[Congressional Record Volume 167, Number 200 (Wednesday, November 17, 2021)]
[Senate]
[Pages S8367-S8379]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
SA 4764. Mr. MENENDEZ (for himself and Mr. Risch) submitted an
amendment intended to be proposed to amendment SA 3867 submitted by Mr.
Reed and intended to be proposed to the bill H.R. 4350, to authorize
appropriations for fiscal year 2022 for military activities of the
Department of Defense, for military construction, and for defense
activities of the Department of Energy, to prescribe military personnel
strengths for such fiscal year, and for other purposes; which was
ordered to lie on the table; as follows:
At the end, add the following:
DIVISION E--FEDERAL INFORMATION SECURITY MODERNIZATION ACT OF 2021
SEC. 5101. SHORT TITLE.
This division may be cited as the ``Federal Information
Security Modernization Act of 2021''.
SEC. 5102. DEFINITIONS.
In this division, unless otherwise specified:
(1) Additional cybersecurity procedure.--The term
``additional cybersecurity procedure'' has the meaning given
the term in section 3552(b) of title 44, United States Code,
as amended by this division.
(2) Agency.--The term ``agency'' has the meaning given the
term in section 3502 of title 44, United States Code.
(3) Appropriate congressional committees.--The term
``appropriate congressional committees'' means--
(A) the Committee on Homeland Security and Governmental
Affairs of the Senate;
(B) the Committee on Oversight and Reform of the House of
Representatives; and
(C) the Committee on Homeland Security of the House of
Representatives.
(4) Director.--The term ``Director'' means the Director of
the Office of Management and Budget.
(5) Incident.--The term ``incident'' has the meaning given
the term in section 3552(b) of title 44, United States Code.
(6) National security system.--The term ``national security
system'' has the meaning given the term in section 3552(b) of
title 44, United States Code.
(7) Penetration test.--The term ``penetration test'' has
the meaning given the term in section 3552(b) of title 44,
United States Code, as amended by this division.
(8) Threat hunting.--The term ``threat hunting'' means
proactively and iteratively searching for threats to systems
that evade detection by automated threat detection systems.
TITLE LI--UPDATES TO FISMA
SEC. 5121. TITLE 44 AMENDMENTS.
(a) Subchapter I Amendments.--Subchapter I of chapter 35 of
title 44, United States Code, is amended--
(1) in section 3504--
(A) in subsection (a)(1)(B)--
(i) by striking clause (v) and inserting the following:
``(v) confidentiality, privacy, disclosure, and sharing of
information;'';
(ii) by redesignating clause (vi) as clause (vii); and
(iii) by inserting after clause (v) the following:
``(vi) in consultation with the National Cyber Director and
the Director of the Cybersecurity and Infrastructure Security
Agency, security of information; and''; and
(B) in subsection (g), by striking paragraph (1) and
inserting the following:
``(1) develop, and in consultation with the Director of the
Cybersecurity and Infrastructure Security Agency and the
National Cyber Director, oversee the implementation of
policies, principles, standards, and guidelines on privacy,
confidentiality, security, disclosure and sharing of
information collected or maintained by or for agencies;
and'';
(2) in section 3505--
(A) in paragraph (3) of the first subsection designated as
subsection (c)--
(i) in subparagraph (B)--
(I) by inserting ``the Director of the Cybersecurity and
Infrastructure Security Agency, the National Cyber Director,
and'' before ``the Comptroller General''; and
(II) by striking ``and'' at the end;
(ii) in subparagraph (C)(v), by striking the period at the
end and inserting ``; and''; and
(iii) by adding at the end the following:
``(D) maintained on a continual basis through the use of
automation, machine-readable data, and scanning.''; and
(B) by striking the second subsection designated as
subsection (c);
(3) in section 3506--
(A) in subsection (b)(1)(C), by inserting ``,
availability'' after ``integrity''; and
(B) in subsection (h)(3), by inserting ``security,'' after
``efficiency,''; and
(4) in section 3513--
(A) by redesignating subsection (c) as subsection (d); and
(B) by inserting after subsection (b) the following:
``(c) Each agency providing a written plan under subsection
(b) shall provide any portion of the written plan addressing
information security or cybersecurity to the Director of the
Cybersecurity and Infrastructure Security Agency.''.
(b) Subchapter II Definitions.--
(1) In general.--Section 3552(b) of title 44, United States
Code, is amended--
(A) by redesignating paragraphs (1), (2), (3), (4), (5),
(6), and (7) as paragraphs (2), (3), (4), (5), (6), (9), and
(11), respectively;
(B) by inserting before paragraph (2), as so redesignated,
the following:
``(1) The term `additional cybersecurity procedure' means a
process, procedure, or other activity that is established in
excess of the information security standards promulgated
under section 11331(b) of title 40 to increase the security
and reduce the cybersecurity risk of agency systems.'';
(C) by inserting after paragraph (6), as so redesignated,
the following:
``(7) The term `high value asset' means information or an
information system that the head of an agency determines so
critical to the agency that the loss or corruption of the
information or the loss of access to the information system
would have a serious impact on the ability of the agency to
perform the mission of the agency or conduct business.
``(8) The term `major incident' has the meaning given the
term in guidance issued by the Director under section
3598(a).'';
(D) by inserting after paragraph (9), as so redesignated,
the following:
``(10) The term `penetration test' means a specialized type
of assessment that--
``(A) is conducted on an information system or a component
of an information system; and
``(B) emulates an attack or other exploitation capability
of a potential adversary, typically under specific
constraints, in order to identify any vulnerabilities of an
information system or a component of an information system
that could be exploited.''; and
(E) by inserting after paragraph (11), as so redesignated,
the following:
``(12) The term `shared service' means a centralized
business or mission capability that is provided to multiple
organizations within an agency or to multiple agencies.''.
(2) Conforming amendments.--
(A) Homeland security act of 2002.--Section 1001(c)(1)(A)
of the Homeland Security Act of 2002 (6 U.S.C. 511(1)(A)) is
amended by striking ``section 3552(b)(5)'' and inserting
``section 3552(b)''.
(B) Title 10.--
(i) Section 2222.--Section 2222(i)(8) of title 10, United
States Code, is amended by striking ``section 3552(b)(6)(A)''
and inserting ``section 3552(b)(9)(A)''.
(ii) Section 2223.--Section 2223(c)(3) of title 10, United
States Code, is amended by striking ``section 3552(b)(6)''
and inserting ``section 3552(b)''.
(iii) Section 2315.--Section 2315 of title 10, United
States Code, is amended by striking ``section 3552(b)(6)''
and inserting ``section 3552(b)''.
(iv) Section 2339a.--Section 2339a(e)(5) of title 10,
United States Code, is amended by striking ``section
3552(b)(6)'' and inserting ``section 3552(b)''.
(C) High-performance computing act of 1991.--Section 207(a)
of the High-Performance Computing Act of 1991 (15 U.S.C.
5527(a)) is amended by striking ``section 3552(b)(6)(A)(i)''
and inserting ``section 3552(b)(9)(A)(i)''.
(D) Internet of things cybersecurity improvement act of
2020.--Section 3(5) of the Internet of Things Cybersecurity
Improvement Act of 2020 (15 U.S.C. 278g-3a) is amended by
striking ``section 3552(b)(6)'' and inserting ``section
3552(b)''.
(E) National defense authorization act for fiscal year
2013.--Section 933(e)(1)(B) of the National Defense
Authorization Act for Fiscal Year 2013 (10 U.S.C. 2224 note)
is amended by striking ``section 3542(b)(2)'' and inserting
``section 3552(b)''.
(F) Ike skelton national defense authorization act for
fiscal year 2011.--The Ike Skelton National Defense
Authorization Act
[[Page S8368]]
for Fiscal Year 2011 (Public Law 111-383) is amended--
(i) in section 806(e)(5) (10 U.S.C. 2304 note), by striking
``section 3542(b)'' and inserting ``section 3552(b)'';
(ii) in section 931(b)(3) (10 U.S.C. 2223 note), by
striking ``section 3542(b)(2)'' and inserting ``section
3552(b)''; and
(iii) in section 932(b)(2) (10 U.S.C. 2224 note), by
striking ``section 3542(b)(2)'' and inserting ``section
3552(b)''.
(G) E-government act of 2002.--Section 301(c)(1)(A) of the
E-Government Act of 2002 (44 U.S.C. 3501 note) is amended by
striking ``section 3542(b)(2)'' and inserting ``section
3552(b)''.
(H) National institute of standards and technology act.--
Section 20 of the National Institute of Standards and
Technology Act (15 U.S.C. 278g-3) is amended--
(i) in subsection (a)(2), by striking ``section
3552(b)(5)'' and inserting ``section 3552(b)''; and
(ii) in subsection (f)--
(I) in paragraph (3), by striking ``section 3532(1)'' and
inserting ``section 3552(b)''; and
(II) in paragraph (5), by striking ``section 3532(b)(2)''
and inserting ``section 3552(b)''.
(c) Subchapter II Amendments.--Subchapter II of chapter 35
of title 44, United States Code, is amended--
(1) in section 3551--
(A) in paragraph (4), by striking ``diagnose and improve''
and inserting ``integrate, deliver, diagnose, and improve'';
(B) in paragraph (5), by striking ``and'' at the end;
(C) in paragraph (6), by striking the period at the end and
inserting a semi colon; and
(D) by adding at the end the following:
``(7) recognize that each agency has specific mission
requirements and, at times, unique cybersecurity requirements
to meet the mission of the agency;
``(8) recognize that each agency does not have the same
resources to secure agency systems, and an agency should not
be expected to have the capability to secure the systems of
the agency from advanced adversaries alone; and
``(9) recognize that a holistic Federal cybersecurity model
is necessary to account for differences between the missions
and capabilities of agencies.'';
(2) in section 3553--
(A) by striking the section heading and inserting
``Authority and functions of the Director and the Director of
the Cybersecurity and Infrastructure Security Agency''.
