Congressional Record, Volume 141 Issue 154 (Friday, September 29, 1995)

[Congressional Record Volume 141, Number 154 (Friday, September 29, 1995)]
[Senate]
[Pages S14782-S14797]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

INTELLIGENCE AUTHORIZATION ACT OF FISCAL YEAR 1996

Mr. COATS. Mr. President, I ask unanimous consent that the Senate
proceed to the consideration of Calendar No. 164, S. 922, the
intelligence authorization bill.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

A bill (S. 922) to authorize appropriations for fiscal year
1996 for intelligence and intelligence related activities of
the United States Government.

The PRESIDING OFFICER. Is there objection to the immediate
consideration of the bill?
There being no objection, the Senate proceeded to consider the bill,
which had been reported from the Committee on Armed Services, with an
amendment to insert the part printed in italics on page 3, so as to
make the bill read:

S. 922

Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled, That this
Act may be cited as the ``Intelligence Authorization Act for
Fiscal Year 1996''.
TITLE I--INTELLIGENCE ACTIVITIES

SEC. 101. AUTHORIZATION OF APPROPRIATIONS.

Funds are authorized to be appropriated for fiscal year
1996 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 Treasury.
(8) The Department of Energy.
(9) The Federal Bureau of Investigation.
(10) The Drug Enforcement Administration.
(11) The National Reconnaissance Office.
(12) The Central Imagery Office.

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, 1996,
for the conduct of the elements listed in such section, are
those specified in the classified Schedule of Authorizations
prepared by the Committee of Conference to accompany ( ) of
the One Hundred and Fourth Congress.
(b) Availability of Classified Schedule of
Authorizations.--The Schedule of Authorizations shall be made
available to the Committee 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.
(c) Scope of Schedule.--The Schedule of Authorizations
referred to in subsections (a) and (b) is only the Schedule
of Authorizations for the National Foreign Intelligence
Program (NFIP).

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
1996 under section 102 of this Act when the Director
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 (as defined in section 3(4) of the
National Security Act of 1947 (50 U.S.C. 401(4)), 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 notify the Permanent Select
Committee on Intelligence of the House of Representatives and
the Select Committee on Intelligence of the Senate prior to
exercising the authority granted by this section.

[[Page S 14783]]

SEC. 104. INTELLIGENCE COMMUNITY MANAGEMENT ACCOUNT.

(a) Authorization of Appropriations.--(1) There is
authorized to be appropriated for the Intelligence Community
Management Account of the Director of Central Intelligence
for fiscal year 1996 the sum of $98,283,000.
(2) Funds made available under paragraph (1) for the
Advanced Research and Development Committee and the
Environmental Task Force shall remain available until
September 30, 1997.
(b) Authorized Personnel Levels.--The Community Management
Staff of the Director of Central Intelligence is authorized
247 full-time personnel as of September 30, 1996. Such
personnel of the Community Management Staff may be permanent
employees of the Community Management Staff or personnel
detailed from other elements of the United States Government.
(c) Reimbursement.--During the fiscal year 1996, any
officer or employee of the United States or any member of the
Armed Forces who is detailed to the Community Management
Staff 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.
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 1996 the sum of $213,900,000.
TITLE III--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.

SEC. 303. APPLICATION OF SANCTIONS TO INTELLIGENCE
ACTIVITIES.

The National Security Act of 1947 (50 U.S.C.401 et seq.) is
amended by adding at the end thereof the following new title:
``TITLE VIII--APPLICATION OF SANCTIONS LAWS TO INTELLIGENCE ACTIVITIES

``SEC. 801. DELAY OF SANCTIONS.

``Notwithstanding any other provision of law, the President
may delay the imposition of a sanction related to the
proliferation of weapons of mass destruction, their delivery
systems, or advanced conventional weapons when he determines
that to proceed without delay would seriously risk the
compromise of a sensitive intelligence source or method or an
ongoing criminal investigation. The President shall terminate
any such delay as soon as it is no longer necessary to that
purpose.

``SEC. 802. REPORTS.

``Whenever the President makes the determination required
pursuant to section 801, the President shall promptly report
to the Select Committee on Intelligence of the Senate and the
Permanent Select Committee on Intelligence of the House of
Representatives the rationale and circumstances that led the
President to exercise the authority under section 801 with
respect to an intelligence source or method, and to the
Judiciary Committees of the Senate and the House of
Representatives the rationale and circumstances that led the
President to exercise the authority under section 801 with
respect to an ongoing criminal investigation. Such report
shall include a description of the efforts being made to
implement the sanctions as soon as possible and an estimate
of the date on which the sanctions will become effective.''.

SEC. 304. THRIFT SAVINGS PLAN FORFEITURE.

(a) In General.--Section 8432(g) of title 5, United States
Code, is amended by adding at the end the following new
paragraph:
``(5) Notwithstanding any other provision of law,
contributions made by the Government for the benefit of an
employee under subsection (c), and all earnings attributable
to such contributions, shall be forfeited if the employee's
annuity, or that of a survivor or beneficiary, is forfeited
pursuant to subchapter II of chapter 83 of this title.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to offenses upon which the requisite annuity
forfeitures are based occurring on or after the date of
enactment of this Act.

SEC. 305. AUTHORITY TO RESTORE SPOUSAL PENSION BENEFITS TO
SPOUSES WHO COOPERATE IN CRIMINAL
INVESTIGATIONS AND PRECAUTIONS FOR NATIONAL
SECURITY OFFENSES.

Section 8312 of title 5, United States Code, is amended by
adding at the end the following new subsection:
``(e) Notwithstanding any other provision of law, the
spouse of an employee whose annuity or retired pay is
forfeited under this section or section 8313 after the
enactment of this subsection shall be eligible for spousal
pension benefits if the Attorney General determines that the
spouse fully cooperated with Federal authorities in the
conduct of a criminal investigation and subsequent
prosecution of the employee.''.

SEC. 306. AMENDMENT TO THE HATCH ACT REFORM AMENDMENTS OF
1993.

Section 7325 of title 5, United States Code, is amended by
adding after ``section 7323(a)'' the following: ``and
paragraph (2) of section 7323(b)''.

SEC. 307. REPORT ON PERSONNEL POLICIES.

(a) Report Required.--Not later than three months after the
date of enactment of this Act, the Director of Central
Intelligence shall submit to the intelligence committees of
Congress a report describing personnel procedures, and
recommending necessary legislation, to provide for mandatory
retirement for expiration of time in class, comparable to the
applicable provisions of section 607 of the Foreign Service
Act of 1980 (22 U.S.C. 4007), and termination based on
relative performance, comparable to section 608 of the
Foreign Service Act of 1980 (22 U.S.C. 4008), for all
civilian employees of the Central Intelligence Agency, the
National Security Agency, the Defense Intelligence Agency,
and the intelligence elements of the Army, Navy, Air Force,
and Marine Corps.
(b) Coordination.--The preparation of the report required
by subsection (a) shall be coordinated as appropriate with
elements of the intelligence community (as defined in section
3(4) of the National Security Act of 1947 (50 U.S.C. 401(4)).
(c) Definition.--As used in this section, the term
``intelligence committees of Congress'' means the Select
Committee on Intelligence of the Senate and the Permanent
Select Committee on Intelligence of the House of
Representatives.

SEC. 308. ASSISTANCE TO FOREIGN COUNTRIES.

(a) In General.--Notwithstanding any other provision of
law, funds authorized to be appropriated by this Act may be
used to provide assistance to a foreign country for
counterterrorism efforts if--
(1) such assistance is provided for the purpose of
protecting the property of the United States Government or
the life and property of any United States citizen, or
furthering the apprehension of any individual involved in any
act of terrorism against such property or persons; and
(2) the appropriate committees of Congress are notified not
later than 15 days prior to the provision of such assistance.
(b) Definition.--As used in this section, the term
``appropriate congressional committees'' means the Select
Committee on Intelligence of the Senate and the Permanent
Select Committee on Intelligence of the House of
Representatives.
TITLE IV--CENTRAL INTELLIGENCE AGENCY

SEC. 401. EXTENSION OF THE CIA VOLUNTARY SEPARATION PAY ACT.

Section 2(f) of the CIA Voluntary Separation Pay Act is
amended by striking out ``September 30, 1997'' and inserting
in lieu thereof ``September 30, 1999''.

SEC. 402. VOLUNTEER SERVICE PROGRAM.

The Central Intelligence Agency Act of 1949 (50 U.S.C. 403a
et seq.) is amended by adding at the end of the following new
section:

``SEC. 20. VOLUNTEER SERVICE PROGRAM.

``(a) Notwithstanding any other provision of law, the
Director of Central Intelligence is authorized to establish
and maintain a program during fiscal years 1996 through 2001
to utilize the services contributed by not more than 50
retired annuitants who serve without compensation as
volunteers in aid of the review by the Central Intelligence
Agency for declassification or downgrading of classified
information under applicable Executive Orders covering the
classification and declassification of national security
information and Public Law 102-526.
``(b) The Agency is authorized to use sums made available
to the Agency by appropriations or otherwise for paying the
costs incidental to the utilization of services contributed
by individuals who serve without compensation as volunteers
in aid of the review by the Agency of classified information,
including, but not limited to, the costs of training,
transportation, lodging, subsistence, equipment, and
supplies. Agency officials may authorize either direct
procurement of, or reimbursement for, expenses incidental to
the effective use of volunteers, except that provision for
such expenses or services shall be in accordance with
volunteer agreements made with such individuals and that such
sums may not exceed $100,000.
``(c) Notwithstanding the provision of any other law,
individuals who volunteer to provide services to the Agency
under this section shall be covered by and subject to the
provisions of--
``(1) the Federal Employees Compensation Act; and
``(2) chapter 11 of title 18, United States Code,
as if they were employees or special Government employees
depending upon the days of expected service at the time they
begin their volunteer service.''.

SEC. 403. AUTHORITIES OF THE INSPECTOR GENERAL OF THE CENTRAL
INTELLIGENCE AGENCY.

(a) Reports by the Inspector General.--Section 17(b)(5) of
the Central Intelligence Act of 1949 (50 U.S.C. 403q) is
amended to read as follows:
``(5) In accordance with section 535 of title 28, United
States Code, the Inspector General

[[Page S 14784]]
shall report to the Attorney General any information, allegation, or
complaint received by the Inspector General relating to
violations of Federal criminal law that involve a program or
operation of the Agency, consistent with such guidelines as
may be issued by the Attorney General pursuant to paragraph
(2). A copy of all such reports shall be furnished to the
Director.''.
(b) Exception to Nondisclosure Requirement.--Section
17(e)(3)(A) of such Act is amended by inserting after
``investigation'' the following: ``or the disclosure is made
to an official of the Department of Justice responsible for
determining whether a prosecution should be undertaken''.

SEC. 404. REPORT ON LIAISON RELATIONSHIPS.

(a) Annual Report.--Section 502 of the National Security
Act of 1947 (50 U.S.C. 413a) is amended--
(1) by striking ``and'' at the end of paragraph (1);
(2) by striking the period at the end of paragraph (2) and
inserting ``; and''; and
(3) by adding at the end the following:
``(3) annually submit to the intelligence committees a
report describing all liaison relationships for the preceding
year, including--
``(A) the names of the governments and entities;
``(B) the purpose of each relationship;
``(C) the resources dedicated (including personnel, funds,
and materiel);
``(D) a description of the intelligence provided and
received, including any reports on human rights violations;
and
``(E) any significant changes anticipated.''.
(b) Definition.--Section 606 of such Act is amended by
adding at the end the following:
``(11) The term `liaison' means any governmental entity or
individual with whom an intelligence agency has established a
relationship for the purpose of obtaining information.''.
TITLE V--DEPARTMENT OF DEFENSE INTELLIGENCE ACTIVITIES

SEC. 501. COMPARABLE OVERSEAS BENEFITS AND ALLOWANCES FOR
CIVILIAN AND MILITARY PERSONNEL ASSIGNED TO THE
DEFENSE INTELLIGENCE AGENCY.

(a) Title 10.--Title 10, United States Code, is amended--
(1) in section 1605(a), by striking ``and'' after ``Defense
Attache Offices'' and inserting ``or''; and
(2) in section 1605(a), by inserting ``, and Defense
Intelligence Agency employees assigned to duty outside the
United States,'' after ``outside the United States,''.
(b) Title 37.--Title 37, United States Code, is amended--
(1) in section 431(a), by striking ``and'' after ``Defense
Attache Offices'' and inserting ``or''; and
(2) in section 431(a), by inserting ``, and members of the
armed forces assigned to the Defense Intelligence Agency and
engaged in intelligence related duties outside the United
States,'' after ``outside the United States''.

SEC. 502. AUTHORITY TO CONDUCT COMMERCIAL ACTIVITIES
NECESSARY TO PROVIDE SECURITY FOR AUTHORIZED
INTELLIGENCE COLLECTION ACTIVITIES ABROAD.

Section 431(a) of title 10, United States Code, is amended
by striking ``1995'' and inserting ``2001''.

