[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2417 Enrolled Bill (ENR)]

        H.R.2417

                       One Hundred Eighth Congress

                                 of the

                        United States of America


                          AT THE FIRST SESSION

          Begun and held at the City of Washington on Tuesday,
           the seventh day of January, two thousand and three


                                 An Act


 
 To authorize appropriations for fiscal year 2004 for intelligence and 
  intelligence-related activities of the United States Government, the 
   Community Management Account, and the Central Intelligence Agency 
        Retirement and Disability System, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Intelligence 
Authorization Act for Fiscal Year 2004''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:
Sec. 1. Short title; table of contents.

                    TITLE I--INTELLIGENCE ACTIVITIES

Sec. 101. Authorization of appropriations.
Sec. 102. Classified schedule of authorizations.
Sec. 103. Personnel ceiling adjustments.
Sec. 104. Intelligence Community Management Account.
Sec. 105. Office of Intelligence and Analysis of the Department of the 
          Treasury.
Sec. 106. Incorporation of reporting requirements.
Sec. 107. Preparation and submittal of reports, reviews, studies, and 
          plans relating to intelligence activities of Department of 
          Defense or Department of 
          Energy.

 TITLE II--CENTRAL INTELLIGENCE AGENCY RETIREMENT AND DISABILITY SYSTEM

Sec. 201. Authorization of appropriations.

                      TITLE III--GENERAL PROVISIONS

                Subtitle A--Recurring General Provisions

Sec. 301. Increase in employee compensation and benefits authorized by 
          law.
Sec. 302. Restriction on conduct of intelligence activities.

                        Subtitle B--Intelligence

Sec. 311. Authority of Federal Bureau of Investigation to award personal 
          services contracts.
Sec. 312. Budget treatment of costs of acquisition of major systems by 
          the intelligence community.
Sec. 313. Modification of sunset of application of sanctions laws to 
          intelligence 
          activities.
Sec. 314. Modification of notice and wait requirements on projects to 
          construct or improve intelligence community facilities.
Sec. 315. Extension of deadline for final report of the National 
          Commission for the Review of the Research and Development 
          Programs of the United States Intelligence Community.
Sec. 316. Improvement of information sharing among Federal, State, and 
          local 
          government officials.
Sec. 317. Pilot program on analysis of signals and other intelligence by 
          intelligence analysts of various elements of the intelligence 
          community.
Sec. 318. Pilot program on recruitment and training of intelligence 
          analysts.
Sec. 319. Improvement of equality of employment opportunities in the 
          intelligence community.
Sec. 320. Sense of Congress on recruitment as intelligence community 
          personnel of members of the Armed Forces on their discharge or 
          release from duty.
Sec. 321. External Collection Capabilities and Requirements Review 
          Panel.

                     Subtitle C--Counterintelligence

Sec. 341. Counterintelligence initiatives for the intelligence 
          community.

                           Subtitle D--Reports

Sec. 351. Report on cleared insider threat to classified computer 
          networks.
Sec. 352. Report on security background investigations and security 
          clearance procedures of the Federal Government.
Sec. 353. Report on detail of civilian intelligence personnel among 
          elements of the intelligence community and the Department of 
          Defense.
Sec. 354. Report on modifications of policy and law on classified 
          information to facilitate sharing of information for national 
          security purposes.
Sec. 355. Report on strategic planning.
Sec. 356. Report on United States dependence on computer hardware and 
          software manufactured overseas.
Sec. 357. Report on lessons learned from military operations in Iraq.
Sec. 358. Reports on conventional weapons and ammunition obtained by 
          Iraq in violation of certain United Nations Security Council 
          resolutions.
Sec. 359. Report on operations of Directorate of Information Analysis 
          and Infrastructure Protection and Terrorist Threat Integration 
          Center.
Sec. 360. Report on Terrorist Screening Center.
Sec. 361. Repeal and modification of report requirements relating to 
          intelligence activities.

                        Subtitle E--Other Matters

Sec. 371. Extension of suspension of reorganization of Diplomatic 
          Telecommunications Service Program Office.
Sec. 372. Modifications of authorities on explosive materials.
Sec. 373. Modification of prohibition on the naturalization of certain 
          persons.
Sec. 374. Modification to definition of financial institution in Right 
          to Financial Privacy Act.
Sec. 375. Coordination of Federal Government research on security 
          evaluations.
Sec. 376. Treatment of classified information in money laundering cases.
Sec. 377. Technical amendments.

                  TITLE IV--CENTRAL INTELLIGENCE AGENCY

Sec. 401. Amendment to certain Central Intelligence Agency Act of 1949 
          notification requirements.
Sec. 402. Protection of certain Central Intelligence Agency personnel 
          from tort liability.
Sec. 403. Repeal of obsolete limitation on use of funds in central 
          services working capital fund.
Sec. 404. Purchases by Central Intelligence Agency of products of 
          Federal Prison Industries.
Sec. 405. Postponement of Central Intelligence Agency compensation 
          reform and other matters.

           TITLE V--DEPARTMENT OF DEFENSE INTELLIGENCE MATTERS

Sec. 501. Protection of certain National Security Agency personnel from 
          tort liability.
Sec. 502. Use of funds for counterdrug and counterterrorism activities 
          for Colombia.
Sec. 503. Scene visualization technologies.
Sec. 504. Measurement and signatures intelligence research program.
Sec. 505. Availability of funds of National Security Agency for national 
          security scholarships.

                    TITLE I--INTELLIGENCE ACTIVITIES

SEC. 101. AUTHORIZATION OF APPROPRIATIONS.

    Funds are hereby authorized to be appropriated for fiscal year 2004 
for the conduct of the intelligence and intelligence-related activities 
of the following elements of the United States Government:
        (1) The Central Intelligence Agency.
        (2) The Department of Defense.
        (3) The Defense Intelligence Agency.
        (4) The National Security Agency.
        (5) The Department of the Army, the Department of the Navy, and 
    the Department of the Air Force.
        (6) The Department of State.
        (7) The Department of the Treasury.
        (8) The Department of Energy.
        (9) The Department of Justice.
        (10) The Federal Bureau of Investigation.
        (11) The National Reconnaissance Office.
        (12) The National Geospatial-Intelligence Agency.
        (13) The Coast Guard.
        (14) The Department of Homeland Security.

SEC. 102. CLASSIFIED SCHEDULE OF AUTHORIZATIONS.

    (a) Specifications of Amounts and Personnel Ceilings.--The amounts 
authorized to be appropriated under section 101, and the authorized 
personnel ceilings as of September 30, 2004, for the conduct of the 
intelligence and intelligence-related activities of the elements listed 
in such section, are those specified in the classified Schedule of 
Authorizations prepared to accompany the conference report on the bill 
H.R. 2417 of the One Hundred Eighth Congress.
    (b) Availability of Classified Schedule of Authorizations.--The 
Schedule of Authorizations shall be made available to the Committees on 
Appropriations of the Senate and House of Representatives and to the 
President. The President shall provide for suitable distribution of the 
Schedule, or of appropriate portions of the Schedule, within the 
executive branch.

SEC. 103. PERSONNEL CEILING ADJUSTMENTS.

    (a) Authority for Adjustments.--With the approval of the Director 
of the Office of Management and Budget, the Director of Central 
Intelligence may authorize employment of civilian personnel in excess 
of the number authorized for fiscal year 2004 under section 102 when 
the Director of Central Intelligence determines that such action is 
necessary to the performance of important intelligence functions, 
except that the number of personnel employed in excess of the number 
authorized under such section may not, for any element of the 
intelligence community, exceed 2 percent of the number of civilian 
personnel authorized under such section for such element.
    (b) Notice to Intelligence Committees.--The Director of Central 
Intelligence shall promptly notify the Select Committee on Intelligence 
of the Senate and the Permanent Select Committee on Intelligence of the 
House of Representatives whenever the Director exercises the authority 
granted by this section.

SEC. 104. INTELLIGENCE COMMUNITY MANAGEMENT ACCOUNT.

    (a) Authorization of Appropriations.--There is authorized to be 
appropriated for the Intelligence Community Management Account of the 
Director of Central Intelligence for fiscal year 2004 the sum of 
$221,513,000. Within such amount, funds identified in the classified 
Schedule of Authorizations referred to in section 102(a) for advanced 
research and development shall remain available until September 30, 
2005.
    (b) Authorized Personnel Levels.--The elements within the 
Intelligence Community Management Account of the Director of Central 
Intelligence are authorized 310 full-time personnel as of September 30, 
2004. Personnel serving in such elements may be permanent employees of 
the Intelligence Community Management Account or personnel detailed 
from other elements of the United States Government.
    (c) Classified Authorizations.--
        (1) Authorization of appropriations.--In addition to amounts 
    authorized to be appropriated for the Intelligence Community 
    Management Account by subsection (a), there are also authorized to 
    be appropriated for the Intelligence Community Management Account 
    for fiscal year 2004 such additional amounts as are specified in 
    the classified Schedule of Authorizations referred to in section 
    102(a). Such additional amounts for research and development shall 
    remain available until September 30, 2005.
        (2) Authorization of personnel.--In addition to the personnel 
    authorized by subsection (b) for elements of the Intelligence 
    Community Management Account as of September 30, 2004, there are 
    also authorized such additional personnel for such elements as of 
    that date as are specified in the classified Schedule of 
    Authorizations.
    (d) Reimbursement.--Except as provided in section 113 of the 
National Security Act of 1947 (50 U.S.C. 404h), during fiscal year 2004 
any officer or employee of the United States or a member of the Armed 
Forces who is detailed to the staff of the Intelligence Community 
Management Account from another element of the United States Government 
shall be detailed on a reimbursable basis, except that any such 
officer, employee, or member may be detailed on a nonreimbursable basis 
for a period of less than one year for the performance of temporary 
functions as required by the Director of Central Intelligence.
    (e) National Drug Intelligence Center.--
        (1) In general.--Of the amount authorized to be appropriated in 
    subsection (a), $47,142,000 shall be available for the National 
    Drug Intelligence Center. Within such amount, funds provided for 
    research, development, testing, and evaluation purposes shall 
    remain available until September 30, 2005, and funds provided for 
    procurement purposes shall remain available until September 30, 
    2006.
        (2) Transfer of funds.--The Director of Central Intelligence 
    shall transfer to the Attorney General funds available for the 
    National Drug Intelligence Center under paragraph (1). The Attorney 
    General shall utilize funds so transferred for the activities of 
    the National Drug Intelligence Center.
        (3) Limitation.--Amounts available for the National Drug 
    Intelligence Center may not be used in contravention of the 
    provisions of section 103(d)(1) of the National Security Act of 
    1947 (50 U.S.C. 403-3(d)(1)).
        (4) Authority.--Notwithstanding any other provision of law, the 
    Attorney General shall retain full authority over the operations of 
    the National Drug Intelligence Center.

SEC. 105. OFFICE OF INTELLIGENCE AND ANALYSIS OF THE DEPARTMENT OF THE 
              TREASURY.

    (a) Establishment of Office.--(1) Chapter 3 of subtitle I of title 
31, United States Code, is amended--
        (A) by redesignating section 311 as section 312; and
        (B) by inserting after section 310 the following:

``Sec. 311. Office of Intelligence and Analysis

    ``(a) Establishment.--There is established within the Department of 
the Treasury, the Office of Intelligence and Analysis (in this section 
referred to as the `Office'), which shall--
        ``(1) be responsible for the receipt, analysis, collation, and 
    dissemination of foreign intelligence and foreign 
    counterintelligence information (within the meaning of section 3 of 
    the National Security Act of 1947 (50 U.S.C. 401a)) related to the 
    operation and responsibilities of the Department of the Treasury; 
    and
        ``(2) have such other related duties and authorities as may be 
    assigned to it by the Secretary, subject to the authority, 
    direction, and control of the Secretary.
    ``(b) Assistant Secretary for Intelligence and Analysis.--The 
Office shall be headed by an Assistant Secretary, who shall be 
appointed by the President, by and with the advice and consent of the 
Senate. The Assistant Secretary shall report directly to the 
Undersecretary of the Treasury for Enforcement.''.
    (2) The table of sections at the beginning of chapter 3 of such 
title is amended by striking the item relating to section 311 and 
inserting the following new items:

``311. Office of Intelligence and Analysis.
``312. Continuing in office.''.

