[Congressional Record Volume 141, Number 205 (Wednesday, December 20, 1995)]
[House]
[Pages H15224-H15235]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




  CONFERENCE REPORT ON H.R. 1655, INTELLIGENCE AUTHORIZATION ACT FOR 
                            FISCAL YEAR 1996

  Mr. COMBEST submitted the following conference report and statement 
on the bill (H.R. 1655) to authorize appropriations for fiscal year 
1996 for intelligence and intelligence-related activities of the United 
States Government, the Community Management Account, and the Central 
Intelligence Agency Retirement and Disability System, and for other 
purposes:

                  Conference Report (H. Rept. 104-427)

       The committee of conference on the disagreeing votes of the 
     two Houses on the amendment of the Senate to the bill (H.R. 
     1655), to authorize appropriations for fiscal year 1996 for 
     intelligence and intelligence-related activities of the 
     United States Government, the Community Management Account, 
     and the Central Intelligence Agency Retirement and Disability 
     System, and for other purposes, having met, after full and 
     free conference, have agreed to recommend and do recommend to 
     their respective Houses as follows:
       That the House recede from its disagreement to the 
     amendment of the Senate and agree to the same with an 
     amendment as follows:
       In lieu of the matter proposed to be inserted by the Senate 
     amendment, insert the following:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the 
     ``Intelligence Authorization Act for Fiscal Year 1996''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.

                    TITLE I--INTELLIGENCE ACTIVITIES

Sec. 101. Authorization of appropriations.
Sec. 102. Classified schedule of authorizations.
Sec. 103. Personnel ceiling adjustments.
Sec. 104. Community Management Account.

 TITLE II--CENTRAL INTELLIGENCE AGENCY RETIREMENT AND DISABILITY SYSTEM

Sec. 201. Authorization of appropriations.

                     TITLE III--GENERAL PROVISIONS

Sec. 301. Increase in employee compensation and benefits authorized by 
              law.
Sec. 302. Restriction on conduct of intelligence activities.
Sec. 303. Application of sanctions laws to intelligence activities.
Sec. 304. Thrift savings plan forfeiture.
Sec. 305. Authority to restore spousal pension benefits to spouses who 
              cooperate in criminal investigations and prosecutions for 
              national security offenses.
Sec. 306. Secrecy agreements used in intelligence activities.
Sec. 307. Limitation on availability of funds for automatic 
              declassification of records over 25 years old.
Sec. 308. Amendment to the Hatch Act Reform Amendments of 1993.
Sec. 309. Report on personnel policies.
Sec. 310. Assistance to foreign countries.
Sec. 311. Financial management of the National Reconnaissance Office.

                 TITLE IV--CENTRAL INTELLIGENCE AGENCY

Sec. 401. Extension of the CIA Voluntary Separation Pay Act.
Sec. 402. Volunteer service program.
Sec. 403. Authorities of the Inspector General of the Central 
              Intelligence Agency.

         TITLE V--DEPARTMENT OF DEFENSE INTELLIGENCE ACTIVITIES

Sec. 501. Defense intelligence senior level positions.
Sec. 502. Comparable benefits and allowances for civilian and military 
              personnel assigned to defense intelligence functions 
              overseas.
Sec. 503. Extension of authority to conduct intelligence commercial 
              activities.
Sec. 504. Availability of funds for Tier II UAV.
Sec. 505. Military Department Civilian Intelligence Personnel 
              Management System.
Sec. 506. Enhancement of capabilities of certain army facilities.

               TITLE VI--FEDERAL BUREAU OF INVESTIGATION

Sec. 601. Disclosure of information and consumer reports to FBI for 
              counterintelligence purposes.

                    TITLE VII--TECHNICAL AMENDMENTS

Sec. 701. Clarification with respect to pay for Director or Deputy 
              Director of Central Intelligence appointed from 
              commissioned officers of the Armed Forces.
Sec. 702. Change of designation of CIA Office of Security.
                    TITLE I--INTELLIGENCE ACTIVITIES

     SEC. 101. AUTHORIZATION OF APPROPRIATIONS.

       Funds are hereby 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.
     
[[Page H15225]]

       (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 intelligence and intelligence-related 
     activities of the elements listed in such section, are those 
     specified in the classified Schedule of Authorizations 
     prepared to accompany the conference report on the bill H.R. 
     1655 of the One Hundred Fourth Congress.
       (b) Availability of Classified Schedule of 
     Authorizations.--The Schedule of Authorizations shall be made 
     available to the Committees on Appropriations of the Senate 
     and House of Representatives and to the President. The 
     President shall provide for suitable distribution of the 
     Schedule, or of appropriate portions of the Schedule, within 
     the executive branch.

     SEC. 103. PERSONNEL CEILING ADJUSTMENTS.

       (a) Authority for Adjustments.--With the approval of the 
     Director of the Office of Management and Budget, the Director 
     of Central Intelligence may authorize employment of civilian 
     personnel in excess of the number authorized for fiscal year 
     1996 under section 102 when the Director of Central 
     Intelligence determines that such action is necessary to the 
     performance of important intelligence functions, except that 
     the number of personnel employed in excess of the number 
     authorized under such section may not, for any element of the 
     intelligence community, exceed two percent of the number of 
     civilian personnel authorized under such section for such 
     element.
       (b) Notice to Intelligence Committees.--The Director of 
     Central Intelligence shall promptly notify the Permanent 
     Select Committee on Intelligence of the House of 
     Representatives and the Select Committee on Intelligence of 
     the Senate whenever he exercises the authority granted by 
     this section.

     SEC. 104. COMMUNITY MANAGEMENT ACCOUNT.

       (a) Authorization of Appropriations.--There is authorized 
     to be appropriated for the Community Management Account of 
     the Director of Central Intelligence for fiscal year 1996 the 
     sum of $90,713,000. Within such amounts authorized, funds 
     identified in the classified Schedule of Authorizations 
     referred to in section 102(a) 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 fiscal year 1996, any officer or 
     employee of the United States or a 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 LAWS TO INTELLIGENCE 
                   ACTIVITIES.

       (a) General Provisions.--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 IX--APPLICATION OF SANCTIONS LAWS TO INTELLIGENCE ACTIVITIES


                          ``stay of sanctions

       ``Sec. 901. Notwithstanding any provision of law identified 
     in section 904, the President may stay the imposition of an 
     economic, cultural, diplomatic, or other sanction or related 
     action by the United States Government concerning a foreign 
     country, organization, or person when the President 
     determines and reports to Congress in accordance with section 
     903 that to proceed without delay would seriously risk the 
     compromise of an ongoing criminal investigation directly 
     related to the activities giving rise to the sanction or an 
     intelligence source or method directly related to the 
     activities giving rise to the sanction. Any such stay shall 
     be effective for a period of time specified by the President, 
     which period may not exceed 120 days, unless such period is 
     extended in accordance with section 902.


                          ``extension of stay

       ``Sec. 902. Whenever the President determines and reports 
     to Congress in accordance with section 903 that a stay of 
     sanctions or related actions pursuant to section 901 has not 
     afforded sufficient time to obviate the risk to an ongoing 
     criminal investigation or to an intelligence source or method 
     that gave rise to the stay, he may extend such stay for a 
     period of time specified by the President, which period may 
     not exceed 120 days. The authority of this section may be 
     used to extend the period of a stay pursuant to section 901 
     for successive periods of not more than 120 days each.


                               ``reports

       ``Sec. 903. Reports to Congress pursuant to sections 901 
     and 902 shall be submitted promptly upon determinations under 
     this title. Such reports shall be submitted to the Committee 
     on International Relations of the House of Representatives 
     and the Committee on Foreign Relations of the Senate. With 
     respect to determinations relating to intelligence sources 
     and methods, reports shall also be submitted to the Permanent 
     Select Committee on Intelligence of the House of 
     Representatives and the Select Committee on Intelligence of 
     the Senate. With respect to determinations relating to 
     ongoing criminal investigations, reports shall also be 
     submitted to the Committees on the Judiciary of the House of 
     Representatives and the Senate.


                         ``laws subject to stay

       ``Sec. 904. The President may use the authority of sections 
     901 and 902 to stay the imposition of an economic, cultural, 
     diplomatic, or other sanction or related action by the United 
     States Government related to the proliferation of weapons of 
     mass destruction, their delivery systems, or advanced 
     conventional weapons otherwise required to be imposed by the 
     Chemical and Biological Weapons Control and Warfare 
     Elimination Act of 1991 (title III of Public Law 102-182); 
     the Nuclear Proliferation Prevention Act of 1994 (title VIII 
     of Public Law 103-236); title XVII of the National Defense 
     Authorization Act for Fiscal Year 1991 (Public Law 101-510) 
     (relating to the nonproliferation of missile technology); the 
     Iran-Iraq Arms Nonproliferation Act of 1992 (title XVI of 
     Public Law 102-484); section 573 of the Foreign Operations, 
     Export Financing Related Programs Appropriations Act, 1994 
     (Public Law 103-87); section 563 of the Foreign Operations, 
     Export Financing Related Programs Appropriations Act, 1995 
     (Public Law 103-306); and comparable provisions.


                             ``application

       ``Sec. 905. This title shall cease to be effective on the 
     date which is one year after the date of the enactment of 
     this title.''.
       (b) Clerical Amendment.--The table of contents in the first 
     section of such Act is amended by adding at the end thereof 
     the following:


   ``TITLE IX--APPLICATION OF SANCTIONS LAWS TO INTELLIGENCE ACTIVITIES

``Sec. 901. Stay of sanctions.
``Sec. 902. Extension of stay.
``Sec. 903. Reports.
``Sec. 904. Laws subject to stay.
``Sec. 905. Application.''.

     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 or Member under subsection (c), and all earnings 
     attributable to such contributions, shall be forfeited if the 
     annuity of the employee or Member, or that of a survivor or 
     beneficiary, is forfeited under subchapter II of chapter 
     83.''.
       (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 the 
     enactment of this Act.

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

       Section 8318 of title 5, United States Code, is amended by 
     adding at the end the following:
       ``(e) The spouse of an individual whose annuity or retired 
     pay is forfeited under section 8312 or 8313 after the date of 
     enactment of this subsection shall be eligible for spousal 
     pension benefits if the Attorney General of the United States 
     determines that the spouse fully cooperated with Federal 
     authorities in the conduct of a criminal investigation and 
     subsequent prosecution of the individual which resulted in 
     such forfeiture.''.

     SEC. 306. SECRECY AGREEMENTS USED IN INTELLIGENCE ACTIVITIES.

       Notwithstanding any other provision of law not specifically 
     referencing this section, a nondisclosure policy form or 
     agreement that is to be executed by a person connected with 
     the conduct of an intelligence or intelligence-related 
     activity, other than an employee or officer of the United 
     States Government, may contain provisions appropriate to the 
     particular activity for which such document is to be used. 
     Such form or agreement shall, at a minimum--
       (1) require that the person will not disclose any 
     classified information received in the course of such 
     activity unless specifically authorized to do so by the 
     United States Government; and
       (2) provide that the form or agreement does not bar--
       (A) disclosures to Congress; or
       (B) disclosures to an authorized official of an executive 
     agency that are deemed essential to reporting a violation of 
     United States law.