SEC. 503. MILITARY DEPARTMENTS' CIVILIAN INTELLIGENCE
PERSONNEL MANAGEMENT SYSTEM: ACQUISITION OF
CRITICAL SKILLS.

(a) Establishment of Training Program.--Chapter 81 of title
10, United States Code, is amended by adding at the end
thereof the following new section:

``Sec. 1599. Financial assistance to certain employees in
acquisition of critical skills

``(a) Training Program.--The Secretary of Defense shall
establish an undergraduate training program with respect to
civilian employees in the Military Departments' Civilian
Intelligence Personnel Management System that is similar in
purpose, conditions, content, and administration to the
program which the Secretary of Defense established under
section 16 of the National Security Act of 1959 (50 U.S.C.
402 note) for civilian employees of the National Security
Agency.
``(b) Funding of Training Program.--Any payments made by
the Secretary to carry out the program required to be
established by subsection (a) may be made in any fiscal year
only to the extent that appropriated funds are available for
that purpose.''.
(b) Clerical Amendment.--The table of sections at the
beginning of that chapter is amended by adding at the end
thereof the following:

``Sec. 1599. Financial assistance to certain employees in acquisition
of critical skills.''.
TITLE VI--FEDERAL BUREAU OF INVESTIGATION

SEC. 601. DISCLOSURE OF INFORMATION AND CONSUMER REPORTS TO
FBI FOR COUNTERINTELLIGENCE PURPOSES.

(a) In General.--The Fair Credit Reporting Act (15 U.S.C.
1681 et seq.) is amended by adding after section 623, the
following new section:

``Sec. 624. Disclosures to FBI for counterintelligence
purposes

``(a) Identity of Financial Institutions.--Notwithstanding
section 604 or any other provision of this title, a consumer
reporting agency shall furnish to the Federal Bureau of
Investigation the names and addresses of all financial
institutions (as that term is defined in section 1101 of the
Right to Financial Privacy Act of 1978) at which a consumer
maintains or has maintained an account, to the extent that
information is in the files of the agency, when presented
with a written request for that information, signed by the
Director of the Federal Bureau of Investigation, or the
Director's designee, which certifies compliance with this
section. The Director or the Director's designee may make
such a certification only if the Director or the Director's
designee has determined in writing that--
``(1) such information is necessary for the conduct of an
authorized foreign counterintelligence investigation; and
``(2) there are specific and articulable facts giving
reason to believe that the consumer--
``(A) is a foreign power (as defined in section 101 of the
Foreign Intelligence Surveillance Act of 1978) or a person
who is not a United States person (as defined in such section
101) and is an official of a foreign power; or
``(B) is an agent of a foreign power and is engaging or has
engaged in an act of international terrorism (as that term is
defined in section 101(c) of the Foreign Intelligence
Surveillance Act of 1978) or clandestine intelligence
activities that involve or may involve a violation of
criminal statutes of the United States.
``(b) Identifying Information.--Notwithstanding the
provisions of section 604 or any other provision of this
title, a consumer reporting agency shall furnish identifying
information respecting a consumer, limited to name, address,
former addresses, places of employment, or former places of
employment, to the Federal Bureau of Investigation when
presented with a written request, signed by the Director or
the Director's designee, which certifies compliance with this
subsection. The Director or the Director's designee may make
such a certification only if the Director or the Director's
designee has determined in writing that--
``(1) such information is necessary to the conduct of an
authorized counterintelligence investigation; and
``(2) there is information giving reason to believe that
the consumer has been, or is about to be, in contact with a
foreign power or an agent of a foreign power (as defined in
section 101 of the Foreign Intelligence Surveillance Act of
1978).
``(c) Court Order for Disclosure of Consumer Reports.--
Notwithstanding section 604 or any other provision of this
title, if requested in writing by the Director of the Federal
Bureau of Investigation, or a designee of the Director, a
court may issue an order ex parte directing a consumer
reporting agency to furnish a consumer report to the Federal
Bureau of Investigation, upon a showing in camera that--
``(1) the consumer report is necessary for the conduct of
an authorized foreign counterintelligence investigation; and
``(2) there are specific and articulable facts giving
reason to believe that the consumer whose consumer report is
sought--
``(A) is an agent of a foreign power, and
``(B) is engaging or has engaged in an act of international
terrorism (as that term is defined in section 101(c) of the
Foreign Intelligence Surveillance Act of 1978) or clandestine
intelligence activities that involve or may involve a
violation of criminal statutes of the United States.

The terms of an order issued under this subsection shall not
disclose that the order is issued for purposes of a
counterintelligence investigation.
``(d) Confidentiality.--No consumer reporting agency or
officer, employee, or agent of a consumer reporting agency
shall disclose to any person, other than those officers,
employees, or agents of a consumer reporting agency necessary
to fulfill the requirement to disclose information to the
Federal Bureau of Investigation under this section, that the
Federal Bureau of Investigation has sought or obtained the
identity of financial institutions or a consumer report
respecting any consumer under subsection (a), (b), or (c),
and no consumer reporting agency or officer, employee, or
agent of a consumer reporting agency shall include in any
consumer report any information that would indicate that the
Federal Bureau of Investigation has sought or obtained such
information or a consumer report.
``(e) Payment of Fees.--The Federal Bureau of Investigation
shall, subject to the availability of appropriations, pay to
the consumer reporting agency assembling or providing report
or information in accordance with procedures established
under this section a fee for reimbursement for such costs as
are reasonably necessary and which have been directly
incurred in searching, reproducing, or transporting books,
papers, records, or other data required or requested to be
produced under this section.
``(f) Limit on Dissemination.--The Federal Bureau of
Investigation may not disseminate information obtained
pursuant to this section outside of the Federal Bureau of
Investigation, except to other Federal agencies as may be
necessary for the approval or conduct of a foreign
counterintelligence investigation, or, where the information
concerns a person subject to the uniform Code of Military
Justice, to appropriate investigative authorities within the
military department concerned as may be necessary for the
conduct of a joint foreign counterintelligence investigation.

[[Page S 14785]]

``(g) Rules of Construction.--Nothing in this section shall
be construed to prohibit information from being furnished by
the Federal Bureau of Investigation pursuant to a subpoena or
court order, in connection with a judicial or administrative
proceeding to enforce the provisions of this Act. Nothing in
this section shall be construed to authorize or permit the
withholding of information from the Congress.
``(h) Reports to Congress.--On a semiannual basis, the
Attorney General shall fully inform the Permanent Select
Committee on Intelligence and the Committee on Banking,
Finance and Urban Affairs of the House of Representatives,
and the Select Committee on Intelligence and the Committee on
Banking, Housing, and Urban Affairs of the Senate concerning
all requests made pursuant to subsections (a), (b), and (c).
``(i) Damages.--Any agency or department of the United
States obtaining or disclosing any consumer reports, records,
or information contained therein in violation of this section
is liable to the consumer to whom such consumer reports,
records, or information relate in an amount equal to the sum
of--
``(1) $100, without regard to the volume of consumer
reports, records, or information involved;
``(2) any actual damages sustained by the consumer as a
result of the disclosure;
``(3) if the violation is found to have been willful or
intentional, such punitive damages as a court may allow; and
``(4) in the case of any successful action to enforce
liability under this subsection, the costs of the action,
together with reasonable attorney fees, as determined by the
court.
``(j) Disciplinary Actions for Violations.--If a court
determines that any agency or department of the United States
has violated any provision of this section and the court
finds that the circumstances surrounding the violation raise
questions of whether or not an officer or employee of the
agency or department acted willfully or intentionally with
respect to the violation, the agency or department shall
promptly initiate a proceeding to determine whether or not
disciplinary action is warranted against the officer or
employee who was responsible for the violation.
``(k) Good-Faith Exception.--Notwithstanding any other
provision of this title, any consumer reporting agency or
agent or employee thereof making disclosure of consumer
reports or identifying information pursuant to this
subsection in good-faith reliance upon a certification of the
Federal Bureau of Investigation pursuant to provisions of
this section shall not be liable to any person for such
disclosure under this title, the constitution of any State,
or any law or regulation of any State or any political
subdivision of any State.
``(l) Limitation of Remedies.--Notwithstanding any other
provision of this title, the remedies and sanctions set forth
in this section shall be the only judicial remedies and
sanctions for violation of this section.
``(m) Injunctive Relief.--In addition to any other remedy
contained in this section, injunctive relief shall be
available to require compliance with the procedures of this
section. In the event of any successful action under this
subsection, costs together with reasonable attorney fees, as
determined by the court, may be recovered.''.
(b) Clerical Amendment.--The table of sections at the
beginning of the Fair Credit Reporting Act (15 U.S.C. 1681 et
seq.) is amended by adding after the item relating to section
624 the following:

``624. Disclosures to FBI for counterintelligence purposes.''.
TITLE VII--TECHNICAL CORRECTIONS

SEC. 701. CLARIFICATION WITH RESPECT TO PAY FOR DIRECTOR OR
DEPUTY DIRECTOR OF CENTRAL INTELLIGENCE
APPOINTED FROM COMMISSIONED OFFICERS OF THE
ARMED FORCES.

Section 102(c)(3)(C) of the National Security Act of 1947
(50 U.S.C. 403(c)(3)(C)) is amended--
(1) by striking ``A'' before ``commissioned'' and inserting
``An active duty'';
(2) by striking out ``(including retired pay)'';
(3) by inserting ``an active duty'' after ``payable to'';
and
(4) by striking ``a'' before ``commissioned''.

SEC. 702. CHANGE OF OFFICE DESIGNATION IN CIA INFORMATION
ACT.

Section 701(b)(3) of the CIA Information Act of 1984 (50
U.S.C. 431(b)(3)) is amended by striking ``Office of
Security'' and inserting ``Office of Personnel Security''.

Amendment No. 2880 To The Committee Amendment

(Purpose: To exclude from the Schedule of Authorizations the Joint
Military Intelligence Programs)

Mr. COATS. Mr. President, I send an amendment to the desk to the
committee amendment and ask for its immediate consideration.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from Indiana [Mr. Coats], for Mr. Specter
proposes an amendment numbered 2880 to the committee reported
amendment.

The amendment is as follows:

In lieu of the matter proposed to be inserted by the
Committee amendment to page 3, lines 18 though 21 of the
bill, insert the following:
(c) Scope of Schedule.--For fiscal year 1996, the Schedule
of Authorizations referred to in subsections (a) and (b) does
not include the Schedule of Authorizations for the Joint
Military Intelligence Programs (JMIP).

THE PRESIDING OFFICER. If there be no further debate, the question is
on agreeing to the amendment.
The amendment (No. 2880) was agreed to.
The PRESIDING OFFICER. Without objection the committee amendment, as
amended, is agreed to.
The committee amendment, as amended, was agreed to.

Amendments Nos. 2881, 2882, 2883, 2884, En Bloc.

Mr. COATS. Mr. President, I send four amendments to the desk and ask
they be considered en bloc.
The PRESIDING OFFICER. Without objection, it is so ordered.
The clerk will report.
The legislative clerk read as follows:

The Senator from Indiana [Mr. Coats] proposes en bloc
amendments Nos. 2881, 2882, 2883, 2884.

The amendments are as follows:

amendment no. 2881

(Purpose: To reduce the total amount of funds authorized to be
appropriated for the National Reconnaissance Office of offset the
availability of certain prior year appropriations)

On page 11, between lines 14 and 15, insert the following
new section:

SEC. 309. REDUCTION IN AMOUNTS AUTHORIZED TO BE APPROPRIATED
FOR THE NATIONAL RECONNAISSANCE OFFICE FOR
FISCAL YEAR 1996.

The total amount authorized to be appropriated for fiscal
year 1996 for the National Reconnaissance Office (NRO) shall
be reduced by an amount equal to the amount by which
appropriations for the Department of Defense for fiscal year
1996 are reduced to reflect the availability of funds
appropriated prior to fiscal year 1996 that have accumulated
in the carry forward accounts for that Office.

Mr. SPECTER. Mr. President, At this time, I join with my colleagues
in offering two amendments to address concerns about financial
practices and management at the National Reconnaissance Office. The
first amendment will reduce the amount authorized to be appropriated
for the National Reconnaissance Office in order to eliminate excess
carry-forward funds in fiscal year 1996. As the Members are aware, the
Conference Committee on the Defense Appropriations Act for Fiscal Year
1996 recently reduced the NRO appropriation in an amount equal to the
excess funds accumulated in the carry-forward accounts. The amendment
ensures that the cut in Fiscal Year 1996 appropriations for NRO is also
reflected in the authorization. The second amendment is designed to
prospectively address the NRO carry-forward accounts and financial
management generally by imposing a statutory cap of 1 month on carry-
forward accounts (in line with DOD general policy); requiring a joint
review by the Inspectors General for CIA and DOD of NRO's financial
management to evaluate the effectiveness of policies and internal
controls over the NRO budget; and requiring the President to report no
later than January 30, 1996 on a proposal to subject the budget of the
intelligence community to greater executive branch oversight, including
the possibility of a statutory financial control officer and greater
OMB review of the NRO budget. The President shall also report on the
impact, if any, on national security brought about by reduction in the
carry forward accounts at NRO.
These amendments addresses an issue that the committee first
identified in 1992 but which has received a good deal of press
attention in the past several days and has raised questions about the
National Reconnaissance Office's financial management practices. It has
been alleged that the NRO has accumulated more than $1 billion in
unspent funds without informing the Pentagon, CIA, or Congress. It has
been further alleged that this is one more example of how intelligence
agencies sometimes use their secret status to avoid accountability.
These are serious charges which the committee has been looking into,
most recently with a closed hearing on Wednesday, September 27, at
which we questioned Mr. George Tenet and Mr. Keith Hall from the Office
of the Director of Central Intelligence, and Mr. Jeff Harris and Mr.
Jimmie Hill, the Director and Deputy Director of the NRO.
As I have noted, the Intelligence Committee first identified this
issue in 1992 when it determined that NRO had accumulated an unusually
large sum of

[[Page S 14786]]
funds in some of its forward-funding accounts. Some forward funding,
generally up to 1 month, is normal for NRO research and development
accounts to cover unforseen overruns on contracts and bridge any gaps
in fiscal year funding that may result from a delay in appropriations.
NRO assured the Committee in 1992 that the excessive funds that had
accumulated would be eliminated within 4 years. We now understand that
this obligation was not fulfilled. Hence, our amendment reduces the
funds in conformance with the appropriations bill.