    (b) Construction of Authority.--Nothing in section 311 of title 31, 
United States Code (as amended by subsection (a)), shall be construed 
to alter the authorities and responsibilities of the Director of 
Central Intelligence with respect to the Office of Intelligence and 
Analysis of the Department of the Treasury as an element of the 
intelligence community.
    (c) Consultation With DCI in Appointment of Assistant Secretary.--
Section 106(b)(2) of the National Security Act of 1947 (50 U.S.C. 403-
6(b)(2)) is amended by adding at the end the following:
            ``(E) The Assistant Secretary for Intelligence and Analysis 
        of the Department of the Treasury.''.
    (d) Conforming Amendments.--
        (1) National security act.--Section 3(4) of the National 
    Security Act of 1947 (50 U.S.C. 401a(4)) is amended--
            (A) in subparagraph (H), by striking ``the Department of 
        the Treasury,'';
            (B) by redesignating subparagraphs (J) and (K) as 
        subparagraphs (K) and (L), respectively; and
            (C) by inserting after subparagraph (I) the following new 
        subparagraph (J):
            ``(J) the Office of Intelligence and Analysis of the 
        Department of the Treasury;''.
        (2) Title 31.--Section 301(e) of title 31, United States Code, 
    is amended by striking ``7'' and inserting ``8''.
        (3) Title 5.--Section 5315 of title 5, United States Code, is 
    amended in the item relating to Assistant Secretaries of the 
    Treasury by striking ``(7)'' and inserting ``(8)''.

SEC. 106. INCORPORATION OF REPORTING REQUIREMENTS.

    (a) In General.--Each requirement to submit a report to the 
congressional intelligence committees that is included in the joint 
explanatory statement to accompany the conference report on the bill 
H.R. 2417 of the One Hundred Eighth Congress, or in the classified 
annex to this Act, is hereby incorporated into this Act, and is hereby 
made a requirement in law.
    (b) Congressional Intelligence Committees Defined.--In this 
section, the term ``congressional intelligence committees'' means--
        (1) the Select Committee on Intelligence of the Senate; and
        (2) the Permanent Select Committee on Intelligence of the House 
    of Representatives.

SEC. 107. PREPARATION AND SUBMITTAL OF REPORTS, REVIEWS, STUDIES, AND 
              PLANS RELATING TO INTELLIGENCE ACTIVITIES OF DEPARTMENT 
              OF DEFENSE OR DEPARTMENT OF ENERGY.

    (a) Consultation in Preparation.--(1) The Director of Central 
Intelligence shall ensure that any report, review, study, or plan 
required to be prepared or conducted by a provision of this Act, 
including a provision of the classified Schedule of Authorizations 
referred to in section 102(a) or the classified annex to this Act, that 
involves the intelligence or intelligence-related activities of the 
Department of Defense or the Department of Energy is prepared or 
conducted in consultation with the Secretary of Defense or the 
Secretary of Energy, as appropriate.
    (2) The Secretary of Defense or the Secretary of Energy may carry 
out any consultation required by this subsection through an official of 
the Department of Defense or the Department of Energy, as the case may 
be, designated by such Secretary for that purpose.
    (b) Submittal.--Any report, review, study, or plan referred to in 
subsection (a) shall be submitted, in addition to any other committee 
of Congress specified for submittal in the provision concerned, to the 
following committees of Congress:
        (1) The Committees on Armed Services and Appropriations and the 
    Select Committee on Intelligence of the Senate.
        (2) The Committees on Armed Services and Appropriations and the 
    Permanent Select Committee on Intelligence of the House of 
    Representatives.

 TITLE II--CENTRAL INTELLIGENCE AGENCY RETIREMENT AND DISABILITY SYSTEM

SEC. 201. AUTHORIZATION OF APPROPRIATIONS.

    There is authorized to be appropriated for the Central Intelligence 
Agency Retirement and Disability Fund for fiscal year 2004 the sum of 
$226,400,000.

                     TITLE III--GENERAL PROVISIONS
                Subtitle A--Recurring General Provisions

SEC. 301. INCREASE IN EMPLOYEE COMPENSATION AND BENEFITS AUTHORIZED BY 
              LAW.

    Appropriations authorized by this Act for salary, pay, retirement, 
and other benefits for Federal employees may be increased by such 
additional or supplemental amounts as may be necessary for increases in 
such compensation or benefits authorized by law.

SEC. 302. RESTRICTION ON CONDUCT OF INTELLIGENCE ACTIVITIES.

    The authorization of appropriations by this Act shall not be deemed 
to constitute authority for the conduct of any intelligence activity 
which is not otherwise authorized by the Constitution or the laws of 
the United States.

                        Subtitle B--Intelligence

SEC. 311. AUTHORITY OF FEDERAL BUREAU OF INVESTIGATION TO AWARD 
              PERSONAL SERVICES CONTRACTS.

    (a) Authority.--(1) Title III of the National Security Act of 1947 
is amended by inserting after section 301 (50 U.S.C. 409a) the 
following new section:


    ``authority of federal bureau of investigation to award personal 
                           services contracts

    ``Sec. 302. (a) In General.--The Director of the Federal Bureau of 
Investigation may enter into personal services contracts if the 
personal services to be provided under such contracts directly support 
the intelligence or counterintelligence missions of the Federal Bureau 
of Investigation.
    ``(b) Inapplicability of Certain Requirements.--Contracts under 
subsection (a) shall not be subject to the annuity offset requirements 
of sections 8344 and 8468 of title 5, United States Code, the 
requirements of section 3109 of title 5, United States Code, or any law 
or regulation requiring competitive contracting.
    ``(c) Contract To Be Appropriate Means of Securing Services.--The 
Chief Contracting Officer of the Federal Bureau of Investigation shall 
ensure that each personal services contract entered into by the 
Director under this section is the appropriate means of securing the 
services to be provided under such contract.''.
    (2) The table of contents for that Act is amended by inserting 
after the item relating to section 301 the following new item:

``Sec. 302. Authority of Federal Bureau of Investigation to award 
          personal services contracts.''.

    (b) Reports on Exercise of Authority.--(1) Not later than one year 
after the date of the enactment of this Act, and annually thereafter, 
the Director of the Federal Bureau of Investigation shall submit to the 
appropriate committees of Congress a report on the exercise of the 
authority in section 302 of the National Security Act of 1947, as added 
by subsection (a).
    (2) Each report under this subsection shall include, for the one-
year period ending on the date of such report, the following:
        (A) The number of contracts entered into during the period.
        (B) The cost of each such contract.
        (C) The length of each such contract.
        (D) The types of services to be provided under each such 
    contract.
        (E) The availability, if any, of United States Government 
    personnel to perform functions similar to the services to be 
    provided under each such contract.
        (F) The efforts of the Federal Bureau of Investigation to fill 
    available personnel vacancies, or request additional personnel 
    positions, in areas relating to the intelligence or 
    counterintelligence mission of the Bureau.
    (3) Each report under this subsection shall be submitted in 
unclassified form, but may include a classified annex.
    (4) In this subsection--
        (A) for purposes of the submittal of the classified annex to 
    any report under this subsection, the term ``appropriate committees 
    of Congress'' means--
            (i) the Select Committee on Intelligence of the Senate; and
            (ii) the Permanent Select Committee on Intelligence of the 
        House of Representatives; and
        (B) for purposes of the submittal of the unclassified portion 
    of any report under this subsection, the term ``appropriate 
    committees of Congress'' means--
            (i) the committees specified in subparagraph (A);
            (ii) the Committees on Appropriations, Governmental 
        Affairs, and the Judiciary of the Senate; and
            (iii) the Committees on Appropriations, Government Reform 
        and Oversight, and the Judiciary of the House of 
        Representatives.

SEC. 312. BUDGET TREATMENT OF COSTS OF ACQUISITION OF MAJOR SYSTEMS BY 
              THE INTELLIGENCE COMMUNITY.

    (a) Findings.--Congress makes the following findings:
        (1) Funds within the National Foreign Intelligence Program 
    often must be shifted from program to program and from fiscal year 
    to fiscal year to address funding shortfalls caused by significant 
    increases in the costs of acquisition of major systems by the 
    intelligence community.
        (2) While some increases in the costs of acquisition of major 
    systems by the intelligence community are unavoidable, the 
    magnitude of growth in the costs of acquisition of many major 
    systems indicates a systemic bias within the intelligence community 
    to underestimate the costs of such acquisition, particularly in the 
    preliminary stages of development and production.
        (3) Decisions by Congress to fund the acquisition of major 
    systems by the intelligence community rely significantly upon 
    initial estimates of the affordability of acquiring such major 
    systems and occur within a context in which funds can be allocated 
    for a variety of alternative programs. Thus, substantial increases 
    in costs of acquisition of major systems place significant burdens 
    on the availability of funds for other programs and new proposals 
    within the National Foreign Intelligence Program.
        (4) Independent cost estimates, prepared by independent 
    offices, have historically represented a more accurate projection 
    of the costs of acquisition of major systems.
        (5) Recognizing the benefits associated with independent cost 
    estimates for the acquisition of major systems, the Secretary of 
    Defense has built upon the statutory requirement in section 2434 of 
    title 10, United States Code, to develop and consider independent 
    cost estimates for the acquisition of such systems by mandating the 
    use of such estimates in budget requests of the Department of 
    Defense.
        (6) The mandatory use throughout the intelligence community of 
    independent cost estimates for the acquisition of major systems 
    will assist the President and Congress in the development and 
    funding of budgets which more accurately reflect the requirements 
    and priorities of the United States Government for intelligence and 
    intelligence-related activities.
    (b) Budget Treatment of Costs of Acquisition of Major Systems.--(1) 
Title V of the National Security Act of 1947 (50 U.S.C. 413 et seq.) is 
amended by inserting after section 506 the following new section:


   ``Budget treatment of costs of acquisition of major systems by the 
                         intelligence community

    ``Sec. 506A. (a) Independent Cost Estimates.--(1) The Director of 
Central Intelligence shall, in consultation with the head of each 
element of the intelligence community concerned, prepare an independent 
cost estimate of the full life-cycle cost of development, procurement, 
and operation of each major system to be acquired by the intelligence 
community.
    ``(2) Each independent cost estimate for a major system shall, to 
the maximum extent practicable, specify the amount required to be 
appropriated and obligated to develop, procure, and operate the major 
system in each fiscal year of the proposed period of development, 
procurement, and operation of the major system.
    ``(3)(A) In the case of a program of the intelligence community 
that qualifies as a major system, an independent cost estimate shall be 
prepared before the submission to Congress of the budget of the 
President for the first fiscal year in which appropriated funds are 
anticipated to be obligated for the development or procurement of such 
major system.
    ``(B) In the case of a program of the intelligence community for 
which an independent cost estimate was not previously required to be 
prepared under this section, including a program for which development 
or procurement commenced before the date of the enactment of the 
Intelligence Authorization Act for Fiscal Year 2004, if the aggregate 
future costs of development or procurement (or any combination of such 
activities) of the program will exceed $500,000,000 (in current fiscal 
year dollars), the program shall qualify as a major system for purposes 
of this section, and an independent cost estimate for such major system 
shall be prepared before the submission to Congress of the budget of 
the President for the first fiscal year thereafter in which 
appropriated funds are anticipated to be obligated for such major 
system.
    ``(4) The independent cost estimate for a major system shall be 
updated upon--
        ``(A) the completion of any preliminary design review 
    associated with the major system;
        ``(B) any significant modification to the anticipated design of 
    the major system; or
        ``(C) any change in circumstances that renders the current 
    independent cost estimate for the major system inaccurate.
    ``(5) Any update of an independent cost estimate for a major system 
under paragraph (4) shall meet all requirements for independent cost 
estimates under this section, and shall be treated as the most current 
independent cost estimate for the major system until further updated 
under that paragraph.
    ``(b) Preparation of Independent Cost Estimates.--(1) The Director 
shall establish within the Office of the Deputy Director of Central 
Intelligence for Community Management an office which shall be 
responsible for preparing independent cost estimates, and any updates 
thereof, under subsection (a), unless a designation is made under 
paragraph (2).
    ``(2) In the case of the acquisition of a major system for an 
element of the intelligence community within the Department of Defense, 
the Director and the Secretary of Defense shall provide that the 
independent cost estimate, and any updates thereof, under subsection 
(a) be prepared by an entity jointly designated by the Director and the 
Secretary in accordance with section 2434(b)(1)(A) of title 10, United 
States Code.
    ``(c) Utilization in Budgets of President.--(1) If the budget of 
the President requests appropriations for any fiscal year for the 
development or procurement of a major system by the intelligence 
community, the President shall, subject to paragraph (2), request in 
such budget an amount of appropriations for the development or 
procurement, as the case may be, of the major system that is equivalent 
to the amount of appropriations identified in the most current 
independent cost estimate for the major system for obligation for each 
fiscal year for which appropriations are requested for the major system 
in such budget.
    ``(2) If the amount of appropriations requested in the budget of 
the President for the development or procurement of a major system is 
less than the amount of appropriations identified in the most current 
independent cost estimate for the major system for obligation for each 
fiscal year for which appropriations are requested for the major system 
in such budget, the President shall include in the budget justification 
materials submitted to Congress in support of such budget--
        ``(A) an explanation for the difference between the amount of 
    appropriations requested and the amount of appropriations 
    identified in the most current independent cost estimate;
        ``(B) a description of the importance of the major system to 
    the national security;
        ``(C) an assessment of the consequences for the funding of all 
    programs of the National Foreign Intelligence Program in future 
    fiscal years if the most current independent cost estimate for the 
    major system is accurate and additional appropriations are required 
    in future fiscal years to ensure the continued development or 
    procurement of the major system, including the consequences of such 
    funding shortfalls on the major system and all other programs of 
    the National Foreign Intelligence Program; and
        ``(D) such other information on the funding of the major system 
    as the President considers appropriate.
    ``(d) Inclusion of Estimates in Budget Justification Materials.--
The budget justification materials submitted to Congress in support of 
the budget of the President shall include the most current independent 
cost estimate under this section for each major system for which 
appropriations are requested in such budget for any fiscal year.
    ``(e) Definitions.--In this section:
        ``(1) The term `budget of the President' means the budget of 
    the President for a fiscal year as submitted to Congress under 
    section 1105(a) of title 31, United States Code.
        ``(2) The term `independent cost estimate' means a pragmatic 
    and neutral analysis, assessment, and quantification of all costs 
    and risks associated with the acquisition of a major system, which 
    shall be based on programmatic and technical specifications 
    provided by the office within the element of the intelligence 
    community with primary responsibility for the development, 
    procurement, or operation of the major system.
        ``(3) The term `major system' means any significant program of 
    an element of the intelligence community with projected total 
    development and procurement costs exceeding $500,000,000 (in 
    current fiscal year dollars), which costs shall include all end-to-
    end program costs, including costs associated with the development 
    and procurement of the program and any other costs associated with 
    the development and procurement of systems required to support or 
    utilize the program.''.
    (2) The table of contents for the National Security Act of 1947 is 
amended by inserting after the item relating to section 506 the 
following new item:

``Sec. 506A. Budget treatment of costs of acquisition of major systems 
          by the intelligence community.''.

    (c) Effective Date.--The amendments made by subsection (b) shall 
take effect on the date of the enactment of this Act.
    (d) Limitations.--(1)(A) For each major system for which funds have 
been authorized for a fiscal year before fiscal year 2005, or for which 
funds are sought in the budget of the President for fiscal year 2005, 
as submitted to Congress pursuant to section 1105(a) of title 31, 
United States Code, and for which no independent cost estimate has been 
provided to Congress, no contract, or option to contract, for the 
procurement or acquisition of such major system may be entered into, or 
option to contract be exercised, before the date of the enactment of an 
Act to authorize appropriations for fiscal year 2005 for intelligence 
and intelligence-related activities of the United States Government.
    (B) Subparagraph (A) shall not affect any contract for procurement 
or acquisition that was entered into before the date of the enactment 
of this Act.
    (2) Commencing as of the date of the submittal to Congress of the 
budget of the President for fiscal year 2006 pursuant to section 
1105(a) of title 31, United States Code, no funds may be obligated or 
expended for the development or procurement of a major system until the 
President has complied with the requirements of section 506A of the 
National Security Act of 1947 (as added by subsection (b)) with respect 
to such major system.
    (3) In this subsection, the terms ``independent cost estimate'' and 
``major system'' have the meaning given such terms in subsection (e) of 
section 506A of the National Security Act of 1947 (as so added).

SEC. 313. MODIFICATION OF SUNSET OF APPLICATION OF SANCTIONS LAWS TO 
              INTELLIGENCE ACTIVITIES.

    (a) Modification.--Section 905 of the National Security Act of 1947 
(50 U.S.C. 441d) is repealed.
    (b) Clerical Amendment.--The table of contents for that Act is 
amended by striking the item relating to section 905.

SEC. 314. MODIFICATION OF NOTICE AND WAIT REQUIREMENTS ON PROJECTS TO 
              CONSTRUCT OR IMPROVE INTELLIGENCE COMMUNITY FACILITIES.

    (a) Increase of Thresholds for Notice.--Subsection (a) of section 
602 of the Intelligence Authorization Act for Fiscal Year 1995 (Public 
Law 103-359; 108 Stat. 3432; 50 U.S.C. 403-2b(a)) is amended--
        (1) by striking ``$750,000'' each place it appears and 
    inserting ``$5,000,000''; and
        (2) by striking ``$500,000'' each place it appears and 
    inserting ``$1,000,000''.
    (b) Notice and Wait Requirements for Emergency Projects.--
Subsection (b)(2) of that section is amended--
        (1) by redesignating subparagraphs (A), (B), and (C) as clauses 
    (i), (ii), and (iii), respectively;
        (2) by inserting ``(A)'' after ``(2) Report.--'';
        (3) by striking ``21-day period'' and inserting ``7-day 
    period''; and
        (4) by adding at the end the following new subparagraph:
        ``(B) Notwithstanding subparagraph (A), a project referred to 
    in paragraph (1) may begin on the date the notification is received 
    by the appropriate committees of Congress under that paragraph if 
    the Director of Central Intelligence and the Secretary of Defense 
    jointly determine that--
            ``(i) an emergency exists with respect to the national 
        security or the protection of health, safety, or environmental 
        quality; and
            ``(ii) any delay in the commencement of the project would 
        harm any or all of those interests.''.

SEC. 315. EXTENSION OF DEADLINE FOR FINAL REPORT OF THE NATIONAL 
              COMMISSION FOR THE REVIEW OF THE RESEARCH AND DEVELOPMENT 
              PROGRAMS OF THE UNITED STATES INTELLIGENCE COMMUNITY.

    (a) In General.--Subsection (a) of section 1007 of the Intelligence 
Authorization Act for Fiscal Year 2003 (Public Law 107-306; 50 U.S.C. 
401 note; 116 Stat. 2442) is amended by striking ``September 1, 2003'' 
and inserting ``September 1, 2004''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect as if included in the enactment of section 1007 of the 
Intelligence Authorization Act for Fiscal Year 2003.

SEC. 316. IMPROVEMENT OF INFORMATION SHARING AMONG FEDERAL, STATE, AND 
              LOCAL GOVERNMENT OFFICIALS.

    (a) Training Program for State and Local Officials.--Section 892(c) 
of the Homeland Security Act of 2002 (Public Law 107-296; 6 U.S.C. 482) 
is amended by adding at the end the following new paragraph:
        ``(3)(A) The Secretary shall establish a program to provide 
    appropriate training to officials described in subparagraph (B) in 
    order to assist such officials in--
            ``(i) identifying sources of potential terrorist threats 
        through such methods as the Secretary determines appropriate;
            ``(ii) reporting information relating to such potential 
        terrorist threats to the appropriate Federal agencies in the 
        appropriate form and manner;
            ``(iii) assuring that all reported information is 
        systematically submitted to and passed on by the Department for 
        use by appropriate Federal agencies; and
            ``(iv) understanding the mission and roles of the 
        intelligence community to promote more effective information 
        sharing among Federal, State, and local officials and 
        representatives of the private sector to prevent terrorist 
        attacks against the United States.
        ``(B) The officials referred to in subparagraph (A) are 
    officials of State and local government agencies and 
    representatives of private sector entities with responsibilities 
    relating to the oversight and management of first responders, 
    counterterrorism activities, or critical infrastructure.
        ``(C) The Secretary shall consult with the Attorney General to 
    ensure that the training program established in subparagraph (A) 
    does not duplicate the training program established in section 908 
    of the USA PATRIOT Act (Public Law 107-56; 28 U.S.C. 509 note).
        ``(D) The Secretary shall carry out this paragraph in 
    consultation with the Director of Central Intelligence and the 
    Attorney General.''.
    (b) Report.--Not later than 60 days after the date of the enactment 
of this Act, the Secretary of Homeland Security shall submit to 
Congress a report that describes the Secretary's plan for implementing 
section 892 of the Homeland Security Act of 2002 and includes an 
estimated date of completion of the implementation.

SEC. 317. PILOT PROGRAM ON ANALYSIS OF SIGNALS AND OTHER INTELLIGENCE 
              BY INTELLIGENCE ANALYSTS OF VARIOUS ELEMENTS OF THE 
              INTELLIGENCE COMMUNITY.

    (a) In General.--The Director of Central Intelligence shall, in 
coordination with the Secretary of Defense, carry out a pilot program 
to assess the feasibility and advisability of permitting intelligence 
analysts of various elements of the intelligence community to access 
and analyze intelligence from the databases of other elements of the 
intelligence community in order to achieve the objectives set forth in 
subsection (c).
    (b) Covered Intelligence.--The intelligence to be analyzed under 
the pilot program under subsection (a) shall include the following:
        (1) Signals intelligence of the National Security Agency.
        (2) Such intelligence of other elements of the intelligence 
    community as the Director shall select for purposes of the pilot 
    program.
    (c) Objectives.--The objectives set forth in this subsection are as 
follows:
        (1) To enhance the capacity of the intelligence community to 
    undertake ``all source fusion'' analysis in support of the 
    intelligence and intelligence-related missions of the intelligence 
    community.
        (2) To reduce, to the extent possible, the amount of 
    intelligence collected by the intelligence community that is not 
    assessed, or reviewed, by intelligence analysts.
        (3) To reduce the burdens imposed on analytical personnel of 
    the elements of the intelligence community by current practices 
    regarding the sharing of intelligence among elements of the 
    intelligence community.
    (d) Commencement.--The Director shall commence the pilot program 
under subsection (a) not later than December 31, 2003.
    (e) Various Mechanisms Required.--In carrying out the pilot program 
under subsection (a), the Director shall develop and utilize various 
mechanisms to facilitate the access to, and the analysis of, 
intelligence in the databases of the intelligence community by 
intelligence analysts of other elements of the intelligence community, 
including the use of so-called ``detailees in place''.
    (f) Security.--(1) In carrying out the pilot program under 
subsection (a), the Director shall take appropriate actions to protect 
against the disclosure and unauthorized use of intelligence in the 
databases of the elements of the intelligence community which may 
endanger sources and methods which (as determined by the Director) 
warrant protection.
    (2) The actions taken under paragraph (1) shall include the 
provision of training on the accessing and handling of information in 
the databases of various elements of the intelligence community and the 
establishment of limitations on access to information in such databases 
regarding United States persons.
    (g) Assessment.--Not later than February 1, 2004, after the 
commencement under subsection (d) of the pilot program under subsection 
(a), the Under Secretary of Defense for Intelligence and the Assistant 
Director of Central Intelligence for Analysis and Production shall 
jointly carry out an assessment of the progress of the pilot program in 
meeting the objectives set forth in subsection (c).
    (h) Report.--(1) The Director of Central Intelligence shall, in 
coordination with the Secretary of Defense, submit to the appropriate 
committees of Congress a report on the assessment carried out under 
subsection (g).
    (2) The report shall include--
        (A) a description of the pilot program under subsection (a);
        (B) the findings of the Under Secretary and Assistant Director 
    as a result of the assessment;
        (C) any recommendations regarding the pilot program that the 
    Under Secretary and the Assistant Director jointly consider 
    appropriate in light of the assessment; and
        (D) any recommendations that the Director and Secretary 
    consider appropriate for purposes of the report.
    (i) Appropriate Committees of Congress Defined.--In this section, 
the term ``appropriate committees of Congress'' means--
        (1) the Select Committee on Intelligence, the Committee on 
    Armed Services, and the Committee on Appropriations of the Senate; 
    and
        (2) the Permanent Select Committee on Intelligence, the 
    Committee on Armed Services, and the Committee on Appropriations of 
    the House of Representatives.

SEC. 318. PILOT PROGRAM ON RECRUITMENT AND TRAINING OF INTELLIGENCE 
              ANALYSTS.