     SEC. 307. LIMITATION ON AVAILABILITY OF FUNDS FOR AUTOMATIC 
                   DECLASSIFICATION OF RECORDS OVER 25 YEARS OLD.

       (a) In General.--The Director of Central Intelligence shall 
     use no more than $25,000,000 of 

[[Page H15226]]
     the amounts authorized to be appropriated for fiscal year 1996 by this 
     Act for the National Foreign Intelligence Program to carry 
     out the provisions of section 3.4 of Executive Order 12958. 
     The Director may, in the Director's discretion, draw on this 
     amount for allocation to the agencies within the National 
     Foreign Intelligence Program for the purpose of automatic 
     declassification of records over 25 years old.
       (b) Required Budget Submission.--The President shall submit 
     for fiscal year 1997 and each of the following fiscal years 
     through fiscal year 2000 a budget request which specifically 
     sets forth the funds requested for implementation of section 
     3.4 of Executive Order 12958.

     SEC. 308. 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. 309. 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), and to provide 
     for other personnel review systems 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. Such 
     report shall contain a description and analysis of voluntary 
     separation incentive options, including a waiver of the 2 
     percent penalty reduction for early retirement under certain 
     Federal retirement systems.
       (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. 310. ASSISTANCE TO FOREIGN COUNTRIES.

       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 Committee on Intelligence of the Senate and the 
     Permanent Select Committee on Intelligence of the House of 
     Representatives are notified not later than 15 days prior to 
     the provision of such assistance.

     SEC. 311. FINANCIAL MANAGEMENT OF THE NATIONAL RECONNAISSANCE 
                   OFFICE.

       (a) Management Review.--(1) The Inspector General for the 
     Central Intelligence Agency, assisted by the Inspector 
     General of the Department of Defense, shall 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 carry-
     forward funding, to ensure that National Reconnaissance 
     Office funds are used in accordance with applicable Federal 
     acquisition regulations and the policies of the Director of 
     Central Intelligence and consistent with those of 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 carry-forward funding;
       (D) determine how the National Reconnaissance Office 
     defines, identifies, and justifies carry-forward funding 
     requirements;
       (E) determine how the National Reconnaissance Office tracks 
     and manages carry-forward funding;
       (F) determine how the National Reconnaissance Office plans 
     to comply with congressional direction regarding carry-
     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 carry-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 Director of Central Intelligence shall submit a 
     report to the Congress setting forth the findings of the 
     review required by paragraph (1) not later than March 1, 
     1996, with an interim report provided to the Congress not 
     later than 2 weeks after the enactment of this Act.
       (b) 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 (among other things)--
       (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;
       (B) recommendations for procedures to be used by the Office 
     of Management and Budget for review of the budget of the 
     National Reconnaissance Office;
       (C) a proposed statutory provision that would require the 
     Director of Central Intelligence to establish a policy to 
     restrict the National Reconnaissance Office authority on 
     carry-forward funding in a manner consistent with the 
     restriction on such authority within the Department of 
     Defense; and
       (D) an evaluation of how changes proposed as a result of 
     the review required by subsection (a) will affect, directly 
     or indirectly, the National Reconnaissance Office's 
     streamlined acquisition process and, ultimately, program 
     costs.
       (c) Definition.--As used in this section, 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)).
                 TITLE IV--CENTRAL INTELLIGENCE AGENCY

     SEC. 401. EXTENSION OF THE CIA 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.''.

     SEC. 402. VOLUNTEER SERVICE PROGRAM.

       (a) General Authority.--The Director of Central 
     Intelligence is authorized to establish and maintain a 
     program from fiscal years 1996 through 2001 to utilize the 
     services contributed by not more than 50 annuitants who serve 
     without compensation as volunteers in aid of the review for 
     declassification or downgrading of classified information by 
     the Central Intelligence Agency under applicable Executive 
     orders governing the classification and declassification of 
     national security information and Public Law 102-526.
       (b) Costs Incidental to Services.--The Director is 
     authorized to use sums made available to the Central 
     Intelligence Agency by appropriations or otherwise for paying 
     the costs incidental to the utilization of services 
     contributed by individuals under subsection (a). Such costs 
     may include (but need not be limited to) training, 
     transportation, lodging, subsistence, equipment, and 
     supplies. The Director may authorize either direct 
     procurement of equipment, supplies, and services, or 
     reimbursement for expenses, incidental to the effective use 
     of volunteers. Such expenses or services shall be in 
     accordance with volunteer agreements made with such 
     individuals. Sums made available for such costs may not 
     exceed $100,000.
       (c) Application of Certain Provisions of Law.--A volunteer 
     under this section shall be considered to be a Federal 
     employee for the purposes of subchapter I of title 81 
     (relating to compensation of Federal employees for work 
     injuries) and section 1346(b) and chapter 171 of title 28 
     (relating to tort claims). A volunteer under this section 
     shall be covered by and subject to the provisions of chapter 
     11 of title 18 of the United States Code as if they were 
     employees or special Government employees depending upon the 
     days of expected service at the time they begin volunteering.

     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(b)(5)) 
     is amended to read as follows:
       ``(5) In accordance with section 535 of title 28, United 
     States Code, the Inspector General 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 subsection (b)(2) of such 
     section. 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''.
     
[[Page H15227]]

         TITLE V--DEPARTMENT OF DEFENSE INTELLIGENCE ACTIVITIES

     SEC. 501. DEFENSE INTELLIGENCE SENIOR LEVEL POSITIONS.

       Section 1604 of title 10, United States Code, is amended to 
     read as follows:

     ``Sec. 1604. Civilian personnel management

       ``(a) General Personnel Authority.--The Secretary of 
     Defense may, without regard to the provisions of any other 
     law relating to the number, classification, or compensation 
     of Federal employees--
       ``(1) establish such positions for employees in the Defense 
     Intelligence Agency and the Central Imagery Office as the 
     Secretary considers necessary to carry out the functions of 
     that Agency and Office, including positions designated under 
     subsection (f) as Defense Intelligence Senior Level 
     positions;
       ``(2) appoint individuals to those positions; and
       ``(3) fix the compensation for service in those positions.
       ``(b) Authority To Fix Rates of Basic Pay; Other Allowances 
     and Benefits.--(1) The Secretary of Defense shall, subject to 
     subsection (c), fix the rates of basic pay for positions 
     established under subsection (a) in relation to the rates of 
     basic pay provided in subpart D of part III of title 5 for 
     positions subject to that title which have corresponding 
     levels of duties and responsibilities. Except as otherwise 
     provided by law, an employee of the Defense Intelligence 
     Agency or the Central Imagery Office may not be paid basic 
     pay at a rate in excess of the maximum rate payable under 
     section 5376 of title 5.
       ``(2) The Secretary of Defense may provide employees of the 
     Defense Intelligence Agency and the Central Imagery Office 
     compensation (in addition to basic pay under paragraph (1)) 
     and benefits, incentives, and allowances consistent with, and 
     not in excess of the levels authorized for, comparable 
     positions authorized by title 5.
       ``(c) Prevailing Rates Systems.--The Secretary of Defense 
     may, consistent with section 5341 of title 5, adopt such 
     provisions of that title as provide for prevailing rate 
     systems of basic pay and may apply those provisions to 
     positions in or under which the Defense Intelligence Agency 
     or the Central Imagery Office may employ individuals 
     described by section 5342(a)(2)(A) of such title.
       ``(d) Allowances Based on Living Costs and Environment for 
     Employees Stationed Outside Continental United States or in 
     Alaska.--(1) In addition to the basic compensation payable 
     under subsection (b), employees of the Defense Intelligence 
     Agency and the Central Imagery Office described in paragraph 
     (3) may be paid an allowance, in accordance with regulations 
     prescribed by the Secretary of Defense, at a rate not in 
     excess of the allowance authorized to be paid under section 
     5941(a) of title 5 for employees whose rates of basic pay are 
     fixed by statute.
       ``(2) Such allowance shall be based on--
       ``(A) living costs substantially higher than in the 
     District of Columbia;
       ``(B) conditions of environment which--
       ``(i) differ substantially from conditions of environment 
     in the continental United States; and
       ``(ii) warrant an allowance as a recruitment incentive; or
       ``(C) both of those factors.
       ``(3) This subsection applies to employees who--
       ``(A) are citizens or nationals of the United States; and
       ``(B) are stationed outside the continental United States 
     or in Alaska.
       ``(e) Termination of Employees.--(1) Notwithstanding any 
     other provision of law, the Secretary of Defense may 
     terminate the employment of any employee of the Defense 
     Intelligence Agency or the Central Imagery Office if the 
     Secretary--
       ``(A) considers such action to be in the interests of the 
     United States; and
       ``(B) determines that the procedures prescribed in other 
     provisions of law that authorize the termination of the 
     employment of such employee cannot be invoked in a manner 
     consistent with the national security.
       ``(2) A decision by the Secretary of Defense to terminate 
     the employment of an employee under this subsection is final 
     and may not be appealed or reviewed outside the Department of 
     Defense.
       ``(3) The Secretary of Defense shall promptly notify the 
     Permanent Select Committee on Intelligence of the House of 
     Representatives and the Select Committee on Intelligence of 
     the Senate whenever the Secretary terminates the employment 
     of any employee under the authority of this subsection.
       ``(4) Any termination of employment under this subsection 
     shall not affect the right of the employee involved to seek 
     or accept employment with any other department or agency of 
     the United States if that employee is declared eligible for 
     such employment by the Director of the Office of Personnel 
     Management.
       ``(5) The authority of the Secretary of Defense under this 
     subsection may be delegated only to the Deputy Secretary of 
     Defense, the Director of the Defense Intelligence Agency 
     (with respect to employees of the Defense Intelligence 
     Agency), and the Director of the Central Imagery Office (with 
     respect to employees of the Central Imagery Office). An 
     action to terminate employment of an employee by any such 
     officer may be appealed to the Secretary of Defense.
       ``(f) Defense Intelligence Senior Level Positions.--(1) In 
     carrying out subsection (a)(1), the Secretary may designate 
     positions described in paragraph (3) as Defense Intelligence 
     Senior Level positions. The total number of positions 
     designated under this subsection, when combined with the 
     total number of positions in the Defense Intelligence Senior 
     Executive Service under section 1601 of this title, may not 
     exceed the total number of positions in the Defense 
     Intelligence Senior Executive Service as of June 1, 1995.
       ``(2) Positions designated under this subsection shall be 
     treated as equivalent for purposes of compensation to the 
     senior level positions to which section 5376 of title 5 is 
     applicable.
       ``(3) Positions that may be designated as Defense 
     Intelligence Senior Level positions are positions in the 
     Defense Intelligence Agency and Central Imagery Office that 
     (A) are classified above the GS-15 level, (B) emphasize 
     functional expertise and advisory activity, but (C) do not 
     have the organizational or program management functions 
     necessary for inclusion in the Defense Intelligence Senior 
     Executive Service.
       ``(4) Positions referred to in paragraph (3) include 
     Defense Intelligence Senior Technical positions and Defense 
     Intelligence Senior Professional positions. For purposes of 
     this subsection--
       ``(A) Defense Intelligence Senior Technical positions are 
     positions covered by paragraph (3) that involve any of the 
     following:
       ``(i) Research and development.
       ``(ii) Test and evaluation.
       ``(iii) Substantive analysis, liaison, or advisory activity 
     focusing on engineering, physical sciences, computer science, 
     mathematics, biology, chemistry, medicine, or other closely 
     related scientific and technical fields.
       ``(iv) Intelligence disciplines including production, 
     collection, and operations in close association with any of 
     the activities described in clauses (i), (ii), and (iii) or 
     related activities; and
       ``(B) Defense Intelligence Senior Professional positions 
     are positions covered by paragraph (3) that emphasize staff, 
     liaison, analytical, advisory, or other activity focusing on 
     intelligence, law, finance and accounting, program and 
     budget, human resources management, training, information 
     services, logistics, security, and other appropriate fields.
       ``(g) `Employee' Defined as Including Officers.--In this 
     section, the term `employee', with respect to the Defense 
     Intelligence Agency or the Central Imagery Office, includes 
     any civilian officer of that Agency or Office.''.