Let me emphasize, however, that while public attention has focused on
one element of those practices--those that involve the carry-forward
accounts in the National Reconnaissance Office, a broader inquiry is
being undertaken by the Intelligence Committee and is reflected in the
second amendment related to the NRO. It is important to determine if
the NRO's past financial management practices in this area have been as
tight as they should have been. While the NRO sits in the Department of
Defense, it is a critical element of the national intelligence
community. Thus, it is also essential that we gain an understanding of
any management practices which need to be changed in order to
strengthen the role of the Director of Central Intelligence so that he
can manage more completely the intelligence community. These are some
of the issues the Intelligence Committee will be examining in the
coming months as it reviews the intelligence community's role in the
post-cold-war world and how that community should be restructured or
refocused to meet the challenges of this changed environment.
Mr. President, acknowledging that this is just one step in a broader
effort to address legitimate public concerns about the NRO and the
intelligence community as a whole, I urge adoption of these amendments.

amendment no. 2882

(Purpose: To provide for improvements in the financial management of
the National Reconnaissance Office) At the appropriate place in the
bill, insert the following new section:

SEC. 310. FINANCIAL MANAGEMENT OF THE NATIONAL RECONNAISSANCE
OFFICE.

(a) Limitation.--No funds are authorized to be carried over
into FY 1997 or subsequent years for the programs, projects,
and activities of the National Reconnaissance Office in
excess of the amount necessary to provide for the ongoing
mission of the NRO for one month.''
(b) Management Review.--(1) The Inspector General for the
Central Intelligence Agency and the Inspector General of the
Department of Defense shall jointly undertake a comprehensive
review of the financial management of the National
Reconnaissance Office to evaluate the effectiveness of
policies and internal controls over the budget of the
National Reconnaissance Office, including the use of forward
funding, to ensure that National Reconnaissance Office funds
are used in accordance with the policies of the Director of
Central Intelligence and the Department of Defense, the
guidelines of the National Reconnaissance Office, and
congressional direction.
(2) The review required by paragraph (1) shall--
(A) determine the quality of the development and
implementation of the budget process within the National
Reconnaissance Office at both the comptroller and directorate
level;
(B) assess the advantages and disadvantages of the use of
incremental versus full funding for contracts entered into by
the National Reconnaissance Office;
(C) assess the advantages and disadvantages of the National
Reconnaissance Office's use of forward funding;
(D) determine how the National Reconnaissance Office
defines, identifies, and justifies forward funding
requirements;
(E) determine how the National Reconnaissance Office tracks
and manages forward funding;
(F) determine how the National Reconnaissance Office plans
to comply with congressional direction regarding forward
funding;
(G) determine whether or not a contract entered into by the
National Reconnaissance Office has ever encountered a
contingency which required the utilization of more than 30
days of forward funding;
(H) consider the proposal by the Director of Central
Intelligence for the establishment of a position of a Chief
Financial Officer, and assess how the functions to be
performed by that officer would enhance the financial
management of the National Reconnaissance Office; and
(I) make recommendations, as appropriate, to improve
control and management of the budget process of the National
Reconnaissance Office.
(3) The President shall submit a report to the appropriate
committees of the Congress setting forth the findings of the
review required by paragraph (1) not later than 90 days after
the date of enactment of this Act, with an interim report
provided to those committees not later than 45 days after the
date of enactment of this Act.
(c) Report.--(1) Not later than January 30, 1996, the
President shall submit a report to the appropriate committees
of the Congress on a proposal to subject the budget of the
intelligence community to greater oversight by the Executive
branch of Government.
(2) Such report shall include--interalia
(A) consideration of establishing by statute a financial
control officer for the National Reconnaissance Office, other
elements of the intelligence community, and for the
intelligence community as a whole; and
(B) recommendations for procedures to be used by the Office
of Management and Budget for review of the budget of the
National Reconnaissance Office.
(d) Definitions.--As used in this section:
(1) Intelligence community.--The term ``intelligence
community'' has the meaning given to the term in section 3(4)
of the National Security Act of 1947 (50 U.S.C. 401a(4)).

Mr. BRYAN. Mr. President, I rise to express deep concerns regarding
an example of financial mismanagement and waste within the intelligence
community. I offered an amendment to the fiscal year 1996 Intelligence
Authorization bill that has been accepted by the full Intelligence
Committee and by the Senate. This amendment is intended to put a stop
to the rampant mismanagement of funding at the National Reconnaissance
Office.
Mr. President, there is a disturbing sense of deja vu as I stand here
on the floor today. One year ago, I was shocked to learn that the
National Reconnaissance Office was constructing a massive headquarters
facility out near Dulles Airport in Virginia. Not only did this
facility include floor space far in excess of what was necessary, but
the record showed a disturbing lack of candor in informing the
congressional oversight committees regarding the scope and expense of
this project.
Last week, the public was informed of another example of gross
financial mismanagement by the NRO. As the papers reported, the NRO has
accumulated more than $1.5 billion in unspent appropriations. In this
time of severe budgetary constraints, when we are cutting Medicare,
Medicaid, veterans' benefits, student loan assistance, it is
inexcusable that an agency can be hoarding well over a billion dollars.
My amendment includes a number of provisions to ensure this situation
is resolved and does not occur again.
First, my amendment directs that the NRO may not carry over more than
1 month in funds into a subsequent fiscal year.
Second, my amendment requires the Department of Defense and Central
Intelligence Agency inspectors general to undertake a comprehensive NRO
financial management review. This review will not only cover the issue
of carry-forward funding, but will also examine the overall
effectiveness of policies and internal controls over the NRO budget.
The amendment also requires that the IG report is unclassified, and can
be released to the public.
Finally, my amendment directs the President to report to the
Intelligence Committees early next year on a proposal to subject the
budget of the intelligence community to greater executive branch
oversight. The report must include procedures to allow the Office of
Management and Budget to have full review of the NRO budget.
I recently received a call from Director of Central Intelligence Dr.
John Deutch on this issue. I was pleased by Dr. Deutch's comments in
which he agreed that stronger financial controls over the NRO are
necessary. Dr. Deutch also stated that he was not aware of the size of
this carry-forward account either in his previous position as Deputy
Secretary of Defense, or in his current position.
It is unfortunate that this amendment is necessary. But these latest
revelations do great damage to the public's trust, and to the
credibility of the NRO and the Intelligence Community as a whole. The
NRO seems to be an agency that is out of control, with no intention of
correcting its ways. Hopefully, opening the NRO budget to increased
scrutiny will help restore confidence in the ability of the NRO to
accomplish its important mission.
Thank you, and I yield the floor.

[[Page S 14787]]

amendment no. 2883

(Purpose: To enhance the capabilities of certain intelligence stations,
and to extend the Central Intelligence Agency Voluntary Separation Pay
Act)

On page 11, strike lines 17 through 21 and insert the
following:

SEC. 401. EXTENSION OF THE CENTRAL INTELLIGENCE AGENCY
VOLUNTARY SEPARATION PAY ACT.

(a) Extension of Authority.--Section 2(f) of the Central
Intelligence Agency Voluntary Separation Pay Act (50 U.S.C.
403-4(f)) is amended by striking ``September 30, 1997'' and
inserting ``September 30, 1999''.
(b) Remittance of Funds.--Section 2 of the Central
Intelligence Agency Voluntary Separation Pay Act (50 U.S.C.
403-4) is amended by inserting at the end the following new
subsection:
``(i) Remittance of Funds.--The Director shall remit to the
Office of Personnel Management for deposit in the Treasury of
the United States to the credit of the Civil Service
Retirement and Disability Fund (in addition to any other
payments which the Director is required to make under
subchapter III of chapter 83 and subchapter II of chapter 84
of title 5, United States Code), an amount equal to 15
percent of the final basic pay of each employee who, in
fiscal year 1998 or fiscal year 1999, retires voluntarily
under section 8336, 8412, or 8414 of such title or resigns
and to whom a voluntary separation incentive payment has been
or is to be paid under this section.''.
At the end of title V of the bill, add the following new
section:

SEC. 504. ENHANCEMENT OF CAPABILITIES OF CERTAIN INTELLIGENCE
STATIONS.

(a) Authority.--(1) In addition to funds otherwise
available for such purpose, the Secretary of the Army is
authorized to transfer or reprogram funds for the enhancement
of the capabilities of the Bad Aibling Station and the
Menwith Hill Station, including improvements of facility
infrastructure and quality of life programs at both
installations.
(2) The authority of paragraph (1) may be exercised
notwithstanding any other provision of law.
(b) Funding.--Funds available for the Army for operations
and maintenance for any fiscal year shall be available to
carry out subsection (a).
(c) Congressional Notification.--Whenever the Secretary of
the Army determines that an amount to be transferred or
reprogrammed under this section would cause the total amounts
transferred or reprogrammed in that fiscal year to exceed
$1,000,000, the Secretary shall notify in advance the Select
Committee on Intelligence, the Committee on Armed Services,
and the Committee on Appropriations of the Senate and the
Permanent Select Committee on Intelligence, the Committee on
National Security, and the Committee on Appropriations of the
House of Representatives and provide a justification for the
increased expenditure.
(d) Statutory Construction.--Nothing in this section may be
construed to modify or obviate existing law or practice with
regard to the transfer or reprogramming of substantial sums
of money from the Department of the Army to the Bad Aibling
or Menwith Hill Stations.

Mr. SPECTER. Mr. President, I offer this amendment along with the
vice chairman to address two issues that arose after the committee
markup of this bill. The first provision of the amendment is intended
to assist the Department of the Army as it assumes Executive Agent
responsibility for the Bad Aibling and Menwith Hill stations.
Specifically, this provision would permit the Department of the Army
to use up to $2 million of appropriated O&M funds per annum, at Menwith
Hill and Bad Aibling, to rectify infrastructure and quality of life
problems. The amendment make clear that it would in no way obviate or
modify current law or practice with regard to reprogramming amounts in
excess of $2 million,
At the present time, the Army is prohibited by 31 U.S.C. section
1301, from using appropriated funds to support an NSA installation,
notwithstanding the fact that the Army has become the Executive Agent
for these field sites. Although the Director of Central Intelligence
could use his special authorities under section 104(d) of the National
Security Act of 1947, the procedures available under that law are
extremely time consuming and were not intended to accommodate
relatively minor transfers of funds.
A good example of the problems that this amendment is intended to
rectify is contained in a memorandum prepared by a joint NSA/Army
inspection team entitled. ``DoD Child Development Program Inspection
Report'' dated June 23, 1995. The memo, which describes the childcare
facility at Menwith Hill station states:

The Child Development Center (CDC), originally constructed
as a office building, is a 35 year old dilapidated structure
with major health and safety violations. The CDC capacity of
89 children cannot accommodate the increasing demands for
child care. The current station population includes 289
children ages four and under. As a result of the conversion
from a civilian to a military facility, the demographics are
changing to younger, junior enlisted personnel with many
single parents who will rely on based-provided child care.
There are no similar facilities available on the economy . .
. Six major deficiencies, those that severely affect health,
safety, and the well-being of staff were identified in this
inspection. All five categories relating to health and safety
were in major violation.