    (a) Pilot Program.--(1) The Director of Central Intelligence shall 
carry out a pilot program to ensure that selected students or former 
students are provided funds to continue academic training, or are 
reimbursed for academic training previously obtained, in areas of 
specialization that the Director, in consultation with the other heads 
of the elements of the intelligence community, identifies as areas in 
which the current analytic capabilities of the intelligence community 
are deficient or in which future analytic capabilities of the 
intelligence community are likely to be deficient.
    (2) A student or former student selected for participation in the 
pilot program shall commit to employment with an element of the 
intelligence community, following completion of appropriate academic 
training, under such terms and conditions as the Director considers 
appropriate.
    (3) The pilot program shall be known as the Pat Roberts 
Intelligence Scholars Program.
    (b) Elements.--In carrying out the pilot program under subsection 
(a), the Director shall--
        (1) establish such requirements relating to the academic 
    training of participants as the Director considers appropriate to 
    ensure that participants are prepared for employment as 
    intelligence analysts; and
        (2) periodically review the areas of specialization of the 
    elements of the intelligence community to determine the areas in 
    which such elements are, or are likely to be, deficient in analytic 
    capabilities.
    (c) Duration.--The Director shall carry out the pilot program under 
subsection (a) during fiscal years 2004 through 2006.
    (d) Limitation on Number of Members During Fiscal Year 2004.--The 
total number of individuals participating in the pilot program under 
subsection (a) during fiscal year 2004 may not exceed 150 students.
    (e) Responsibility.--The Director shall carry out the pilot program 
under subsection (a) through the Assistant Director of Central 
Intelligence for Analysis and Production.
    (f) Reports.--(1) Not later than 120 days after the date of the 
enactment of this Act, the Director shall submit to Congress a 
preliminary report on the pilot program under subsection (a), including 
a description of the pilot program and the authorities to be utilized 
in carrying out the pilot program.
    (2) Not later than one year after the commencement of the pilot 
program, the Director shall submit to Congress a report on the pilot 
program. The report shall include--
        (A) a description of the activities under the pilot program, 
    including the number of individuals who participated in the pilot 
    program and the training provided such individuals under the pilot 
    program;
        (B) an assessment of the effectiveness of the pilot program in 
    meeting the purpose of the pilot program; and
        (C) any recommendations for additional legislative or 
    administrative action that the Director considers appropriate in 
    light of the pilot program.
    (g) Funding.--Of the amounts authorized to be appropriated by this 
Act, $4,000,000 shall be available until expended to carry out this 
section.

SEC. 319. IMPROVEMENT OF EQUALITY OF EMPLOYMENT OPPORTUNITIES IN THE 
              INTELLIGENCE COMMUNITY.

    (a) Findings.--Congress makes the following findings:
        (1) It is the recommendation of the Joint Inquiry of the Senate 
    Select Committee on Intelligence and the House Permanent Select 
    Committee on Intelligence into Intelligence Community Activities 
    Before and After the Terrorist Attacks of September 11, 2001, that 
    the Intelligence Community should enhance recruitment of a more 
    ethnically and culturally diverse workforce and devise a strategy 
    to capitalize upon the unique cultural and linguistic capabilities 
    of first generation Americans.
        (2) The Intelligence Community could greatly benefit from an 
    increased number of employees who are proficient in foreign 
    languages and knowledgeable of world cultures, especially in 
    foreign languages that are critical to the national security 
    interests of the United States. Particular emphasis should be given 
    to the recruitment of United States citizens whose linguistic 
    capabilities are acutely required for the improvement of the 
    overall intelligence collection and analysis effort of the United 
    States Government.
        (3) The Intelligence Community has a significantly lower 
    percentage of women and minorities than the total workforce of the 
    Federal government and the total civilian labor force.
        (4) Women and minorities continue to be under-represented in 
    senior grade levels, and in core mission areas, of the intelligence 
    community.
    (b) Pilot Project To Promote Equality of Employment Opportunities 
for Women and Minorities Throughout the Intelligence Community Using 
Innovative Methodologies.--The Director of Central Intelligence shall 
carry out a pilot project under this section to test and evaluate 
alternative, innovative methods to promote equality of employment 
opportunities in the intelligence community for women, minorities, and 
individuals with diverse ethnic and cultural backgrounds, skills, 
language proficiency, and expertise.
    (c) Methods.--In carrying out the pilot project, the Director shall 
employ methods to increase diversity of officers and employees in the 
intelligence community.
    (d) Duration of Project.--The Director shall carry out the project 
under this section for a 3-year period.
    (e) Report.--Not later than 2 years after the date the Director 
implements the pilot project under this section, the Director shall 
submit to Congress a report on the project. The report shall include--
        (1) an assessment of the effectiveness of the project; and
        (2) recommendations on the continuation of the project, as well 
    recommendations as for improving the effectiveness of the project 
    in meeting the goals of promoting equality of employment 
    opportunities in the intelligence community for women, minorities, 
    and individuals with diverse ethnic and cultural backgrounds, 
    skills, language proficiency, and expertise.
    (f) Diversity Plan.--(1) Not later than February 15, 2004, the 
Director of Central Intelligence shall submit to Congress a report 
which describes the plan of the Director, entitled the ``DCI Diversity 
Strategic Plan'', and any subsequent revision to that plan, to increase 
diversity of officers and employees in the intelligence community, 
including the short- and long-term goals of the plan. The report shall 
also provide a detailed description of the progress that has been made 
by each element of the intelligence community in implementing the plan.
    (2) In implementing the plan, the Director shall incorporate 
innovative methods for recruitment and hiring that the Director has 
determined to be effective from the pilot project carried out under 
this section.
    (g) Intelligence Community Defined.--In this section, the term 
``intelligence community'' has the meaning given that term in section 
3(4) of the National Security Act of 1947 (50 U.S.C. 401(4)).

SEC. 320. SENSE OF CONGRESS ON RECRUITMENT AS INTELLIGENCE COMMUNITY 
              PERSONNEL OF MEMBERS OF THE ARMED FORCES ON THEIR 
              DISCHARGE OR RELEASE FROM DUTY.

    It is the sense of Congress that the elements of the intelligence 
community should, in the course of their civilian recruitment efforts 
in the United States, endeavor to recruit as personnel of the 
intelligence community citizens and, as appropriate, nationals of the 
United States who are members of the Armed Forces who participated in 
Operation Enduring Freedom, Operation Iraqi Freedom, and other 
campaigns undertaken abroad upon the separation, discharge, or release 
of such individuals from the Armed Forces.

SEC. 321. EXTERNAL COLLECTION CAPABILITIES AND REQUIREMENTS REVIEW 
              PANEL.

    The President may establish an External Collection Capabilities and 
Requirements Review Panel as specified in the classified annex to this 
Act.

                    Subtitle C--Counterintelligence

SEC. 341. COUNTERINTELLIGENCE INITIATIVES FOR THE INTELLIGENCE 
              COMMUNITY.

    (a) In General.--(1) Title XI of the National Security Act of 1947 
(50 U.S.C. 401 et seq.) is amended by adding at the end the following 
new section:


                    ``counterintelligence initiatives

    ``Sec. 1102. (a) Inspection Process.--(1) In order to protect 
intelligence sources and methods from unauthorized disclosure, the 
Director of Central Intelligence shall establish and implement an 
inspection process for all agencies and departments of the United 
States that handle classified information relating to the national 
security of the United States intended to assure that those agencies 
and departments maintain effective operational security practices and 
programs directed against counterintelligence activities.
    ``(2) The Director shall carry out the process through the Office 
of the National Counterintelligence Executive.
    ``(b) Annual Review of Dissemination Lists.--(1) The Director of 
Central Intelligence shall establish and implement a process for all 
elements of the intelligence community to review, on an annual basis, 
individuals included on distribution lists for access to classified 
information. Such process shall ensure that only individuals who have a 
particularized `need to know' (as determined by the Director) are 
continued on such distribution lists.
    ``(2) Not later than October 15 of each year, the Director shall 
certify to the congressional intelligence committees that the review 
required under paragraph (1) has been conducted in all elements of the 
intelligence community during the preceding fiscal year.
    ``(c) Completion of Financial Disclosure Statements Required for 
Access to Certain Classified Information.--(1) The Director of Central 
Intelligence shall establish and implement a process by which each head 
of an element of the intelligence community directs that all employees 
of that element, in order to be granted access to classified 
information referred to in subsection (a) of section 1.3 of Executive 
Order No. 12968 (August 2, 1995; 60 Fed. Reg. 40245; 50 U.S.C. 435 
note), submit financial disclosure forms as required under subsection 
(b) of such section.
    ``(2) The Director shall carry out paragraph (1) through the Office 
of the National Counterintelligence Executive.
    ``(d) Arrangements To Handle Sensitive Information.--The Director 
of Central Intelligence shall establish, for all elements of the 
intelligence community, programs and procedures by which sensitive 
classified information relating to human intelligence is safeguarded 
against unauthorized disclosure by employees of those elements.''.
    (2) The table of contents contained in the first section of such 
Act is amended in the items relating to title XI by adding at the end 
the following new item:

``Sec. 1102. Counterintelligence initiatives.''.

    (b) Intelligence and National Security Aspects of Espionage 
Prosecutions.--The Attorney General, acting through the Office of 
Intelligence Policy and Review of the Department of Justice, and in 
consultation with the Director of Central Intelligence, acting through 
the Office of the National Counterintelligence Executive, shall 
establish policies and procedures to assist the Attorney General in the 
consideration of intelligence and national security-related equities in 
the development of charging documents and related pleadings in 
espionage prosecutions.

                          Subtitle D--Reports

SEC. 351. REPORT ON CLEARED INSIDER THREAT TO CLASSIFIED COMPUTER 
              NETWORKS.

    (a) Report Required.--The Director of Central Intelligence and the 
Secretary of Defense shall jointly submit to the appropriate committees 
of Congress a report on the risks to the national security of the 
United States of the current computer security practices of the 
elements of the intelligence community and of the Department of 
Defense.
    (b) Assessments.--The report under subsection (a) shall include an 
assessment of the following:
        (1) The vulnerability of the computers and computer systems of 
    the elements of the intelligence community, and of the Department 
    of Defense, to various threats from foreign governments, 
    international terrorist organizations, and organized crime, 
    including information warfare (IW), Information Operations (IO), 
    Computer Network Exploitation (CNE), and Computer Network Attack 
    (CNA).
        (2) The risks of providing users of local area networks (LANs) 
    or wide-area networks (WANs) of computers that include classified 
    information with capabilities for electronic mail, upload and 
    download, or removable storage media without also deploying 
    comprehensive computer firewalls, accountability procedures, or 
    other appropriate security controls.
        (3) Any other matters that the Director and the Secretary 
    jointly consider appropriate for purposes of the report.
    (c) Information on Access to Networks.--The report under subsection 
(a) shall also include information as follows:
        (1) An estimate of the number of access points on each 
    classified computer or computer system of an element of the 
    intelligence community or the Department of Defense that permit 
    unsupervised uploading or downloading of classified information, 
    set forth by level of classification.
        (2) An estimate of the number of individuals utilizing such 
    computers or computer systems who have access to input-output 
    devices on such computers or computer systems.
        (3) A description of the policies and procedures governing the 
    security of the access points referred to in paragraph (1), and an 
    assessment of the adequacy of such policies and procedures.
        (4) An assessment of the viability of utilizing other 
    technologies (including so-called ``thin client servers'') to 
    achieve enhanced security of such computers and computer systems 
    through more rigorous control of access to such computers and 
    computer systems.
    (d) Recommendations.--The report under subsection (a) shall also 
include such recommendations for modifications or improvements of the 
current computer security practices of the elements of the intelligence 
community, and of the Department of Defense, as the Director and the 
Secretary jointly consider appropriate as a result of the assessments 
under subsection (b) and the information under subsection (c).
    (e) Submittal Date.--The report under subsection (a) shall be 
submitted not later than February 15, 2004.
    (f) Form.--The report under subsection (a) may be submitted in 
classified or unclassified form, at the election of the Director.
    (g) Definitions.--In this section:
        (1) The term ``appropriate committees of Congress'' means--
            (A) the Select Committee on Intelligence and the Committee 
        on Armed Services of the Senate; and
            (B) the Permanent Select Committee on Intelligence and the 
        Committee on Armed Services of the House of Representatives.
        (2) The term ``elements of the intelligence community'' means 
    the elements of the intelligence community set forth in or 
    designated under section 3(4) of the National Security Act of 1947 
    (50 U.S.C. 401a(4)).