     SEC. 502. COMPARABLE BENEFITS AND ALLOWANCES FOR CIVILIAN AND 
                   MILITARY PERSONNEL ASSIGNED TO DEFENSE 
                   INTELLIGENCE FUNCTIONS OVERSEAS.

       (a) Civilian Personnel.--Section 1605 of title 10, United 
     States Code, is amended--
       (1) in subsection (a)--
       (A) by inserting ``(1)'' after ``(a)'';
       (B) by striking ``of the Department of Defense'' and all 
     that follows through ``this subsection,'' and inserting 
     ``described in subsection (d)''; and
       (C) by designating the second sentence as paragraph (2);
       (2) by striking subsection (c) and inserting the following:
       ``(c) Regulations prescribed under subsection (a) may not 
     take effect until the Secretary of Defense has submitted such 
     regulations to--
       ``(1) the Committee on Armed Services and the Select 
     Committee on Intelligence of the Senate; and
       ``(2) the Committee on National Security and the Permanent 
     Select Committee on Intelligence of the House of 
     Representatives.''; and
       (3) by adding at the end the following new subsection:
       ``(d) Subsection (a) applies to civilian personnel of the 
     Department of Defense who--
       ``(1) are United States nationals;
       ``(2) in the case of employees of the Defense Intelligence 
     Agency, are assigned to duty outside the United States and, 
     in the case of other employees, are assigned to Defense 
     Attache Offices or Defense Intelligence Agency Liaison 
     Offices outside the United States; and
       ``(3) are designated by the Secretary of Defense for the 
     purposes of subsection (a).''.
       (b) Military Personnel.--Section 431 of title 37, United 
     States Code, is amended--
       (1) in subsection (a), by striking ``who are assigned to'' 
     and all that follows through ``of this subsection'' and 
     inserting ``described in subsection (e)'';
       (2) by striking subsection (d) and inserting the following:
       ``(d) Regulations prescribed under subsection (a) may not 
     take effect until the Secretary of Defense has submitted such 
     regulations to--
       ``(1) the Committee on Armed Services and the Select 
     Committee on Intelligence of the Senate; and
       ``(2) the Committee on National Security and the Permanent 
     Select Committee on Intelligence of the House of 
     Representatives.''; and
       (3) by adding at the end the following new subsection:
       ``(e) Subsection (a) applies to members of the armed forces 
     who--
       ``(1) are assigned--
       ``(A) to Defense Attache Offices or Defense Intelligence 
     Agency Liaison Offices outside the United States; or
       ``(B) to the Defense Intelligence Agency and engaged in 
     intelligence-related duties outside the United States; and
       ``(2) are designated by the Secretary of Defense for the 
     purposes of subsection (a).''.

     SEC. 503. EXTENSION OF AUTHORITY TO CONDUCT INTELLIGENCE 
                   COMMERCIAL ACTIVITIES.

       Section 431(a) of title 10, United States Code, is amended 
     by striking ``1995'' and inserting ``1998''.

     SEC. 504. AVAILABILITY OF FUNDS FOR TIER II UAV.

       All funds appropriated for fiscal year 1995 for the Medium 
     Altitude Endurance Unmanned Aerial Vehicle (Tier II) are 
     specifically authorized, within the meaning of section 504 of 
     the National Security Act of 1947 (50 U.S.C. 414), for such 
     purpose.
     
[[Page H15228]]


     SEC. 505. MILITARY DEPARTMENT CIVILIAN INTELLIGENCE PERSONNEL 
                   MANAGEMENT SYSTEM.

       (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. 1599a. 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 Department Civilian 
     Intelligence Personnel Management System that is similar in 
     purpose, conditions, content, and administration to the 
     program established by the Secretary of Defense 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) Use of Funds for Training Program.--Any payment 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 new item:

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

     SEC. 506. ENHANCEMENT OF CAPABILITIES OF CERTAIN ARMY 
                   FACILITIES.

       (a) Authority.--(1) In addition to funds otherwise 
     available for such purpose, the Secretary of the Army may 
     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 those installations.
       (2) The authority of paragraph (1) may be exercised 
     notwithstanding any other provision of law.
       (b) Source of Funds.--Funds available for the Army for 
     operations and maintenance for fiscal years 1996 and 1997 
     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 amount 
     transferred or reprogrammed in that fiscal year under this 
     section 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 funds in excess of 
     $2,000,000 from the Department of the Army to the Bad Aibling 
     Station and the Menwith Hill Station.
               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.
       ``(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 

[[Page H15229]]
     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 
     623 the following new item:

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

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

       (a) Clarification.--Subparagraph (C) of section 102(c)(3) 
     of the National Security Act of 1947 (50 U.S.C. 403(c)(3)) is 
     amended to read as follows:
       ``(C) A commissioned officer of the Armed Forces on active 
     duty who is appointed to the position of Director or Deputy 
     Director, while serving in such position and while remaining 
     on active duty, shall continue to receive military pay and 
     allowances and shall not receive the pay prescribed for the 
     Director or Deputy Director. Funds from which such pay and 
     allowances are paid shall be reimbursed from funds available 
     to the Director.''.
       (b) Technical Corrections.--(1) Subparagraphs (A) and (B) 
     of such section are amended by striking ``pursuant to 
     paragraph (2) or (3)'' and inserting ``to the position of 
     Director or Deputy Director''.
       (2) Subparagraph (B) of such section is amended by striking 
     ``paragraph (A)'' and inserting ``subparagraph (A)''.

     SEC. 702. CHANGE OF DESIGNATION OF CIA OFFICE OF SECURITY.

       Section 701(b)(3) of the National Security Act of 1947 (50 
     U.S.C. 431(b)(3)), is amended by striking ``Office of 
     Security'' and inserting ``Office of Personnel Security''.
       And the Senate agree to the same.

     From the Permanent Select Committee on Intelligence, for 
     consideration of the House bill, and the Senate amendment, 
     and modifications committed to conference:
     Larry Combest,
     R.K. Dornan,
     Bill Young,
     James V. Hansen,
     Jerry Lewis,
     Proter J. Goss,
     Bud Shuster,
     Bill McCollum,
     Michael N. Castle,
     Norman Dicks,
     Bill Richardson,
     Julian C. Dixon,
     Robert G. Torricelli,
     Ron Coleman,
     David E. Skaggs,
     Nancy Pelosi,
     As additional conferees from the Committee on National 
     Security, for consideration of defense tactical intelligence 
     and related activities:
     Floyd Spence,
     Bob Stump,
     As additional conferees from the Committee on International 
     Relations, for consideration of section 303 of the House 
     bill, and section 303 of the Senate amendment, and 
     modifications committed to conference:
     Benjamin A. Gilman,
     Christopher Smith,
     Howard L. Berman,
                                Managers on the Part of the House.

     Arlen Specter,
     Richard G. Lugar,
     Richard Shelby,
     Mike DeWine,
     Jon Kyl,
     Jim Inhofe,
     Kay Bailey Hutchison,
     Connie Mack,
     Bill Cohen,
     Strom Thurmond,
     Robert Kerrey,
     John Glenn,
     Richard H. Bryan,
     Bob Graham,
     John F. Kerry,
     Max Baucus,
     J. Bennett Johnston,
     Charles Robb,
     Sam Nunn,
                               Managers on the Part of the Senate.

       JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE

       The managers on the part of the House and the Senate at the 
     conference on the disagreeing votes of the two Houses on the 
     amendment of the Senate to the bill (H.R. 1655) to authorize 
     appropriations for fiscal year 1996 for intelligence and the 
     intelligence-related activities of the United States 
     Government, the Community Management Account, and the Central 
     Intelligence Agency Retirement and Disability System, and for 
     other purposes, submit the following joint statement to the 
     House and the Senate in explanation of the effect of the 
     action agreed upon by the managers and recommended in the 
     accompanying conference report:
       The Senate amendment struck all of the House bill after the 
     enacting clause and inserted a substitute text.
       The House recedes from its disagreement to the amendment of 
     the Senate with an amendment that is a substitute for the 
     House bill and the Senate amendment. The differences between 
     the House bill the Senate amendment, and the substitute 
     agreed to in conference are noted below, except for clerical 
     corrections, conforming changes made necessary by agreements 
     reached by the conferees, and minor drafting and clerical 
     changes.

                    Title I--Intelligence Activities

     SEC. 101. AUTHORIZATION FOR APPROPRIATIONS.

       Section 101 of the conference report lists the departments, 
     agencies and other elements of the United States Government 
     for whose intelligence and intelligence-related activities 
     the Act authorizes appropriations for fiscal year 1996.

     SEC. 102--CLASSIFIED SCHEDULE OF AUTHORIZATIONS.

       Section 102 of the conference report makes clear that the 
     details of the amounts authorized to be appropriated for 
     intelligence and intelligence-related activities and 
     applicable personnel ceilings covered under this title for 
     fiscal year 1996 are contained in a classified Schedule of 
     Authorizations. The Schedule of Authorizations is 
     incorporated into the Act by this section. The details of the 
     Schedule are explained in the classified annex to this 
     report.

     SEC. 103. PERSONNEL CEILING ADJUSTMENTS.

       Section 103 of the conference report authorizes the 
     Director of Central Intelligence, with the approval of the 
     Director of the Office of Management and Budget, in fiscal 
     year 1996 to exceed the personnel ceilings applicable to the 
     components of the Intelligence Community under section 102 by 
     an amount not to exceed two percent of the total of the 
     ceilings applicable under section 102. The Director may 
     exercise this authority only when doing so is necessary to 
     the performance of important intelligence functions. Any 
     exercise of this authority must be reported to the two 
     intelligence committees of the Congress.
       The conferees emphasize that the authority conferred by 
     Section 103 is not intended to permit the whosesale raising 
     of personnel strength in any intelligence component. Rather, 
     the section provides the Director of Central Intelligence 
     with flexibility to adjust personnel levels temporarily for 
     contingencies and for overages caused by an imbalance between 
     hiring of new employees and attrition of current employees. 
     The conferees do not expect the Director of Central 
     Intelligence to allow heads of intelligence components to 
     plan to exceed levels set in the Schedule of Authorizations 
     except for the satisfaction of clearly identified hiring 
     needs which are consistent with the authorization of 
     personnel strengths in this bill. In no case is this 
     authority to be used to provide for positions denied by this 
     bill.