(B) in subsection (a)--
(i) in paragraph (1), by inserting ``, in consultation with
the Director of the Cybersecurity and Infrastructure Security
Agency and the National Cyber Director,'' before
``overseeing'';
(ii) in paragraph (5), by striking ``and'' at the end; and
(iii) by adding at the end the following:
``(8) promoting, in consultation with the Director of the
Cybersecurity and Infrastructure Security Agency and the
Director of the National Institute of Standards and
Technology--
``(A) the use of automation to improve Federal
cybersecurity and visibility with respect to the
implementation of Federal cybersecurity; and
``(B) the use of presumption of compromise and least
privilege principles to improve resiliency and timely
response actions to incidents on Federal systems.'';
(C) in subsection (b)--
(i) by striking the subsection heading and inserting
``Cybersecurity and Infrastructure Security Agency'';
(ii) in the matter preceding paragraph (1), by striking
``The Secretary, in consultation with the Director'' and
inserting ``The Director of the Cybersecurity and
Infrastructure Security Agency, in consultation with the
Director and the National Cyber Director'';
(iii) in paragraph (2)--
(I) in subparagraph (A), by inserting ``and reporting
requirements under subchapter IV of this title'' after
``section 3556''; and
(II) in subparagraph (D), by striking ``the Director or
Secretary'' and inserting ``the Director of the Cybersecurity
and Infrastructure Security Agency'';
(iv) in paragraph (5), by striking ``coordinating'' and
inserting ``leading the coordination of'';
(v) in paragraph (8), by striking ``the Secretary's
discretion'' and inserting ``the Director of the
Cybersecurity and Infrastructure Security Agency's
discretion''; and
(vi) in paragraph (9), by striking ``as the Director or the
Secretary, in consultation with the Director,'' and inserting
``as the Director of the Cybersecurity and Infrastructure
Security Agency'';
(D) in subsection (c)--
(i) in the matter preceding paragraph (1), by striking
``each year'' and inserting ``each year during which agencies
are required to submit reports under section 3554(c)'';
(ii) by striking paragraph (1);
(iii) by redesignating paragraphs (2), (3), and (4) as
paragraphs (1), (2), and (3), respectively;
(iv) in paragraph (3), as so redesignated, by striking
``and'' at the end;
(v) by inserting after paragraph (3), as so redesignated
the following:
``(4) a summary of each assessment of Federal risk posture
performed under subsection (i);''; and
(vi) in paragraph (5), by striking the period at the end
and inserting ``; and'';
(E) by redesignating subsections (i), (j), (k), and (l) as
subsections (j), (k), (l), and (m) respectively;
(F) by inserting after subsection (h) the following:
``(i) Federal Risk Assessments.--On an ongoing and
continuous basis, the Director of the Cybersecurity and
Infrastructure Security Agency shall perform assessments of
Federal risk posture using any available information on the
cybersecurity posture of agencies, and brief the Director and
National Cyber Director on the findings of those assessments
including--
``(1) the status of agency cybersecurity remedial actions
described in section 3554(b)(7);
``(2) any vulnerability information relating to the systems
of an agency that is known by the agency;
``(3) analysis of incident information under section 3597;
``(4) evaluation of penetration testing performed under
section 3559A;
``(5) evaluation of vulnerability disclosure program
information under section 3559B;
``(6) evaluation of agency threat hunting results;
``(7) evaluation of Federal and non-Federal cyber threat
intelligence;
``(8) data on agency compliance with standards issued under
section 11331 of title 40;
``(9) agency system risk assessments performed under
section 3554(a)(1)(A); and
``(10) any other information the Director of the
Cybersecurity and Infrastructure Security Agency determines
relevant.''; and
(G) in subsection (j), as so redesignated--
(i) by striking ``regarding the specific'' and inserting
``that includes a summary of--
``(1) the specific'';
(ii) in paragraph (1), as so designated, by striking the
period at the end and inserting ``; and'' and
(iii) by adding at the end the following:
``(2) the trends identified in the Federal risk assessment
performed under subsection (i).''; and
(H) by adding at the end the following:
``(n) Binding Operational Directives.--If the Director of
the Cybersecurity and Infrastructure Security Agency issues a
binding operational directive or an emergency directive under
this section, not later than 2 days after the date on which
the binding operational directive requires an agency to take
an action, the Director of the Cybersecurity and
Infrastructure Security Agency shall provide to the
appropriate reporting entities the status of the
implementation of the binding operational directive at the
agency.'';
(3) in section 3554--
(A) in subsection (a)--
(i) in paragraph (1)--
(I) by redesignating subparagraphs (A), (B), and (C) as
subparagraphs (B), (C), and (D), respectively;
(II) by inserting before subparagraph (B), as so
redesignated, the following:
``(A) on an ongoing and continuous basis, performing agency
system risk assessments that--
``(i) identify and document the high value assets of the
agency using guidance from the Director;
``(ii) evaluate the data assets inventoried under section
3511 for sensitivity to compromises in confidentiality,
integrity, and availability;
``(iii) identify agency systems that have access to or hold
the data assets inventoried under section 3511;
``(iv) evaluate the threats facing agency systems and data,
including high value assets, based on Federal and non-Federal
cyber threat intelligence products, where available;
``(v) evaluate the vulnerability of agency systems and
data, including high value assets, including by analyzing--
``(I) the results of penetration testing performed by the
Department of Homeland Security under section 3553(b)(9);
``(II) the results of penetration testing performed under
section 3559A;
``(III) information provided to the agency through the
vulnerability disclosure program of the agency under section
3559B;
``(IV) incidents; and
``(V) any other vulnerability information relating to
agency systems that is known to the agency;
``(vi) assess the impacts of potential agency incidents to
agency systems, data, and operations based on the evaluations
described in clauses (ii) and (iv) and the agency systems
identified under clause (iii); and
``(vii) assess the consequences of potential incidents
occurring on agency systems that would impact systems at
other agencies, including due to interconnectivity between
different agency systems or operational reliance on the
operations of the system or data in the system;'';
(III) in subparagraph (B), as so redesignated, in the
matter preceding clause (i), by striking ``providing
information'' and inserting ``using information from the
assessment conducted under subparagraph (A), providing, in
consultation with the Director of the Cybersecurity and
Infrastructure Security Agency, information'';
(IV) in subparagraph (C), as so redesignated--
(aa) in clause (ii) by inserting ``binding'' before
``operational''; and
(bb) in clause (vi), by striking ``and'' at the end; and
(V) by adding at the end the following:
``(E) providing an update on the ongoing and continuous
assessment performed under subparagraph (A)--
``(i) upon request, to the inspector general of the agency
or the Comptroller General of the United States; and
[[Page S8369]]
``(ii) on a periodic basis, as determined by guidance
issued by the Director but not less frequently than annually,
to--
``(I) the Director;
``(II) the Director of the Cybersecurity and Infrastructure
Security Agency; and
``(III) the National Cyber Director;
``(F) in consultation with the Director of the
Cybersecurity and Infrastructure Security Agency and not less
frequently than once every 3 years, performing an evaluation
of whether additional cybersecurity procedures are
appropriate for securing a system of, or under the
supervision of, the agency, which shall--
``(i) be completed considering the agency system risk
assessment performed under subparagraph (A); and
``(ii) include a specific evaluation for high value assets;
``(G) not later than 30 days after completing the
evaluation performed under subparagraph (F), providing the
evaluation and an implementation plan, if applicable, for
using additional cybersecurity procedures determined to be
appropriate to--
``(i) the Director of the Cybersecurity and Infrastructure
Security Agency;
``(ii) the Director; and
``(iii) the National Cyber Director; and
``(H) if the head of the agency determines there is need
for additional cybersecurity procedures, ensuring that those
additional cybersecurity procedures are reflected in the
budget request of the agency in accordance with the risk-
based cyber budget model developed pursuant to section
3553(a)(7);'';
(ii) in paragraph (2)--
(I) in subparagraph (A), by inserting ``in accordance with
the agency system risk assessment performed under paragraph
(1)(A)'' after ``information systems'';
(II) in subparagraph (B)--
(aa) by striking ``in accordance with standards'' and
inserting ``in accordance with--
``(i) standards''; and
(bb) by adding at the end the following:
``(ii) the evaluation performed under paragraph (1)(F); and
``(iii) the implementation plan described in paragraph
(1)(G);''; and
(III) in subparagraph (D), by inserting ``, through the use
of penetration testing, the vulnerability disclosure program
established under section 3559B, and other means,'' after
``periodically'';
(iii) in paragraph (3)--
(I) in subparagraph (A)--
(aa) in clause (iii), by striking ``and'' at the end;
(bb) in clause (iv), by adding ``and'' at the end; and
(cc) by adding at the end the following:
``(v) ensure that--
``(I) senior agency information security officers of
component agencies carry out responsibilities under this
subchapter, as directed by the senior agency information
security officer of the agency or an equivalent official; and
``(II) senior agency information security officers of
component agencies report to--
``(aa) the senior information security officer of the
agency or an equivalent official; and
``(bb) the Chief Information Officer of the component
agency or an equivalent official;''; and
(iv) in paragraph (5), by inserting ``and the Director of
the Cybersecurity and Infrastructure Security Agency'' before
``on the effectiveness'';
(B) in subsection (b)--
(i) by striking paragraph (1) and inserting the following:
``(1) pursuant to subsection (a)(1)(A), performing ongoing
and continuous agency system risk assessments, which may
include using guidelines and automated tools consistent with
standards and guidelines promulgated under section 11331 of
title 40, as applicable;'';
(ii) in paragraph (2)--
(I) by striking subparagraph (B) and inserting the
following:
``(B) comply with the risk-based cyber budget model
developed pursuant to section 3553(a)(7);''; and
(II) in subparagraph (D)--
(aa) by redesignating clauses (iii) and (iv) as clauses
(iv) and (v), respectively;
(bb) by inserting after clause (ii) the following:
``(iii) binding operational directives and emergency
directives promulgated by the Director of the Cybersecurity
and Infrastructure Security Agency under section 3553;''; and
(cc) in clause (iv), as so redesignated, by striking ``as
determined by the agency; and'' and inserting ``as determined
by the agency, considering--
