mica worries that the move will not expedite matters.

Brookings Institution international security authority Michael O'Hanlon says little of the debate in Washington has focused outward. Security is still too much of a homeland concern, he says. He worries that the USA will set itself on a course to create a security regime that later will come into conflict with international standards.

Source: Airline Business