     SEC. 104. COMMUNITY MANAGEMENT ACCOUNT.

       Section 104 of the conference report authorizes 
     appropriations for the Community Management Account of the 
     Director of Central Intelligence and sets the personnel end-
     strength for the Intelligence Community Management Staff for 
     fiscal year 1996.
       Subsection (a) authorizes appropriations of $90,713,000 for 
     fiscal year 1996 for the activities of the Community 
     Management Account of the Director of Central Intelligence. 
     It also authorizes funds identified for the Advanced Research 
     and Development Committee and the Environmental Task Force to 
     remain available for two years.
       Subsection (b) authorizes 247 full-time personnel for the 
     Community Management Staff for fiscal year 1996 and provides 
     that such personnel may be permanent employees of the Staff 
     or detailed from various elements of the United States 
     Government.
       Subsection (c) requires that personnel be detailed on a 
     reimbursable basis except for temporary situations of less 
     than one year.

 Title II--Central Intelligence Agency Retirement and Disability System

     SEC. 201. AUTHORIZATION OF APPROPRIATIONS.

       Section 201 authorizes appropriations in the amount of 
     $213,900,000 for fiscal year 1996 for the Central 
     Intelligence Agency Retirement and Disability Fund.

                     Title III--General Provisions

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

       Section 301 of the conference report provides that 
     appropriations authorized by the conference report 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. Section 301 is 
     identical to section 301 of the House bill and section 301 of 
     the Senate amendment.

     SEC. 302. RESTRICTION ON CONDUCT OF INTELLIGENCE ACTIVITIES.

       Section 302 provides that the authorization of 
     appropriations by the conference report shall not be deemed 
     to constitute authority for the conduct of any intelligence 
     activity that is not otherwise authorized by the Constitution 
     or laws of the United States. Section 302 is identical to 
     section 302 of the 

[[Page H15230]]
     House bill and section 302 of the Senate amendment.

     SEC. 303. APPLICATION OF SANCTIONS LAWS TO INTELLIGENCE 
                   ACTIVITIES.

       Section 303 of the conference report amends the National 
     Security Act of 1947 with a new Title IX to permit the 
     President to stay the imposition of an economic, cultural, 
     diplomatic, or other sanction or related action when the 
     President determines and reports to Congress that to proceed 
     without delay would seriously risk the compromise of an 
     intelligence source or method or an ongoing criminal 
     investigation. Both the House bill and the Senate amendment 
     contained provisions pertaining to deferrals of sanctions.
       Section 901 of the new Title IX of the National Security 
     Act of 1947 grants the President the authority to stay the 
     imposition of a sanction or related action. Section 901 
     requires that when a sanction or related action is to be 
     deferred due to the risk of compromise of a source or method 
     or an ongoing criminal investigation, the source or method or 
     the law enforcement matter in question must be related to the 
     activities giving rise to the sanction. The section allows 
     the President to stay the imposition of a sanction or related 
     action for a specified period not to exceed 120 days.
       Section 902 of the new Title IX provides that when the 
     President determines and reports to Congress that a stay of 
     an imposition of a sanction or related action has not 
     afforded sufficient time to obviate the risk to an ongoing 
     criminal investigation or to an intelligence source or method 
     that gave rise to the stay, the President may extend the stay 
     for successive periods of not more than 120 days.
       Section 903 of the new Title IX requires that reports to 
     Congress pursuant to section 901 and 902 be submitted 
     promptly upon the President's determination to stay the 
     imposition of a sanction or related action. Reports required 
     under the new title are to be submitted to the Committee on 
     International Relations of the House and the Committee on 
     Foreign Relations of the Senate. Those reports pertaining to 
     determinations related to intelligence sources and methods 
     are also to be submitted to the Permanent Select Committee on 
     Intelligence of the House and the Select Committee on 
     Intelligence of the Senate. Those reports pertaining to 
     determinations related to ongoing criminal investigations are 
     also to be submitted to the Judiciary Committees of the House 
     and Senate. The conferees further recognize that the actual 
     structure and content of the reports to the Senate and House 
     committees of jurisdiction will be achieved as a result of 
     ongoing dialogue between the Congress and the Executive 
     Branch. The conferees expect that the reports submitted 
     pursuant to the new title will indicate the nature of the 
     activities giving rise to the sanction or related action, the 
     applicable law concerned, the country or countries in which 
     the activity took place, and other pertinent details, to the 
     maximum extent practicable consistent with the protection of 
     intelligence sources and methods. The reports should also 
     include a determination that the delay in the imposition of a 
     sanction or related action will not be seriously prejudicial 
     to the achievement of the United States' nonproliferation 
     objectives or significantly increase the threat or risk to 
     United States' military forces.
       Section 904 of the new Title IX enumerates specific 
     nonproliferation laws requiring a sanction or related action, 
     the imposition of which the President may stay pursuant to 
     sections 901 and 902. The section also grants the President 
     the authority to stay the imposition of a sanction or related 
     action contained in laws comparable to the enumerated acts.
       Section 905 of the new Title IX states that the title 
     ceases to be effective one year from the date of its 
     enactment. The conferees believe this will afford Congress an 
     opportunity to evaluate the use and effect of this provision 
     in relation to sanctions laws. The Senate bill did not 
     contain a similar provision.
       The conferees expect that when the President chooses to 
     exercise the deferral authority, the utmost will be done to 
     resolve sources or methods or law enforcement problems as 
     soon as possible so as to permit sanctions to be imposed as 
     required by law. The intelligence and judiciary committees, 
     as appropriate, should be informed fully of the efforts being 
     made to address the circumstances that led to the delay. The 
     conferees understand that instances where sanctions would be 
     deferred would be rare, and that the deferral authority will 
     be exercised only when an intelligence source or method or a 
     criminal investigation is seriously at risk, and not to 
     protect generic or speculative intelligence or law 
     enforcement interests. Moreover, the presidential 
     determination should not be used as a pretext for some other 
     reason not to impose sanctions such as economic or foreign 
     policy reasons. The President should lift the stay when the 
     President determines that it is no longer necessary to 
     protect against compromise.
       The President must have sufficient information to determine 
     whether the risk to intelligence sources and methods or an 
     ongoing criminal investigation is significant and outweighs 
     any potential harm to U.S. nonproliferation objectives. The 
     conferees expect that determinations to invoke a stay 
     authorized under this new title will be preceded by a 
     rigorous interagency review process in which the 
     recommendations of all relevant agencies, together with 
     supporting facts, are made available to the President. The 
     conferees intend to closely monitor the use of the authority 
     provided under this title.

     SEC. 304. THRIFT SAVINGS PLAN FORFEITURE.

       Section 304 of the conference report adds a new subsection 
     to section 8432(g) of title 5, United States Code, to provide 
     that the Government's contribution to the Thrift Savings Plan 
     under the Federal Employees Retirement System (FERS) and 
     interest earned on that contribution shall be forfeited if 
     the employee's annuity has been forfeited under subchapter II 
     of Chapter 83, title 5, United States Code. This provision 
     closes a loophole that was created when the FERS was 
     established.
       Prior to the enactment of the FERS, an employee's 
     retirement annuity was based entirely on contributions made 
     by the employee and by the Government to the applicable 
     retirement fund. Under subchapter II of Chapter 83, any 
     employee convicted of various national security offenses, 
     including espionage, would forfeit his annuity and be 
     entitled to receive only his monetary contributions to the 
     annuity. A new retirement benefit, however, was created with 
     the establishment of FERS, payable under the Thrift Savings 
     Plan.
       The Thrift Savings Plan now permits the employee to 
     contribute into the Government-managed fund and requires that 
     the Government also contribute to the fund on the employee's 
     behalf. When FERS was enacted, the forfeiture provisions of 
     subchapter II were not amended to cover the Government's 
     contributions to the Plan. This situation clearly undermines 
     the intent of subchapter II by permitting an employee 
     convicted of espionage to retain the Government's 
     contributions to the Plan. Section 304 corrects this anomaly 
     by requiring the forfeiture of the Government's contribution 
     to the Plan and attributable earnings on that contribution in 
     situations where an individual's annuity is forfeited under 
     subchapter II. Section 304 is identical to section 304 of the 
     House bill and section 304 of the Senate amendment.

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

       Section 304 of the conference report amends section 8318 of 
     title 5, United States Code, to make the spouse of an 
     individual whose annuity or retired pay has been forfeited 
     under section 8312 or 8313 of title 5 eligible for spousal 
     pension benefits if the Attorney General determines that the 
     spouse fully cooperated in the criminal investigation and 
     prosecution of the individual. Enactment of this legislation 
     will help to protect the national security interests of the 
     United States by encouraging the spouses of federal employees 
     who know or suspect that their husband or wife is engaged in 
     espionage activities to inform the Government and to 
     cooperate in a subsequent criminal investigation and 
     prosecution. Current law actually discourages cooperation 
     with the Government, since under current law pension benefits 
     are lost upon conviction and forfeiture of the husband's or 
     wife's annuity, even if the spouse has cooperated with the 
     Government. Section 305 is identical to section 305 of the 
     House bill and section 305 of the Senate amendment.

     SEC. 306. SECRECY AGREEMENTS USED IN INTELLIGENCE ACTIVITIES.

       Section 306 addresses a problem that CIA has experienced 
     with secrecy agreements in the conduct of authorized 
     intelligence activities. Beginning with the Treasury, Postal 
     Service, and General Government Appropriations Act for fiscal 
     year 1991 and in each year thereafter, Congress has required 
     that agreements to protect classified information must 
     contain certain prescribed language to put the executor on 
     notice that the agreement does not supersede specified laws 
     and Executive Order 12356. The language is as follows:

       These restrictions are consistent with and do not 
     supersede, conflict with or otherwise alter the employee 
     obligations, rights or liabilities created by Executive Order 
     12356; section 7211 of title 5, United States Code (governing 
     disclosures to Congress); section 1034 of title 10, United 
     States Code, as amended by the Military Whistleblower 
     Protection Act (governing disclosure to Congress by members 
     of the military); section 2302(b)(8) of title 5, United 
     States Code, as amended by the Whistleblower Protection Act 
     (governing disclosures of illegality, waste, fraud, abuse of 
     public health or safety threats); the Intelligence Identities 
     Protection Act of 1982 (50 U.S.C. 421 et seq.) (governing 
     disclosures that could expose confidential Government 
     agents), and the statutes which protect against disclosure 
     that may compromise the national security, including sections 
     641, 793, 794, 798, and 952 of title 18, United States Code, 
     and section 4(b) of the Subversive Activities Act of 1950 (50 
     U.S.C. section 783(b)). The definitions, requirements, 
     obligations, rights, sanctions and liabilities created by 
     said Executive Order and listed statutes are incorporated 
     into the Agreement and are controlling.