``(I) the agency risk assessment performed under subsection
(a)(1)(A); and
``(II) the determinations of applying more stringent
standards and additional cybersecurity procedures pursuant to
section 11331(c)(1) of title 40; and'';
(iii) in paragraph (5)(A), by inserting ``, including
penetration testing, as appropriate,'' after ``shall include
testing'';
(iv) in paragraph (6), by striking ``planning,
implementing, evaluating, and documenting'' and inserting
``planning and implementing and, in consultation with the
Director of the Cybersecurity and Infrastructure Security
Agency, evaluating and documenting'';
(v) by redesignating paragraphs (7) and (8) as paragraphs
(8) and (9), respectively;
(vi) by inserting after paragraph (6) the following:
``(7) a process for providing the status of every remedial
action and known system vulnerability to the Director and the
Director of the Cybersecurity and Infrastructure Security
Agency, using automation and machine-readable data to the
greatest extent practicable;''; and
(vii) in paragraph (8)(C), as so redesignated--
(I) by striking clause (ii) and inserting the following:
``(ii) notifying and consulting with the Federal
information security incident center established under
section 3556 pursuant to the requirements of section 3594;'';
(II) by redesignating clause (iii) as clause (iv);
(III) by inserting after clause (ii) the following:
``(iii) performing the notifications and other activities
required under subchapter IV of this title; and''; and
(IV) in clause (iv), as so redesignated--
(aa) in subclause (I), by striking ``and relevant offices
of inspectors general'';
(bb) in subclause (II), by adding ``and'' at the end;
(cc) by striking subclause (III); and
(dd) by redesignating subclause (IV) as subclause (III);
(C) in subsection (c)--
(i) by redesignating paragraph (2) as paragraph (5);
(ii) by striking paragraph (1) and inserting the following:
``(1) Biannual report.--Not later than 2 years after the
date of enactment of the Federal Information Security
Modernization Act of 2021 and not less frequently than once
every 2 years thereafter, using the continuous and ongoing
agency system risk assessment under subsection (a)(1)(A), the
head of each agency shall submit to the Director, the
Director of the Cybersecurity and Infrastructure Security
Agency, the majority and minority leaders of the Senate, the
Speaker and minority leader of the House of Representatives,
the Committee on Homeland Security and Governmental Affairs
of the Senate, the Committee on Oversight and Reform of the
House of Representatives, the Committee on Homeland Security
of the House of Representatives, the Committee on Commerce,
Science, and Transportation of the Senate, the Committee on
Science, Space, and Technology of the House of
Representatives, the appropriate authorization and
appropriations committees of Congress, the National Cyber
Director, and the Comptroller General of the United States a
report that--
``(A) summarizes the agency system risk assessment
performed under subsection (a)(1)(A);
``(B) evaluates the adequacy and effectiveness of
information security policies, procedures, and practices of
the agency to address the risks identified in the agency
system risk assessment performed under subsection (a)(1)(A),
including an analysis of the agency's cybersecurity and
incident response capabilities using the metrics established
under section 224(c) of the Cybersecurity Act of 2015 (6
U.S.C. 1522(c));
``(C) summarizes the evaluation and implementation plans
described in subparagraphs (F) and (G) of subsection (a)(1)
and whether those evaluation and implementation plans call
for the use of additional cybersecurity procedures determined
to be appropriate by the agency; and
``(D) summarizes the status of remedial actions identified
by inspector general of the agency, the Comptroller General
of the United States, and any other source determined
appropriate by the head of the agency.
``(2) Unclassified reports.--Each report submitted under
paragraph (1)--
``(A) shall be, to the greatest extent practicable, in an
unclassified and otherwise uncontrolled form; and
``(B) may include a classified annex.
``(3) Access to information.--The head of an agency shall
ensure that, to the greatest extent practicable, information
is included in the unclassified form of the report submitted
by the agency under paragraph (2)(A).
``(4) Briefings.--During each year during which a report is
not required to be submitted under paragraph (1), the
Director shall provide to the congressional committees
described in paragraph (1) a briefing summarizing current
agency and Federal risk postures.''; and
(iii) in paragraph (5), as so redesignated, by inserting
``including the reporting procedures established under
section 11315(d) of title 40 and subsection (a)(3)(A)(v) of
this section''; and
(D) in subsection (d)(1), in the matter preceding
subparagraph (A), by inserting ``and the Director of the
Cybersecurity and Infrastructure Security Agency'' after
``the Director''; and
(4) in section 3555--
(A) in the section heading, by striking ``annual
independent'' and inserting ``independent'';
(B) in subsection (a)--
(i) in paragraph (1), by inserting ``during which a report
is required to be submitted under section 3553(c),'' after
``Each year'';
(ii) in paragraph (2)(A), by inserting ``, including by
penetration testing and analyzing the vulnerability
disclosure program of the agency'' after ``information
systems''; and
(iii) by adding at the end the following:
``(3) An evaluation under this section may include
recommendations for improving the cybersecurity posture of
the agency.'';
(C) in subsection (b)(1), by striking ``annual'';
[[Page S8370]]
(D) in subsection (e)(1), by inserting ``during which a
report is required to be submitted under section 3553(c)''
after ``Each year'';
(E) by striking subsection (f) and inserting the following:
``(f) Protection of Information.--(1) Agencies, evaluators,
and other recipients of information that, if disclosed, may
cause grave harm to the efforts of Federal information
security officers shall take appropriate steps to ensure the
protection of that information, including safeguarding the
information from public disclosure.
``(2) The protections required under paragraph (1) shall be
commensurate with the risk and comply with all applicable
laws and regulations.
``(3) With respect to information that is not related to
national security systems, agencies and evaluators shall make
a summary of the information unclassified and publicly
available, including information that does not identify--
``(A) specific information system incidents; or
``(B) specific information system vulnerabilities.'';
(F) in subsection (g)(2)--
(i) by striking ``this subsection shall'' and inserting
``this subsection--
``(A) shall'';
(ii) in subparagraph (A), as so designated, by striking the
period at the end and inserting ``; and''; and
(iii) by adding at the end the following:
``(B) identify any entity that performs an independent
evaluation under subsection (b).''; and
(G) by striking subsection (j) and inserting the following:
``(j) Guidance.--
``(1) In general.--The Director, in consultation with the
Director of the Cybersecurity and Infrastructure Security
Agency, the Chief Information Officers Council, the Council
of the Inspectors General on Integrity and Efficiency, and
other interested parties as appropriate, shall ensure the
development of guidance for evaluating the effectiveness of
an information security program and practices
``(2) Priorities.--The guidance developed under paragraph
(1) shall prioritize the identification of--
``(A) the most common threat patterns experienced by each
agency;
``(B) the security controls that address the threat
patterns described in subparagraph (A); and
``(C) any other security risks unique to the networks of
each agency.''; and
(5) in section 3556(a)--
(A) in the matter preceding paragraph (1), by inserting
``within the Cybersecurity and Infrastructure Security
Agency'' after ``incident center''; and
(B) in paragraph (4), by striking ``3554(b)'' and inserting
``3554(a)(1)(A)''.
(d) Conforming Amendments.--
(1) Table of sections.--The table of sections for chapter
35 of title 44, United States Code, is amended--
(A) by striking the item relating to section 3553 and
inserting the following:
``3553. Authority and functions of the Director and the Director of the
Cybersecurity and Infrastructure Security Agency.''; and
(B) by striking the item relating to section 3555 and
inserting the following:
``3555. Independent evaluation.''.
(2) OMB reports.--Section 226(c) of the Cybersecurity Act
of 2015 (6 U.S.C. 1524(c)) is amended--
(A) in paragraph (1)(B), in the matter preceding clause
(i), by striking ``annually thereafter'' and inserting
``thereafter during the years during which a report is
required to be submitted under section 3553(c) of title 44,
United States Code''; and
(B) in paragraph (2)(B), in the matter preceding clause
(i)--
(i) by striking ``annually thereafter'' and inserting
``thereafter during the years during which a report is
required to be submitted under section 3553(c) of title 44,
United States Code''; and
(ii) by striking ``the report required under section
3553(c) of title 44, United States Code'' and inserting
``that report''.
(3) NIST responsibilities.--Section 20(d)(3)(B) of the
National Institute of Standards and Technology Act (15 U.S.C.
278g-3(d)(3)(B)) is amended by striking ``annual''.
(e) Federal System Incident Response.--
(1) In general.--Chapter 35 of title 44, United States
Code, is amended by adding at the end the following:
``SUBCHAPTER IV--FEDERAL SYSTEM INCIDENT RESPONSE
``Sec. 3591. Definitions
``(a) In General.--Except as provided in subsection (b),
the definitions under sections 3502 and 3552 shall apply to
this subchapter.
``(b) Additional Definitions.--As used in this subchapter:
``(1) Appropriate reporting entities.--The term
`appropriate reporting entities' means--
``(A) the majority and minority leaders of the Senate;
``(B) the Speaker and minority leader of the House of
Representatives;
``(C) the Committee on Homeland Security and Governmental
Affairs of the Senate;
``(D) the Committee on Oversight and Reform of the House of
Representatives;
``(E) the Committee on Homeland Security of the House of
Representatives;
``(F) the appropriate authorization and appropriations
committees of Congress;
``(G) the Director;
``(H) the Director of the Cybersecurity and Infrastructure
Security Agency;
``(I) the National Cyber Director;
``(J) the Comptroller General of the United States; and
``(K) the inspector general of any impacted agency.
``(2) Awardee.--The term `awardee'--
``(A) means a person, business, or other entity that
receives a grant from, or is a party to a cooperative
agreement or an other transaction agreement with, an agency;
and
``(B) includes any subgrantee of a person, business, or
other entity described in subparagraph (A).
``(3) Breach.--The term `breach' means--
``(A) a compromise of the security, confidentiality, or
integrity of data in electronic form that results in
unauthorized access to, or an acquisition of, personal
information; or
``(B) a loss of data in electronic form that results in
unauthorized access to, or an acquisition of, personal
information.
``(4) Contractor.--The term `contractor' means--
``(A) a prime contractor of an agency or a subcontractor of
a prime contractor of an agency; and
``(B) any person or business that collects or maintains
information, including personally identifiable information,
on behalf of an agency.