Last fall, two members of the committee staff visited the Menwith
Hill Station and toured its Child Development Center. Their views are
fully consistent with the findings described in this memo. The staff
can also attest to the fact that there are many other maintenance and
qualify of life issues at these two facilities, particularly Menwith
Hill, that need to be urgently addressed.
My colleagues should understand that this legislation was requested
by the Department of the Army and enjoys the full support of the
Director of the National Security Agency. It is also worth noting that
the Department of the Army has consulted with the Senate Appropriations
and Armed Services Committees and encountered no objections.
I ask unanimous consent that a letter from Admiral McConnel
requesting this legislation, and the memorandum I quoted from earlier,
be included in the Record at this point.
The second provision in this amendment is designed to offset the
direct spending cost of the extension of the authority provided for in
the CIA Voluntary Separation Pay Act as provided in section 402 of our
bill. Specifically, it establishes procedures to conform with the pay-
as-you-go provision, section 252, of the Balanced Budget and Emergency
Deficit Control Act, by requiring the Director of Central Intelligence
to remit to the Treasury an amount equal to 15 percent of the final
basic pay of each employee who, in fiscal year 1998 or fiscal year
1999, retires voluntarily or who resigns and to whom a voluntary
separation incentive payment has been or is to be paid.
Mr. President, I urge the adoption of this amendment.

amendment no. 2884

(Purpose: To require a description and analysis of voluntary separation
incentive proposals in the report required by the legislation and for
other purposes)

On page 10, line 7, after ``(22 U.S.C. 4008),'' insert
``and to provide for other personnel review systems,''.
On page 10, at the end of line 10 add the following new
sentence: ``The report shall also contain a description and
analysis of voluntary separation incentive proposals,
including a waiver of the two-percent penalty reduction for
early retirement.''

Mr. SPECTER. Mr. President, on June 14, 1995, my distinguished
colleague and vice chairman of the Select Committee on Intelligence
[SSCI], Senator Kerrey, and I filed a bill which authorizes
appropriations for fiscal year 1996 for the intelligence activities and
programs of the United States Government. The Select Committee on
Intelligence approved the bill by a unanimous vote on May 24, 1995, and
ordered that it be favorably reported. The bill was subsequently
referred to the Senate Armed Services Committee [SASC] for up to 30
days, as it has been every year. The Armed Services Committee reported
the bill at the end of the 30-day period, on August 4, 1995, with one
amendment.
This bill would: Authorize appropriations for fiscal year 1996 for
first, the intelligence activities and programs of the United States
Government; second, the Central Intelligence Agency Retirement and
Disability System; and third, the Community Management Account of the
Director of Central Intelligence; authorize the personnel ceilings as
of September 30, 1996, for the intelligence activities of the United
States and for the Community Management Account of the Director of
Central Intelligence; authorize the Director of Central Intelligence,
with Office of Management and Budget approval, to exceed the personnel
ceilings by up to 2 percent; permit the President to delay the
imposition of sanctions related to proliferation of weapons of mass
destruction when necessary to protect an intelligence source or method
or an ongoing criminal investigation; provide for forfeiture of the
U.S. Government contribution to

[[Page S 14788]]
the Thrift Savings Plan under the Federal Employees Retirement System
[FERS], along with interest, if an employee is convicted of national
security offenses; restore spousal benefits to the spouse of an
employee so convicted if the spouse cooperates in the investigation and
prosecution; allow employees of the excepted services to take an active
part in certain local elections; amend the Fair Credit Reporting Act to
permit the Federal Bureau of Investigation to obtain consumer credit
reports necessary to foreign counterintelligence investigations under
certain circumstances and subject to appropriate controls on the use of
such reports; and make certain other changes of technical nature to
existing law governing intelligence agencies.
As it does annually, the committee conducted a detailed review of the
administration's budget request for the National Foreign Intelligence
Program [NFIP] for fiscal year 1996. The committee also reviewed the
administration's fiscal year 1996 request for a new intelligence budget
category, called the Joint Military Intelligence Program [JMIP]. The
committee's review included a series of briefings and hearings with the
Director of Central Intelligence [DCI], the Acting Deputy Assistant
Secretary of Defense for Intelligence and Security, and other senior
officials from the Intelligence Community, numerous staff briefings,
review of budget justification materials and numerous written responses
provided by the Intelligence Community to specific questions posed by
the committee.
In addition to its annual review of the administration's budget
request, the committee performs continuing oversight of various
intelligence activities and programs, to include the conduct of audits
and reviews by the committee's audit staff. These inquires frequently
lead to actions initiated by the committee with respect to the budget
of the activity or program concerned.
The Intelligence Committee's consideration of the authorization bill
this year coincides with a major review effort by this committee, its
House counterpart, and a Presidential Commission mandated by Congress
last year. This review is aimed at examining how changes in the world,
particularly since the fall of the Soviet Union, should be reflected in
the roles and missions of the intelligence community. A major part of
this examination will include determining how the intelligence
community might better be organized to accomplish those changing roles
and missions.
While this review by the committee in not likely to conclude until
early next year, one of the issues already emerging is the need for
stronger, more coherent management of the intelligence community. The
nominal head of the community, the DCI, must become the de facto head
of the community--with the authority to make adjustments and trade-offs
between its disparate elements. One example of a problem resulting, in
part, from the lack of unified management is the disconnect between the
vast amounts of intelligence we are now capable of collecting and our
capacity for analyzing and disseminating that intelligence in a way
that is useful for decisonmakers. We cannot afford to continue spending
money in one area without ensuring that its objectives are not
frustrated by inadequate funding in another. Yet, it is difficult to
strike the necessary balance if you do not have the authority to move
funding from one area to another.
The same principle is at work in congressional oversight, where a
comprehensive and coherent review of intelligence programs is
essential. When the SSCI was established in 1976, the Senate, in Senate
Resolution 400, chose to give the committee jurisdiction over all
intelligence activities, including those of the Department of Defense.
``Intelligence activities'' are defined very broadly in the charter
legislation, but expressly exclude ``tactical foreign military
intelligence serving no national policymaking function.'' Over the
years, this has been interpreted to mean that programs and activities
funded in the [TIARA]--which stands for tactical intelligence and
related activities--budget category have been authorized by the Armed
Services Committee in the Defense authorization bill, with the SSCI
providing recommendations in a letter to the SASC. All activities
funded in the NFIP, or National Foreign Intelligence Program, have been
authorized by the Intelligence Committee in the Intelligence
Authorization Act, which is automatically referred sequentially to the
Armed Services Committee before going to the floor.

Traditionally, this breakdown between the strictly tactical
activities supporting the battlefield commander--which are logically
subject to Armed Services oversight--and activities serving some
broader national policymaking function--over which integrated oversight
by the Intelligence Committee is essential--has worked well and our two
committees have cooperated very closely. Today, however, I believe both
committees recognizes that it is increasingly difficult to classify
intelligence systems as either strictly national or strictly tactical.
The same images of Bosnia taken by aerial reconnaissance can be used
simultaneously by Admiral Smith to protect our pilots, by Assistant
Secretary of State Holbrooke to show his interlocutors the true
situation on the ground, and by the President's National Security
Advisor to determine if a change in policy is indicated. U-2
photography of Iraq helps the commanders of our joint task forces
enforce the no-fly zones in northern and southern Iraq. Ambassador
Madeleine Albright uses the same images to great effect in convincing
other countries on the United Nations Security Council to keep in force
the sanctions against Iraq.
Budget politics has also contributed to the blurring of the two
budget categories. Over the last 5 years the executive branch has moved
programs from the national portion of the budget into the tactical, at
least in part to get out from under a perceived spending ``ceiling'' on
the national budget. When the administration created the new JMIP
budget category this year, a number of these formerly NFIP programs
were included.
The committees acknowledge that a number of the programs in this new
budget category serve important national policymaking functions and
previously have been authorized by this committee--programs like the U-
2 spyplane and unmanned aerial vehicles such as those that have
provided important intelligence on Bosnia to the decisionmakers at
State and in the White House. However, this new budget category also
contains some programs that are tactical in nature and would normally
have been within the sole jurisdiction of the Armed Services Committee.

When considering how to approach this new budget category for fiscal
year 1996, the Intelligence Committee turned to Senate Resolution 400.
We determined that the national policymaking-related activities in JMIP
meant that it did not fit that statue's definition for items excluded
from committee jurisdiction. Thus, the SSCI used the expertise
developed from day-to-day oversight of all intelligence activities to
formulate authorization recommendations for all of the activities in
this program. When the SASC received our bill on sequential, as it
routinely does, that committee disagreed with our assertion of
authorization jurisdiction.
The Armed Services Committee took the position that the Intelligence
Committee had no oversight interest in the JMIP programs and voted to
offer an amendment to the Intelligence authorization bill to strip it
of all JMIP authorization.
After extensive discussion, we have arrived at a compromise that will
allow the Intelligence authorization bill to move forward, recognize
the national interest served by the oversight of each of the
committees--SSCI and SASC--and set up a mechanism for addressing these
issues in the coming year. In order to resolve the disagreement for
this year and bring this bill before the Senate in a timely fashion, we
have agreed that the Armed Services Committee will authorize and
conference JMIP for fiscal year 1996. The Intelligence Committee has
provided its JMIP recommendations to the Armed Services Committee, and
I think the two committees concur on the details of almost every JMIP
activity for this year.

[[Page S 14789]]

At the same time, the chairmen and ranking members of the two
committees agree that this action does not reflect a determination that
Senate Resolution 400 does not provide authorizing jurisdiction for the
Intelligence Committee over JMIP. It is, rather, a compromise to allow
this bill, this year, to go to the floor.
Left unresolved, then, it how the Senate should conduct oversight and
authorization of the Intelligence Community in today's changing world.
As I have previously noted, there have been significant changes over
the years that have been reflected in the way intelligence activities
are budgeted. In the coming years, we see even greater change. Our
committee, the House Intelligence Committee, and the Brown Commission
on Intelligence Roles and Capabilities, are examining what changes
should be made in the intelligence community in the post-cold-war
world. Together, these efforts comprise the greatest opportunity to
improve U.S. intelligence since 1947. Budget categories, and many other
familiar features of today's intelligence landscape, are likely to
change still further. To make sure that the Senate's authorization
process appropriately reflects the changes that have already occurred
and that may be coming, Senator Kerrey and I, together with Chairman
Thurmond and Senator Nunn, have directed our staffs to form a working
group to recommend to the two committees how authorization
responsibilities should apply to specific categories or activities.
Mr. President, we will be prepared for the future, and I think the
Senate and the country will be the beneficiaries of our collaboration.
I am most grateful for the vast knowledge and the attitude of
constructive cooperation which the President pro tempore and Senator
Nunn brought to this problem.
Mr. President, I yield to the distinguished senator from Nebraska.
Mr. KERREY. Mr. President, I rise to describe a bill which has not
attracted much attention this year, the intelligence authorization bill
for fiscal year 1996. This year the intelligence bill is not the venue
for controversies over the foreign policy issues or levels of national
security spending, but it is an important piece of legislation
nonetheless.
Much has been written about the Presidential Commission and
congressional and private sector studies underway to redefine and
reorganize the intelligence community. Few have noted that no matter
what the outcome of all this discussion, the actual intelligence
community, with its real and serious continuing requirements to keep
our leaders informed and our military warned, must be budgeted and
guided to do its job.
This bill provides the budget authorization and the priorities our
intelligence professionals need for the year ahead.
The bill attempts to fix the imbalance between collection, which we
have a great deal of, and processing, where we see shortfalls.
The bill supports efforts to track the transnational targets, threats
like terrorism, weapons proliferation, and narcotrafficking, which are
directed against us from many countries.
The bill acknowledges the indispensable role of intelligence in
monitoring the arms control treaties we entered into, and it funds the
systems which provide that intelligence.
The bill supports innovative technologies and the leveraging of
private sector achievements and market requirements for the benefit of
intelligence.
The bill supports research and development for the agencies whose
mission depends on technology, and it addresses the growing imbalance
between rising personnel costs and the shrinking availability of
research funds.
The intelligence authorization bill also closes some of the remaining
loopholes noted in the aftermath of the Ames case. The Intelligence
Committee wants to make sure Americans who commit espionage forfeit all
the financial gains from their espionage and from their pretense of
being loyal American officials. Consequently the bill would require
forfeiture of a convicted spy's Thrift Savings Account, if the spy were
a civil servant. The bill also provides for the innocent spouse of a
convicted spy to keep some of his or her assets, provided he or she
cooperates with the authorities regarding the espionage case. Access to
personal financial data was a problem in the Ames case, so the bill
would permit FBI to have access to consumer credit reports on a
suspected spy earlier in the investigative process.
CIA has been criticized for retaining Ames in the clandestine service
long after his mediocrity was apparent. Although the great majority of
intelligence personnel I meet are clearly talented people making a
contribution to their country, the intelligence community's retention
of the few people whose performance would get them fired in the private
sector is a problem we need to fix. Consequently the bill asks the
Director of Central Intelligence to implement an up-or-out policy
across the intelligence community, similar to the policies of the State
Department and the military. Such a provision would be one of the few
positive outcomes of the Ames case. Not only would it strengthen
personnel quality, it would also help the intelligence agencies manage
their retention and overstrength problems.
The bill supports counterintelligence programs because America has
secrets worth protecting, and those secrets are threatened by foreign
intelligence services and Americans who would sell those secrets to
them. As former DCI Woolsey explained to the committee in our first
hearing of this Congress, no one can guarantee that Ames was the last
of his breed. Given human nature and the size of the intelligence
community, it is likely we will see more espionage cases. We don't need
witch hunts. We do need vigilance and deterrence.
Many people presumed that the end of the cold war meant the end of
spying and secrecy, and the Ames case led them to ask why the material
being protected mattered any more. Of course, the costs of Ames'
treachery in human lives alone is enough to justify his sentence. A
life sentence for what he did is merciful, in my view. But there are
additional reasons why our secrets are important, and must be
protected.
Simply put, our ability to monitor and predict threats to this
country is essential to saving the lives of Americans. Whether
intelligence brings the warning of a strategic attack or accidental
missile launch, or an impending terrorist attack, or the decision of
some foreign leader to develop a clandestine program of biological
weapons, our national lives and our individual lives hinge, in part, on
the capabilities of the intelligence community. I urge my colleagues to
support the intelligence authorization bill.
We buy many expensive things in the name of national security which
are never used in combat. We buy some things the Pentagon doesn't even
want. Their defenders justify them with theories. The contributions of
intelligence are not theoretical. I can take any Member to CIA or the
NSA or the NRO or over to the Joint Intelligence Center at the Pentagon
and demonstrate how intelligence is being used today to inform and
support U.S. policy and U.S. military operations.
We read in the September 27 Washington Post how crucial intelligence
is to NATO operations over Bosnia, and how the intelligence is getting
to the warfighter so much faster than in the gulf war. The gulf war
itself was a triumph of dominant battlefield awareness, to use the
current catchphrase. General Schwartzkopf knew vastly more about the
enemy and the situation than the Iraqis did about us, and we all saw on
television the fruits of that superior intelligence. With these events
so fresh on our consciousness it is easy to forget that as essential as
it is to support the military with intelligence, the priority customer
for intelligence in peacetime must be the President and the
policymakers around him.
Who, more than the President, needs a clear understanding of our
vulnerabilities and our opportunities? With the best intelligence, the
President can shape a policy that addresses the weaknesses of our
adversaries and the requirements of our allies. Intelligence is the key
to effective policy, and effective policy ought to achieve its goal,
most of the time, without the need to employ our Armed Forces in
combat. In my view, preventing the war, getting what we want without
the war, is far better than having the war.