SEC. 352. REPORT ON SECURITY BACKGROUND INVESTIGATIONS AND SECURITY 
              CLEARANCE PROCEDURES OF THE FEDERAL GOVERNMENT.

    (a) Report Required.--The Director of Central Intelligence, the 
Secretary of Defense, the Attorney General, the Director of the Office 
of Personnel Management, and the heads of other appropriate Federal 
departments and agencies (as determined by the President) shall jointly 
submit to the appropriate committees of Congress a report on the 
utility and effectiveness of the current security background 
investigations and security clearance procedures of the Federal 
Government in meeting the purposes of such investigations and 
procedures.
    (b) Particular Report Matters.--The report shall address in 
particular the following:
        (1) A comparison of the costs and benefits of conducting 
    background investigations for Secret clearance with the costs and 
    benefits of conducting full field background investigations.
        (2) The standards governing the revocation of security 
    clearances.
    (c) Recommendations.--The report under subsection (a) shall include 
such recommendations for modifications or improvements of the current 
security background investigations or security clearance procedures of 
the Federal Government as are considered appropriate as a result of the 
preparation of the report under that subsection.
    (d) Submittal Date.--The report under subsection (a) shall be 
submitted not later than February 15, 2004.
    (e) Appropriate Committees of Congress Defined.--In this section, 
the term ``appropriate committees of Congress'' means--
        (1) the Select Committee on Intelligence and the Committees on 
    Armed Services and the Judiciary of the Senate; and
        (2) the Permanent Select Committee on Intelligence and the 
    Committees on Armed Services and the Judiciary of the House of 
    Representatives.

SEC. 353. REPORT ON DETAIL OF CIVILIAN INTELLIGENCE PERSONNEL AMONG 
              ELEMENTS OF THE INTELLIGENCE COMMUNITY AND THE DEPARTMENT 
              OF DEFENSE.

    (a) Report Required.--The Director of Central Intelligence shall, 
in consultation with the heads of the elements of the intelligence 
community, submit to the appropriate committees of Congress a report on 
means of improving the detail or transfer of civilian intelligence 
personnel between and among the various elements of the intelligence 
community for the purpose of enhancing the flexibility and 
effectiveness of the intelligence community in responding to changes in 
requirements for the collection, analysis, and dissemination of 
intelligence.
    (b) Report Elements.--The report under subsection (a) shall--
        (1) set forth a variety of proposals on means of improving the 
    detail or transfer of civilian intelligence personnel as described 
    in that subsection;
        (2) identify the proposal or proposals determined by the heads 
    of the elements of the intelligence community most likely to meet 
    the purpose described in that subsection; and
        (3) include such recommendations for such legislative or 
    administrative action as the heads of the elements of the 
    intelligence community consider appropriate to implement the 
    proposal or proposals identified under paragraph (2).
    (c) Submittal Date.--The report under subsection (a) shall be 
submitted not later than February 15, 2004.
    (d) Definitions.--In this section:
        (1) The term ``appropriate committees of Congress'' means--
            (A) the Select Committee on Intelligence and the Committees 
        on Armed Services, Governmental Affairs, and the Judiciary of 
        the Senate; and
            (B) the Permanent Select Committee on Intelligence and the 
        Committees on Armed Services, Government Reform, and the 
        Judiciary of the House of Representatives.
        (2) The term ``elements of the intelligence community'' means 
    the elements of the intelligence community set forth in or 
    designated under section 3(4) of the National Security Act of 1947 
    (50 U.S.C. 401a(4)).
        (3) The term ``heads of the elements of the intelligence 
    community'' includes the Secretary of Defense with respect to each 
    element of the intelligence community within the Department of 
    Defense or the military departments.

SEC. 354. REPORT ON MODIFICATIONS OF POLICY AND LAW ON CLASSIFIED 
              INFORMATION TO FACILITATE SHARING OF INFORMATION FOR 
              NATIONAL SECURITY PURPOSES.

    (a) Report.--Not later than four months after the date of the 
enactment of this Act, the President shall submit to the appropriate 
committees of Congress a report that--
        (1) identifies impediments in current policy and regulations to 
    the sharing of classified information horizontally across and among 
    Federal departments and agencies, and vertically between the 
    Federal Government and agencies of State and local governments and 
    the private sector, for national security purposes, including 
    homeland security; and
        (2) proposes appropriate modifications of policy, law, and 
    regulations to eliminate such impediments in order to facilitate 
    such sharing of classified information for national security 
    purposes, including homeland security.
    (b) Considerations.--In preparing the report under subsection (a), 
the President shall--
        (1) consider the extent to which the reliance on a document-
    based approach to the protection of classified information impedes 
    the sharing of classified information; and
        (2) consider the extent to which the utilization of a database-
    based approach, or other electronic approach, to the protection of 
    classified information might facilitate the sharing of classified 
    information.
    (c) Coordination With Other Information Sharing Activities.--In 
preparing the report under subsection (a), the President shall, to the 
maximum extent practicable, take into account actions being undertaken 
under the Homeland Security Information Sharing Act (subtitle I of 
title VIII of Public Law 107-296; 116 Stat. 2252; 6 U.S.C. 481 et 
seq.).
    (d) Appropriate Committees of Congress Defined.--In this section, 
the term ``appropriate committees of Congress'' means--
        (1) the Select Committee on Intelligence and the Committees on 
    Armed Services, Governmental Affairs, and the Judiciary of the 
    Senate; and
        (2) the Permanent Select Committee on Intelligence, the Select 
    Committee on Homeland Security, and the Committees on Armed 
    Services and the Judiciary of the House of Representatives.

SEC. 355. REPORT ON STRATEGIC PLANNING.

    (a) Report.--Not later than February 15, 2004, the Secretary of 
Defense and the Director of Central Intelligence shall jointly submit 
to the appropriate committees of Congress a report that assesses 
progress in the following:
        (1) The development by the Department of Defense and the 
    intelligence community of a comprehensive and uniform analytical 
    capability to assess the utility and advisability of various sensor 
    and platform architectures and capabilities for the collection of 
    intelligence.
        (2) The improvement of coordination between the Department and 
    the intelligence community on strategic and budgetary planning.
    (b) Form.--The report under subsection (a) may be submitted in 
classified form.
    (c) Appropriate Committees of Congress Defined.--In this section, 
the term ``appropriate committees of Congress'' means--
        (1) the Select Committee on Intelligence and the Committee on 
    Armed Services of the Senate; and
        (2) the Permanent Select Committee on Intelligence and the 
    Committee on Armed Services of the House of Representatives.

SEC. 356. REPORT ON UNITED STATES DEPENDENCE ON COMPUTER HARDWARE AND 
              SOFTWARE MANUFACTURED OVERSEAS.

    (a) Report.--Not later than February 15, 2004, the Director of 
Central Intelligence shall submit to the appropriate committees of 
Congress a report on the extent of United States dependence on computer 
hardware or software that is manufactured overseas.
    (b) Elements.--The report under subsection (a) shall address the 
following:
        (1) The extent to which the United States currently depends on 
    computer hardware or software that is manufactured overseas.
        (2) The extent to which United States dependence, if any, on 
    such computer hardware or software is increasing.
        (3) The vulnerabilities of the national security and economy of 
    the United States as a result of United States dependence, if any, 
    on such computer hardware or software.
        (4) Any other matters relating to United States dependence, if 
    any, on such computer hardware or software that the Director 
    considers appropriate.
    (c) Consultation With Private Sector.--(1) In preparing the report 
under subsection (a), the Director may consult, and is encouraged to 
consult, with appropriate persons and entities in the computer hardware 
or software industry and with other appropriate persons and entities in 
the private sector.
    (2) Consultations of the Director with persons or entities under 
paragraph (1) shall not be treated as the activities of an advisory 
committee for purposes of the Federal Advisory Committee Act (5 U.S.C. 
App.).
    (d) Form.--(1) The report under subsection (a) shall be submitted 
in unclassified form, but may include a classified annex.
    (2) The report may be in the form of a National Intelligence 
Estimate.
    (e) Appropriate Committees of Congress Defined.--In this section, 
the term ``appropriate committees of Congress'' means--
        (1) the Select Committee on Intelligence and the Committee on 
    Armed Services of the Senate; and
        (2) the Permanent Select Committee on Intelligence and the 
    Committee on Armed Services of the House of Representatives.

SEC. 357. REPORT ON LESSONS LEARNED FROM MILITARY OPERATIONS IN IRAQ.

    (a) Report.--As soon as possible, but not later than one year after 
the date of the enactment of this Act, the Director of Central 
Intelligence shall submit to the appropriate committees of Congress a 
report on the intelligence lessons learned as a result of Operation 
Iraqi Freedom, including lessons relating to the following:
        (1) The tasking, collection, processing, exploitation, 
    analysis, and dissemination of intelligence.
        (2) The accuracy, timeliness, and objectivity of intelligence 
    analysis.
        (3) The intelligence support available to policymakers and 
    members of the Armed Forces in combat.
        (4) The coordination of intelligence activities and operations 
    with military operations.
        (5) The strengths and limitations of intelligence systems and 
    equipment.
        (6) Such other matters as the Director considers appropriate.
    (b) Recommendations.--The report under subsection (a) shall include 
such recommendations on improvement in the matters described in 
subsection (a) as the Director considers appropriate.
    (c) Appropriate Committees of Congress Defined.--In this section, 
the term ``appropriate committees of Congress'' means--
        (1) the Permanent Select Committee on Intelligence and the 
    Committee on Armed Services of the House of Representatives; and
        (2) the Select Committee on Intelligence and the Committee on 
    Armed Services of the Senate.

SEC. 358. REPORTS ON CONVENTIONAL WEAPONS AND AMMUNITION OBTAINED BY 
              IRAQ IN VIOLATION OF CERTAIN UNITED NATIONS SECURITY 
              COUNCIL RESOLUTIONS.

    (a) Preliminary Report.--Not later than 90 days after the date of 
the enactment of this Act, the Director of the Defense Intelligence 
Agency shall, after such consultation with the Secretary of State and 
the Attorney General as the Director considers appropriate, submit to 
the appropriate committees of Congress a preliminary report on all 
information obtained by the Department of Defense and the intelligence 
community on the conventional weapons and ammunition obtained by Iraq 
in violation of applicable resolutions of the United Nations Security 
Council adopted since the invasion of Kuwait by Iraq in August 1990.
    (b) Final Report.--(1) Not later than one year after the date of 
the enactment of this Act, the Director shall submit to the appropriate 
committees of Congress a final report on the information described in 
subsection (a).
    (2) The final report under paragraph (1) shall include such updates 
of the preliminary report under subsection (a) as the Director 
considers appropriate.
    (c) Elements.--Each report under this section shall set forth, to 
the extent practicable, with respect to each shipment of weapons or 
ammunition addressed in such report the following:
        (1) The country of origin.
        (2) Any country of transshipment.
    (d) Form.--Each report under this section shall be submitted in 
unclassified form, but may include a classified annex.
    (e) Appropriate Committees of Congress Defined.--In this section, 
the term ``appropriate committees of Congress'' means--
        (1) the Select Committee on Intelligence and the Committees on 
    Armed Services and Foreign Relations of the Senate; and
        (2) the Permanent Select Committee on Intelligence and the 
    Committees on Armed Services and International Relations of the 
    House of Representatives.

SEC. 359. REPORT ON OPERATIONS OF DIRECTORATE OF INFORMATION ANALYSIS 
              AND INFRASTRUCTURE PROTECTION AND TERRORIST THREAT 
              INTEGRATION CENTER.