``(5) Federal information.--The term `Federal information'
means information created, collected, processed, maintained,
disseminated, disclosed, or disposed of by or for the Federal
Government in any medium or form.
``(6) Federal information system.--The term `Federal
information system' means an information system used or
operated by an agency, a contractor, an awardee, or another
organization on behalf of an agency.
``(7) Intelligence community.--The term `intelligence
community' has the meaning given the term in section 3 of the
National Security Act of 1947 (50 U.S.C. 3003).
``(8) Nationwide consumer reporting agency.--The term
`nationwide consumer reporting agency' means a consumer
reporting agency described in section 603(p) of the Fair
Credit Reporting Act (15 U.S.C. 1681a(p)).
``(9) Vulnerability disclosure.--The term `vulnerability
disclosure' means a vulnerability identified under section
3559B.
``Sec. 3592. Notification of breach
``(a) Notification.--As expeditiously as practicable and
without unreasonable delay, and in any case not later than 45
days after an agency has a reasonable basis to conclude that
a breach has occurred, the head of the agency, in
consultation with a senior privacy officer of the agency,
shall--
``(1) determine whether notice to any individual
potentially affected by the breach is appropriate based on an
assessment of the risk of harm to the individual that
considers--
``(A) the nature and sensitivity of the personally
identifiable information affected by the breach;
``(B) the likelihood of access to and use of the personally
identifiable information affected by the breach;
``(C) the type of breach; and
``(D) any other factors determined by the Director; and
``(2) as appropriate, provide written notice in accordance
with subsection (b) to each individual potentially affected
by the breach--
``(A) to the last known mailing address of the individual;
or
``(B) through an appropriate alternative method of
notification that the head of the agency or a designated
senior-level individual of the agency selects based on
factors determined by the Director.
``(b) Contents of Notice.--Each notice of a breach provided
to an individual under subsection (a)(2) shall include--
``(1) a brief description of the rationale for the
determination that notice should be provided under subsection
(a);
``(2) if possible, a description of the types of personally
identifiable information affected by the breach;
``(3) contact information of the agency that may be used to
ask questions of the agency, which--
``(A) shall include an e-mail address or another digital
contact mechanism; and
``(B) may include a telephone number or a website;
``(4) information on any remedy being offered by the
agency;
``(5) any applicable educational materials relating to what
individuals can do in response to a breach that potentially
affects their personally identifiable information, including
relevant contact information for Federal law enforcement
agencies and each nationwide consumer reporting agency; and
``(6) any other appropriate information, as determined by
the head of the agency or established in guidance by the
Director.
``(c) Delay of Notification.--
``(1) In general.--The Attorney General, the Director of
National Intelligence, or the Secretary of Homeland Security
may delay a notification required under subsection (a) if the
notification would--
``(A) impede a criminal investigation or a national
security activity;
``(B) reveal sensitive sources and methods;
``(C) cause damage to national security; or
``(D) hamper security remediation actions.
``(2) Documentation.--
[[Page S8371]]
``(A) In general.--Any delay under paragraph (1) shall be
reported in writing to the Director, the Attorney General,
the Director of National Intelligence, the Secretary of
Homeland Security, the Director of the Cybersecurity and
Infrastructure Security Agency, and the head of the agency
and the inspector general of the agency that experienced the
breach.
``(B) Contents.--A report required under subparagraph (A)
shall include a written statement from the entity that
delayed the notification explaining the need for the delay.
``(C) Form.--The report required under subparagraph (A)
shall be unclassified but may include a classified annex.
``(3) Renewal.--A delay under paragraph (1) shall be for a
period of 60 days and may be renewed.
``(d) Update Notification.--If an agency determines there
is a significant change in the reasonable basis to conclude
that a breach occurred, a significant change to the
determination made under subsection (a)(1), or that it is
necessary to update the details of the information provided
to impacted individuals as described in subsection (b), the
agency shall as expeditiously as practicable and without
unreasonable delay, and in any case not later than 30 days
after such a determination, notify each individual who
received a notification pursuant to subsection (a) of those
changes.
``(e) Exemption From Notification.--
``(1) In general.--The head of an agency, in consultation
with the inspector general of the agency, may request an
exemption from the Director from complying with the
notification requirements under subsection (a) if the
information affected by the breach is determined by an
independent evaluation to be unreadable, including, as
appropriate, instances in which the information is--
``(A) encrypted; and
``(B) determined by the Director of the Cybersecurity and
Infrastructure Security Agency to be of sufficiently low risk
of exposure.
``(2) Approval.--The Director shall determine whether to
grant an exemption requested under paragraph (1) in
consultation with--
``(A) the Director of the Cybersecurity and Infrastructure
Security Agency; and
``(B) the Attorney General.
``(3) Documentation.--Any exemption granted by the Director
under paragraph (1) shall be reported in writing to the head
of the agency and the inspector general of the agency that
experienced the breach and the Director of the Cybersecurity
and Infrastructure Security Agency.
``(f) Rule of Construction.--Nothing in this section shall
be construed to limit--
``(1) the Director from issuing guidance relating to
notifications or the head of an agency from notifying
individuals potentially affected by breaches that are not
determined to be major incidents; or
``(2) the Director from issuing guidance relating to
notifications of major incidents or the head of an agency
from providing more information than described in subsection
(b) when notifying individuals potentially affected by
breaches.
``Sec. 3593. Congressional and Executive Branch reports
``(a) Initial Report.--
``(1) In general.--Not later than 72 hours after an agency
has a reasonable basis to conclude that a major incident
occurred, the head of the agency impacted by the major
incident shall submit to the appropriate reporting entities a
written report and, to the extent practicable, provide a
briefing to the Committee on Homeland Security and
Governmental Affairs of the Senate, the Committee on
Oversight and Reform of the House of Representatives, the
Committee on Homeland Security of the House of
Representatives, and the appropriate authorization and
appropriations committees of Congress, taking into account--
``(A) the information known at the time of the report;
``(B) the sensitivity of the details associated with the
major incident; and
``(C) the classification level of the information contained
in the report.
``(2) Contents.--A report required under paragraph (1)
shall include, in a manner that excludes or otherwise
reasonably protects personally identifiable information and
to the extent permitted by applicable law, including privacy
and statistical laws--
``(A) a summary of the information available about the
major incident, including how the major incident occurred,
information indicating that the major incident may be a
breach, and information relating to the major incident as a
breach, based on information available to agency officials as
of the date on which the agency submits the report;
``(B) if applicable, a description and any associated
documentation of any circumstances necessitating a delay in
or exemption to notification to individuals potentially
affected by the major incident under subsection (c) or (e) of
section 3592; and
``(C) if applicable, an assessment of the impacts to the
agency, the Federal Government, or the security of the United
States, based on information available to agency officials on
the date on which the agency submits the report.
``(b) Supplemental Report.--Within a reasonable amount of
time, but not later than 30 days after the date on which an
agency submits a written report under subsection (a), the
head of the agency shall provide to the appropriate reporting
entities written updates on the major incident and, to the
extent practicable, provide a briefing to the congressional
committees described in subsection (a)(1), including
summaries of--
``(1) vulnerabilities, means by which the major incident
occurred, and impacts to the agency relating to the major
incident;
``(2) any risk assessment and subsequent risk-based
security implementation of the affected information system
before the date on which the major incident occurred;
``(3) the status of compliance of the affected information
system with applicable security requirements at the time of
the major incident;
``(4) an estimate of the number of individuals potentially
affected by the major incident based on information available
to agency officials as of the date on which the agency
provides the update;
``(5) an assessment of the risk of harm to individuals
potentially affected by the major incident based on
information available to agency officials as of the date on
which the agency provides the update;
``(6) an update to the assessment of the risk to agency
operations, or to impacts on other agency or non-Federal
entity operations, affected by the major incident based on
information available to agency officials as of the date on
which the agency provides the update; and
``(7) the detection, response, and remediation actions of
the agency, including any support provided by the
Cybersecurity and Infrastructure Security Agency under
section 3594(d) and status updates on the notification
process described in section 3592(a), including any delay or
exemption described in subsection (c) or (e), respectively,
of section 3592, if applicable.
``(c) Update Report.--If the agency determines that there
is any significant change in the understanding of the agency
of the scope, scale, or consequence of a major incident for
which an agency submitted a written report under subsection
(a), the agency shall provide an updated report to the
appropriate reporting entities that includes information
relating to the change in understanding.
``(d) Annual Report.--Each agency shall submit as part of
the annual report required under section 3554(c)(1) of this
title a description of each major incident that occurred
during the 1-year period preceding the date on which the
report is submitted.
``(e) Delay and Exemption Report.--
``(1) In general.--The Director shall submit to the
appropriate notification entities an annual report on all
notification delays and exemptions granted pursuant to
subsections (c) and (d) of section 3592.
``(2) Component of other report.--The Director may submit
the report required under paragraph (1) as a component of the
annual report submitted under section 3597(b).
``(f) Report Delivery.--Any written report required to be
submitted under this section may be submitted in a paper or
electronic format.
``(g) Threat Briefing.--
``(1) In general.--Not later than 7 days after the date on
which an agency has a reasonable basis to conclude that a
major incident occurred, the head of the agency, jointly with
the National Cyber Director and any other Federal entity
determined appropriate by the National Cyber Director, shall
provide a briefing to the congressional committees described
in subsection (a)(1) on the threat causing the major
incident.
``(2) Components.--The briefing required under paragraph
(1)--
``(A) shall, to the greatest extent practicable, include an
unclassified component; and
``(B) may include a classified component.
``(h) Rule of Construction.--Nothing in this section shall
be construed to limit--
``(1) the ability of an agency to provide additional
reports or briefings to Congress; or
``(2) Congress from requesting additional information from
agencies through reports, briefings, or other means.
``Sec. 3594. Government information sharing and incident
response
``(a) In General.--
``(1) Incident reporting.--The head of each agency shall
provide any information relating to any incident, whether the
information is obtained by the Federal Government directly or
indirectly, to the Cybersecurity and Infrastructure Security
Agency and the Office of Management and Budget.