       Notwithstanding that several of the laws cited apply only 
     to federal employees, the Treasury appropriations acts have 
     required CIA to include the specified language in 
     nondisclosure agreements intended to be executed by private 
     parties. The prescribed 

[[Page H15231]]
     language is required in every secrecy agreement entered into, so 
     federal employees and private entities alike must have such 
     language included in the agreement that they sign. The 
     recitation of numerous statutes in the overbearing but 
     required ``legalese'' has caused confusion, complicated 
     authorized intelligence activities, and even disrupted them 
     when parties refuse to sign agreements containing provisions 
     that do not apply to them. The required language is 
     intimidating and has chilled otherwise promising intelligence 
     relationships with private entities.
       Consequently, section 306 clarifies that CIA and other 
     intelligence agencies have the flexibility to tailor 
     nondisclosure agreements according to the needs of the 
     intelligence activity at hand, as long as the agreement at a 
     minimum requires nondisclosure without specific authorization 
     by the United States Government. The form or agreement must 
     also make clear that the form or agreement does not bar 
     disclosures to Congress or disclosures to an authorized 
     official of an executive agency that are deemed essential to 
     reporting a violation of United States laws. This section, 
     when enacted, will permit the use of secrecy agreements 
     stated in plain and understandable English and that will not 
     intimidate the layman. The provision will make it easier for 
     people to understand their rights and obligations when 
     signing a secrecy agreement, which will ultimately enhance 
     the protection of national security information.

     SEC. 307. LIMITATION ON AVAILABILITY OF FUNDS FOR AUTOMATIC 
                   DECLASSIFICATION OF RECORDS OVER 25 YEARS OLD.

       Section 307 limits the availability of funds authorized to 
     be appropriated by this Act to implement section 3.4 of 
     Executive Order 12958 to $25 million in fiscal year 1996. The 
     Director of Central Intelligence, at the Director's 
     discretion, may allocate this amount among the agencies of 
     the National Foreign Intelligence Program for this purpose. 
     Section 307 requires the President to submit budget requests 
     that specifically identify the funds necessary to implement 
     section 3.4 for fiscal years 1997 through 2000.
       Given that the conferees have received four different 
     estimates of the cost of implementing section 3.4 since the 
     beginning of the year, the conferees believe there needs to 
     be a continuing effort to fully evaluate the potential costs 
     associated with the declassification review programs. The 
     conferees further urge that this declassification effort be 
     coordinated closely with CIA's Historical Review Program 
     Office so as to enhance the intellectual coherence of the 
     declassification process. In the budget submission for 
     FY1997, the President is to provide a detailed request 
     supported by firm estimates of declassification costs.
       Section 307 of the House bill limited each agency of the 
     National Foreign Intelligence Program to $2.5 million to 
     carry out the provisions of section 3.4. The Senate amendment 
     had no similar provision.

     SEC. 308. AMENDMENT TO THE HATCH ACT REFORM AMENDMENTS OF 
                   1993.

       Section 308 restores the authority of the Office of 
     Personnel Management (OPM) to extend ``de-Hatching'' to 
     employees of the agencies listed in 5 U.S.C. 
     Sec. 7323(b)(2)(B)(i).
       Previously, under 5 U.S.C. Sec. 7323, OPM had the authority 
     to designate certain municipalities and other political 
     subdivisions in which federal employees in both competitive 
     and excepted services could actively participate in local 
     partisan elections. (Such designation of municipalities and 
     political subdivisions by OPM is commonly referred to as 
     ``de-Hatching''.) However, when this authority was amended by 
     Public Law 103-94 and recodified in 5 U.S.C. Sec. 7325, the 
     authority was granted only ``without regard to the 
     prohibitions in paragraphs (2) and (3) of section 7323(a)''. 
     The prohibitions in section 7323(a) apply to the federal 
     employees, both competitive and excepted service. However, 
     employees of NSA, CIA, DIA and the other agencies listed in 5 
     U.S.C. Sec. 7323(b)(2)(B)(i) are subject to additional 
     prohibitions under section 7323(b)(2)(A) which section 7325 
     does not permit OPM to disregard. Thus, OPM cannot extend de-
     Hatching to employees of the listed agencies and the 
     implementing interim regulations issued by OPM (59 Fed. Reg. 
     5313 (1994) to be codified at 5 C.F.R. Part 733) reflect this 
     restriction.
       This provision would amend the ``de-Hatching'' provision (5 
     U.S.C. Sec. 7325) to include the excepted services in the 
     category of federal employees that OPM may permit to take an 
     active part in local (not Federal) political campaigns.
       Section 308 is identical to section 306 of the Senate 
     amendment. The House bill did not contain a similar 
     provision.

     SEC. 309.--REPORT ON PERSONNEL POLICIES.

       Section 309 of the conference report requires the DCI to 
     report to the intelligence oversight committees within three 
     months detailed personnel procedures that could be 
     implemented across the intelligence community to provide for 
     mandatory retirement at expiration of time in class and 
     termination based on relative performance similar to 
     comparable provisions in sections 607 and 608 of the Foreign 
     Service Act of 1980 (Title 22 U.S.C. 4007 and 4008) for 
     civilian employees.
       The Director of Central Intelligence and Secretary of 
     Defense were directed in the FY 1995 Intelligence 
     Authorization Act to provide a report by December 1, 1994 on 
     the advisability of providing for mandatory retirement at 
     expiration of time in class. The oversight committees have 
     reviewed the issue and determined that a performance-based 
     policy is advisable and are now directing the DCI to develop 
     and report on procedures that could be implemented.
       Senate floor action added a provision requiring that the 
     DCI's report include a description and analysis of voluntary 
     separation incentives, including a waiver of the ``two 
     percent penalty'' reduction for early retirement under 
     certain federal retirement systems. Section 309 is 
     substantially similar to section 307 of the Senate amendment. 
     The House bill did not contain a similar provision.

     SEC. 310.--ASSISTANCE TO FOREIGN COUNTRIES.

       Section 310 of the conference report authorizes assistance 
     to a foreign country for counterterrorism efforts, 
     notwithstanding any other provision of law, 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. The 
     appropriate committees of Congress are to be notified not 
     later than 15 days prior to the provision of such assistance. 
     This authority is needed for the purpose of furthering United 
     States interests. By providing this authority, there will be 
     no doubt that the United States will be able to provide 
     assistance to foreign countries that are willing to help 
     identify, track and apprehend persons who have destroyed 
     American property or harmed American citizens. Section 310 is 
     identical to section 308 of the Senate amendment. There was 
     no comparable language in the House bill.

     SEC. 311.--FINANCIAL MANAGEMENT OF THE NATIONAL 
                   RECONNAISSANCE OFFICE.

       Section 311 of the conference report seeks to improve 
     accountability and financial management control over the 
     National Reconnaissance Office. The section further requires 
     a review of NRO's financial management by the Inspector 
     General of CIA, assisted by the Inspector General of DOD, to 
     evaluate the effectiveness of policies and internal controls 
     over the NRO budget, particularly wit regard to carry-forward 
     funding. It is the intention of the conferees that the 
     Director of Central Intelligence notify the intelligence 
     oversight committees prior to reprogramming, reallocating, 
     and/or rescinding funds previously authorized and 
     appropriated for NRO programs, projects, and activities. The 
     section also requires 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 for the NRO and greater Office of Management and 
     Budget review of the NRO's budget. The report must include an 
     analysis of the option for a statutory provision requiring 
     the DCI to establish a policy to restrict the NRO's authority 
     on carry-forward funding consistent with the restriction on 
     such authority within the Department of Defense. The 
     President shall also report on how changes proposed as a 
     result of this review will affect, directly or indirectly, 
     the NRO's streamlined acquisition process and ultimately, 
     program costs.
       Elements of section 311 were added to the Senate amendment 
     in floor action, but the provision has been substantially 
     changed in subsequent discussions among conferees. There was 
     no comparable provision in the House bill.

                 Title IV--Central Intelligence Agency

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

       Section 401 amends section 2(f) of the CIA Voluntary 
     Separation Pay Act, 50 U.S.C. Sec. 403-4(f), to extend the 
     Agency's authority to offer separation incentives until 
     September 30, 1999. Without this amendment, the Agency's 
     authority to offer such incentives will expire on September 
     30, 1997.
       CIA's separation incentive program has been an effective 
     force reduction tool. It is necessary to extend this 
     authority until September 30, 1999, because CIA, Like DoD, 
     will continue to downsize through that year. Enactment of 
     this provision will ensure that CIA can minimize the need to 
     separate employees involuntarily. In light of the conferees' 
     concern that this authority may have been used in the past in 
     lieu of more rigorous personnel policies, this authority is 
     extended with the understanding that the Intelligence 
     Community will be pursuing such policies, and that this 
     authority can be used to ease the transition to the more 
     rigorous, performance-based criteria and policy.
       Section 401(b) is designed to offset the direct spending 
     cost of the extension of the authority provided for in the 
     CIA Voluntary Separation Pay Act. 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 has 
     been or is to be paid.
       Section 401(a) is identical to section 401 of the House 
     bill. Section 401(b) is identical to section 401(b) of the 
     Senate amendment. The House bill did not contain a similar 
     offset provision.

     SEC. 402. VOLUNTEER SERVICE PROGRAM.

       Section 402 authorizes the Director to establish, as a 
     demonstration project, a limited volunteer service program 
     for fiscal years 1996 through 2001, whereby no more 

[[Page H15232]]
     than 50 retirees can volunteer their services to the CIA to assist the 
     Agency in its systematic or mandatory review for 
     declassification or downgrading of classified information 
     under certain Executive Orders and Public Law 102-526. The 
     provision limits expenditures to no more than $100,000.
       This section authorizes the Agency to pay costs incidental 
     to the use of the services of volunteers, such as training, 
     equipment, lodging, subsistence, equipment and supplies. It 
     also ensures that volunteers are covered by workers 
     compensation and the Federal Torts Claim Act. Without this 
     legislation, the CIA would be unable to pay costs incident to 
     the use of gratuitous services provided by volunteers, such 
     as training and equipment. The program established under this 
     section will be temporary and limited. Section 402 is 
     identical to section 402 of the House bill and section 402 of 
     the Senate amendment.

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

       Section 403(a) of the conference report modifies the CIA 
     Inspector General statute to require the IG to report 
     violations of Federal law by any person, as opposed to 
     violations by officers or employees of the CIA. It also 
     allows the reports to go directly from OIG to the Department 
     of Justice, rather than through the DCI, although the DCI 
     must receive a copy of the report. This is consistent with 
     the Inspector General Statute of 1978 and enhances the 
     independence of the IG. The conferees understand that the 
     Inspector General has agreed to give advanced notice to the 
     DCI and the conferees strongly support this agreement. The 
     conferees further understand that this advance notice will 
     not be used to prevent reports from going to the Department 
     of Justice. Section 403(a) is identical to section 403(a) of 
     the Senate amendment. The House bill did not contain a 
     similar provision.
       Section 403(b) of the conference report clarifies the CIA 
     Inspector General statute to ensure that the identity of an 
     employee who has been granted confidentiality can be 
     disclosed to the Department of Justice official responsible 
     for determining whether a prosecution should be undertaken. 
     Current law already provides for this but this provision 
     would clarify and simplify the process. Section 403(b) is 
     identical to section 403(b) of the Senate amendment. The 
     House bill did not contain a similar provision.