    (a) Report Required.--The President shall submit to the appropriate 
committees of Congress a report on the operations of the Directorate of 
Information Analysis and Infrastructure Protection of the Department of 
Homeland Security and the Terrorist Threat Integration Center. The 
report shall include the following:
        (1) An assessment of the operations of the Directorate and the 
    Center, including the capabilities of each--
            (A) to meet personnel requirements, including requirements 
        to employ qualified analysts, and the status of efforts to 
        employ qualified analysts;
            (B) to share intelligence information with the other 
        elements of the intelligence community, including the sharing 
        of intelligence information through secure information 
        technology connections between the Directorate, the Center, and 
        the other elements of the intelligence community;
            (C) to disseminate intelligence information, or analyses of 
        intelligence information, to other departments and agencies of 
        the Federal Government and, as appropriate, to State and local 
        governments;
            (D) to coordinate with State and local counterterrorism and 
        law enforcement officials;
            (E) to receive information from Federal, State, and local 
        officials, and private sector entities, relating to the 
        respective responsibilities and authorities of the Directorate 
        and the Center; and
            (F) to access information, including intelligence and law 
        enforcement information, from the departments and agencies of 
        the Federal Government, including the ability of the 
        Directorate to access, in a timely and efficient manner, all 
        information authorized by section 202 of the Homeland Security 
        Act of 2002 (Public Law 107-296; 6 U.S.C. 122).
        (2) An assessment of the ability of the Center to fulfill the 
    responsibilities assigned to it by the President given its 
    structure, authorities, current assets, and capabilities.
        (3) An assessment of the ability of the Directorate to fulfill 
    the responsibilities set forth in section 201 of the Homeland 
    Security Act of 2002 (6 U.S.C. 121) given its current assets and 
    capabilities.
        (4) A plan of action (including appropriate milestones, 
    funding, and sources of funding) for bringing the Center to its 
    full operational capacity as called for in the Information on the 
    State of the Union given by the President to Congress under section 
    3 of Article II of the Constitution of the United States in 2003.
        (5) A delineation of the responsibilities and duties of the 
    Directorate and of the responsibilities and duties of the Center.
        (6) A delineation and summary of the areas in which the 
    responsibilities and duties of the Directorate, the Center, and 
    other elements of the Federal Government overlap.
        (7) An assessment of whether the areas of overlap, if any, 
    delineated under paragraph (6) represent an inefficient utilization 
    of resources.
        (8) A description of the policies and procedures to ensure that 
    the Directorate and the Center comply with the Constitution and 
    applicable statutes, Executive orders, and regulations of the 
    United States.
        (9) The practical impact, if any, of the operations of the 
    Center on individual liberties and privacy.
        (10) Such information as the President considers appropriate to 
    explain the basis for the establishment and operation of the Center 
    as a ``joint venture'' of participating agencies rather than as an 
    element of the Directorate reporting directly to the Secretary of 
    Homeland Security through the Under Secretary of Homeland Security 
    for Information Analysis and Infrastructure Protection.
    (b) Submittal Date.--The report required by this section shall be 
submitted not later than May 1, 2004.
    (c) Form.--The report required by this section shall be submitted 
in unclassified form, but may include a classified annex.
    (d) Appropriate Committees of Congress Defined.--In this section, 
the term ``appropriate committees of Congress'' means--
        (1) the Select Committee on Intelligence and the Committees on 
    Governmental Affairs, the Judiciary, and Appropriations of the 
    Senate; and
        (2) the Permanent Select Committee on Intelligence, the Select 
    Committee on Homeland Security, and the Committees on the Judiciary 
    and Appropriations of the House of Representatives.

SEC. 360. REPORT ON TERRORIST SCREENING CENTER.

    (a) Report.--Not later than September 16, 2004, the President shall 
submit to Congress a report on the establishment and operation of the 
Terrorist Screening Center, established on September 16, 2003, by 
Homeland Security Presidential Directive 6, including the matters 
described in subsection (b).
    (b) Covered Matters.--The matters referred to in subsection (a) are 
the following:
        (1) An analysis of the operations of the Terrorist Screening 
    Center to ensure that the Terrorist Screening Center does not 
    violate the Constitution, or any statute, Executive order, or 
    regulation of the United States.
        (2) A description of the architecture of the database system of 
    the Terrorist Screening Center, including the number of databases 
    maintained, operated, or administered by the Terrorist Screening 
    Center, and the extent to which these databases have been 
    integrated.
        (3) A determination of whether data from all watch lists 
    detailed in the April 2003 report of the Comptroller General of the 
    United States, entitled ``Information Technology: Terrorist Watch 
    Lists Should be Consolidated to Promote Better Integration and 
    Sharing'', have been incorporated into the Terrorist Screening 
    Center database system.
        (4) A determination of whether there remain any relevant 
    databases that are not yet part of the Terrorist Screening Center 
    database system.
        (5) A schedule that specifies the dates on which each Federal 
    watch list database identified in the report referred to in 
    paragraph (3), or determined under paragraph (4) to be not yet part 
    of the Terrorist Screening Center database system, were, or will 
    be, integrated into the Terrorist Screening Center database system.
        (6) A description of the protocols in effect to ensure the 
    protection of classified and sensitive information contained in the 
    Terrorist Screening Center database system.
        (7) A description of--
            (A) the process by which databases in the Terrorist 
        Screening Center database system are reviewed for accuracy and 
        timeliness of data and the frequency of updates of such 
        reviews; and
            (B) the mechanism used to ensure that data within a 
        particular database is synchronized and replicated throughout 
        the database system of the Terrorist Screening Center.
        (8) A description of the extent to which the Terrorist 
    Screening Center makes information available to the private sector 
    and critical infrastructure components, and the criteria for 
    determining which private sector and critical infrastructure 
    components receive that information.
        (9) The number of individuals listed in the Terrorist Screening 
    Center database system.
        (10) The estimated operating budget of, and sources of funding 
    for, the Terrorist Screening Center for each of fiscal years 2004, 
    2005, and 2006.
        (11) An assessment of the impact of the Terrorist Screening 
    Center on current law enforcement systems.
        (12) The practical impact, if any, of the operations of the 
    Terrorist Screening Center on individual liberties and privacy.
        (13) Such recommendations as the President considers 
    appropriate for modifications of law or policy to ensure the 
    continuing operation of the Terrorist Screening Center.
    (c) Form of Report.--The report required by subsection (a) shall be 
submitted in unclassified form, but may include a classified annex.

SEC. 361. REPEAL AND MODIFICATION OF REPORT REQUIREMENTS RELATING TO 
              INTELLIGENCE ACTIVITIES.

    (a) Annual Evaluation of Performance and Responsiveness of 
Intelligence Community.--Section 105 of the National Security Act of 
1947 (50 U.S.C. 403-5) is amended by striking subsection (d).
    (b) Periodic Reports on Disclosure of Intelligence Information to 
United Nations.--Section 112(b) of the National Security Act of 1947 
(50 U.S.C. 404g(b)(1)) is amended--
        (1) in the subsection caption, by striking ``Periodic'' and 
    inserting ``Annual'';
        (2) in paragraph (1), by striking ``semiannually'' and 
    inserting ``annually''; and
        (3) in paragraph (3), by striking ``periodic'' and inserting 
    ``the annual''.
    (c) Annual Report on Intelligence Community Cooperation With 
Counterdrug Activities.--Section 114 of the National Security Act of 
1947 (50 U.S.C. 404i) is amended--
        (1) by striking subsection (a); and
        (2) by redesignating subsections (b) through (f) as subsections 
    (a) through (e), respectively.
    (d) Annual Report on Covert Leases.--Section 114 of the National 
Security Act of 1947, as amended by this section, is further amended--
        (1) by striking subsection (d); and
        (2) by redesignating subsection (e) as subsection (d).
    (e) Annual Report on Certain Foreign Companies Involved in 
Proliferation of Weapons of Mass Destruction.--Section 827 of the 
Intelligence Authorization Act for Fiscal Year 2003 (Public Law 107-
306; 116 Stat. 2430; 50 U.S.C. 404n-3) is repealed.
    (f) Annual Report on Intelligence Activities of People's Republic 
of China.--Section 308 of the Intelligence Authorization Act for Fiscal 
Year 1998 (Public Law 105-107; 111 Stat. 2253; 50 U.S.C. 402a note) is 
repealed.
    (g) Annual Report on Coordination of Counterintelligence Matters 
With FBI.--Section 811(c) of the Counterintelligence and Security 
Enhancements Act of 1994 (title VIII of Public Law 103-359; 50 U.S.C. 
402a(c)) is amended--
        (1) by striking paragraph (6); and
        (2) by redesignating paragraphs (7) and (8) as paragraphs (6) 
    and (7), respectively.
    (h) Annual Report on Postemployment Assistance for Terminated 
Intelligence Employees.--Section 1611 of title 10, United States Code, 
is amended by striking subsection (e).
    (i) Annual Report on Activities of FBI Personnel Outside the United 
States.--Section 540C of title 28, United States Code, is repealed.
    (j) Annual Report on Exceptions to Consumer Disclosure Requirements 
for National Security Investigations.--Section 604(b)(4) of the Fair 
Credit Reporting Act (15 U.S.C. 1681b(b)(4)) is amended--
        (1) by striking subparagraphs (D) and (E); and
        (2) by redesignating subparagraph (F) as subparagraph (D).
    (k) Reports on Acquisition of Technology Relating to Weapons of 
Mass Destruction and Advanced Conventional Munitions.--Subsection 
(b)(1) of section 721 of the Intelligence Authorization Act for Fiscal 
Year 1997 (Public Law 104-293; 50 U.S.C. 2366) is amended by striking 
``a semiannual'' and inserting ``an annual''.
    (l) Conforming Amendments.--Section 507 of the National Security 
Act of 1947 (50 U.S.C. 415b) is amended--
        (1) in subsection (a)--
            (A) in paragraph (1)--
                (i) by striking subparagraphs (A), (C), (G), (I), (J), 
            and (L);
                (ii) by redesignating subparagraphs (B), (D), (E), (H), 
            (K), (M), and (N) as subparagraphs (A), (C), (D), (G), (H), 
            and (I), respectively;
                (iii) by inserting after subparagraph (A), as so 
            redesignated, the following new subparagraph (B):
        ``(B) The annual report on intelligence provided to the United 
    Nations required by section 112(b)(1).''; and
                (iv) by inserting after subparagraph (D), as so 
            redesignated, the following new subparagraph (E):
        ``(E) The annual report on the acquisition of technology 
    relating to weapons of mass destruction and advanced conventional 
    munitions required by section 721 of the Intelligence Authorization 
    Act for Fiscal Year 1997 (Public Law 104-293; 50 U.S.C. 2366).''; 
    and
            (B) in paragraph (2)--
                (i) in subparagraph (A), by striking ``section 114(b)'' 
            and inserting ``section 114(a)'';
                (ii) in subparagraph (B), by striking ``section 
            114(d)'' and inserting ``section 114(c)'';
                (iii) by striking subparagraphs (C), (E), and (F); and
                (iv) by redesignating subparagraphs (D) and (G) as 
            subparagraphs (C) and (D), respectively; and
        (2) in subsection (b)--
            (A) by striking paragraphs (1) and (4); and
            (B) by redesignating paragraphs (2), (3), (5), (6), (7), 
        and (8) as paragraphs (1), (2), (3), (4), (5), and (6), 
        respectively.
    (m) Clerical Amendments.--
        (1) National security act of 1947.--The table of contents for 
    the National Security Act of 1947 is amended by striking the item 
    relating to section 603.
        (2) Title 28, united states code.--The table of sections at the 
    beginning of chapter 33 of title 28, United States Code, is amended 
    by striking the item relating to section 540C.
    (n) Effective Date.--The amendments made by this section shall take 
effect on December 31, 2003.

                       Subtitle E--Other Matters

SEC. 371. EXTENSION OF SUSPENSION OF REORGANIZATION OF DIPLOMATIC 
              TELECOMMUNICATIONS SERVICE PROGRAM OFFICE.

    Section 311 of the Intelligence Authorization Act for Fiscal Year 
2002 (Public Law 107-108; 22 U.S.C. 7301 note) is amended--
        (1) in the heading, by striking ``two-year'' before 
    ``suspension of reorganization''; and
        (2) in the text, by striking ``ending on October 1, 2003'' and 
    inserting ``ending on the date that is 60 days after the 
    appropriate congressional committees of jurisdiction (as defined in 
    section 324(d) of that Act (22 U.S.C. 7304(d)) are notified jointly 
    by the Secretary of State (or the Secretary's designee) and the 
    Director of the Office of Management and Budget (or the Director's 
    designee) that the operational framework for the office has been 
    terminated''.

SEC. 372. MODIFICATIONS OF AUTHORITIES ON EXPLOSIVE MATERIALS.