``(2) Contents.--A provision of information relating to an
incident made by the head of an agency under paragraph (1)
shall--
``(A) include detailed information about the safeguards
that were in place when the incident occurred;
``(B) whether the agency implemented the safeguards
described in subparagraph (A) correctly;
``(C) in order to protect against a similar incident,
identify--
``(i) how the safeguards described in subparagraph (A)
should be implemented differently; and
``(ii) additional necessary safeguards; and
``(D) include information to aid in incident response, such
as--
``(i) a description of the affected systems or networks;
``(ii) the estimated dates of when the incident occurred;
and
``(iii) information that could reasonably help identify the
party that conducted the incident.
``(3) Information sharing.--To the greatest extent
practicable, the Director of the
[[Page S8372]]
Cybersecurity and Infrastructure Security Agency shall share
information relating to an incident with any agencies that
may be impacted by the incident.
``(4) National security systems.--Each agency operating or
exercising control of a national security system shall share
information about incidents that occur on national security
systems with the Director of the Cybersecurity and
Infrastructure Security Agency to the extent consistent with
standards and guidelines for national security systems issued
in accordance with law and as directed by the President.
``(b) Compliance.--The information provided under
subsection (a) shall take into account the level of
classification of the information and any information sharing
limitations and protections, such as limitations and
protections relating to law enforcement, national security,
privacy, statistical confidentiality, or other factors
determined by the Director
``(c) Incident Response.--Each agency that has a reasonable
basis to conclude that a major incident occurred involving
Federal information in electronic medium or form, as defined
by the Director and not involving a national security system,
regardless of delays from notification granted for a major
incident, shall coordinate with the Cybersecurity and
Infrastructure Security Agency regarding--
``(1) incident response and recovery; and
``(2) recommendations for mitigating future incidents.
``Sec. 3595. Responsibilities of contractors and awardees
``(a) Notification.--
``(1) In general.--Unless otherwise specified in a
contract, grant, cooperative agreement, or an other
transaction agreement, any contractor or awardee of an agency
shall report to the agency within the same amount of time
such agency is required to report an incident to the
Cybersecurity and Infrastructure Security Agency, if the
contractor or awardee has a reasonable basis to conclude
that--
``(A) an incident or breach has occurred with respect to
Federal information collected, used, or maintained by the
contractor or awardee in connection with the contract, grant,
cooperative agreement, or other transaction agreement of the
contractor or awardee;
``(B) an incident or breach has occurred with respect to a
Federal information system used or operated by the contractor
or awardee in connection with the contract, grant,
cooperative agreement, or other transaction agreement of the
contractor or awardee; or
``(C) the contractor or awardee has received information
from the agency that the contractor or awardee is not
authorized to receive in connection with the contract, grant,
cooperative agreement, or other transaction agreement of the
contractor or awardee.
``(2) Procedures.--
``(A) Major incident.--Following a report of a breach or
major incident by a contractor or awardee under paragraph
(1), the agency, in consultation with the contractor or
awardee, shall carry out the requirements under sections
3592, 3593, and 3594 with respect to the major incident.
``(B) Incident.--Following a report of an incident by a
contractor or awardee under paragraph (1), an agency, in
consultation with the contractor or awardee, shall carry out
the requirements under section 3594 with respect to the
incident.
``(b) Effective Date.--This section shall apply on and
after the date that is 1 year after the date of enactment of
the Federal Information Security Modernization Act of 2021.
``Sec. 3596. Training
``(a) Covered Individual Defined.--In this section, the
term `covered individual' means an individual who obtains
access to Federal information or Federal information systems
because of the status of the individual as an employee,
contractor, awardee, volunteer, or intern of an agency.
``(b) Requirement.--The head of each agency shall develop
training for covered individuals on how to identify and
respond to an incident, including--
``(1) the internal process of the agency for reporting an
incident; and
``(2) the obligation of a covered individual to report to
the agency a confirmed major incident and any suspected
incident involving information in any medium or form,
including paper, oral, and electronic.
``(c) Inclusion in Annual Training.--The training developed
under subsection (b) may be included as part of an annual
privacy or security awareness training of an agency.
``Sec. 3597. Analysis and report on Federal incidents
``(a) Analysis of Federal Incidents.--
``(1) Quantitative and qualitative analyses.--The Director
of the Cybersecurity and Infrastructure Security Agency shall
develop, in consultation with the Director and the National
Cyber Director, and perform continuous monitoring and
quantitative and qualitative analyses of incidents at
agencies, including major incidents, including--
``(A) the causes of incidents, including--
``(i) attacker tactics, techniques, and procedures; and
``(ii) system vulnerabilities, including zero days,
unpatched systems, and information system misconfigurations;
``(B) the scope and scale of incidents at agencies;
``(C) cross Federal Government root causes of incidents at
agencies;
``(D) agency incident response, recovery, and remediation
actions and the effectiveness of those actions, as
applicable;
``(E) lessons learned and recommendations in responding to,
recovering from, remediating, and mitigating future
incidents; and
``(F) trends in cross-Federal Government cybersecurity and
incident response capabilities using the metrics established
under section 224(c) of the Cybersecurity Act of 2015 (6
U.S.C. 1522(c)).
``(2) Automated analysis.--The analyses developed under
paragraph (1) shall, to the greatest extent practicable, use
machine readable data, automation, and machine learning
processes.
``(3) Sharing of data and analysis.--
``(A) In general.--The Director shall share on an ongoing
basis the analyses required under this subsection with
agencies and the National Cyber Director to--
``(i) improve the understanding of cybersecurity risk of
agencies; and
``(ii) support the cybersecurity improvement efforts of
agencies.
``(B) Format.--In carrying out subparagraph (A), the
Director shall share the analyses--
``(i) in human-readable written products; and
``(ii) to the greatest extent practicable, in machine-
readable formats in order to enable automated intake and use
by agencies.
``(b) Annual Report on Federal Incidents.--Not later than 2
years after the date of enactment of this section, and not
less frequently than annually thereafter, the Director of the
Cybersecurity and Infrastructure Security Agency, in
consultation with the Director and other Federal agencies as
appropriate, shall submit to the appropriate notification
entities a report that includes--
``(1) a summary of causes of incidents from across the
Federal Government that categorizes those incidents as
incidents or major incidents;
``(2) the quantitative and qualitative analyses of
incidents developed under subsection (a)(1) on an agency-by-
agency basis and comprehensively across the Federal
Government, including--
``(A) a specific analysis of breaches; and
``(B) an analysis of the Federal Government's performance
against the metrics established under section 224(c) of the
Cybersecurity Act of 2015 (6 U.S.C. 1522(c)); and
``(3) an annex for each agency that includes--
``(A) a description of each major incident;
``(B) the total number of compromises of the agency; and
``(C) an analysis of the agency's performance against the
metrics established under section 224(c) of the Cybersecurity
Act of 2015 (6 U.S.C. 1522(c)).
``(c) Publication.--A version of each report submitted
under subsection (b) shall be made publicly available on the
website of the Cybersecurity and Infrastructure Security
Agency during the year in which the report is submitted.
``(d) Information Provided by Agencies.--
``(1) In general.--The analysis required under subsection
(a) and each report submitted under subsection (b) shall use
information provided by agencies under section 3594(a).
``(2) Noncompliance reports.--
``(A) In general.--Subject to subparagraph (B), during any
year during which the head of an agency does not provide data
for an incident to the Cybersecurity and Infrastructure
Security Agency in accordance with section 3594(a), the head
of the agency, in coordination with the Director of the
Cybersecurity and Infrastructure Security Agency and the
Director, shall submit to the appropriate reporting entities
a report that includes--
``(i) data for the incident; and
``(ii) the information described in subsection (b) with
respect to the agency.
``(B) Exception for national security systems.--The head of
an agency that owns or exercises control of a national
security system shall not include data for an incident that
occurs on a national security system in any report submitted
under subparagraph (A).
``(3) National security system reports.--
``(A) In general.--Annually, the head of an agency that
operates or exercises control of a national security system
shall submit a report that includes the information described
in subsection (b) with respect to the agency to the extent
that the submission is consistent with standards and
guidelines for national security systems issued in accordance
with law and as directed by the President to--
``(i) the majority and minority leaders of the Senate,
``(ii) the Speaker and minority leader of the House of
Representatives;
``(iii) the Committee on Homeland Security and Governmental
Affairs of the Senate;
``(iv) the Select Committee on Intelligence of the Senate;
``(v) the Committee on Armed Services of the Senate;
``(vi) the Committee on Appropriations of the Senate;
``(vii) the Committee on Oversight and Reform of the House
of Representatives;
``(viii) the Committee on Homeland Security of the House of
Representatives;
``(ix) the Permanent Select Committee on Intelligence of
the House of Representatives;
``(x) the Committee on Armed Services of the House of
Representatives; and
[[Page S8373]]
``(xi) the Committee on Appropriations of the House of
Representatives.
``(B) Classified form.--A report required under
subparagraph (A) may be submitted in a classified form.
``(e) Requirement for Compiling Information.--In publishing
the public report required under subsection (c), the Director
of the Cybersecurity and Infrastructure Security Agency shall
sufficiently compile information such that no specific
incident of an agency can be identified, except with the
concurrence of the Director of the Office of Management and
Budget and in consultation with the impacted agency.
``Sec. 3598. Major incident definition
``(a) In General.--Not later than 180 days after the date
of enactment of the Federal Information Security
Modernization Act of 2021, the Director, in coordination with
the Director of the Cybersecurity and Infrastructure Security
Agency and the National Cyber Director, shall develop and
promulgate guidance on the definition of the term `major
incident' for the purposes of subchapter II and this
subchapter.