                     Title V--Department of Defense


                        intelligence activities

     SEC. 501. DEFENSE INTELLIGENCE SENIOR LEVEL POSITIONS.

       Section 501 of the conference report amends section 1604 of 
     title 10, United States Code, by authorizing the Secretary of 
     Defense to establish the Defense Intelligence Senior Level 
     (DISL) personnel system for the Defense Intelligence Agency 
     (DIA) and the Central Imagery Office (CIO). Section 1604 
     currently authorizes the Secretary of Defense to establish 
     positions for civilian officers and employees in DIA and CIO. 
     The rates of basic pay for these positions are fixed in 
     relation to the rates of basic pay provided in the General 
     Schedule under section 5332 of title 5. Section 5332, 
     however, which limits the grades of employees to GS-15, is 
     insufficient for the needs of DIA and CIO.
       In 1991, two Army field activities were transferred to DIA. 
     The employees at the Missile and Space Intelligence Center 
     and the Armed Forces Medical Intelligence Center are high-
     level technical employees. Their positions do not meet the 
     management and program criteria for Senior Executive Service 
     (SES) inclusion, but they do exceed the GS-15 criteria. DIA 
     is also acquiring the Human Intelligence (HUMINT) resources 
     of the Military Services. This functional transfer will add 
     over 1,000 civilian and military personnel to DIA's rolls, 
     and there may be a need to structure at least one senior 
     advisory assignment as part of the Defense HUMINT Service 
     (DHS) architecture. Additionally, the increased Defense 
     intelligence leadership roles of DIA and CIO require 
     increased high level activity in technical analysis, liaison 
     and advisory services.
       The primary purpose of DISL positions will be to provide 
     technical expertise and advisory services beyond the GS-15 
     level established by DIA and CIO. Employees in DISL positions 
     will not be responsible for managerial and program oversight, 
     which are functions of the SES. DISL positions will include 
     Defense Intelligence Senior Technical (DIST) and Defense 
     Intelligence Senior Professional (DISP) assignments. These 
     positions are classifiable above the DIA and CIO GS-15 level 
     but do not involve the organizational or program management 
     functions necessary for the Defense Intelligence Senior 
     Executive Service.
       DIST positions are those that involve research and 
     development; test and evaluation; or substantive analysis, 
     liaison, and/or advisory activity focusing on engineering, 
     physical sciences, computer science, mathematics, medicine, 
     biology, chemistry, or other closely related scientific and 
     technical fields; and intelligence disciplines including 
     production, collection, and operations in close association 
     with the preceding or related activities.
       DISP positions are those that emphasize staff, liaison, 
     analytical, advisory, or other activity focusing on 
     intelligence, law, finance and accounting, program and 
     budget, human resources management, training, information 
     services, logistics, and other appropriate support fields.
       DISL positions will provide DIA and CIO with the 
     flexibility that is essential to recruit effectively and to 
     retain highly competent employees with scientific, technical, 
     or other complex skills. This provision allows the Secretary 
     of Defense to establish a basic rate of pay that does not 
     exceed the rate paid to Executive Level IV. It also 
     authorizes the Secretary of Defense to provide to DIA and CIO 
     employees other benefits, allowances, incentives, or 
     compensation that similarly situated federal employees are 
     eligible to receive under title 5, United States Code. 
     Section 501 is identical to section 501 of the House bill. 
     The Senate amendment did not contain a similar provision.

     SEC. 502. COMPARABLE BENEFITS AND ALLOWANCES FOR CIVILIAN AND 
                   MILITARY PERSONNEL ASSIGNED TO DEFENSE 
                   INTELLIGENCE FUNCTIONS OVERSEAS.

       Section 502 of the conference report amends section 1605 of 
     title 10, United States Code, and section 431 of title 37, 
     United States Code, to provide to civilian personnel and 
     members of the armed forces serving with the Defense HUMINT 
     Service outside the United States benefits and allowances 
     comparable to those provided by the Secretary of State to 
     officers and employees of the Foreign Service.
       The Secretary of Defense has the authority to provide to 
     civilian personnel and members of the armed forces assigned 
     to the Defense Attache Offices and the Defense Intelligence 
     Agency Liaison Offices outside the United States benefits and 
     allowances comparable to those provided by the Secretary of 
     State to officers and employees of the Foreign Service. This 
     authority was attained in 1983 (Public Law 98-215) because 
     travel allowances and related benefits for overseas personnel 
     at the Defense Attache Offices and the Defense Intelligence 
     Agency Liaison Offices were different from Foreign Service 
     personnel assigned overseas.
       With the consolidation of Department of Defense human 
     intelligence into the Defense HUMINT Service, the Defense 
     Intelligence Agency will be responsible for a significant 
     number of employees overseas. Although a number of these 
     employees may be assigned to Defense Attache Offices or 
     Defense Intelligence Agency Liaison Offices outside the 
     United States, there will be some assigned to other overseas 
     locations. Since the Agency's authority to provide benefits 
     and allowances to overseas employees is limited to the 
     Defense Attache Office and the Defense Intelligence Agency 
     Liaison Offices, inequities will once again occur. Section 
     502 ensures comparable benefits for civilian and military 
     personnel assigned to the Defense HUMINT Service overseas. 
     Section 502 is virtually identical to Section 501 of the 
     Senate amendment and section 502 of the House bill.

     SEC. 503. EXTENSION OF AUTHORITY TO CONDUCT INTELLIGENCE 
                   COMMERCIAL ACTIVITIES.

       Section 503 of the conference report would extend for three 
     years, until December 31, 1998, the authority of the 
     Secretary of Defense to initiate intelligence commercial 
     activities to provide cover security to intelligence 
     collection activities undertaken abroad by the Defense 
     Department. This authority permits the Secretary to waive 
     compliance with certain types of federal laws and regulations 
     pertaining to the management and administration of federal 
     entities when he determines that compliance by the commercial 
     cover activity would create an unacceptable risk of 
     compromise of an authorized intelligence collection activity. 
     This authority is similar to the authority granted to the 
     Central Intelligence Agency and the Federal Bureau of 
     Investigation.
       The Secretary's intelligence commercial cover authority was 
     originally enacted as part of the FY 1991 Intelligence 
     Authorization Act (Public Law 102-88) August 14, 1991. 
     However, the intelligence commercial cover authority did not 
     become effective until December 2, 1992, after the 
     statutorily required promulgation and submission to Congress 
     of a directive from the Secretary governing the 
     implementation of the statute. Due to a variety of reasons, 
     including the launching of a plan in 1993 to create a new 
     Defense Humint Service under which all Defense Department 
     human intelligence activities are being consolidated, this 
     intelligence commercial activities authority has not yet been 
     used, due largely to significant budget cuts effected in 
     December 1992. Recently, however, DoD has enhanced its HUMINT 
     efforts and is working closely with CIA to develop the 
     skills, plans, and infrastructure necessary to effectively 
     utilize this authority. Thus, the conference report extends 
     the sunset provision to December 31, 1998.
       The Administration's intelligence authorization legislative 
     proposal sought repeal of the existing ``sunset'' clause, 
     thus making the Secretary's intelligence commercial 
     activities authority permanent. Senior officials from both 
     the Defense Department and the Central Intelligence Agency 
     testified to the continuing and growing need for the 
     Secretary to have this authority under certain circumstances 
     to provide bona fide commercial cover that can withstand 
     detailed investigation by hostile foreign intelligence 
     services as well as domestic scrutiny. The conferees agreed 
     to the extension of the authority. However, in view of the 
     lack of a record of use thus far, Section 503 extends the 
     authority for three years, instead of the permanent extension 
     originally sought by the Administration. Three years should 
     provide time for the development and oversight of a 

[[Page H15233]]
     track record on the use of this authority without encouraging overuse 
     of it, and particularly its more elaborate and sophisticated 
     applications. At the end of that time, and based on its 
     oversight of the record, the Intelligence Committees can 
     address whether to make this authority permanent, extend it 
     for a specific period or allow it to lapse. Section 503 is 
     the same as section 503 of the House bill. Section 502 of the 
     Senate amendment had extended the authority for five years.

     SEC. 504. AVAILABILITY OF FUNDS FOR TIER II UAV.

       The Fiscal Year 1995 authorization bill authorized full 
     funding of the Defense Department's request for the Tier-2 
     Medium Altitude Endurance Unmanned Aerial Vehicle (UAV) 
     Advanced Concept Technology Demonstration. The Fiscal Year 
     1995 defense appropriations bill included appropriations $20 
     million above the amount authorized for the program. As these 
     additional funds were not specifically authorized, as 
     required by Section 504 of the National Security Act of 1947, 
     the Department of Defense could not spend them. To remedy 
     this problem, Section 504 of the conference report 
     specifically authorizes an additional $20 million for this 
     program. Section 504 is identical to section 504 of the House 
     bill. The Senate bill did not contain a similar provision.

     SEC. 505. MILITARY DEPARTMENT CIVILIAN INTELLIGENCE PERSONNEL 
                   MANAGEMENT SYSTEM.

       Section 505 of the conference report authorizes the 
     Secretary of Defense to send civilian employees in the 
     Military Departments' Civilian Intelligence Personnel 
     Management System (CIPMS) to be students at accredited 
     professional, technical, and other institutions of higher 
     learning for training at the undergraduate level. This 
     authority would be similar to that already granted to the 
     Defense Intelligence Agency (DIA) in 10 U.S.C. section 1608 
     (Public Law 101-93, title V, section 507(a)(1), Nov 30, 1989, 
     103 Stat. 1710) and the National Security Agency (NSA) in 50 
     U.S.C. 402 note. The purpose of the new section is to 
     establish an undergraduate training program, including 
     training which may lead to the baccalaureate degree, to 
     facilitate the recruitment of individuals, particularly 
     minority, women, and handicapped high school students with a 
     demonstrated capability to develop skills critical to the 
     intelligence missions of the Military Departments in areas 
     such as computer science, engineering, foreign language, and 
     area studies. In exchange for this financial assistance from 
     the respective CIPMS organization, the student participant 
     would undertake an obligation to work for a period of one-
     and-one half year for each year or partial yea of schooling.
       The missions of the intelligence entities of the United 
     States Government demand employees of extraordinary aptitude 
     and strong undergraduate training. These same entities must 
     compete with a private sector--capable of offering more 
     favorable compensation arrangements--that in most instances 
     has been able to outbid the USG in terms of attracting 
     qualified minority candidates. Statistics in recent years 
     indicate that the success of the Military Departments' CIPMS 
     to attract minority group candidates has been marginal.
       This proposal is designed to enhance the capabilities of 
     the intelligence elements of the Military Departments to: (i) 
     ensure equal employment opportunity with their civilian ranks 
     through affirmative action; (ii) develop and retain personnel 
     trained in the skills essential to the effective performance 
     of their intelligence mission; and, (iii) compete on equal 
     footing with other intelligence Community entities for 
     personnel with critical skills. Section 505 is identical to 
     section 503 of the Senate amendment. The House bill did not 
     contain a similar provision.

