DOHA acted under Executive Order 10865, Safeguarding Classified Information Within Industry (February1
20, 1990), as amended; Department of Defense (DoD) Directive 5220.6, Defense Industrial Personnel Security
Clearance Review Program  (January 2, 1992), as amended (Directive), and the adjudicative guidelines (AG)
effective within the DoD on 1 September 2006. 
The hearing was initially scheduled for 10 February 2010, but was postponed because of a record snowstorm2
in the area.
1
                                                             
                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
)       ISCR Case No. 09-01167
SSN: )
)
Applicant for Security Clearance )
Appearances
For Government: Braden M. Murphy, Esquire, Department Counsel
For Applicant: Pro se
______________
Decision
______________
METZ, John Grattan, Jr., Administrative Judge:
On 28 October 2009 the Defense Office of Hearings and Appeals (DOHA) issued
a Statement of Reasons (SOR) to Applicant detailing security concerns under Guideline
F, Financial Considerations as the basis for a decision to deny or revoke his access to
classified information.  Applicant answered the SOR 17 November 2009, and requested1
a hearing. DOHA assigned the case to me 4 January 2010, and I convened a hearing 8
March 2010.  DOHA received the transcript (Tr.) 16 March 2010.2
The SOR also alleged two debts totaling just over $500, which Applicant has paid. They lack security3
significance in the context of this case.
2
Findings of Fact
Applicant admitted the SOR allegations.  He is a 59-year-old program manager3
employed by a defense contractor since July 1999. He seeks to retain the clearance
held when he was in the military, and which was most recently renewed in September
2003.
The SOR alleges, Applicant admits, and government exhibits substantiate, over
$54,000 in taxes, interest, and penalties owed to the Internal Revenue Service (IRS) for
tax years 1998-2008. Despite Applicant’s sporadic payments to the IRS over the years,
the debt has grown to nearly $56,000 as of February 2010. Applicant has not entered
into a repayment plan with the IRS, and has no plan for addressing this indebtedness.
The IRS offered him a repayment plan in July 2009 in which the IRS concluded that
Applicant could afford monthly payments of $1,690. Applicant believed he could not
afford that payment. The IRS bases its calculations on Applicant’s available income,
which includes amounts Applicant is currently sending to his 401k retirement plan, his
son’s college tuition, and his tithe to his church. Applicant had proposed that the IRS
accept monthly payments of $350. Applicant discussed a repayment plan with the IRS
in February 2010, but they are still far apart on the monthly payment. The IRS wants
Applicant to pay $1,621 per month; he has offered $900 (Tr. 34).
In September 1997, Applicant retired as an O-6 after 25 years service with the
military. In early 1996 or 1997, he and his wife separated, and ultimately divorced.
Although Applicant had the property settlement reviewed by a military legal assistance
attorney, he was unrepresented in the property settlement negotiations, and perceiving
his wife to be “unstable” largely acquiesced to her and her attorney’s demands. Chief
among those demands were Applicant’s assumption of most of the marital debt,
payment of alimony and child support, and his agreement that she could claim the
children as dependents on her income tax returns. Applicant agreed to these terms
despite the fact that his wife did not, and does not, work outside the home.
Because of the property settlement, Applicant experienced financial difficulties.
He got custody of his children in 2000, which helped him on his income taxes, but
required him to spend more on housing. In 2003, he entered a debt consolidation
program and paid $700 per month for five years, finishing in November 2008. He has
made sporadic payments to the IRS over the years, but has not satisfied his tax liability
for any one year. It appears that the only tax year for which his balance has been
reduced by payment is tax year 2008. All other tax years have increased balances
because of interest and penalties.
Applicant’s combined salary and military retirement total about $182,000 per year
(Tr. 50-51). He always files his federal income tax returns on time, but has been unable
to pay the full amount due. The large tax liabilities in 1998 and 1998 were mostly due to
See, Department of the Navy v. Egan, 484 U.S. 518 (1988).4
3
the tax consequences of his separation and losing his children as deductions. He has
not offered satisfactory explanations for his failure to withhold adequate income tax from
2000 to 2008, although in the later years he was subject to alternative minimum tax. He
also took premature distributions from his 401k retirement plan to pay debts, which
increased his tax liability for the year in which he made the withdrawal. He believes that
he has adjusted his withholding enough so he will have a small refund due when he files
his 2009 income tax return.
