Terry Glenn is a cowgirl

- AP

Despite ongoing privacy concerns and legal disputes involving
companies bidding on the project, the U.S. State Department plans
to begin issuing smart chip-embedded passports to Americans as
planned Monday.

Not even the foiled terror plot that heightened security checks at
airports nationwide threatens to delay the rollout, the agency said.
Any hitches in getting the technology to work properly could add
even longer waits to travelers already facing lengthy security lines
at airports.

The new U.S. passports will include a chip that contains all the
data contained in the paper version - name, birthdate, gender, for
example - and can be read by electronic scanners at equipped
airports. The State Department says they will speed up going
through customs and help enhance border security.

Privacy groups continue to raise concerns about the security of the
electronic information and a German computer security expert earlier
this month demonstrated in Las Vegas how personal information stored
on the documents could be copied and transferred to another device.

But electronic cloning does not constitute a threat because the
information on the chips, including the photograph, is encrypted and
cannot be changed, according to the Smart Card Alliance, a New
Jersey-based not-for-profit made up of government agencies and
industry players.

"It's no different than someone stealing your passport and trying to
use it," Randy Vanderhoof, executive director of the alliance, said
in a statement. "No one else can use it because your photo is on
the chip and they're not you."

Yet the ability to clone the information on the chips may not be the
sole threat, privacy advocates argue. A major concern is that
hackers could pick up the electronic signal when the passport is
being scanned, said Sherwin Siy, staff counsel at the
Washington-based Electronic Privacy Information Center, a leading
privacy group.

"Many of the advantages the industry is touting are eliminated by
security concerns," Siy said.

After testing the passports in a pilot project over the past year,
the government insists they're safe.

Numerous companies competed the last two years to provide the
technology. One winner was San Jose-based Infineon Technologies
North America Corp., a subsidiary of Germany's Infineon AG. Another
was French firm Gemalto, which earlier this month announced that it
had received its first production order from the Government Printing
Office. It is producing the passports for the State Department,
using the Infineon technology.

Another company, On Track Innovations Ltd. (OTIV), was notified
July 31 that it had been eliminated from consideration and is
appealing the decision, a spokeswoman for the Fort Lee, N.J.
company said this week. On Track previously had been eliminated but
appealed that decision in the U.S. Court of Federal Claims in
Washington, D.C., which found in favor of the company and ordered it
be reinstated.

Infineon has been approved for production-quantity orders but hasn't
received any because of the unresolved legal dispute, said Veronica
Meter, a spokeswoman for the Government Printing Office. The
rollout that begins Monday will use technology built up during the
pilot project.

Neville Pattinson, director of technology and government affairs for
Gemalto in Austin, Texas, would not discuss financial terms of the
contract. He acknowledged the economic potential is massive, noting
that the State Department issued 10 million passports in 2005 and
expects that to increase to 13 million this year.

Citizens who get new passports can expect to pay a lot more. New
ones issued under this program will cost $97, which includes a $12
security surcharge added last year. Not all new passports will
contain the technology until it's fully rolled out - a process
expected to take a year. Existing passports without the electronic
chips will remain valid until their normal expiration date.