     SEC. 506. ENHANCEMENT OF CAPABILITIES OF CERTAIN ARMY 
                   FACILITIES.

       Section 506 of the conference report is intended to assist 
     the Department of the Army as it assumes executive agent 
     responsibility for the Bad Aibling, Germany and Menwith Hill, 
     England stations. Specifically, this provision would permit 
     the Department of the Army to use up to $2 million of 
     appropriated operations and maintenance funds to rectify 
     infrastructure and quality of life problems at Menwith Hill 
     and Bad Aibling. At the present time, the Army is prohibited 
     by statute from using appropriated funds to support certain 
     activities. Section 506 was added to the Senate amendment in 
     floor action. The House bill did not include a similar 
     provision.

               Title VI--Federal Bureau of Investigation

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

       Section 601 of the conference report would amend the Fair 
     Credit Reporting Act (FCRA) (15 U.S.C. 1681f) to grant the 
     Federal Bureau of Investigation (FBI) access to certain 
     information in consumer credit records in counterintelligence 
     investigations.
       A similar provision was included in the Intelligence 
     Authorization Act for FY 1995 as reported by the Senate 
     Select Committee on Intelligence. The provision was dropped 
     in conference at the request of the House Committee on 
     Banking, Finance, and Urban Affairs upon assurances that it 
     would pursue similar legislation. The U.S. House of 
     Representatives ultimately adopted H.R. 5143 which was 
     substantially the same as section 601 of this Act. The bill 
     was never acted upon by the Senate during the last Congress. 
     The conferees have recently received a letter from the 
     Chairman of the House Committee on Banking and Financial 
     Services in support of this provision. The language of that 
     letter is as follows:

         House of Representatives, Committee on Banking and 
           Financial Services,
                                 Washington, DC, October 11, 1995.
     Hon. Newt Gingrich,
     Speaker, House of Representatives,
     Washington, DC.
       Dear Mr. Speaker: I am writing concerning H.R. 1655, the 
     ``Intelligence Authorization Act for Fiscal Year 1996'' on 
     which the House will soon appoint conferees to reconcile 
     differences with the Senate. Section 601 of H.R. 1655, as 
     added by the Senate amends the Fair Credit Reporting Act 
     (FCRA) and thereby falls under the jurisdiction of the 
     Committee on Banking and Financial Services, as provided for 
     under Rule X of the Rules of the House of Representatives.
       Section 601 of the Senate reported bill amends the FCRA to 
     allow the FBI greater access to consumer reports when 
     investigating foreign terrorism. The FCRA imposes certain 
     obligations and liabilities on consumer reporting agencies in 
     assembling, evaluating and maintaining consumer credit 
     reports. Section 601 amends the FCRA to grant authority to 
     the FBI to obtain certain information from a consumer report 
     on a suspected terrorist without a court order.
       The section is carefully crafted to protect consumers' 
     rights to privacy while allowing law enforcement agencies to 
     obtain necessary information in order to conduct authorized 
     foreign counterintelligence investigations. This issue was 
     considered by the Banking Committee in the last several 
     Congresses and a provision similar to section 601 was passed 
     by the full House in the 103rd Congress. In addition, Banking 
     Committee conferees were appointed by the House to the 
     Intelligence Authorization conference (H.R. 4299) last 
     Congress on this issue. Given past precedent of the House and 
     the fact that the language of this section was developed in 
     consultation with the House Banking Committee.
       I would strongly urge the House conferees to recede to the 
     Senate on Section 601 or to consult with the Banking 
     Committee in the event of any substantive modifications.
           Sincerely,
                                                   James A. Leach,
                                                         Chairman.

       This provision would provide a limited expansion of the 
     FBI's authority in counterintelligence investigations 
     (including terrorism investigations), to obtain a consumer 
     credit report with a court order. In addition, it would allow 
     the FBI to use a ``National Security Letter,'' i.e. a written 
     certification by the FBI Director or the Director's designee, 
     to obtain from a consumer credit agency the names and 
     addresses of all financial institutions at which a consumer 
     maintains an account, as well as certain identifying 
     information.
       Under current law, when appropriate legal standards are 
     met, FBI is able to obtain mandatory access to credit records 
     by means of a court order or grand jury subpoena (see the 
     FCRA, 15 U.S.C. 168b(1)), but such an option is available to 
     the FBI only after a counterintelligence investigation has 
     been converted to a criminal investigation or proceeding. 
     Many counterintelligence investigations never reach the 
     criminal stage but proceed for intelligence purposes or are 
     handled in diplomatic channels.
       In addition, FBI presently has authority to use the 
     National Security Letter mechanism to obtain two types of 
     records; financial institution records (under the Right to 
     Financial Privacy Act, 12 U.S.C. 3414(a)(5)) and telephone 
     subscriber and toll billing information (under the Electronic 
     Communications Privacy Act, 18 U.S.C. 2709). Expansion of 
     this extraordinary authority is not taken lightly by the 
     conferees, but the conferees have concluded that in this 
     instance the need is genuine, the threshold for use is 
     sufficiently rigorous, and, given the safeguards built in to 
     the legislation, the threat to privacy is minimized.
       Under a provision of the Right to Financial Privacy Act 
     (RFPA) (12 U.S.C. 3414(a)(5)), the FBI is entitled to obtain 
     financial records from financial institutions, such as banks 
     and credit card companies, by means of a National Security 
     Letter when the Director or the Director's designee certifies 
     in writing to the financial institution that such records are 
     sought for foreign counterintelligence purposes and that 
     there are specific and articulable facts giving reason to 
     believe that the customer or entity whose records are sought 
     is a foreign power or an agent of a foreign power, as those 
     terms are defined in section 101 of the Foreign Intelligence 
     Surveillance Act of 1978 (50 U.S.C. 1801 et seq.).
       The FBI considers such access to financial records crucial 
     to trace the activities of suspected spies or terrorists. The 
     need to follow financial dealings in counterintelligence 
     investigations has grown as foreign intelligence service 
     increasingly operate under non-official over, i.e., pose as 
     business entities or executives, and as foreign intelligence 
     service activity has focused increasingly on U.S. economic 
     information.
       FBI's right of access under the Right of Financial Privacy 
     Act cannot be effectively used, however, until the FBI 
     discovers which financial institutions are being utilized by 

[[Page H15234]]
     the subject of a counterintelligence investigation. Consumer reports 
     maintained by credit bureaus are a ready source of such 
     information, but, although such report are readily available 
     to the private sector, they are not available to FBI 
     counterintelligence investigators. Under section 608 of the 
     Fair Credit Reporting Act, without a court order, FBI 
     counterintelligence officials, like other government 
     agencies, are entitled to obtain only limited information 
     from credit reporting agencies--the name, address, former 
     addresses, places of employment, and former places of 
     employment, of a person--and this information can be obtained 
     only with the consent of the credit bureau.
       FBI has made a specific showing to the conferees that the 
     effort to identify financial institutions in order to make 
     use of FBI authority under the Right to Financial Privacy Act 
     can not only be time-consuming and resource-intensive, but 
     can also require the use of investigative techniques--such as 
     physical and electronic surveillance, review of mail covers, 
     and canvassing of all banks in an area--that would appear to 
     be more intrusive than the review of credit reports. FBI has 
     offered a number of specific examples in which lengthy, 
     intensive and intrusive surveillance activity was required to 
     identify financial institutions doing business with a 
     suspected spy or terrorist.
       Section 601 of the instant legislation would amend FCRA by 
     adding a new section 624, consisting of 13 paragraphs.
       Paragraph 624(a) of the amended FCRA requires a consumer 
     reporting agency to furnish to the FBI the names and 
     addresses of all financial institutions at which a consumer 
     maintains or has maintained an account, to the extent the 
     agency has that information, when presented with a written 
     request signed by the FBI Director or the Director's 
     designee, which certifies compliance with the subsection. The 
     FBI Director or the Director's designee may make such 
     certification only if the Director or the Director's designee 
     has determined in writing that such records are necessary for 
     the conduct of an authorized foreign counterintelligence 
     investigation and that there are specific and articulable 
     facts giving reason to believe that the person whose consumer 
     report is sought is a foreign power, a non-U.S. official of a 
     foreign power, or an agent of a foreign power (as defined in 
     Section 101 of the Foreign Intelligence Surveillance Act of 
     1978 (50 U.S.C. 1801 et seq.)) and is engaged in terrorism or 
     other criminal clandestine intelligence activities.
       The requirement that there be specific and articulable 
     facts giving reasons to believe that a U.S. person is an 
     agent of a foreign power before FBI can obtain access to a 
     consumer report is consistent with the standards in the Right 
     to Financial Privacy Act, U.S.C. 3414(a)(5)(A), and the 
     Electronic Communications Privacy Act, 18 U.S.C. 2709(b).
       However, in contrast to those statutes, the conferees have 
     drafted the FCRA certification requirement to provide that 
     the FBI demand submitted to the consumer reporting agency 
     make reference to the statutory provision without providing 
     the agency with a written certification that the subject of 
     the consumer report is believed to be an agent of a foreign 
     power. FBI would still be required to record in writing its 
     determination regarding the subject, and the credit reporting 
     agency would be able to draw the necessary conclusion, but 
     the conferees believe that this approach would reduce the 
     risk of harm from the certification process itself to the 
     person under investigation. A similar approach is taken in 
     paragraph 624(b), described below.
       Section 605 of the FCRA, 15 U.S.C. 1681c, defines 
     ``consumer report'' in a manner that prohibits the 
     dissemination by credit reporting agencies of certain older 
     information except in limited circumstances. None of these 
     excepted circumstances would apply to FBI access under 
     proposed FCRA paragraph 624(a) (or proposed FCRA paragraph 
     624(b)). Accordingly, FBI access would be limited to 
     ``consumer reports'' as defined in section 605.
       The term ``an authorized foreign counterintelligence 
     investigation'' includes those FBI investigations conducted 
     for the purpose of countering international terrorist 
     activities as well as those FBI investigations conducted for 
     the purpose of countering the intelligence activities of 
     foreign powers. Both types of investigations are conducted 
     under the auspices of the FBI's Intelligence Division, headed 
     by an FBI Assistant Director.
       As is the case with the FBI's existing National Security 
     Letter authority under the Right to Financial Privacy Act 
     (see Senate Report 99-307, May 21, 1986, p. 16; House Report 
     99-952, October 1. 1986, p. 23), the conferees expect that, 
     if the Director of the FBI delegates this function under 
     paragraph 624(a), as well as under paragraph 624(b) discussed 
     below, the Director will delegate it no further than the 
     level of FBI Deputy Assistant Director. (There are presently 
     two Deputy Assistant Directors for the National Security 
     Division, one with primary responsibility for 
     counterintelligence investigations and the other with primary 
     responsibility for international terrorism investigations.)
       Paragraph 624(b) would give the FBI mandatory access to the 
     consumer identifying information--name address, former 
     addresses, places of employment, or former places of 
     employment--that it may obtain under current section 608 only 
     with the consent of the credit reporting agency. A consumer 
     reporting agency would be required signed by the FBI Director 
     or the Director's designee, which certifies compliance with 
     the 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 such 
     information is necessary to the conduct of an authorized 
     foreign counterintelligence investigation and that there is 
     information giving reason to believe that the person about 
     whom the information is sought 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 (50 U.S.C. 1801 et. seq.).
       FBI officials have indicated that they seek mandatory 
     access to this identifying information in order to determine 
     if a person who has been in contact with a foreign power or 
     agent is a government or industry employee who might have 
     access to sensitive information of interest to a foreign 
     intelligence service. Accordingly, the conferees have drafted 
     this provision to require that such limited information can 
     be provided only in circumstances where the consumer has been 
     or is about to be in contact with the foreign power or agent.
       The conferees have also drafted paragraphs 624(a) and 
     624(b) in a manner intended to make clear the conferees' 
     intent that the FBI may use this authority to obtain this 
     information only as regard those persons who either are a 
     foreign power or agent there of or have been or will be in 
     contact with a foreign power or agent. Although the consumer 
     records of another person, such as a relative or friend of an 
     agent of a foreign power, or identifying information 
     respecting a relative or friend of a person in contact with 
     an agent of a foreign power, may be of interest to FBI 
     counterintelligence investigators, they are not subject to 
     access under paragraphs 624(a) and 624(b).
       It is not the intent of the conferees to require any credit 
     reporting agency to gather credit or identifying information 
     on a person for the purpose of fulfilling an FBI request 
     under paragraphs 624(a) and 624(b). A credit reporting 
     agency's obligation under these provision is to provide 
     information responsive to the FBI's request that the credit 
     reporting agency already has in its possession.
       Paragraph 624(c) provides that, if requested in writing by 
     the FBI, a court may issue an order ex parte directing a 
     consumer reporting agency to furnish a consumer report to the 
     FBI upon a showing in camera that the report is necessary for 
     the conduct of an authorized foreign counterintelligence 
     investigation and that there are specific and articulable 
     facts giving reason to believe the consumer is an agent of a 
     foreign power and is engaged in international terrorism or 
     clandestine intelligence activities that may involve a crime.
       Paragraph 624(d) provides that no consumer reporting agency 
     or officer, employee, or agent of such institution shall 
     disclose to any person, other than those officers, employees 
     or agents of such institution necessary to fulfill the 
     requirement to disclose information to the FBI under 
     subsection 624, that the FBI has sought or obtained a 
     consumer report or financial institution, or identifying 
     information respecting any consumer under paragraphs 624, nor 
     shall such agency, officer, employee, or agent include in any 
     consumer report any information that would indicate that the 
     FBI has sought or obtained such information. The prohibition 
     against including such information in a consumer report is 
     intended to clarify the obligations of the consumer reporting 
     agencies. It is not intended to preclude employees of 
     consumer reporting agencies from complying with company 
     regulations or policies concerning the reporting of 
     information, nor to preclude their complying with a subpoena 
     for such information issued pursuant to appropriate legal 
     authority.
       Paragraph 624(d) departs from the parallel provision of the 
     RFPA by clarifying that disclosure is permitted within the 
     contacted institution to the extent necessary to fulfill the 
     FBI request. The conferees have not concluded that, or 
     otherwise taken a position whether, disclosure for such 
     purpose would be forbidden by the RFPA; indeed, 
     practicalities would dictate that the provision not be 
     interpreted to exclude such disclosure. However, the 
     conferees believe that clarification of the obligation for 
     purposes of the FCRA is desirable.
       Paragraph 624(e) requires the FBI, subject to the 
     availability of appropriations, to pay to the consumer 
     reporting agency assembling or providing credit records a fee 
     in accordance with FCRA procedures for reimbursement for 
     costs reasonably necessary and which have been directly 
     incurred in searching for, reproducing, or transporting 
     books, papers, records, or other data required or requested 
     to be produced under section 624. The FBI informs the 
     Committee that such reports are commercially available for 
     approximately $7 to $25 and that FBI could expect to pay fees 
     in approximately that range. FBI officials have advised the 
     conferees that the costs of such reports would be easily 
     recouped from the savings afforded by the reduced need for 
     other investigative techniques aimed at obtaining the same 
     information.
       Paragraph 624(f) prohibits the FBI from disseminating 
     information obtained pursuant to section 624 outside the FBI, 
     except as may be necessary for the approval of conduct of a 
     foreign counterintelligence investigation, or, where the 
     information concerns military service personnel subject to 
     the Uniform Code of Military Justice, to appropriate 
     investigation authorities in the military department 
     concerned as may be necessary for the conduct of a joint 
     foreign 