``(b) Requirements.--With respect to the guidance issued
under subsection (a), the definition of the term `major
incident' shall--
``(1) include, with respect to any information collected or
maintained by or on behalf of an agency or an information
system used or operated by an agency or by a contractor of an
agency or another organization on behalf of an agency--
``(A) any incident the head of the agency determines is
likely to have an impact on--
``(i) the national security, homeland security, or economic
security of the United States; or
``(ii) the civil liberties or public health and safety of
the people of the United States;
``(B) any incident the head of the agency determines likely
to result in an inability for the agency, a component of the
agency, or the Federal Government, to provide 1 or more
critical services;
``(C) any incident that the head of an agency, in
consultation with a senior privacy officer of the agency,
determines is likely to have a significant privacy impact on
1 or more individual;
``(D) any incident that the head of the agency, in
consultation with a senior privacy official of the agency,
determines is likely to have a substantial privacy impact on
a significant number of individuals;
``(E) any incident the head of the agency determines
impacts the operations of a high value asset owned or
operated by the agency;
``(F) any incident involving the exposure of sensitive
agency information to a foreign entity, such as the
communications of the head of the agency, the head of a
component of the agency, or the direct reports of the head of
the agency or the head of a component of the agency; and
``(G) any other type of incident determined appropriate by
the Director;
``(2) stipulate that the National Cyber Director shall
declare a major incident at each agency impacted by an
incident if the Director of the Cybersecurity and
Infrastructure Security Agency determines that an incident--
``(A) occurs at not less than 2 agencies; and
``(B) is enabled by--
``(i) a common technical root cause, such as a supply chain
compromise, a common software or hardware vulnerability; or
``(ii) the related activities of a common threat actor; and
``(3) stipulate that, in determining whether an incident
constitutes a major incident because that incident--
``(A) is any incident described in paragraph (1), the head
of an agency shall consult with the Director of the
Cybersecurity and Infrastructure Security Agency;
``(B) is an incident described in paragraph (1)(A), the
head of the agency shall consult with the National Cyber
Director; and
``(C) is an incident described in subparagraph (C) or (D)
of paragraph (1), the head of the agency shall consult with--
``(i) the Privacy and Civil Liberties Oversight Board; and
``(ii) the Chair of the Federal Trade Commission.
``(c) Significant Number of Individuals.--In determining
what constitutes a significant number of individuals under
subsection (b)(1)(D), the Director--
``(1) may determine a threshold for a minimum number of
individuals that constitutes a significant amount; and
``(2) may not determine a threshold described in paragraph
(1) that exceeds 5,000 individuals.
``(d) Evaluation and Updates.--Not later than 2 years after
the date of enactment of the Federal Information Security
Modernization Act of 2021, and not less frequently than every
2 years thereafter, the Director shall submit to the
Committee on Homeland Security and Governmental Affairs of
the Senate and the Committee on Oversight and Reform of the
House of Representatives an evaluation, which shall include--
``(1) an update, if necessary, to the guidance issued under
subsection (a);
``(2) the definition of the term `major incident' included
in the guidance issued under subsection (a); and
``(3) an explanation of, and the analysis that led to, the
definition described in paragraph (2).''.
(2) Clerical amendment.--The table of sections for chapter
35 of title 44, United States Code, is amended by adding at
the end the following:
``subchapter iv--federal system incident response
``3591. Definitions.
``3592. Notification of breach.
``3593. Congressional and Executive Branch reports.
``3594. Government information sharing and incident response.
``3595. Responsibilities of contractors and awardees.
``3596. Training.
``3597. Analysis and report on Federal incidents.
``3598. Major incident definition.''.
SEC. 5122. AMENDMENTS TO SUBTITLE III OF TITLE 40.
(a) Modernizing Government Technology.--Subtitle G of title
X of Division A of the National Defense Authorization Act for
Fiscal Year 2018 (40 U.S.C. 11301 note) is amended--
(1) in section 1077(b)--
(A) in paragraph (5)(A), by inserting ``improving the
cybersecurity of systems and'' before ``cost savings
activities''; and
(B) in paragraph (7)--
(i) in the paragraph heading, by striking ``cio'' and
inserting ``CIO'';
(ii) by striking ``In evaluating projects'' and inserting
the following:
``(A) Consideration of guidance.--In evaluating projects'';
(iii) in subparagraph (A), as so designated, by striking
``under section 1094(b)(1)'' and inserting ``by the
Director''; and
(iv) by adding at the end the following:
``(B) Consultation.--In using funds under paragraph (3)(A),
the Chief Information Officer of the covered agency shall
consult with the necessary stakeholders to ensure the project
appropriately addresses cybersecurity risks, including the
Director of the Cybersecurity and Infrastructure Security
Agency, as appropriate.''; and
(2) in section 1078--
(A) by striking subsection (a) and inserting the following:
``(a) Definitions.--In this section:
``(1) Agency.--The term `agency' has the meaning given the
term in section 551 of title 5, United States Code.
``(2) High value asset.--The term `high value asset' has
the meaning given the term in section 3552 of title 44,
United States Code.'';
(B) in subsection (b), by adding at the end the following:
``(8) Proposal evaluation.--The Director shall--
``(A) give consideration for the use of amounts in the Fund
to improve the security of high value assets; and
``(B) require that any proposal for the use of amounts in
the Fund includes a cybersecurity plan, including a supply
chain risk management plan, to be reviewed by the member of
the Technology Modernization Board described in subsection
(c)(5)(C).''; and
(C) in subsection (c)--
(i) in paragraph (2)(A)(i), by inserting ``, including a
consideration of the impact on high value assets'' after
``operational risks'';
(ii) in paragraph (5)--
(I) in subparagraph (A), by striking ``and'' at the end;
(II) in subparagraph (B), by striking the period at the end
and inserting ``and''; and
(III) by adding at the end the following:
``(C) a senior official from the Cybersecurity and
Infrastructure Security Agency of the Department of Homeland
Security, appointed by the Director.''; and
(iii) in paragraph (6)(A), by striking ``shall be--'' and
all that follows through ``4 employees'' and inserting
``shall be 4 employees''.
(b) Subchapter I.--Subchapter I of subtitle III of title
40, United States Code, is amended--
(1) in section 11302--
(A) in subsection (b), by striking ``use, security, and
disposal of'' and inserting ``use, and disposal of, and, in
consultation with the Director of the Cybersecurity and
Infrastructure Security Agency and the National Cyber
Director, promote and improve the security of,'';
(B) in subsection (c)--
(i) in paragraph (3)--
(I) in subparagraph (A)--
(aa) by striking ``including data'' and inserting ``which
shall--
``(i) include data'';
(bb) in clause (i), as so designated, by striking ``, and
performance'' and inserting ``security, and performance;
and''; and
(cc) by adding at the end the following:
``(ii) specifically denote cybersecurity funding under the
risk-based cyber budget model developed pursuant to section
3553(a)(7) of title 44.''; and
(II) in subparagraph (B), adding at the end the following:
``(iii) The Director shall provide to the National Cyber
Director any cybersecurity funding information described in
subparagraph (A)(ii) that is provided to the Director under
clause (ii) of this subparagraph.''; and
(ii) in paragraph (4)(B), in the matter preceding clause
(i), by inserting ``not later than 30 days after the date on
which the review under subparagraph (A) is completed,''
before ``the Administrator'';
(C) in subsection (f)--
(i) by striking ``heads of executive agencies to develop''
and inserting ``heads of executive agencies to--
``(1) develop'';
(ii) in paragraph (1), as so designated, by striking the
period at the end and inserting ``; and''; and
(iii) by adding at the end the following:
[[Page S8374]]
``(2) consult with the Director of the Cybersecurity and
Infrastructure Security Agency for the development and use of
supply chain security best practices.''; and
(D) in subsection (h), by inserting ``, including
cybersecurity performances,'' after ``the performances''; and
(2) in section 11303(b)--
(A) in paragraph (2)(B)--
(i) in clause (i), by striking ``or'' at the end;
(ii) in clause (ii), by adding ``or'' at the end; and
(iii) by adding at the end the following:
``(iii) whether the function should be performed by a
shared service offered by another executive agency;''; and
(B) in paragraph (5)(B)(i), by inserting ``, while taking
into account the risk-based cyber budget model developed
pursuant to section 3553(a)(7) of title 44'' after ``title
31''.
(c) Subchapter II.--Subchapter II of subtitle III of title
40, United States Code, is amended--
(1) in section 11312(a), by inserting ``, including
security risks'' after ``managing the risks'';
(2) in section 11313(1), by striking ``efficiency and
effectiveness'' and inserting ``efficiency, security, and
effectiveness'';
(3) in section 11315, by adding at the end the following:
``(d) Component Agency Chief Information Officers.--The
Chief Information Officer or an equivalent official of a
component agency shall report to--
``(1) the Chief Information Officer designated under
section 3506(a)(2) of title 44 or an equivalent official of
the agency of which the component agency is a component; and
``(2) the head of the component agency.'';
(4) in section 11317, by inserting ``security,'' before
``or schedule''; and
(5) in section 11319(b)(1), in the paragraph heading, by
striking ``CIOS'' and inserting ``Chief information
officers''.
(d) Subchapter III.--Section 11331 of title 40, United
States Code, is amended--
(1) in subsection (a), by striking ``section 3532(b)(1)''
and inserting ``section 3552(b)'';
(2) in subsection (b)(1)(A), by striking ``the Secretary of
Homeland Security'' and inserting ``the Director of the
Cybersecurity and Infrastructure Security Agency'';
(3) by striking subsection (c) and inserting the following:
``(c) Application of More Stringent Standards.--
``(1) In general.--The head of an agency shall--
``(A) evaluate, in consultation with the senior agency
information security officers, the need to employ standards
for cost-effective, risk-based information security for all
systems, operations, and assets within or under the
supervision of the agency that are more stringent than the
standards promulgated by the Director under this section, if
such standards contain, at a minimum, the provisions of those
applicable standards made compulsory and binding by the
Director; and
``(B) to the greatest extent practicable and if the head of
the agency determines that the standards described in
subparagraph (A) are necessary, employ those standards.