    (a) Clarification of Aliens Authorized To Distribute Explosive 
Materials.--Section 842(d)(7) of title 18, United States Code, is 
amended--
        (1) in subparagraph (A), by striking ``or'' at the end;
        (2) in subparagraph (B)--
            (A) by inserting ``or'' at the end of clause (i); and
            (B) by striking clauses (iii) and (iv); and
        (3) by adding the following new subparagraphs:
            ``(C) is a member of a North Atlantic Treaty Organization 
        (NATO) or other friendly foreign military force, as determined 
        by the Attorney General in consultation with the Secretary of 
        Defense, who is present in the United States under military 
        orders for training or other military purpose authorized by the 
        United States and the shipping, transporting, possession, or 
        receipt of explosive materials is in furtherance of the 
        authorized military purpose; or
            ``(D) is lawfully present in the United States in 
        cooperation with the Director of Central Intelligence, and the 
        shipment, transportation, receipt, or possession of the 
        explosive materials is in furtherance of such cooperation;''.
    (b) Clarification of Aliens Authorized To Possess or Receive 
Explosive Materials.--Section 842(i)(5) of title 18, United States 
Code, is amended--
        (1) in subparagraph (A), by striking ``or'' at the end;
        (2) in subparagraph (B)--
            (A) by inserting ``or'' at the end of clause (i); and
            (B) by striking clauses (iii) and (iv); and
        (3) by adding the following new subparagraphs:
            ``(C) is a member of a North Atlantic Treaty Organization 
        (NATO) or other friendly foreign military force, as determined 
        by the Attorney General in consultation with the Secretary of 
        Defense, who is present in the United States under military 
        orders for training or other military purpose authorized by the 
        United States and the shipping, transporting, possession, or 
        receipt of explosive materials is in furtherance of the 
        authorized military purpose; or
            ``(D) is lawfully present in the United States in 
        cooperation with the Director of Central Intelligence, and the 
        shipment, transportation, receipt, or possession of the 
        explosive materials is in furtherance of such cooperation;''.

SEC. 373. MODIFICATION OF PROHIBITION ON THE NATURALIZATION OF CERTAIN 
              PERSONS.

    Section 313(e)(4) of the Immigration and Nationality Act (8 U.S.C. 
1424(e)(4)) is amended--
        (1) by inserting ``when Department of Defense activities are 
    relevant to the determination'' after ``Secretary of Defense''; and
        (2) by inserting ``and the Secretary of Homeland Security'' 
    after ``Attorney General''.

SEC. 374. MODIFICATION TO DEFINITION OF FINANCIAL INSTITUTION IN RIGHT 
              TO FINANCIAL PRIVACY ACT.

    (a) Modification of Definition.--Section 1114 of the Right to 
Financial Privacy Act of 1978 (12 U.S.C. 3414) is amended by adding at 
the end the following:
    ``(d) For purposes of this section, and sections 1115 and 1117 
insofar as they relate to the operation of this section, the term 
`financial institution' has the same meaning as in subsections (a)(2) 
and (c)(1) of section 5312 of title 31, United States Code, except 
that, for purposes of this section, such term shall include only such a 
financial institution any part of which is located inside any State or 
territory of the United States, the District of Columbia, Puerto Rico, 
Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, 
or the United States Virgin Islands.''.
    (b) Cross Reference Modification.--Section 1101(1) of such Act (12 
U.S.C. 3401(1)) is amended by inserting ``, except as provided in 
section 1114,'' before ``means any office''.

SEC. 375. COORDINATION OF FEDERAL GOVERNMENT RESEARCH ON SECURITY 
              EVALUATIONS.

    (a) Workshops for Coordination of Research.--The National Science 
Foundation and the Office of Science and Technology Policy shall 
jointly sponsor not less than two workshops on the coordination of 
Federal Government research on the use of behavioral, psychological, 
and physiological assessments of individuals in the conduct of security 
evaluations.
    (b) Deadline for Completion of Activities.--The activities of the 
workshops sponsored under subsection (a) shall be completed not later 
than March 1, 2004.
    (c) Purposes.--The purposes of the workshops sponsored under 
subsection (a) are as follows:
        (1) To provide a forum for cataloging and coordinating 
    federally funded research activities relating to the development of 
    new techniques in the behavioral, psychological, or physiological 
    assessment of individuals to be used in security evaluations.
        (2) To develop a research agenda for the Federal Government on 
    behavioral, psychological, and physiological assessments of 
    individuals, including an identification of the research most 
    likely to advance the understanding of the use of such assessments 
    of individuals in security evaluations.
        (3) To distinguish between short-term and long-term areas of 
    research on behavioral, psychological, and physiological 
    assessments of individuals in order to maximize the utility of 
    short-term and long-term research on such assessments.
        (4) To identify the Federal agencies best suited to support 
    research on behavioral, psychological, and physiological 
    assessments of individuals.
        (5) To develop recommendations for coordinating future 
    federally funded research for the development, improvement, or 
    enhancement of security evaluations.
    (d) Advisory Group.--(1) In order to assist the National Science 
Foundation and the Office of Science and Technology Policy in carrying 
out the activities of the workshops sponsored under subsection (a), 
there is hereby established an interagency advisory group with respect 
to such workshops.
    (2) The advisory group shall be composed of the following:
        (A) A representative of the Social, Behavioral, and Economic 
    Directorate of the National Science Foundation.
        (B) A representative of the Office of Science and Technology 
    Policy.
        (C) The Secretary of Defense, or a designee of the Secretary.
        (D) The Secretary of State, or a designee of the Secretary.
        (E) The Attorney General, or a designee of the Attorney 
    General.
        (F) The Secretary of Energy, or a designee of the Secretary.
        (G) The Secretary of Homeland Security, or a designee of the 
    Secretary.
        (H) The Director of Central Intelligence, or a designee of the 
    Director.
        (I) The Director of the Federal Bureau of Investigation, or a 
    designee of the Director.
        (J) The National Counterintelligence Executive, or a designee 
    of the National Counterintelligence Executive.
        (K) Any other official assigned to the advisory group by the 
    President for purposes of this section.
    (3) The members of the advisory group under subparagraphs (A) and 
(B) of paragraph (2) shall jointly head the advisory group.
    (4) The advisory group shall provide the Foundation and the Office 
such information, advice, and assistance with respect to the workshops 
sponsored under subsection (a) as the advisory group considers 
appropriate.
    (5) The advisory group shall not be treated as an advisory 
committee for purposes of the Federal Advisory Committee Act (5 U.S.C. 
App.).
    (e) FOIA Exemption.--All files of the National Science Foundation 
and the Office of Science and Technology Policy for purposes of 
administering this section, including any files of a Federal, State, or 
local department or agency or of a private sector entity provided to or 
utilized by a workshop or advisory group under this section, shall be 
exempt from the provisions of section 552 of title 5, United States 
Code, that require publication, disclosure, search, or review in 
connection therewith.
    (f) Report.--Not later than March 1, 2004, the National Science 
Foundation and the Office of Science and Technology Policy shall 
jointly submit to Congress a report on the results of activities of the 
workshops sponsored under subsection (a), including the findings and 
recommendations of the Foundation and the Office as a result of such 
activities.
    (g) Funding.--(1) Of the amount authorized to be appropriated for 
the Intelligence Community Management Account by section 104(a), 
$500,000 shall be available to the National Science Foundation and the 
Office of Science and Technology Policy to carry out this section.
    (2) The amount authorized to be appropriated by paragraph (1) shall 
remain available until expended.

SEC. 376. TREATMENT OF CLASSIFIED INFORMATION IN MONEY LAUNDERING 
              CASES.

    Section 5318A of title 31, United States Code, is amended by adding 
at the end the following:
    ``(f) Classified Information.--In any judicial review of a finding 
of the existence of a primary money laundering concern, or of the 
requirement for 1 or more special measures with respect to a primary 
money laundering concern, made under this section, if the designation 
or imposition, or both, were based on classified information (as 
defined in section 1(a) of the Classified Information Procedures Act 
(18 U.S.C. App.), such information may be submitted by the Secretary to 
the reviewing court ex parte and in camera. This subsection does not 
confer or imply any right to judicial review of any finding made or any 
requirement imposed under this section.''.

SEC. 377. TECHNICAL AMENDMENTS.

    (a) National Security Act of 1947.--Section 112(d)(1) of the 
National Security Act of 1947 (50 U.S.C. 404g(d)(1)) is amended by 
striking ``section 103(c)(6)'' and inserting ``section 103(c)(7)''.
    (b) Central Intelligence Agency Act of  1949.--(1) Section 5(a)(1) 
of the Central Intelligence Agency Act of 1949 (50 U.S.C. 403f(a)(1)) 
is amended by striking ``(c)(6)'' each place it appears and inserting 
``(c)(7)''.
    (2) Section 6 of that Act (50 U.S.C. 403g) is amended by striking 
``section 103(c)(6) of the National Security Act of 1947 (50 U.S.C. 
403-3(c)(6))'' and inserting ``section 103(c)(7) of the National 
Security Act of 1947 (50 U.S.C. 403-3(c)(7))''.
    (3) Section 15 of that Act (50 U.S.C. 403o) is amended--
        (A) in subsection (a)(1), by striking ``special policemen of 
    the General Services Administration perform under the first section 
    of the Act entitled `An Act to authorize the Federal Works 
    Administrator or officials of the Federal Works Agency duly 
    authorized by him to appoint special policeman for duty upon 
    Federal property under the jurisdiction of the Federal Works 
    Agency, and for other purposes'(40 U.S.C. 318),'' and inserting 
    ``officers and agents of the Department of Homeland Security, as 
    provided in section 1315(b)(2) of title 40, United States Code,''; 
    and
        (B) in subsection (b), by striking ``the fourth section of the 
    Act referred to in subsection (a) of this section (40 U.S.C. 
    318c)'' and inserting ``section 1315(c)(2) of title 40, United 
    States Code''.
    (c) National Security Agency Act of  1959.--Section 11 of the 
National Security Agency Act of 1959 (50 U.S.C. 402 note) is amended--
        (1) in subsection (a)(1), by striking ``special policemen of 
    the General Services Administration perform under the first section 
    of the Act entitled `An Act to authorize the Federal Works 
    Administrator or officials of the Federal Works Agency duly 
    authorized by him to appoint special policeman for duty upon 
    Federal property under the jurisdiction of the Federal Works 
    Agency, and for other purposes'(40 U.S.C. 318)'' and inserting 
    ``officers and agents of the Department of Homeland Security, as 
    provided in section 1315(b)(2) of title 40, United States Code,''; 
    and
        (2) in subsection (b), by striking ``the fourth section of the 
    Act referred to in subsection (a) (40 U.S.C. 318c)'' and inserting 
    ``section 1315(c)(2) of title 40, United States Code''.
    (d) Intelligence Authorization Act for Fiscal Year 2003.--Section 
343 of the Intelligence Authorization Act for Fiscal Year 2003 (Public 
Law 107-306; 116 Stat. 2399; 50 U.S.C. 404n-2) is amended--
        (1) in subsection (c), by striking ``section 103(c)(6) of the 
    National Security Act of 1947 (50 U.S.C. 403-3(c)(6))'' and 
    inserting ``section 103(c)(7) of the National Security Act of 1947 
    (50 U.S.C. 403-3(c)(7))''; and
        (2) in subsection (e)(2), by striking ``section 103(c)(6)'' and 
    inserting ``section 103(c)(7)''.
    (e) Federal Information Security Management Act of 2002.--Section 
3535(b)(1) of title 44, United States Code, as added by section 
1001(b)(1) of the Homeland Security Act of 2002 (Public Law 107-296), 
and section 3545(b)(1) of title 44, United States Code, as added by 
section 301(b)(1) of the E-Government Act of 2002 (Public Law 107-347), 
are each amended by inserting ``or any other law'' after ``1978''.
    (f) Public Law 107-173.--Section 201(c)(3)(F) of the Enhanced 
Border Security and Visa Entry Reform Act of 2002 (Public Law 107-173; 
116 Stat. 548; 8 U.S.C. 1721(c)(3)(F)) is amended by striking ``section 
103(c)(6) of the National Security Act of 1947 (50 U.S.C. 403-
3(c)(6))'' and inserting ``section 103(c)(7) of the National Security 
Act of 1947 (50 U.S.C. 403-3(c)(7))''.

                 TITLE IV--CENTRAL INTELLIGENCE AGENCY

SEC. 401. AMENDMENT TO CERTAIN CENTRAL INTELLIGENCE AGENCY ACT OF 1949 
              NOTIFICATION REQUIREMENTS.