Applicant’s supervisor since 2008 considers him a trustworthy employee and
recommends him for his clearance. She is aware that his clearance is under review, but
is not aware of the issues raised in the SOR.
Policies
The adjudicative guidelines (AG) list factors to be considered in evaluating an
applicant’s suitability for access to classified information. Administrative judges must
assess both disqualifying and mitigating conditions under each issue fairly raised by the
facts and circumstances presented. Each decision must also reflect a fair and impartial
commonsense consideration of the factors listed in AG ¶ 2(a). The presence or absence
of a disqualifying or mitigating condition is not determinative for or against applicant.
However, specific adjudicative guidelines should be followed where a case can be
measured against them, as they represent policy guidance governing the grant or denial
of access to classified information. Considering the SOR allegations and the evidence
as a whole, the relevant, applicable, adjudicative guideline is Guideline F (Financial
Considerations).
Security clearance decisions resolve whether it is clearly consistent with the
national interest to grant or continue an applicant’s security clearance. The government
must prove, by something less than a preponderance of the evidence, controverted
facts alleged in the SOR. If it does so, it establishes a legally sufficient case against
access to classified information. Applicant must then refute, extenuate, or mitigate the
government’s case. Because no one has a right to a security clearance, the applicant
bears a heavy burden of persuasion.
Persons with access to classified information enter into a fiduciary relationship
with the government based on trust and confidence. Therefore, the government has a
compelling interest in ensuring each applicant possesses the requisite judgement,
reliability, and trustworthiness of those who must protect national interests as their own.
The “clearly consistent with the national interest” standard compels resolution of any
reasonable doubt about an applicant’s suitability for access in favor of the government.4
¶19 (a) inability or unwillingness to satisfy debts;5
¶20 (a) the behavior happened so long ago, was so infrequent, or occurred under such circumstances that6
it is unlikely to recur . . . 
¶20 (b) the conditions that resulted in the financial problem were largely beyond the person’s control . . . and7
the individual acted responsibly under the circumstances;
¶20 (c)  the person has received or is receiving counseling for the problem and there are clear indications8
that the problem is being resolved or is under control;
,¶20(d) the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts.9
4
Analysis
The government established a case for disqualification under Guideline F, and
Applicant did not mitigate the security concerns. Applicant has a history of financial
difficulties dating to at least 1998 as demonstrated by outstanding income tax liabilities
for tax years 1998 through 2008.  He has not made systematic payments to the IRS,5
has not reached a repayment agreement with the IRS, and has only recently adjusted
his income tax withholding for tax year 2009 to ensure that enough tax is withheld. 
The mitigating factors for financial considerations provide little help to Applicant.
His financial difficulties are both recent and multiple.  His financial problems are as6
much a product of choices he made when he separated from his wife in 1996 or 1997
as the divorce itself.  Further, he did not deal responsibly with his tax debt. Indeed, his7
financial plan seems to have provided for repayment of every creditor but the IRS. His
payments to the IRS have been haphazard and sporadic. He has declined the
repayment plans offered by the IRS because, in his view, he cannot afford the
payments because of other financial choices he has made. There is no evidence that
Applicant has undertaken financial counseling. He has not demonstrated that the
problem has been brought substantially under control.  The payments that have been8
paid have not been paid in a timely, good-faith effort.  The record does not indicate9
when, if ever, his financial situation will be settled enough for him to make clear
progress on his tax debt. I conclude Guideline F against Applicant.
A whole-person analysis requires no different result. Although the record is silent
on his military record, I take as a given that his performance was satisfactory, and there
is no evidence of any security issues during his career. Similarly, his work performance
is favorable. However, for the last 11 years, Applicant has demonstrated misplaced
priorities by not addressing his income tax issues in a timely and effective manner. Even
now, it is not certain that Applicant will have no tax issues for tax years 2009 and
beyond. Further, it remains to be seen what steps Applicant will take to address his
income tax liabilities for tax years 1998-2008. Finally, it is anomalous that Applicant
would expect to be trusted with access to classified information by the same
government whose tax assessments remain unsatisfied, and growing, for more than 10
years.
5
Formal Findings
Paragraph 1. Guideline F: AGAINST APPLICANT
Subparagraph a: Against Applicant
Subparagraph b-c: For Applicant
Conclusion
In light of all the circumstances presented by the record in this case, it is not
clearly consistent with the national interest to grant or continue a security clearance for
Applicant. Clearance denied.
                                              
                                             
JOHN GRATTAN METZ, JR
Administrative Judge