``(2) Evaluation of more stringent standards.--In
evaluating the need to employ more stringent standards under
paragraph (1), the head of an agency shall consider available
risk information, such as--
``(A) the status of cybersecurity remedial actions of the
agency;
``(B) any vulnerability information relating to agency
systems that is known to the agency;
``(C) incident information of the agency;
``(D) information from--
``(i) penetration testing performed under section 3559A of
title 44; and
``(ii) information from the vulnerability disclosure
program established under section 3559B of title 44;
``(E) agency threat hunting results under section 5145 of
the Federal Information Security Modernization Act of 2021;
``(F) Federal and non-Federal cyber threat intelligence;
``(G) data on compliance with standards issued under this
section;
``(H) agency system risk assessments performed under
section 3554(a)(1)(A) of title 44; and
``(I) any other information determined relevant by the head
of the agency.'';
(4) in subsection (d)(2)--
(A) in the paragraph heading, by striking ``Notice and
comment'' and inserting ``Consultation, notice, and
comment'';
(B) by inserting ``promulgate,'' before ``significantly
modify''; and
(C) by striking ``shall be made after the public is given
an opportunity to comment on the Director's proposed
decision.'' and inserting ``shall be made--
``(A) for a decision to significantly modify or not
promulgate such a proposed standard, after the public is
given an opportunity to comment on the Director's proposed
decision;
``(B) in consultation with the Chief Information Officers
Council, the Director of the Cybersecurity and Infrastructure
Security Agency, the National Cyber Director, the Comptroller
General of the United States, and the Council of the
Inspectors General on Integrity and Efficiency;
``(C) considering the Federal risk assessments performed
under section 3553(i) of title 44; and
``(D) considering the extent to which the proposed standard
reduces risk relative to the cost of implementation of the
standard.''; and
(5) by adding at the end the following:
``(e) Review of Office of Management and Budget Guidance
and Policy.--
``(1) Conduct of review.--
``(A) In general.--Not less frequently than once every 3
years, the Director of the Office of Management and Budget,
in consultation with the Chief Information Officers Council,
the Director of the Cybersecurity and Infrastructure Security
Agency, the National Cyber Director, the Comptroller General
of the United States, and the Council of the Inspectors
General on Integrity and Efficiency shall review the efficacy
of the guidance and policy promulgated by the Director in
reducing cybersecurity risks, including an assessment of the
requirements for agencies to report information to the
Director, and determine whether any changes to that guidance
or policy is appropriate.
``(B) Federal risk assessments.--In conducting the review
described in subparagraph (A), the Director shall consider
the Federal risk assessments performed under section 3553(i)
of title 44.
``(2) Updated guidance.--Not later than 90 days after the
date on which a review is completed under paragraph (1), the
Director of the Office of Management and Budget shall issue
updated guidance or policy to agencies determined appropriate
by the Director, based on the results of the review.
``(3) Public report.--Not later than 30 days after the date
on which a review is completed under paragraph (1), the
Director of the Office of Management and Budget shall make
publicly available a report that includes--
``(A) an overview of the guidance and policy promulgated
under this section that is currently in effect;
``(B) the cybersecurity risk mitigation, or other
cybersecurity benefit, offered by each guidance or policy
document described in subparagraph (A); and
``(C) a summary of the guidance or policy to which changes
were determined appropriate during the review and what the
changes are anticipated to include.
``(4) Congressional briefing.--Not later than 30 days after
the date on which a review is completed under paragraph (1),
the Director shall provide to the Committee on Homeland
Security and Governmental Affairs of the Senate and the
Committee on Oversight and Reform of the House of
Representatives a briefing on the review.
``(f) Automated Standard Implementation Verification.--When
the Director of the National Institute of Standards and
Technology issues a proposed standard pursuant to paragraphs
(2) and (3) of section 20(a) of the National Institute of
Standards and Technology Act (15 U.S.C. 278g-3(a)), the
Director of the National Institute of Standards and
Technology shall consider developing and, if appropriate and
practical, develop, in consultation with the Director of the
Cybersecurity and Infrastructure Security Agency,
specifications to enable the automated verification of the
implementation of the controls within the standard.''.
SEC. 5123. ACTIONS TO ENHANCE FEDERAL INCIDENT RESPONSE.
(a) Responsibilities of the Cybersecurity and
Infrastructure Security Agency.--
(1) In general.--Not later than 180 days after the date of
enactment of this Act, the Director of the Cybersecurity and
Infrastructure Security Agency shall--
(A) develop a plan for the development of the analysis
required under section 3597(a) of title 44, United States
Code, as added by this division, and the report required
under subsection (b) of that section that includes--
(i) a description of any challenges the Director
anticipates encountering; and
(ii) the use of automation and machine-readable formats for
collecting, compiling, monitoring, and analyzing data; and
(B) provide to the appropriate congressional committees a
briefing on the plan developed under subparagraph (A).
(2) Briefing.--Not later than 1 year after the date of
enactment of this Act, the Director of the Cybersecurity and
Infrastructure Security Agency shall provide to the
appropriate congressional committees a briefing on--
(A) the execution of the plan required under paragraph
(1)(A); and
(B) the development of the report required under section
3597(b) of title 44, United States Code, as added by this
division.
(b) Responsibilities of the Director of the Office of
Management and Budget.--
(1) FISMA.--Section 2 of the Federal Information Security
Modernization Act of 2014 (44 U.S.C. 3554 note) is amended--
(A) by striking subsection (b); and
(B) by redesignating subsections (c) through (f) as
subsections (b) through (e), respectively.
(2) Incident data sharing.--
(A) In general.--The Director shall develop guidance, to be
updated not less frequently than once every 2 years, on the
content, timeliness, and format of the information provided
by agencies under section 3594(a) of title 44, United States
Code, as added by this division.
(B) Requirements.--The guidance developed under
subparagraph (A) shall--
(i) prioritize the availability of data necessary to
understand and analyze--
(I) the causes of incidents;
(II) the scope and scale of incidents within the
environments and systems of an agency;
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(III) a root cause analysis of incidents that--
(aa) are common across the Federal Government; or
(bb) have a Government-wide impact;
(IV) agency response, recovery, and remediation actions and
the effectiveness of those actions; and
(V) the impact of incidents;
(ii) enable the efficient development of--
(I) lessons learned and recommendations in responding to,
recovering from, remediating, and mitigating future
incidents; and
(II) the report on Federal incidents required under section
3597(b) of title 44, United States Code, as added by this
division;
(iii) include requirements for the timeliness of data
production; and
(iv) include requirements for using automation and machine-
readable data for data sharing and availability.
(3) Guidance on responding to information requests.--Not
later than 1 year after the date of enactment of this Act,
the Director shall develop guidance for agencies to implement
the requirement under section 3594(c) of title 44, United
States Code, as added by this division, to provide
information to other agencies experiencing incidents.
(4) Standard guidance and templates.--Not later than 1 year
after the date of enactment of this Act, the Director, in
consultation with the Director of the Cybersecurity and
Infrastructure Security Agency, shall develop guidance and
templates, to be reviewed and, if necessary, updated not less
frequently than once every 2 years, for use by Federal
agencies in the activities required under sections 3592,
3593, and 3596 of title 44, United States Code, as added by
this division.
(5) Contractor and awardee guidance.--
(A) In general.--Not later than 1 year after the date of
enactment of this Act, the Director, in coordination with the
Secretary of Homeland Security, the Secretary of Defense, the
Administrator of General Services, and the heads of other
agencies determined appropriate by the Director, shall issue
guidance to Federal agencies on how to deconflict, to the
greatest extent practicable, existing regulations, policies,
and procedures relating to the responsibilities of
contractors and awardees established under section 3595 of
title 44, United States Code, as added by this division.
(B) Existing processes.--To the greatest extent
practicable, the guidance issued under subparagraph (A) shall
allow contractors and awardees to use existing processes for
notifying Federal agencies of incidents involving information
of the Federal Government.
(6) Updated briefings.--Not less frequently than once every
2 years, the Director shall provide to the appropriate
congressional committees an update on the guidance and
templates developed under paragraphs (2) through (4).
(c) Update to the Privacy Act of 1974.--Section 552a(b) of
title 5, United States Code (commonly known as the ``Privacy
Act of 1974'') is amended--
(1) in paragraph (11), by striking ``or'' at the end;
(2) in paragraph (12), by striking the period at the end
and inserting ``; or''; and
(3) by adding at the end the following:
``(13) to another agency in furtherance of a response to an
incident (as defined in section 3552 of title 44) and
pursuant to the information sharing requirements in section
3594 of title 44 if the head of the requesting agency has
made a written request to the agency that maintains the
record specifying the particular portion desired and the
activity for which the record is sought.''.
SEC. 5124. ADDITIONAL GUIDANCE TO AGENCIES ON FISMA UPDATES.
Not later than 1 year after the date of enactment of this
Act, the Director, in coordination with the Director of the
Cybersecurity and Infrastructure Security Agency, shall issue
guidance for agencies on--
(1) performing the ongoing and continuous agency system
risk assessment required under section 3554(a)(1)(A) of title
44, United States Code, as amended by this division;
(2) implementing additional cybersecurity procedures, which
shall include resources for shared services;
(3) establishing a process for providing the status of each
remedial action under section 3554(b)(7) of title 44, United
States Code, as amended by this division, to the Director and
the Cybersecurity and Infrastructure Security Agency using
automation and machine-readable data, as practicable, which
shall include--
(A) specific guidance for the use of automation and
machine-readable data; and
(B) templates for providing the status of the remedial
action;
(4) interpreting the definition of ``high value asset''
under section 3552 of title 44, United States Code, as
amended by this division; and
(5) a requirement to coordinate with inspectors general of
agencies to ensure consistent understanding and application
of agency policies for the purpose of evaluations by
inspectors general.
SEC. 5125. AGENCY REQUIREMENTS TO NOTIFY PRIVATE SECTOR
ENTITIES IMPACTED BY INCIDENTS.
(a) Definitions.--In this section:
(1) Reporting entity.--The term ``reporting entity'' means
private organization or governmental unit that is required by
statute or regulation to submit sensitive information to an
agency.
(2) Sensitive information.--The term ``sensitive
information'' has the meaning given the term by the Director
in guidance issued under subsection (b).
(b) Guidance on Notification of Reporting Entities.--Not
later than 180 days after the date of enactment of this Act,
the Director shall issue guidance requiring the head of each
agency to notify a reporting entity of an incident that is
likely to substantially affect--
(1) the confidentiality or integrity of sensitive
information submitted by the reporting entity to the agency
pursuant to a statutory or regulatory requirement; or
(2) the agency information system or systems used in the
transmission or storage of the sensitive information
described in paragraph (1).
