Diversion of Security Fee funds from TSA harms screening tech adoption, report warns

A leading travel industry organization is calling on the Trump administration to end the diversion of collected funds from the Transportation Security Administration so that new aviation security technologies can be more effectively deployed at American airports. 

In a report released on Wednesday, the U.S. Travel Association said that President Donald Trump can usher in a “golden age of travel” by taking steps to modernize outdated systems and enhance identity verification screening capabilities, including by redirecting funding originally meant for the TSA back to the agency. 

The release of the association’s recommended reforms — which also call for the White House to improve air traffic control technology and address the national shortage of air traffic controllers — comes in the wake of several high-profile airline safety incidents, including last month’s collision between a U.S. Army helicopter and a passenger jet outside of Washington, D.C., that killed 67 people. 

When Congress created the TSA following the September 11 terrorist attacks, it also created a Passenger Security Fee — commonly known as the September 11 Security Fee — to help fund the agency’s activities. Although the Bipartisan Budget Act of 2013 raised the fee for travelers to $5.60 per one-way flight, it also diverted one-third of the collected funds to the Treasury Department’s general fund to help reduce the national deficit.

“Limited federal appropriations and the diversion of the Passenger Security Fee severely hinder TSA’s ability to deploy cutting-edge security technology across the aviation system,” the report said. “As a result, the U.S. is falling behind other nations in the race to modernize the air travel experience.”

One of the technologies that TSA has been increasingly using in the security screening process in recent years is facial recognition. The agency has rolled out the biometric tools to more than 80 U.S. airports so far, and ultimately plans to implement the identity verification technology at more than 400 airports.

The facial recognition-enhanced screening units, known as CAT-2 systems, compare real-time pictures of travelers against their scanned photo identifications. TSA has made the facial recognition screenings optional and says that it deletes photos once a match has been made, but the use of the biometric tools has drawn privacy concerns from some lawmakers and advocacy groups. 

The Department of Homeland Security’s inspector general said last month that his office is reviewing TSA’s use of facial recognition to determine how the tools enhance security while protecting travelers’ privacy. The watchdog’s audit comes after a bipartisan group of 12 senators requested that the DHS IG look into the tools “from both an authorities and privacy perspective.”

Even as the Trump administration prioritizes efforts to slash federal spending, the U.S. Travel Association said revenue from the September 11 Security Fee should fully go to the agency it was intended to help fund.

“Congress must find other sources for deficit reduction that do not undermine national security,” the organization’s report said. “The Passenger Security Fee should be reinvested in aviation security to supplement current appropriations, not replace them.”

TSA officials have already cited the redirection of the funding as a barrier to broader adoption of modernized technologies such as facial recognition. 

During a House hearing last May, former TSA Administrator David Pekoske said the agency’s rollout of the new biometric screening tools at all U.S. airports would likely not be completed until 2049 because of the fee diversion. He added that TSA could finalize deployment of the identity verification technologies in 2033 if Congress does not extend the fee diversion past fiscal year 2027. 

The report said that ending the fee diversion “would generate $10 billion to invest in state-of-the-art identity verification and screening technology at every U.S. airport.”

Congress has taken some steps to redirect funding from the fee back to the TSA, including transferring $800 million of the collected monies back to the agency as part of the fiscal year 2024 DHS appropriations bill. Some lawmakers, however, have taken steps to bring all of the collected revenue back to TSA so that the agency can more quickly pursue its technology modernization efforts. 

Last year, a bipartisan group of lawmakers — led by Rep. Nick LaLota, R-N.Y. — introduced legislation to end the fee diversion and create an “aviation security checkpoint technology fund” to help TSA deploy new tools. 

In an interview with Nextgov/FCW, LaLota said “this situation is only exacerbated the more time that goes by because the technology keeps on getting better.”