[[Page S 14790]]
You can't do that without dominant knowledge.
Once the President has formed the policy, intelligence can also help
in its execution. To keep the U.N. Security Council solid in keeping
sanctions against Iraq, Ambassador Albright last year showed U-2
photographs of Saddam Hussein's new palaces and continuing weapons
programs to ten of her foreign colleagues on the Security Council.
Similar images of the killing fields of Bosnia are pinpointing the
atrocities there and will be useful as evidence in war crimes trials.
United States showed the world North Korea's true purposes at the
nuclear facility at Yong Byon.
As these and many other daily cases show, intelligence is a national
asset. It plays a national role every day, whether or not our military
is engaged somewhere. There used to be a clear distinction between
national and tactical intelligence, but the line is blurred today.
Increasingly, the same agencies and collection systems that produce
intelligence for the national policymaker also support the military,
even at the tactical level. The same U-2 mission can bring back
information on a Bosnian Serb air defense mission, intelligence for the
local NATO, and simultaneously take pictures of refugee flows or mass
graves that our policymakers and diplomats can use in their negotiating
efforts. This growing dual capability of intelligence is often
overlooked by those who associate intelligence exclusively with
military operations.
The annual authorization process is a time to ask how our
intelligence efforts can maximize their contribution to the nation.
There are new directions I believe intelligence must take.
First, intelligence must get closer to its customers. The age of
ivory-tower analysis is over. Intelligence managers have been much more
responsive to customers in recent years, but more must be done. I would
even consider physically moving teams of analysts right into the
customers' offices. The intelligence community must also make maximum
use of computer-based interactive communication with its customers. The
analysts need to get into the customers' heads, so to speak. The
challenge is to do so without taking on the policy biases of the
customer, because the intelligence must not only be useful and
responsive to the customer, it must also be absolutely honest. When the
President's policy isn't working, or the efforts of the customer's
organization are backfiring, the analyst must tell it like it is. Not
all the bravery in national security takes place on the battlefield.

Second, intelligence should be predictive, even risking that its
predictions could occasionally be wrong. It should look to the margins
of likely future events and trends and analyze the less likely events
which would most endanger U.S. interests. As the devaluation of the
Mexican peso demonstrated, the less likely events nonetheless sometimes
happen, and they can have a deep impact on Americans.
Third, intelligence must adapt to a world which has not only seen the
end of Communism, but which is best suited for small, fast-moving,
entrepreneurial organizations, a world which puts its greatest premium
on knowledge, and a world in which the market, not the government,
drives the improvement of technology. This new world brings Director
Deutch many new tasks. He must develop his human collectors, planning
ten or more years in advance for their peak usefulness, in the same way
we acquire satellites. He must modify the personnel management culture
that periodically moves people for its own internal bureaucratic
purposes. Similarly, the managers of military intelligence personnel
must find a place in their services for the handful of military
personnel who have mastered foreign languages and cultures. We cannot
have a first class HUMINT service without nurturing the people who
serve in it, both civilian and military.
The explosion of commercial technology presents big potential
advantages to the intelligence community, and it fundamentally
challenges traditional methods of procurement. The traditional way to
procure intelligence technology is for the government to pay for the
research, development, and testing, as well as for the finished
product. Consequently, the collection systems and processing and
dissemination equipment for the Intelligence community cost the
Government a lot of money. The unit cost is also high because the
intelligence community buys relatively few of the finished items.
The Government tends to buy hundreds of something unique and pays
millions for each one. The commercial world buys millions of something
broadly available and pays hundreds for each one. The challenge is to
find commercial applications for intelligence equipment, and thus
reduce the government's acquisition cost. The Intelligence Committee
has supported this approach for several years, starting with permitting
U.S. Companies to offer one-meter space imagery and imaging systems to
the commercial market. Another trailblazing effort is ongoing at David
Sarnoff Laboratories in Princeton, NJ, where researchers have created
image analysis equipment which simultaneously answers the needs of
intelligence analysts looking for evidence of weapons on the ground and
the needs of radiologists looking for evidence of tumors in mammograms.
In both uses, this equipment saves lives. It also provides a model for
the intelligence community on how to procure the latest equipment more
cheaply.
I have spoken about how our intelligence capability should adapt
itself to the world of today. Under the leadership of one of the most
capable executives and scientists in the country, this adaptation will
proceed swiftly. I only wish the authority of the DCI over other
agencies were stronger, so they could get the benefit of strong,
centralized leadership. That is an issue for another day. My point
today is the central, day-to-day importance of intelligence. The lives
of individuals and at times our national life depends on its
excellence, it is an essential function of government, and we are not
about to block grant it to the states. That is why the intelligence
authorization bill is an important piece of legislation.
Mr. THURMOND. Mr. President, I thank the distinguished Senator from
Pennsylvania. Mr. President, the Armed Services Committee and the
Intelligence Committee have worked closely together over the past
nineteen years, and that cooperation is going to grow even closer in
the years ahead. The Armed Services Committee greatly appreciates the
advice of the Intelligence Committee regarding tactical intelligence
programs.
I agree with the distinguished chairman of the Intelligence Committee
that the creation of the JMIP budget category is a sign of the times.
All the programs in JMIP have been previously found in the tactical
category, but several were recently in the national category and others
have clear national, as well as tactical, application. In fact, there
are very few intelligence activities today that do not have potential
benefit for both the policymaker and the tactical military commander.
For that reason, the Intelligence Committee sought to have a formal
role in authorizing and overseeing JMIP.
I believe that the Committee on Armed Services should be the
committee of jurisdiction for JMIP for fiscal year 1996. The Armed
Services Committee benefited this year from the Intelligence
Committee's work on JMIP, and in almost every case we agreed with the
Intelligence Committee. Our close working relationship has resulted in
general agreement on the JMIP issues and an efficient allocation of the
work to be done.
However, I also agree that this decision to allow JMIP to be
authorized in the Defense Authorization bill rather than the
Intelligence Authorization bill this year does not reflect a judgment
on the scope of authority provided to the Intelligence Committee by
Senate Resolution 400.
There is great change on the horizon for intelligence. Major
reorganization may occur next year, and our legislative process must
keep pace with it. My colleagues on the Committee on Armed Services and
I look forward to working with the Intelligence Committee to determine
the best way for the Senate to authorize and oversee the JMIP next
year, as well as any new categories of intelligence programs that may
come out of the newly reorganized intelligence community.
Mr. President, I thank the Senator from Pennsylvania and the Senator

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from Nebraska for their cooperation, and I yield the floor.
Mr. KERREY. Mr. President, I rise to endorse the views of my Chairman
and Chairman Thurmond. Continued close collaboration between the
Intelligence Committee and the Armed Service Committee can only result
in the best possible intelligence for the military, together with
greater efficiency.
Although the two committees disagree on this jurisdictional issue, in
fact the cooperative process worked quite well this year on JMIP. The
Intelligence Committee studied the individual JMIP programs in the
context of all intelligence activities and the Armed Services Committee
looked at them in terms of the military's requirements. On the
substance, the two committees are, as usual, in broad agreement. We
disagree on one program. I think the merits of that argument are on the
side of the Intelligence Committee, but I agree that the Armed Services
Committee should have the last word on authorizing programs whose
normal function is support to tactical operations.
We have worked out a good solution for this year on JMIP, Next year's
possible reorganization of the Intelligence Community could produce a
whole new aggregation of intelligence programs. So I look forward to
joining in a working group with the Armed Services Committee to
determine how the Senate should authorize and oversee these programs so
the needs of the policymaker and the tactical commander are fully
addressed in the coming years. The Intelligence Committee has great
experience and expertise in monitoring all the country's intelligence
activities, and we offer them freely to the Senate without concern for
turf or pride of authorship.
Mr. President, I yield to the distinguished Senator from Georgia.
Mr. NUNN. Mr. President, I thank the Senator from Nebraska. The
Senator from Pennsylvania was quite right when he said that the
creation of this new joint military budget account was a sign of the
times. The old accounting categories are becoming blurred by the
versatility of intelligence systems today. The creation of JMIP put a
strain on the relationship between the two committees, but I think we
have fixed it for this year in a satisfactory way. Next year may bring
additional change, and we are creating an inter-committee working group
to determine how we adapt our procedures to the changed circumstances.
I understand, and I believe my Intelligence Committee colleagues
understand, that each committee has a distinct and complementary role
in authorizing these programs. We will do a far better job working
together than separately.
Let me explain the Armed Services Committee's concerns about these
programs. There have been occasions in the past when the Intelligence
Committee and the Armed Services Committee disagreed about systems to
support the military which we and the military thought were extremely
important. One of these was Joint STARS, a program that made a great
contribution during the gulf war and is now a mainstay of tactical
intelligence. We had sole authorization over the budget category of
which Joint STARS had a part. If our Committee had not supported it
strongly, our military, might not have this system today. So we take
our responsibilities regarding intelligence support to the military
very seriously. The chairman and vice chairman of the Intelligence
Committee are no less serious, and we have six crossover Members to
insure that our common efforts keep on track. I am, therefore,
confident that our close relation will continue, to the country's
benefit.
Mr. KERREY. Mr. President, while I believe this bill is the best that
can be achieved during this period of tight budgets and a changing
world, there is one part of it that makes me uneasy. All of us were
presented earlier this week with media stories that the National
Reconnaissance Office once again has secretly kept large sums of money
stashed away. Supposedly, DOD, CIA, and the Congress didn't know
anything about $1 billion that had been ``hoarded'' away in carry-
forward accounts.
The committee has already held a hearing on this subject. Based on
the information presented and on the tough questions asked by committee
members, several things are quite clear.
One, this is not a secret ``slush'' fund that no one knew anything
about. In fact, these were funds maintained in accordance with the
appropriate DOD manual. Moreover, DOD has known about the account since
at least 1989 when the DOD Inspector General audited the NRO and agreed
with the NRO's proposal on the size and method of accounting for these
funds.
Second, the Committee has been overseeing and not overlooking the
NRO's budget. We are all very much aware of the debate about the NRO in
which the previous Director of Central Intelligence and the Congress
were engaged. I say we are aware of it because even though the NRO's
activities are highly classified--and they should be for good reasons--
the news media carried the stories about the intensity of the debate
between the Committee and the DIC. That debate has ended because we
have a new DCI, and the Committee is moving ahead with its close
scrutiny of the NRO.
Third, the manager's amendment to the bill conforms our authorization
level for the NRO's carry-forward accounts to the amount of the
reductions in these accounts legislated by the Defense appropriations
conference bill. The committee has done this so we can move ahead to a
conference with our House counterparts. But, Mr. President, I want
everyone to understand the implications of what is happening here.
In the opinion of the Director of the Intelligence Community
Management Staff, the cuts being taken against these accounts could
have far-reaching effects on the country's ability to collect extremely
valuable information involving our most vital interests. The National
Reconnaissance Office collects sensitive information better than anyone
else, anywhere else in the world. Let me repeat that: no one,
anywhere--the Russians, the French, the Germans, the Japanese, even
DOD--is better at this business than the NRO.
If any of my colleagues believes I may be exaggerating about the
importance and usefulness of this information, let me make a standing
invitation to those of my colleagues who might have doubts. You can
pick any day of any week, and we will go together to find out what the
NRO has collected, and is collecting on that day. I can guarantee you,
you will walk away from the experience with a far better appreciation
of just how good our satellite systems are, and with a better
understanding that the NRO's contributions are vital to our military
and foreign policy successes.
This year, when the NRO presented its Future Years Defense Plan to
the Congress, it gave us a very aggressive plan. It provides for big
savings by consolidating operations. It restructures our satellite
constellations, moving them away from a Cold War focus and instead
directing them against future problems. In order to execute that plan,
the NRO says it needs all of the money contained in its request. The
size of the cut contained in the Defense appropriations conference bill
and mirrored in the manager's amendment offered with the Intelligence
Authorization Bill probably means the plan cannot be executed unless
the money is restored. So I just want my colleagues to know that if the
NRO is correct, next year important satellite programs will be cut and
others will be pushed far out into the future if a substantial amount
of this money is not restored.
It is very difficult to discuss--in an unclassified statement on the
floor of the Senate--the enormous problem this cut could create. I
could tell my colleagues that as result of these cuts, when they, or
their successors, get a classified briefing in S-407 five years from
now, there may not be any satellite images available to help explain
the situation. But I don't know for certain if this is true.
Nevertheless, I want to alert my colleagues to the potential
repercussion this cut could have, if the money is not restored in
subsequent years of the NRO's Future Years Defense Plan.
Mr. COHEN. Mr. President, I rise to urge my colleagues to support the
fiscal year 1996 intelligence authorization bill. Although most of the
programs authorized by this bill remain classified, there are a number
of general points that are worth noting as the