[[Page H15235]]
     counterintelligence investigation with the FBI. Since the military 
     departments have concurrent jurisdiction to investigate and 
     prosecute military personnel subject to the Uniform Code of 
     Military Justice, paragraph 624(g) permits the FBI to 
     disseminate consumer credit reports it obtains pursuant to 
     this section to appropriate military investigative 
     authorities where a foreign counterintelligence investigation 
     involves a military service person and is being conducted 
     jointly with the FBI.
       Paragraph 624(g) provides that nothing in section 624 shall 
     be construed to prohibit information from being furnished by 
     the FBI pursuant to subpoena or court order, or in connection 
     with judicial or administrative proceeding to enforce the 
     provisions of the FCRA. The paragraph further provides that 
     nothing in section 624 shall be construed to authorize or 
     permit the withholding of information from the Congress.
       Paragraph 634(h) provides that 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 U.S. House of 
     Representatives, and the Select Committee on Intelligence and 
     the Committee on Banking, Housing, and Urban Affairs of the 
     U.S. Senate concerning all requests made pursuant to section 
     624.
       Semiannual reports are required to be submitted to the 
     intelligence committees on (1) use of FBI's mandatory access 
     provision of the RFPA by section 3414(a)(5)(C) of title 15, 
     United States Code; and (2) use of the FBI's 
     counterintelligence authority, under the Electronic Privacy 
     Communications Act of 1986, to access telephone subscriber 
     and toll billing information by section 2709(e) of title 18, 
     United States Code. The conferees expect the reports required 
     by FCRA paragraph 624(h) to match the level of detail 
     included in these reports, i.e., a breakdown by quarter, by 
     number of requests, by number or persons or organizations 
     subject to requests, and by U.S. persons and organizations 
     and non-U.S. persons and organizations.
       Paragraphs 624(i) through 624(m) parallel the enforcement 
     provisions of the Right to Financial Privacy Act, 12 U.S.C. 
     3417 and 3418.
       Paragraph 624(i) establishes civil penalties for access or 
     disclosure by an agency or department of the United States in 
     violation of section 624. Damages, costs and attorney fees 
     would be awarded to the person to whom the consumer reports 
     related in the event of a violation.
       Paragraph 624(j) provides that whenever a court determines 
     that any agency or department of the United States has 
     violated any provision of section 624 and that the 
     circumstances surrounding the violation raise questions of 
     whether 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 disciplinary action is 
     warranted against the officer or employee who was responsible 
     for the violation.
       Paragraph 624(k) provides that any credit reporting 
     institution or agent or employee thereof making a disclosure 
     of credit records pursuant to section 624 in good-faith 
     reliance upon a certificate by the FBI pursuant to the 
     provisions of section 624 shall not be liable to any person 
     for such disclosure under title 15, the constitution of any 
     State, or any law or regulation of any State or any political 
     subdivision of any State.
       Paragraph 624(l) provides that the remedies and sanctions 
     set forth in section 624 shall be the only judicial remedies 
     and sanctions for violations of the section.
       Paragraph 624(m) provides that in addition to any other 
     remedy contained in section 624, injunctive relief shall be 
     available to require that the procedures of the section are 
     compiled with and that in the event of any successful action, 
     costs together with reasonable attorney's fees, as determined 
     by the court, may be recovered.
       Section 601 is identical to section 601 of the Senate 
     amendment. The House bill did not contain a similar 
     provision.

                    Title VII--Technical Amendments

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

       Section 701 of the conference report amends section 
     102(c)(3)(C) of the National Security Act of 1947 to make 
     clear that a retired military officer appointed as Director 
     or Deputy Director of Central Intelligence can receive 
     compensation at the appropriate level of the Executive 
     Schedule under 5 U.S.C. Sec. 5313 (Director) or 5 U.S.C. 
     Sec. 5314 (Deputy Director). This was clearly the intent of 
     the drafters of this provision. The conferees are aware of 
     the restriction on compensation that applies to active duty 
     military personnel appointed as DCI or DDCI, and in no way 
     wish to change this restriction. Section 701 is similar to 
     Section 601 in the House bill and Section 701 in the Senate 
     amendment.

     SEC. 702. CHANGE OF DESIGNATION OF CIA OFFICE OF SECURITY.

       Section 702 of the conference report amends the CIA 
     Information Act of 1984 to reflect the recent reorganization 
     of the CIA Office of Security into the Office of Personnel 
     Security and the Office of Security Operations. The amendment 
     will ensure that the Office of Personnel Security, where the 
     records intended to be subject to the Act are kept, will 
     continue to receive the benefit of the Act's exception from 
     search and review under the Freedom of Information Act. 
     Section 701 is similar to Section 602 in the House bill and 
     Section 702 in the Senate amendment.


            Provisions Not Included in the Conference Report

       The Senate amendment included, at Section 404, a 
     requirement for an annual report on liaison relationships. 
     While the Conferees are committed to ensuring that the 
     oversight committees are appropriately informed on liaison 
     relationships, they do not believe that a statutory reporting 
     requirement is the best way to achieve that result. 
     Consequently, the conferees agreed to delete section 404.

     From the Permanent Select Committee on Intelligence, for 
     consideration of the House bill, and the Senate amendment, 
     and modifications committed to conference:
     Larry Combest,
     R. K. Dornan,
     Bill Young,
     James V. Hansen,
     Jerry Lewis,
     Porter J. Goss,
     Bud Shuster,
     Bill McCollum,
     Michael N. Castle,
     Norman Dicks,
     Bill Richardson,
     Julian C. Dixon,
     Robert G. Torricelli,
     Ron Coleman,
     David E. Skaggs,
     Nancy Pelosi,

     As additional conferees from the Committee on National 
     Security, for consideration of defense tactical intelligence 
     and related activities:
     Floyd Spence,
     Bob Stump,

     As additional conferees from the Committee on International 
     Relations, for consideration of section 303 of the House 
     bill, and section 303 of the Senate amendment, and 
     modifications committed to conference:
     Benjamin A. Gilman,
     Christopher Smith,
     Howard L. Berman,
                                Managers on the Part of the House.

     Arlen Specter,
     Richard G. Lugar,
     Richard Shelby,
     Mike DeWine,
     Jon Kyl,
     Jim Inhofe,
     Kay Bailey Hutchison,
     Connie Mack,
     Bill Cohen,
     Strom Thurmond,
     Robert Kerrey,
     John Glenn,
     Richard H. Bryan,
     Bob Graham,
     John F. Kerry,
     Max Baucus,
     J. Bennett Johnston,
     Charles Robb,
     Sam Nunn,
                               Managers on the Part of the Senate.