In spite of actions to reduce the backlog, DOD had to take two actions that brought the security clearance applications to a standstill. First, on April 6. 2006 DSS notified contractors that because of funding constraints and high number of investigations designated as "priority" it would no longer process contractor requests for priority handling of security clearance applications. Second, April 25, DSS stopped processing all security clearances for government contractors due to an "overwhelming" volume of requests and funding constraints. Following an uproar from industry and the House, DSS announced on May 16, 2006 it had found some additional funding that would enable it to restart processing initial secret requests but that it would not process initial requests for top secret clearances and requests for period reinvestigations until it found more funding. In addition, the 2006 defense authorization bill has provided that there will be a restriction of revoking expired contractor security clearances for the rest of 2006. In spite of this, the authors conclude there is no significant improvement in processing security clearance applications in the current period. In fact, a recent FAR interim rule requiring additional background checks be made to obtain identification badges necessary for contractor personnel to enter certain government facilities and have access to federal information technology systems (see Fed. Reg. 211, Jan. 3, 2006) will exacerbate the backlog problem.

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