[[Page S 14792]]
Senate considers this important legislation.
First, the time has long since passed when the intelligence budget
escaped serious scrutiny within Congress or the executive branch. Let
me briefly outline the current process:
Prior to its submission to Congress, the intelligence budget is
reviewed by the DCI's Community Management Staff, the Office of the
Secretary of Defense, and the Office of Management and Budget.
The intelligence budget is then reviewed by no less than six
congressional committees. It is available to all 535 members of
Congress, and indeed, every year the Senate Intelligence Committee
sends a written invitation to each member of the Senate inviting them
to review the President's request and the committee's recommendations.
To the best of my knowledge, this degree of access is not available to
members of the British or French Parliaments, the Israeli Knesset, or
representatives of the world's other great democracies. Every Senator
has the right to review the classified annex accompanying this bill
prior to voting on it.
In addition to the scrutiny provided by the House and Senate
Intelligence, Armed Services, and Appropriations Committees, GAO has
personnel who routinely audit a variety of intelligence programs.
The President's Foreign Intelligence Advisory Board [PFIAB] also has
access to budget and operational information as does the
congressionally mandated Presidential Commission on Intelligence Roles
and Missions.
The CIA has a statutory IG with broad powers to investigate
programmatic issues as well as alleged improprieties.
In short, the intelligence community's black budget is subjected to
careful scrutiny each and every year.
Some may say, if that is all true, how could the NRO secretly hoard
over $1 billion without Congress, DOD, or the DCI being aware of these
funds? The fact is that the DOD IG became aware of the NRO's policy
with regard to carry forward accounts in 1989. Further, in 1992 the
audit staff of the Senate Intelligence Committee uncovered the NRO 3-
month carry-forward policy and learned that this policy was a response
to increased technical risks associated with launch problems that
developed in the mid-eighties. The committee was assured that the 3-
month carry-forward policy would be reduced to a 1-month margin by
1996. That did not occur in a timely fashion as promised, and the
Congress has intervened to remedy the problem. So I would submit to my
colleagues that although the oversight process continues to evolve and
improve, it was that very process which brought the NRO carry-forward
accounts to light.
I think we all need to be clear about the NRO issue. There is no
evidence that funds were misspent or laws broken. Every dollar was duly
authorized and appropriated and every dollar that is taken out of the
NRO's so-called carry forward accounts this year will need to be
restored in future budgets. The NRO was excessively conservative in its
planning and budgeting, which has not increased the overall acquisition
costs for satellites, but has reduced the funds available in the near
term for other important intelligence programs. That problem has been
brought to light and is being rectified.
Because there are a number of misperceptions about the NRO funding
issue, as well as other aspects of the intelligence budget, I would
like to briefly comment on what we are authorizing in this bill and why
it is still necessary, notwithstanding the end of the cold war, to
devote considerable resources to intelligence programs.
We are not buying a crystal ball that will bring future events
clearly into focus. No matter how much we spend on intelligence, there
will never be a foolproof method for predicting the future of Bosnia,
Russia, or the Middle East. There are no documents we can acquire,
photographs we can take, or sources we can recruit that will foretell
the future of these turbulent regions.
As my colleagues may know, the intelligence community was not able to
predict the Iraqi invasion of Kuwait with certainty. It is quite
possible that Saddam Hussein himself did not decide to proceed with the
invasion until the final hours--therefore no matter what access the
United States had had in Baghdad the invasion of Kuwait could not have
been confidently predicted in advance. What United States intelligence
could and did do, however, was provide substantial detail on the Iraqi
troop buildup along the Kuwaiti border in the weeks prior to the
invasion. Developing a policy in response to the buildup then became a
matter for the President and Congress. Then, after the invasion, the
intelligence community provided General Schwarzkopf with the
information needed to decisively defeat Iraq with a minimum of allied
casualties. That is the primary rationale for the programs authorized
in this bill--to provide critical information to policymakers and if
diplomacy fails, to fight and prevail with a minimum of casualties.
As a member of both the Senate Intelligence and Armed Services
Committees, I am keenly aware of the vital linkage between intelligence
programs and military operations. Roughly 85 percent of the
intelligence budget is executed by the military services or defense
department agencies such as the National Reconnaissance Office [NRO],
the National Security Agency [NSA], and the Defense Intelligence Agency
[DIA]. These agencies, which are designated Combat Support Agencies
pursuant to the Goldwater-Nichols Act, provide intelligence and warning
in peacetime and direct combat support in wartime. The Defense
Department is by far the Nation's leading consumer of intelligence
information and most of the programs authorized by this bill have been
developed in response to military requirements. Many of the systems
that support the U.S. military, however, are also used on a daily basis
to monitor arms control agreements, detect and track illegal narcotics,
monitor the proliferation of weapons of mass destruction, and monitor
terrorist organizations. To a large extent, the intelligence produced
on these topics is a dividend made possible in peacetime by an
intelligence system geared for the wartime requirements of the U.S.
military.
My colleagues should also appreciate the fact that the dependence of
the U.S. military on sophisticated intelligence systems is increasing.
As the U.S. military force structure shrinks, the Pentagon has
consciously decided to compensate for smaller numbers of men and
equipment by placing increased reliance on sophisticated intelligence
and communications systems. Precision guided munitions require precise
targeting information; smaller numbers of more advanced ships and
planes need to be allocated against the highest priority targets; and
as the force structure shrinks each of our remaining military assets
becomes more valuable and its potential loss more costly to the
military. Further, in many of the politically sensitive conflicts
underway in the world today, an option that involves substantial, so-
called collateral damage is not a politically viable option for the
President. For all of these reasons, the Department of Defense needs
and expects voluminous amounts of precise intelligence information to
support military operations. In sum, intelligence is a force multiplier
that permits the U.S. military to do more with less.
In conclusion, all Senators should understand that the Armed Forces
are the primary advocates for the programs in this bill, and the
overwhelming majority of the funds this bill authorizes will be
executed by the Department of Defense. I should also point out that the
DCI has publicly stated that his top priority is support to the U.S.
military. As a former Deputy Secretary of Defense, he certainly
understands the importance of this mission, and I know he is dedicated
to providing the best support possible to our men and women in uniform.
The world we live in is turbulent and dangerous. The proliferation of
nuclear, chemical, and biological weapons concerns us all. Terrorism is
a continuing threat--one that could become far more dangerous in the
future given the spread of weapons of mass destruction. Intelligence is
contributing to recent arrests that have severely damaged the Cali
cartel. As the Ames case demonstrates, counterintelligence operations
remain critical to U.S. national security. And without national
intelligence systems, it would be difficult to enter into verifiable
arms control

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agreements. Yet, even if none of these requirements for intelligence
collection existed, the great majority of the spending in this bill
would still be necessary to support our men and women in uniform.
For all of these reasons, I believe that intelligence activities
remain vital to U.S. national security and this legislation deserves
the support of every member of the Senate.
Mr. MACK. Mr. President, I rise to express my strong support for the
fiscal year 1996 intelligence authorization bill.
As a member of the Senate Intelligence Committee, as well as the
Defense Appropriations Subcommittee, I have been involved in reviewing
U.S. intelligence requirements and programs. While most of the programs
authorized by this legislation are classified, there is much that can
be said in general terms about the importance of this measure.
My colleagues should understand that although the end of the cold war
has lessened the threat to the United States, it has not reduced the
demands for information imposed on the Intelligence Community by its
many consumers. We live in an era described as the ``age of
information,'' and that applies to the public sector no less than the
private sector. In fact, the instability and turbulence unleashed by
the collapse of the Soviet empire has led to increased requests for
information on a wide variety of new topics, countries, and conflicts.
For example, in recent years the U.S. has become involved in
conflicts in Iraq, Somalia, Haiti, and Bosnia. In each case, the
Defense Department has depended on the Intelligence Community for the
information necessary to perform assigned military missions with a
minimum of risk to U.S. personnel. These operations, including the
ongoing U.S. military involvement in Bosnia, should demonstrate beyond
any doubt that the demise of the Soviet Union has not lead to reduced
requirements for intelligence information, either to support the U.S.
military, or to support civilian policymakers engaged in arms control,
counternarcotics, political or economic negotiations, monitoring
international embargoes, or the routine conduct of foreign policy.
Ironically, our national security is becoming more dependent on
intelligence collection, rather than less dependent, in the post cold
war era. This is primarily the result of a reduced military force
structure that is increasingly dependent on superior intelligence to
compensate for smaller numbers. For example, the U.S. Army has shrunk
from 18 Active Duty Divisions in the mid-eighties to only 10 today. The
U.S. Army is now the eighth largest in the world, and it is stretched
thin at many points, as in South Korea, where 37,000 U.S. military
personnel and 500,000 South Korean soldiers are confronted by a North
Korean Army that is twice as large.
The U.S. Navy and Air Force are engaged in similar reductions. The
Air Force now has 20 active and reserve fighter wings, down from the 38
fighter wings available during the Reagan Administration. Similarly,
the Navy has long since abandoned the goal of a 600 ship fleet and is
now planning for a force some 30% smaller. With this reduced force
structure, the U.S. can still prevail, even against much larger
adversaries fighting close to their own shores, but only if the U.S.
maintains superior personnel, weapons systems, and intelligence and
communications capabilities. The public and my colleagues should be
aware that the overwhelming majority of the funds authorized in this
bill directly support, and indeed are executed by, the Department of
Defense. There is simply no way to make substantial, additional
reductions in intelligence programs without harming U.S. military
readiness and capabilities.
In addition to the critical support that the Intelligence Community
provides the Department of Defense, there are numerous missions
performed by the Intelligence Community that are critical to the
conduct of U.S. foreign policies. The Intelligence Community makes it
possible to verify arms control agreements; it monitors the
proliferation of weapons of mass destruction; it provides unique
information regarding the intentions of foreign governments; it tracks
international terrorism across the globe; and our intelligence
agencies operate on a global basis to penetrate the international drug
cartels. Many of these missions involve great difficulty and often
danger, but there is no substitute for the painstaking work the
Intelligence Community quietly performs in many distant lands.

I believe that the contributions made by the Intelligence Community
to the war on drugs merit special consideration and increased support.
During the confirmation hearings for DCI John Deutch, I expressed my
sentiments to the nominee and asked him to consider the evidence
presented by William Bennett and John Walters in their article of
February 9, 1995, entitled, ``Why aren't we attacking the supply of
drugs?'' The article points out that after the Bush Administration
deployed U.S. military forces to help detect and interdict drug
shipments in 1989, the price of cocaine increased by some 30% within a
year's time, and the number of hospital admissions for cocaine
overdoses declined by a roughly similar amount. The DCI responded to my
questions on the counternarcotics issues by saying, ``And I must say,
Senator, just so there is no misunderstanding, I agree with your point,
that here is a place that deserves more resources generally by the
Intelligence Community, not less.''
After the nomination hearings, I wrote the DCI on this issue, and
supported increased expenditures for counternarcotics activities during
the committee's budget deliberations. I am pleased to say that the
Intelligence Authorization bill contains additional funds for
counternarcotics programs that were not in the Administration's
request. I am also delighted by the progress that has been made over
the last few months in apprehending the leaders of the Cali cartel.
U.S. intelligence agencies have contributed to this success and
already, once again, the newspapers are reporting an increase in the
street price of cocaine. The evidence again clearly suggests that
aggressive efforts to attack drug production and transportation can be
effective. As a member of the Intelligence Committee, and the Defense
Appropriations Subcommittee, I will continue to press for increased
counternarcotics efforts by the Defense Department and the Intelligence
Community.
Finally, I would like to acknowledge the far-reaching changes being
implemented within the Intelligence Community because too often the
public only hears the bad news. The Intelligence Community has
tightened its belt in terms of both budget and personnel. Substantial
changes are being made in the way that the CIA operates overseas; in
hiring and promotion practices, and in the way that the CIA interacts
with its oversight committees. This Intelligence Community is not
treading water--DCI John Deutch is implementing profound changes that
will increase efficiency, improve intelligence support to consumers,
and rectify the problems recently brought to light in Guatemala and the
Ames case. Further, although there was no illegality or impropriety
involved, he is working to ensure that the National Reconnaissance
Office [NRO] is not overly conservative in estimating costs and risks,
leading to excess funds in carry-forward accounts. We are most
fortunate, in my view, to have a Director of Central Intelligence who
is intimately familiar with military requirements for intelligence as
well as the many technical matters which are so critical to modern
intelligence collection. I believe that Director Deutch and his team
will continue to aggressively implement the changes necessary to assure
accountability and restore public confidence in the CIA.
In conclusion, I believe that the Intelligence Community is moving
rapidly to keep pace with new missions and new technologies. I also
believe that the programs authorized by this bill are vital to the
security of the United States and deserve the support of every Senator.
Mr. President, I ask unanimous consent that a copy of a statement
recently made by the DCI addressing the future of the Intelligence
Community, together with my correspondence with him and a relevant
newspaper article on counternarcotics issues, be printed in the Record.

