Investment firm Henry Inc. this week said it signed a letter of intent with Verified Identity Pass and its primary debt holder, Morgan Stanley, to purchase some "assets and liabilities" of the dominant Registered Traveler provider, which abruptly folded this summer and took much of the industry down with it. The company joins a chorus of players, from members of Congress to the National Business Travel Association and remaining provider Flo Corp., as advocates for relaunching the Registered Traveler program, which some said could come as soon as this year.
In prepared testimony for a House subcommittee on homeland security hearing, Henry Inc. principal Alison Townley today said a relaunch of a viable Registered Traveler program would require "a close partnership with TSA," which in the past year released the program from pilot mode and largely discontinued its involvement.
Since Verified Identity Pass in late June halted operations, some customers have sued the company for breach of contract, one of its competitors, Vigilant Solutions, also folded, and the sole survivor, Flo Corp., suspended operations at the only airport where it operated
(BTNonline, July 27).
None of those operations has yet to resume, though Flo Corp. principal and managing partner Fred Fischer in testimony today said the Registered Traveler firm "has secured significant financing since Clear's failure and plans to relaunch a national program, with or without TSA, at multiple airports in the next 30 days, with additional former RT airports and airports new to RT eagerly awaiting relaunch of the program." Airports slated to relaunch were not disclosed.
Without the support of TSA, "It was only a matter of time before service providers ran into trouble," said Rep. Charlie Dent (R-Pa.) during the subcommittee hearing today. Dent added, "TSA has never embraced the RT program," though, as evidenced by the passage of a TSA reauthorization bill in the House, "Congress intends for the Registered Traveler program to move forward."
That message is clear in the Transportation Security Administration Authorization Act, which passed the House this summer, but awaits passage of a Senate companion bill. The bill includes language that would bolster TSA's involvement in the program—reinstating the security threat assessments and background checks that it abandoned last year.
John Sammon, assistant TSA administrator for transportation sector network management, today said TSA is awaiting the "speedy confirmation" of President Barack Obama's pick for TSA administrator, Erroll Southers, to determine its approach to the Registered Traveler program.
Townley said if Henry Inc.'s bid to acquire the remains of Clear are successful, the firm plans on "reengaging existing customers and attracting new customers" of the program, including a plan to enroll members of Clear for free for the "balance of the term of their membership that remained unused when Clear ceased operations in June." Townley also envisions launching what she described as a "a streamlined 'fast pass' process which would allow innovations like 'same day' in-airport sales and more pricing options, while still providing certain non-security-related conveniences for members."
Since its launch at Orlando International Airport in 2005, Verified Identity Pass grew to become the dominant player in an emerging business that sought to speed through airport security passengers who elected to pay an annual fee and undergo a threat assessment. Verified Identity Pass ran the Clear program at 18 of the 21 airports in the United States that hosted Registered Traveler lanes.
NBTA executive director Michael McCormick in prepared remarks said, "Business travelers were very disappointed when, with only several hours notice, VIP's Clear terminated its service and the two other smaller players were forced to suspend operations with VIP's airport operations defunct. This development was a sudden and unfortunate blow for business travelers."
Still, the program is not without its dissenters. "I would rather focus on the throughput of all Americans" than a front-of-the-line program, said Rep. Peter DeFazio (D-Ore.).