    Section 4(b)(5) of the Central Intelligence Agency Act of 1949 (50 
U.S.C. 403e(b)(5)) is amended by inserting ``, other than regulations 
under paragraph (1),'' after ``Regulations''.

SEC. 402. PROTECTION OF CERTAIN CENTRAL INTELLIGENCE AGENCY PERSONNEL 
              FROM TORT LIABILITY.

    Section 15 of the Central Intelligence Agency Act of 1949 (50 
U.S.C. 403o) is amended by adding at the end the following new 
subsection:
    ``(d)(1) Notwithstanding any other provision of law, any Agency 
personnel designated by the Director under subsection (a), or 
designated by the Director under section 5(a)(4) to carry firearms for 
the protection of current or former Agency personnel and their 
immediate families, defectors and their immediate families, and other 
persons in the United States under Agency auspices, shall be considered 
for purposes of chapter 171 of title 28, United States Code, or any 
other provision of law relating to tort liability, to be acting within 
the scope of their office or employment when such Agency personnel take 
reasonable action, which may include the use of force, to--
        ``(A) protect an individual in the presence of such Agency 
    personnel from a crime of violence;
        ``(B) provide immediate assistance to an individual who has 
    suffered or who is threatened with bodily harm; or
        ``(C) prevent the escape of any individual whom such Agency 
    personnel reasonably believe to have committed a crime of violence 
    in the presence of such Agency personnel.
    ``(2) Paragraph (1) shall not affect the authorities of the 
Attorney General under section 2679 of title 28, United States Code.
    ``(3) In this subsection, the term `crime of violence' has the 
meaning given that term in section 16 of title 18, United States 
Code.''.

SEC. 403. REPEAL OF OBSOLETE LIMITATION ON USE OF FUNDS IN CENTRAL 
              SERVICES WORKING CAPITAL FUND.

    Section 21(f)(2) of the Central Intelligence Agency Act of 1949 (50 
U.S.C. 403u(f)(2)) is amended--
        (1) in subparagraph (A), by striking ``(A) Subject to 
    subparagraph (B), the Director'' and inserting ``The Director''; 
    and
        (2) by striking subparagraph (B).

SEC. 404. PURCHASES BY CENTRAL INTELLIGENCE AGENCY OF PRODUCTS OF 
              FEDERAL PRISON INDUSTRIES.

    Notwithstanding section 4124 of title 18, United States Code, 
purchases by the Central Intelligence Agency from Federal Prison 
Industries shall be made only if the Director of Central Intelligence 
determines that the product or service to be purchased from Federal 
Prison Industries best meets the needs of the Agency.

SEC. 405. POSTPONEMENT OF CENTRAL INTELLIGENCE AGENCY COMPENSATION 
              REFORM AND OTHER MATTERS.

    (a) Postponement of Compensation Reform Plan.--Section 402(a)(2) of 
the Intelligence Authorization Act for Fiscal Year 2003 (Public Law 
107-306; 116 Stat. 2403; 50 U.S.C. 403-4 note) is amended by striking 
``February 1, 2004,'' and all that follows through the end and 
inserting ``the date of the enactment of the Intelligence Authorization 
Act for Fiscal Year 2005.''.
    (b) Contribution by CIA Employees of Certain Bonus Pay to Thrift 
Savings Plan.--
        (1) Civil service retirement system participants.--Section 
    8351(d) of title 5, United States Code, is amended--
            (A) by inserting ``(1)'' after ``(d)''; and
            (B) by adding at the end the following new paragraph:
    ``(2)(A) Only those employees of the Central Intelligence Agency 
participating in the pilot project required by section 402(b) of the 
Intelligence Authorization Act for Fiscal Year 2003 (Public Law 107-
306; 50 U.S.C. 403-4 note) and making contributions to the Thrift 
Savings Fund out of basic pay may also contribute (by direct transfer 
to the Fund) any part of bonus pay received by the employee as part of 
the pilot project.
    ``(B) Contributions under this paragraph are subject to section 
8432(d) of this title.''.
        (2) Federal employees' retirement system participants.--Section 
    8432 of title 5, United States Code, is amended by adding at the 
    end the following new subsection:
    ``(k)(1) Only those employees of the Central Intelligence Agency 
participating in the pilot project required by section 402(b) of the 
Intelligence Authorization Act for Fiscal Year 2003 (Public Law 107-
306; 50 U.S.C. 403-4 note) and making contributions to the Thrift 
Savings Fund out of basic pay may also contribute (by direct transfer 
to the Fund) any part of bonus pay received by the employee as part of 
the pilot project.
    ``(2) Contributions under this subsection are subject to subsection 
(d).
    ``(3) For purposes of subsection (c), basic pay of an employee of 
the Central Intelligence Agency participating in the pilot project 
referred to in paragraph (1) shall include bonus pay received by the 
employee as part of the pilot project.''.
    (c) Report.--(1) The Director of Central Intelligence shall submit 
to the congressional intelligence committees a report on the amount of 
compensation (including basic pay, bonuses, and employer contributions 
to the Thrift Savings Plan) of each employee of the Central 
Intelligence Agency participating in the pilot project required by 
section 402(b) of the Intelligence Authorization Act for Fiscal Year 
2003 (Public Law 107-306; 116 Stat. 2403; 50 U.S.C. 403-4 note), and on 
the amount that each such employee would have received had such 
employee received compensation under the existing system of 
compensation used by the Agency.
    (2) The report required by paragraph (1) shall be submitted 
together with the report required by paragraph (3) of such section 
402(b).
    (3) In this subsection, the term ``congressional intelligence 
committees'' has the meaning given that term in section 402(d) of the 
Intelligence Authorization Act for Fiscal Year 2003.

          TITLE V--DEPARTMENT OF DEFENSE INTELLIGENCE MATTERS

SEC. 501. PROTECTION OF CERTAIN NATIONAL SECURITY AGENCY PERSONNEL FROM 
              TORT LIABILITY.

    Section 11 of the National Security Agency Act of 1959 (50 U.S.C. 
402 note) is amended by adding at the end the following new subsection:
    ``(d)(1) Notwithstanding any other provision of law, agency 
personnel designated by the Director of the National Security Agency 
under subsection (a) shall be considered for purposes of chapter 171 of 
title 28, United States Code, or any other provision of law relating to 
tort liability, to be acting within the scope of their office or 
employment when such agency personnel take reasonable action, which may 
include the use of force, to--
        ``(A) protect an individual in the presence of such agency 
    personnel from a crime of violence;
        ``(B) provide immediate assistance to an individual who has 
    suffered or who is threatened with bodily harm; or
        ``(C) prevent the escape of any individual whom such agency 
    personnel reasonably believe to have committed a crime of violence 
    in the presence of such agency personnel.
    ``(2) Paragraph (1) shall not affect the authorities of the 
Attorney General under section 2679 of title 28, United States Code.
    ``(3) In this subsection, the term `crime of violence' has the 
meaning given that term in section 16 of title 18, United States 
Code.''.

SEC. 502. USE OF FUNDS FOR COUNTERDRUG AND COUNTERTERRORISM ACTIVITIES 
              FOR COLOMBIA.

    (a) Authority.--Funds designated for intelligence or intelligence-
related purposes for assistance to the Government of Colombia for 
counterdrug activities for fiscal year 2004, and any unobligated funds 
available to any element of the intelligence community for such 
activities for a prior fiscal year, shall be available--
        (1) to support a unified campaign by the Government of Colombia 
    against narcotics trafficking and against activities by 
    organizations designated as terrorist organizations (such as the 
    Revolutionary Armed Forces of Colombia (FARC), the National 
    Liberation Army (ELN), and the United Self-Defense Forces of 
    Colombia (AUC)); and
        (2) to take actions to protect human health and welfare in 
    emergency circumstances, including undertaking rescue operations.
    (b) Applicability of Certain Laws and Limitations.--The use of 
funds pursuant to the authority in subsection (a) shall be subject to 
the following:
        (1) Sections 556, 567, and 568 of the Foreign Operations, 
    Export Financing, and Related Programs Appropriations Act, 2002 
    (Public Law 107-115; 115 Stat. 2160, 2165, and 2166).
        (2) Section 8077 of the Department of Defense Appropriations 
    Act, 2004 (Public Law 108-87; 117 Stat. 1090).
        (3) The numerical limitations on the number of United States 
    military personnel and United States individual civilian 
    contractors in section 3204(b)(1) of the Emergency Supplemental 
    Act, 2000 (division B of Public Law 106-246; 114 Stat. 575), as 
    amended by the Foreign Operations, Export Financing, and Related 
    Programs Appropriations Act, 2002 (115 Stat. 2131).
    (c) Limitation on Participation of United States Personnel.--No 
United States Armed Forces personnel or United States civilian 
contractor employed by the United States Armed Forces will participate 
in any combat operation in connection with assistance made available 
under this section, except for the purpose of acting in self defense or 
during the course of search and rescue operations for United States 
citizens.

SEC. 503. SCENE VISUALIZATION TECHNOLOGIES.

    Of the amount authorized to be appropriated by this Act, $2,500,000 
shall be available for the National Geospatial-Intelligence Agency 
(NGA) for scene visualization technologies.

SEC. 504. MEASUREMENT AND SIGNATURES INTELLIGENCE RESEARCH PROGRAM.

    (a) Research Program.--(1) The Secretary of Defense and the 
Director of Central Intelligence shall jointly carry out a program to 
incorporate the results of basic research on sensors into the 
measurement and signatures intelligence systems of the United States, 
to the extent the results of such research are applicable to such 
systems.
    (2) In carrying out paragraph (1), the Secretary of Defense and the 
Director of Central Intelligence shall act through the Director of the 
Defense Intelligence Agency's Directorate for MASINT and Technical 
Collection (hereinafter in this section referred to as the 
``Director'').
    (b) Program Components.--The program under subsection (a) shall 
review and assess basic research on sensors and technologies conducted 
both by the United States Government and by non-governmental entities. 
In carrying out the program, the Director shall protect intellectual 
property rights, maintain organizational flexibility, and establish 
research projects, funding levels, and potential benefits in an 
equitable manner through the Directorate.
    (c) Advisory Panel.--(1) The Director shall establish an advisory 
panel to assist the Director in carrying out the program under 
subsection (a).
    (2) The advisory panel shall be headed by the Director who shall 
determine the selection, review, and assessment of the research 
projects under the program.
    (3)(A) The Director shall appoint as members of the advisory panel 
representatives of each entity of the MASINT community, and may appoint 
as such members representatives of national laboratories, universities, 
and private sector entities.
    (B) For purposes of this subsection the term ``MASINT community'' 
means academic, professional, industrial, and government entities that 
are committed towards the advancement of the sciences in measurement 
and signatures intelligence.
    (C) The term for a member of the advisory panel shall be 
established by the Director, but may not exceed a period of 5 
consecutive years.
    (D) Members of the advisory panel may not receive additional pay, 
allowances, or benefits by reason of their service on the advisory 
panel, but may receive per diem in lieu of subsistence, in accordance 
with applicable provisions under subchapter I of chapter 57 of title 5, 
United States Code.
    (4) The Director may accept contributions from non-governmental 
participants on the advisory panel to defray the expenses of the 
advisory panel.
    (5) The Federal Advisory Committee Act (5 U.S.C. App.) shall not 
apply to the activities of the advisory panel established under this 
subsection.
    (d) FOIA Exemption.--All files in the possession of the Defense 
Intelligence Agency for purposes of administering the program under 
this section, including any files of a Federal, State, or local 
department or agency or of a private sector entity provided to or 
utilized by the program, shall be exempt from the provisions of section 
552 of title 5, United States Code, that require publication, 
disclosure, search, or review in connection therewith.

SEC. 505. AVAILABILITY OF FUNDS OF NATIONAL SECURITY AGENCY FOR 
              NATIONAL SECURITY SCHOLARSHIPS.

    (a) Availability of Funds.--Any funds authorized to be appropriated 
for the National Security Agency for a fiscal year after fiscal year 
2003 may be made available to the Independent College Fund of Maryland 
(also known as the ``I-Fund'') for the purpose of the establishment and 
provision of national security scholarships to the extent such funds 
are specifically authorized for that purpose.
    (b) Mechanisms of Availability.--Funds may be made available to the 
Independent College Fund of Maryland under subsection (a) by grant, 
contract, cooperative agreement, or such other appropriate mechanisms 
as the Director of the National Security Agency considers appropriate.

                               Speaker of the House of Representatives.

                            Vice President of the United States and    
                                               President of the Senate.