[[Page S 14794]]

There being no objection, the material was ordered to be printed in
the Record, as follows:

U.S. Senate,

Select Committee on Intelligence,

Washington, DC, May 1, 1995.
Hon. John M. Deutch,
Deputy Secretary of Defense, Department of Defense, The
Pentagon, Washington, DC.
Dear Secretary Deutch: As you know, I am delighted that the
President has nominated you to be the next Director of
Central Intelligence. You bring a great deal of energy and
integrity to the position, as well as a nearly unique blend
of scientific and governmental experience. I look forward to
working with you on intelligence issues in the years ahead.
During the course of your confirmation hearings last week,
you may recall that I raised the issue of illegal narcotics
during both the open and closed sessions. Due to the format
of the hearings, however, and the limited amount of time
available, I do not feel as though I was able to obtain all
the information I sought. Due to the critical importance I
attach to this matter, I would therefore like to pursue this
issue somewhat further.
Specifically: Would you agree that the experience of the
early 1900's indicates that increased spending on
interdiction, eradication, and disruption of narcotics
organizations can substantially reduce drug use in this
country? The information in the article I entered into the
record during the open hearing, which I have attached,
suggests that we have not reached the point of diminishing
marginal returns with regard to intelligence and defense
programs intended to reduce the supply of illegal narcotics
in the United States. If confirmed, will you task the Crime
and Narcotics Center, or other appropriate office, to conduct
an assessment of this issue and make the results available to
the Committee prior to the August recess?
Does DoD have a threat assessment with regard to illegal
narcotics? Despite the rhetoric we often hear, it seems as
though drug smuggling is still treated primarily as an issue
for law enforcement rather than a national security matter.
As you know, threat assessments drive force structure and
planning within the Department of Defense. If there is a DoD
threat assessment that I am not aware of? I would appreciate
a copy of the report as well as any supporting documentation
which explains how the threat assessment has been converted
into programmatics. Again, if a threat assessment is not
available, I would like to ask that you task the DCI's Crime
and Narcotics Center, or the Department of Defense if
appropriate, to produce such an assessment prior to the
conferences on the Defense and Intelligence Authorization
bills this fall.
I know that you will face many challenges as the next
Director of Central Intelligence. There are many threats
facing our country in the uncertain world in which we live.
It is worth noting, however, that as horrific as terrorism
is, the number of Americans who die or suffer mental or
physical damage from illegal narcotics is far greater. I
believe that there is much more that can and should be done
to staunch the massive flow of illegal narcotics into the
United States.
I appreciate your consideration of this request. Again, I
look forward to working with you in the years ahead.
Sincerely,
Connie Mack,
U.S. Senator.
____

The Future of U.S. Intelligence--Charting a Course for Change

(By John Deutch, Director of Central Intelligence)

Thank you very much for that introduction.
There are two challenges facing the Intelligence Community
today:
First, we must be effective. We must deploy our
considerable resources against the most pressing security
threats of the post-Cold War era.
Second, we must be accountable. We must carry out our
intelligence operations in an efficient and responsible
manner. At the same time we must maintain an effective
espionage service.
When President Clinton asked me to be the Director of
Central Intelligence, he instructed me to make whatever
changes were necessary to assure that our nation has the best
intelligence service in the world and that we carry out our
duties with integrity.
Today I will outline five broad changes underway to make
the Intelligence Community--and the CIA in particular--more
effective and more accountable. They are not quick fixes.
They do not involve massive new legislation or
reorganization. These are measures that lay a foundation for
fundamental change in the way we do our business. They will
strengthen our intelligence capability, they will not tear it
down. There are many things that the Intelligence Community
does well. We intend to build on these strengths, but we are
determined to address the problems that have damaged the
reputation and diminished the effectiveness of the
Intelligence Community.
These changes are going to require a great deal of work on
the part of members of the Community and extensive
consultation with the policy makers and military commanders
who use our intelligence on a day-to-day basis. I look
forward to working with these changes with Members of
Congress and others who have the responsibility to review our
nation's intelligence programs.
I also want to public to understand what we are doing so
that they will have confidence that our intelligence
activities are carried out in a manner consistent with this
nation's interests and values. Accordingly, our process of
reform and change will be open for discussion.
Our success in strengthening the Intelligence Community is
of critical importance to all Americans. The nation faces a
multitude of challenges that will test our leadership and
influence in post-Cold War world: The proliferation of
chemical, biological, and nuclear weapons of mass
destruction; the activities of hostile countries like Iran,
Iraq, and North Korea; the growing threat of international
crime, terrorism and narcotics trafficking; and we must
maintain the economic security of our nation
We must also keep an eye on the larger, longer term
developments. Will an emergent China redraw the political and
economic landscape of Asia? Will Russia abandon its steps
toward democracy and return to authoritarian rule?
When President Clinton visited CIA in July he spoke to the
importance of intelligence in addressing these challenges and
these questions. President Clinton said: ``The intelligence I
receive informs just about every foreign policy decision we
make. It's easy to take it for granted. But we couldn't do
without it. Unique intelligence makes it less likely that our
forces will be sent into battle, less likely that American
lives will have to be put at risk. It gives us the chance to
prevent crises rather than forcing us to manage them.''

1. customer focus

Customer focus is the first change I want to discuss.
Our primary mission in intelligence is to provide the
President and other senior leaders with the information they
need to make and implement foreign policy.
When the Intelligence Community focuses closely on what
intelligence customers need, when we make the policy makers
deadlines and requirements our own, we provide superb
support. That means getting the right information to the
right person at the right time--that goal hasn't changed. But
we are changing significantly the way we get the job
accomplished.
Interagency intelligence teams have been particularly
effective in providing critical, round-the-clock support,
from detailed maps of remote areas to human intelligence and
amazingly vivid pictures taken from space. For example, both
policy makers and military commanders give high marks to
Intelligence Community support to humanitarian and
peacekeeping operations in Bosnia, Haiti, and Somalia.
Permanent interdisciplinary centers that bring together
collectors and analysts from the CIA and other intelligence
agencies have also been the most successful approach to the
complex transnational issues of weapons proliferation,
terrorism, organized crime and narcotics trafficking.
Making sure that our information is the most thorough, most
objective available on a day-to-day basis requires discipline
on our part, and it requires close and continuous contact
with our intelligence customers.
Here I would note that giving policy makers the information
that they need is not the same as giving them the
intelligence judgments that they would like to see. If we
want our products to be used, we also have to maintain an
unassailable reputation for objectivity. Any effort to tailor
our analysis to policy would quickly destroy our credibility.
Closer contact with our customers begins, but does not end,
with the DCI. I am meeting more often with our key
intelligence consumers--at least once a week with the
Secretary of State, the Secretary of Defense, and the
National Security Advisor, and, at least monthly with the
Attorney General, the Chairman of the Joint Chiefs, and those
officials involved with economic security and trade. And, of
course, I meet with the President and Vice President whenever
necessary.
This contact and awareness of consumer needs must extend to
all working levels of the Intelligence Community.
Accordingly, we are assigning more intelligence officers on
rotation to policymaking offices and to work on site with
military units.
At a time of tight budgets and a proliferation of
intelligence challenges, we cannot afford to collect for the
sake of collection or pursue every promising technology.
Guided by customer needs, the Intelligence Community must
exercise discipline in pursuing only those systems that offer
significant promise for meeting customer needs better and
more cheaply.
For example, we will not only buy expensive new satellites
unless there is a significant demand from our national
security customers. I have already taken several steps to
improve efficiency in the management of our satellite
systems.
Defense Secretary Bill Perry and I are putting into place a
new decisionmaking process--the new Joint Space Management
Board--to assure that both intelligence and military
satellite acquisition decisions are made efficiently and meet
user needs.
We are also moving toward consolidating the eight agencies
now involved in imagery

[[Page S 14795]]
intelligence into a single National Imagery Agency, organized to serve
better the joint military commander in wartime and top policy
makers in peacetime. The new National Imagery Agency will put
together all aspects of collection, analysis, and
distribution of imagery. The goal will be to provide the
military commander near real time, all source intelligence
that will give our forces a unique ``dominant battlefield
awareness.''
Both these management initiatives will provide better
service to our customers and will save money.

2. human intelligence: assuring integrity

The second area I would like to discuss is major change in
the CIA's Directorate of Operations, or DO. The DO manages
our spies. Even in this day of highly sophisticated
satellites and technical collection systems, there are some
types of information that can only be collected by people.
Espionage is the core mission of the Central Intelligence
Agency. Despite set backs, we must continue to take risks
that result in the collection of information that is
available by no other means. If we do not take such risks
because we are afraid to fail or we are afraid of
controversy, then we will fail as an intelligence service in
protecting the national security interests of the United
States. Therefore we shall not slacken our efforts to recruit
informants in hostile governments, terrorist groups or drug
trafficking organizations.
Let me be clear, we will continue to need to work with
unsavory people. We will actively seek out any individual who
can provide important intelligence from within a terrorist
cell or a factory supplying arms to a rogue state. Why are we
doing this? Because such human intelligence can save American
lives or avert conflict.
What will be different is that we will not do these things
blindly, without thorough vetting and established procedures
for accoutability. We will not fool ourselves or fool our
customers about the risks we have taken.
The new Deputy Director for Operations has ordered a
complete ``scrub'' of all DO ``assets,'' as the Intelligence
Community refers to human agents. This is a rigorous
evaluation of each one of the agents that we recruit to give
us information. If the information these assets provide is no
longer relevant, if we can get the same information
elsewhere, if questions of human rights violations or
criminal involvement outweigh the value of the information to
our national interest, then we will end the relationship with
the asset.
We are developing new guidelines to ensure that concerns
about human rights and criminal activity are taken into
account in recruiting, evaluating and managing assets. The
guidelines will also include mandatory steps to provide
accurate and timely information to Congressional Oversight
Committees and law enforcement agencies.
Thus these new guidelines will allow us to make informed
decisions on asset recruitment and retention; this does not
mean that we will slacken our efforts to recruit informants
in hostile governments, terrorist organizations, or
international crime and drug trafficking organizations. To do
so would be to deny our government information that leads to
actions that better protect our citizens and their interests.
I would like to say a word about covert action--those
activities CIA undertakes to influence events overseas that
are intended not to be attributable to this country. Since
the public controversies of the eighties over Iran-Contra and
activities in Central America, we have greatly reduced our
capability to engage in covert action. I believe that the US
needs to maintain, and perhaps even expand, covert action as
a policy tool. But here again, we will not undertake covert
action to support policy objectives, unless it is approved at
the highest level of government and only if the President
authorizes such action after a scrupulous review process,
including timely notification of the appropriate
Congressional oversight bodies.
Finally, the Ames case has taught us that counter
intelligence--guarding against penetration of our
intelligence or national security agencies by agents of a
foreign government--requires constant vigilance. I recently
created the position of Associate Deputy Director of
Operations for Counterintelligence to assure permanent, high
level attention to counter intelligence issues.

