The recent arrest in Pakistan of Abu Farraj al-Libbi, reputedly the number 3 man in al-Qaeda, serves as a powerful reminder that the terrorists are still out there and remain a serious threat to the United States. There is no place for complacency. It took five years to plan the 9/11 attacks and three years to plan the Madrid bombings. Right now, terrorists in some basement could be laying the groundwork for an attack five years from now. We need sustainable security that is "on watch" for the long term. The last thing we need to do is just to throw money at the problem, particularly if it does little to make all Americans safer.

Unfortunately, however, that is exactly what is being done. Congress continues to perpetuate a grant system that is better at giving money to states and cities than it is at fighting terrorism. Under the current system, rural, less populated areas often receive a disproportionate amount of money. Some states allocate funds with only a cursory effort to assess risks or strategic need. Congress needs to disburse money to state and local governments based on a risk management strategy grounded on clear national priorities.

The Department of Homeland Security currently awards grants to state governments based on a formula partially codified in the USA PATRIOT Act. According to the formula, DHS distributes 0.75 percent of the state terrorism preparedness grant money appropriated to the department to each state regardless of risk or need. This figure, combined with a slightly smaller percentage for U.S. territories, makes up approximately 40 percent of DHS's first responder grants. The department then allocates the remaining 60 percent of the funding based solely on population.

Put another way, these grants comprise 11 percent of DHS's total budget, with the department giving out $3.6 billion in assistance to state and local first responders in 2006. This formula does little to increase security, but it does ensure that every state has a piece of the Homeland Security funding pie.

H.R. 1544, the Faster and Smarter Funding for First Responders Act of 2005, incorporates risk into the calculation for state grants. Co-sponsored by House Committee on Homeland Security Chairman Christopher Cox and Ranking Member Bennie Thompson, the bill would award federal preparedness dollars to states based on need while still maintaining a minimum amount for all states.

The House bill goes further by requiring states to distribute the grants to their constituents based on necessity rather than population or other factors. The legislation also requires that the grant money be allocated and spent in a timely manner while also encouraging cooperation among neighboring jurisdictions.

Neither the state nor federal governments can afford to protect every public asset or piece of critical infrastructure. DHS and state governments must work together to develop a prioritized list of assets that must be protected. Only with a well-thought-out risk management plan and targeted funding can the federal and state governments get the most protection for taxpayers' money. Legislation from Congress that makes such a system the law of the land would go a long way toward making all Americans safer.

James Jay Carafano, Ph.D., is Senior Research Fellow for National Security and Homeland Security, and Alane Kochems is a Research Assistant, in the Kathryn and Shelby Cullom Davis Institute for International Studies at The Heritage Foundation.

Tom Weiss contributed to this WebMemo.