3. law enforcement and intelligence

The third area of change is to greatly increase our
cooperation with the law enforcement community. In the past,
we used the borders of the United States as a convenient
dividing line between the responsibilities of intelligence
agencies and law enforcement agencies. The CIA
handled everything that involved foreign intelligence
outside the US. The FBI and the Drug Enforcement Agency
handled law enforcement within the US. Unfortunately
international criminals, drug traffickers, and terrorists
do not respect these neat distinctions that were
introduced over a half century ago.
Cooperation between intelligence and law enforcement can
produce fantastic success--the arrest of the leaders of the
Cali drug cartel in recent months is a tremendous example--
but this cooperation has yet to be as effective, extensive,
and routine as it needs to be.
President Clinton and Vice President Gore are not
satisfied, and correctly so, that we have in place the
interagency mechanisms that we need to address these threats
adequately. We cannot waste any more time worrying about
bureaucratic rivalries that go back to the days of J. Edgar
Hoover and Allen Dulles.
It's time for a fresh approach: a new division of
responsibility that realistically reflects the pattern of
international activity that exists today in terrorism, crime
and drugs. The Intelligence Community must learn that in
these areas, the law enforcement community--the FBI, the Drug
Enforcement Agency, and US Customs--is the customer for
intelligence, just as the Department of State and Defense are
the customer for intelligence in the national security arena.
And the law enforcement community must accept that it is
not necessary or efficient to establish an elaborate new and
separate foreign collection system for intelligence.
Intelligence and law enforcement professionals need to
develop new procedures that will result in more effective
cooperation. For example, intelligence and law enforcement
must modify some of their most strongly held beliefs about
not sharing information about their sources with each other.
This does not mean that intelligence agencies will spy on
US citizens. Our collection activities will not infringe on
the rights of US citizens. Nor will CIA or other intelligence
agencies take on any law enforcement duties. Attorney General
Reno and I are simply seeking to build a new relationship
between intelligence and law enforcement that will improve
the country's performance in curbing international crime,
drugs, and terrorism.

4. carrying out intelligence operations in an efficient fashion

The fourth change that I want to address is the initiation
of an integrated approach to resource planning and
programming for all the agencies of the Intelligence
Community.
In this era of tight budgets, the Intelligence Community
has to undergo serious reexamination of its needs and its
resources and, indeed, downsizing has been going on for some
time--for example, since 1990, the number of people in the
Intelligence Community has been reduced by 17% and an
additional 10% reduction is planned by the end of the
century.
However, up to the present, the Intelligence Community has
been relatively free from the systematic planning,
programming, and budgeting process that is the hallmark of
efficient government.
The reason for this absence of management scrutiny is not
because the intelligence budget is ``secret.'' The reason is
that intelligence activities are carried out by different
agencies--NSA, DIA, CIA--and are carried out under separate
budgets. There is no mechanism to compare the budgets of the
various intelligence agencies and assess how they contribute
to the missions of U.S. intelligence. The present system does
not permit resource-saving tradeoff analysis: for example,
the possibility of substituting satellites for aircraft
imagery or signals collection, or assigning intelligence
analysis responsibilities among the different agencies,
considering the capabilities of the entire community.
It is the responsibility of the Director of Central
Intelligence to review the nation's intelligence budget as a
whole and justify it to Congress. As the system now stands,
the DCI does not have the tools to do this job properly.
In preparing the FY97 budget, I am insisting that all
agencies present their intelligence budgets in a manner that
will allow us to make more informed hard decisions on
resource allocation.
Simply put, the problem is to make a ``symphony'' from the
diverse instruments represented by the various agencies. We
need to assure that all elements of the community work in
harmony. A mission oriented Intelligence Community multi-year
program period will identify the resources needed to carry
out our activities and assess the value of individual
programs. An added benefit of this approach is that it will
provide a clear description of what the Intelligence
Community is doing and what is the value to both President
Clinton and to the Congress.

5. improving the quality of the people

The most important element of success in the Intelligence
Community is the quality of its people. Historically, we have
attracted outstanding and highly motivated individuals.
Unfortunately, some parts of the Intelligence Community are
in danger of losing the ability to attract and retain the
best people. This is particularly true of the Central
Intelligence Agency and its Directorate of Operations. The
fifth and last change I will discuss today is a new
approach to personnel management.
We must replace CIA's personnel system with one that is
better suited to the special nature of the work its employees
must perform. We must reexamine the use of the polygraph in
hiring and create a system that encourages employees to gain
wider experience within the agency and discourages the
development of barriers between the different directorates
and cultures within CIA.
I have assigned CIA's Executive Director the task of
reviewing past studies and designing a new system that will
allow individuals to advance according to their
accomplishments without regard to gender or race, a system
that will be perceived as fair by employees throughout CIA.
As intelligence officers, it is our job to understand and be
able to operate in widely different cultures. A diverse
workforce is absolutely essential to our ability to be an
effective intelligence Agency in the next century.

[[Page S 14796]]

This same emphasis on personnel management must extend to
all other agencies of the Intelligence Community. All
agencies need to recruit top people; all need career
development programs; and all need to welcome diversity in
the workplace. We need health promotion opportunities that
are comparable across the Intelligence Community, and we need
a retirement system that upholds the contract we have made
with the good people who have dedicated their careers to our
national security.
We will need to seek new authority to allow more flexible
management of the very special Intelligence Community work
force to assure, in a time of downsizing, that there is a
reasonable prospect for advancement and provisions for early
retirement within the Community.

concluding remarks.

I have presented five fundamental changes that are
necessary to improve the performance of the Intelligence
Community: a significantly sharper focus on the needs of the
intelligence customer; more selective and effective human
intelligence; a new cooperative relationship between law
enforcement and the Intelligence Community; a more efficient
system for allocating the resources of the Intelligence
Community; and revitalizing the personnel system to better
serve all of the employees of the Intelligence Community.
These changes will enable the Intelligence Community to
efficiently and effectively address the intelligence
challenges of the post-Cold War era. I will devote my energy
and my influence to assuring that each of these changes is
made--thoroughly and promptly.
I hope that the media, Congress, and public opinion will
give the Intelligence Community a chance to demonstrate what
it can do. In a democracy, all the failures become public,
the successes do not. It takes good will along with vigilant
skepticism to give the intelligence enterprise a fair shake--
to balance accounts about past excesses with reporting that
assesses current accomplishments. Thank you very much.
____

[From the New York Times]

Columbia Arrests Raise Price of Cocaine in New York City

(By Clifford Brauss)

Only a few months after the Colombian Government began
arresting the top leaders of the Cali drug cartel, law
enforcement officials said the supply and potency of cocaine
in New York City is dwindling, forcing wholesale and street
prices to soar.
In what officials described as the most precipitous shift
in almost six years, the wholesale price of cocaine has
increased nearly 50 percent since May, while retail prices
have gone up 30 percent. Similar increases, they said, are
evident in other big Eastern cities dependent on New York-
based Cali operatives for supplies.
In addition, they said, recent seizures and intelligence
indicate that the size and number of shipments of cocaine
into the New York area have declined. Only four months ago,
Federal agents say, shipments weighing 1,000 pounds or more
were coming into the city in trucks, ships and airplanes;
now, they typically weigh less than 200 pounds.
The shifts are also evident in the city's drug markets.
Drug dealers in Washington Square Park said this week that
the same gram of cocaine that sold for $50 in May now goes
for $80, an increase that they said was beginning to drive
away younger buyers who come to Greenwich Village from New
Jersey.
``I've been around 39 years,'' said one Washington Square
dealer, whispering as he gave knowing glances to prospective
buyers walking through the park. ``So I know when they bust
the big guys in Colombia, that's when the coke goes up.''
Law enforcement authorities cautioned that the shifts in
supply and price might be temporary, evidence of another
periodic realignment of international trafficking networks
with little long-lasting importance. But they said that the
declining sizes of cocaine shipments and five recent fatal
shootings between competing drug gangs in Queens appeared to
be strong signs that the world's richest drug trafficking
organization is at least going through a painful period of
adjustment.
```Maybe it's only a breather that is benefiting the
community,'' said Peter A. Crusco, chief of narcotics
investigations in the Queens District Attorney's office ``But
relatively little is coming in. The big-level people are not
risking moving the cocaine.''
Officials say cocaine buyers can still find the drug in
neighborhoods across the city, but New York police officials
say laboratory tests show that dealers are now mixing their
small bags and tins of cocaine power with 30 percent more
sugar or baking power to stretch supplies.
On the other hand, officials say supplies and prices of
crack--the cocaine-based drug of choice among many poor
users--have not been affected, because its purity is low to
begin with and abusers need little to become intoxicated.
Though they are encouraged by the tightened supply of
cocaine, some police officials expressed concern that
shortages of cocaine could eventually increase demand for
heroin, which is already gaining in popularity and is mostly
distributed by organized crime groups that compete with the
Cali cartel.
They also worry that if drug profits continue to be
stretched, street gangs competing for customers, territory
and supplies could turn more violent, much as they did when
crack first became popular in the late 1980's.
Investigators said information collected through wiretaps
and informers indicate that supplies of cocaine are being
held up in Colombia and Mexico, where they are stockpiled
before moving across the border, because the leaders who once
personally supervised their release are in jail or on the
run.
Middle-level traffickers, the wiretaps and informers
indicated are holding back shipments, in part because they
feared that the captured leaders might be trading information
about cartel operations in exchange for more lenient
treatment.
``The one person who moved the cocaine between Colombia and
Mexico, Miguel Angel Rodriguez Orejuela, is out of commission
for at least the moment,'' said a senior Drug Enforcement
Administration official who spoke on condition that he not be
named. ``One can logically surmise that right now there is a
quandary, a state of confusion, and problems with people
hooking up with the traffickers both in Colombia and
Mexico.''
The most striking effect of the arrests in Colombia have so
far been at the wholesale level of the drug trade, officials
said. Responding to the decreased supplies, several law
enforcement officials said top cocaine dealers have increased
their prices to their largest distributors to an average of
$26,000 per kilogram, from $18,000 only four months ago.
In Detroit, the Drug Enforcement Administration has
reported an increase in wholesale prices from $22,000 to
$32,000 per kilogram in the last two months alone.
A bodega owner in Washington Heights with broad knowledge
of the cocaine trade in New York said the recent increase had
forced middle-level dealers to drop some street sellers,
shave profits, dilute their inventory and hoard supplies in
case the current shortages continued.
``A lot of people are just holding onto their good stuff
for when prices really go up,'' he said.
The last time cocaine prices in New York rose so much and
so fast was in late 1989, when a shooting war broke out
between the Medellin cartel and the Colombian Government. The
Medellin group never recovered, but within months the Cali
cartel picked up the trafficking slack, and prices returned
to normal levels.
State Department and law enforcement officials said that
Mexican trafficking groups and smaller Colombian cartels
operating on Colombia's northern coast are now jockeying for
new markets. Mexican traffickers have already taken control
of much of the cocaine market in the Southwest, they said,
and wholesale prices there have not risen as sharply as in
New York.
But Thomas A. Constantine, the head of the Drug Enforcement
Administration, said in a recent interview that there was no
cartel waiting in the wings that could match the Cali group's
financial resources, political clout in Colombia, and
international trafficking connections.
``Nobody out there even compares,'' he said, saying that
the Cali group had already surpassed the Medellin cartel in
sophistication and resources at the time of the Medellin
group's downfall.
But Mr. Constantine and other officials cautioned that it
was too soon to tell how harshly the Colombian authorities
would punish the six top Cali leaders they captured this
year. United States officials noted that the cartel leaders
were able to negotiate some of the terms of their surrender,
and none have suffered confiscations of ill-gotten gains like
their mountainside mansions or fleets of yachts.
In addition, the United States officials say, the cartel
leaders are still able to communicate with their lieutenants
sporadically through family members who visit them in jail
and by paying off guards. But perhaps because their telephone
conversations are being monitored the officials say, they
have not directed their underlings to release huge loads of
cocaine warehoused in Colombia and Mexico.
Whatever the long-term impact, law-enforcement officials
say, the latest price rises demonstrate that the cartel's top
leaders direct the most minute details of their cocaine
wholesale operations in the New York area. Recent captures of
cartel records include items like personnel evaluations and
Con Edison bills.
``We have done investigations involving wiretaps,'' said
Robert H. Silbering, the Special Assistant District Attorney
in charge of citywide narcotics cases, ``that show a direct
link from the streets of New York to the estates of Cali.''
____

Mr. COATS. Mr. President, I ask unanimous consent the amendments be
agreed to en bloc, the motions to reconsider be laid upon the table en
bloc, the bill be then deemed read a third time.
The PRESIDING OFFICER. Without objection, it is so ordered.
So the bill was deemed read a third time.
Mr. COATS. Further, that the Intelligence Committee be immediately
discharged from further consideration of H.R. 1655, the Senate proceed
immediately to its consideration, that all after the enacting clause be
stricken, the text of S. 922 as amended be inserted, H.R. 1655 then be
deemed read a

[[Page S 14797]]
third time and passed, the motion to reconsider be laid upon the table.
The PRESIDING OFFICER. Without objection, it is so ordered.
So the bill (H.R. 1655), as amended, was deemed read a third time and
passed.
Mr. COATS. Mr. President, I move the Senate insist on its amendment,
request a conference with the House, and that the Chair be authorized
to appoint the conferees on the part of the Senate.
The motion was agreed to, and the Presiding Officer appointed Mr.
Specter, Mr. Lugar, Mr. Shelby, Mr. DeWine, Mr. Kyl, Mr. Inhofe, Mrs.
Hutchison, Mr. Mack, Mr. Cohen, Mr. Kerrey, Mr. Glenn, Mr. Bryan, Mr.
Graham, Mr. Kerry, Mr. Baucus, Mr. Johnston, Mr. Robb, and, from the
Committee on Armed Services, Mr. Thurmond and Mr. Nunn.
The PRESIDING OFFICER. The Senator from Indiana.

____________________