TITLE LII--IMPROVING FEDERAL CYBERSECURITY
SEC. 5141. MOBILE SECURITY STANDARDS.
(a) In General.--Not later than 1 year after the date of
enactment of this Act, the Director shall--
(1) evaluate mobile application security guidance
promulgated by the Director; and
(2) issue guidance to secure mobile devices, including for
mobile applications, for every agency.
(b) Contents.--The guidance issued under subsection (a)(2)
shall include--
(1) a requirement, pursuant to section 3506(b)(4) of title
44, United States Code, for every agency to maintain a
continuous inventory of every--
(A) mobile device operated by or on behalf of the agency;
and
(B) vulnerability identified by the agency associated with
a mobile device; and
(2) a requirement for every agency to perform continuous
evaluation of the vulnerabilities described in paragraph
(1)(B) and other risks associated with the use of
applications on mobile devices.
(c) Information Sharing.--The Director, in coordination
with the Director of the Cybersecurity and Infrastructure
Security Agency, shall issue guidance to agencies for sharing
the inventory of the agency required under subsection (b)(1)
with the Director of the Cybersecurity and Infrastructure
Security Agency, using automation and machine-readable data
to the greatest extent practicable.
(d) Briefing.--Not later than 60 days after the date on
which the Director issues guidance under subsection (a)(2),
the Director, in coordination with the Director of the
Cybersecurity and Infrastructure Security Agency, shall
provide to the appropriate congressional committees a
briefing on the guidance.
SEC. 5142. DATA AND LOGGING RETENTION FOR INCIDENT RESPONSE.
(a) Recommendations.--Not later than 2 years after the date
of enactment of this Act, and not less frequently than every
2 years thereafter, the Director of the Cybersecurity and
Infrastructure Security Agency, in consultation with the
Attorney General, shall submit to the Director
recommendations on requirements for logging events on agency
systems and retaining other relevant data within the systems
and networks of an agency.
(b) Contents.--The recommendations provided under
subsection (a) shall include--
(1) the types of logs to be maintained;
(2) the time periods to retain the logs and other relevant
data;
(3) the time periods for agencies to enable recommended
logging and security requirements;
(4) how to ensure the confidentiality, integrity, and
availability of logs;
(5) requirements to ensure that, upon request, in a manner
that excludes or otherwise reasonably protects personally
identifiable information, and to the extent permitted by
applicable law (including privacy and statistical laws),
agencies provide logs to--
(A) the Director of the Cybersecurity and Infrastructure
Security Agency for a cybersecurity purpose; and
(B) the Federal Bureau of Investigation to investigate
potential criminal activity; and
(6) requirements to ensure that, subject to compliance with
statistical laws and other relevant data protection
requirements, the highest level security operations center of
each agency has visibility into all agency logs.
(c) Guidance.--Not later than 90 days after receiving the
recommendations submitted under subsection (a), the Director,
in consultation with the Director of the Cybersecurity and
Infrastructure Security Agency and the Attorney General,
shall, as determined to be appropriate by the Director,
update guidance to agencies regarding requirements for
logging, log retention, log management, sharing of log data
with other appropriate agencies, or any other logging
activity determined to be appropriate by the Director.
SEC. 5143. CISA AGENCY ADVISORS.
(a) In General.--Not later than 120 days after the date of
enactment of this Act, the Director of the Cybersecurity and
Infrastructure Security Agency shall assign not less than 1
cybersecurity professional employed by the Cybersecurity and
Infrastructure Security Agency to be the Cybersecurity and
Infrastructure Security Agency advisor to the senior agency
information security officer of each agency.
(b) Qualifications.--Each advisor assigned under subsection
(a) shall have knowledge of--
[[Page S8376]]
(1) cybersecurity threats facing agencies, including any
specific threats to the assigned agency;
(2) performing risk assessments of agency systems; and
(3) other Federal cybersecurity initiatives.
(c) Duties.--The duties of each advisor assigned under
subsection (a) shall include--
(1) providing ongoing assistance and advice, as requested,
to the agency Chief Information Officer;
(2) serving as an incident response point of contact
between the assigned agency and the Cybersecurity and
Infrastructure Security Agency; and
(3) familiarizing themselves with agency systems,
processes, and procedures to better facilitate support to the
agency in responding to incidents.
(d) Limitation.--An advisor assigned under subsection (a)
shall not be a contractor.
(e) Multiple Assignments.--One individual advisor may be
assigned to multiple agency Chief Information Officers under
subsection (a).
SEC. 5144. FEDERAL PENETRATION TESTING POLICY.
(a) In General.--Subchapter II of chapter 35 of title 44,
United States Code, is amended by adding at the end the
following:
``Sec. 3559A. Federal penetration testing
``(a) Definitions.--In this section:
``(1) Agency operational plan.--The term `agency
operational plan' means a plan of an agency for the use of
penetration testing.
``(2) Rules of engagement.--The term `rules of engagement'
means a set of rules established by an agency for the use of
penetration testing.
``(b) Guidance.--
``(1) In general.--The Director shall issue guidance that--
``(A) requires agencies to use, when and where appropriate,
penetration testing on agency systems; and
``(B) requires agencies to develop an agency operational
plan and rules of engagement that meet the requirements under
subsection (c).
``(2) Penetration testing guidance.--The guidance issued
under this section shall--
``(A) permit an agency to use, for the purpose of
performing penetration testing--
``(i) a shared service of the agency or another agency; or
``(ii) an external entity, such as a vendor; and
``(B) require agencies to provide the rules of engagement
and results of penetration testing to the Director and the
Director of the Cybersecurity and Infrastructure Security
Agency, without regard to the status of the entity that
performs the penetration testing.
``(c) Agency Plans and Rules of Engagement.--The agency
operational plan and rules of engagement of an agency shall--
``(1) require the agency to--
``(A) perform penetration testing on the high value assets
of the agency; or
``(B) coordinate with the Director of the Cybersecurity and
Infrastructure Security Agency to ensure that penetration
testing is being performed;
``(2) establish guidelines for avoiding, as a result of
penetration testing--
``(A) adverse impacts to the operations of the agency;
``(B) adverse impacts to operational environments and
systems of the agency; and
``(C) inappropriate access to data;
``(3) require the results of penetration testing to include
feedback to improve the cybersecurity of the agency; and
``(4) include mechanisms for providing consistently
formatted, and, if applicable, automated and machine-
readable, data to the Director and the Director of the
Cybersecurity and Infrastructure Security Agency.
``(d) Responsibilities of CISA.--The Director of the
Cybersecurity and Infrastructure Security Agency shall--
``(1) establish a process to assess the performance of
penetration testing by both Federal and non-Federal entities
that establishes minimum quality controls for penetration
testing;
``(2) develop operational guidance for instituting
penetration testing programs at agencies;
``(3) develop and maintain a centralized capability to
offer penetration testing as a service to Federal and non-
Federal entities; and
``(4) provide guidance to agencies on the best use of
penetration testing resources.
``(e) Responsibilities of OMB.--The Director, in
coordination with the Director of the Cybersecurity and
Infrastructure Security Agency, shall--
``(1) not less frequently than annually, inventory all
Federal penetration testing assets; and
``(2) develop and maintain a standardized process for the
use of penetration testing.
``(f) Prioritization of Penetration Testing Resources.--
``(1) In general.--The Director, in coordination with the
Director of the Cybersecurity and Infrastructure Security
Agency, shall develop a framework for prioritizing Federal
penetration testing resources among agencies.
``(2) Considerations.--In developing the framework under
this subsection, the Director shall consider--
``(A) agency system risk assessments performed under
section 3554(a)(1)(A);
``(B) the Federal risk assessment performed under section
3553(i);
``(C) the analysis of Federal incident data performed under
section 3597; and
``(D) any other information determined appropriate by the
Director or the Director of the Cybersecurity and
Infrastructure Security Agency.
``(g) Exception for National Security Systems.--The
guidance issued under subsection (b) shall not apply to
national security systems.
``(h) Delegation of Authority for Certain Systems.--The
authorities of the Director described in subsection (b) shall
be delegated--
``(1) to the Secretary of Defense in the case of systems
described in section 3553(e)(2); and
``(2) to the Director of National Intelligence in the case
of systems described in 3553(e)(3).''.
(b) Deadline for Guidance.--Not later than 180 days after
the date of enactment of this Act, the Director shall issue
the guidance required under section 3559A(b) of title 44,
United States Code, as added by subsection (a).
(c) Clerical Amendment.--The table of sections for chapter
35 of title 44, United States Code, is amended by adding
after the item relating to section 3559 the following:
``3559A. Federal penetration testing.''.
(d) Penetration Testing by the Secretary of Homeland
Security.--Section 3553(b) of title 44, United States Code,
as amended by section 5121, is further amended--
(1) in paragraph (8)(B), by striking ``and'' at the end;
(2) by redesignating paragraph (9) as paragraph (10); and
(3) by inserting after paragraph (8) the following:
``(9) performing penetration testing with or without
advance notice to, or authorization from, agencies, to
identify vulnerabilities within Federal information systems;
and''.
SEC. 5145. ONGOING THREAT HUNTING PROGRAM.
(a) Threat Hunting Program.--
(1) In general.--Not later than 540 days after the date of
enactment of this Act, the Director of the Cybersecurity and
Infrastructure Security Agency shall establish a program to
provide ongoing, hypothesis-driven threat-hunting services on
the network of each agency.
(2) Plan.--Not later than 180 days after the date of
enactment of this Act, the Director of the Cybersecurity and
Infrastructure Security Agency shall develop a plan to
establish the program required under paragraph (1) that
describes how the Director of the Cybersecurity and
Infrastructure Security Agency plans to--
(A) determine the method for collecting, storing,
accessing, and analyzing appropriate agency data;
(B) provide on-premises support to agencies;
(C) staff threat hunting services;
(D) allocate available human and financial resources to
implement the plan; and
(E) provide input to the heads of agencies on the use of--
(i) more stringent standards under section 11331(c)(1) of
title 40, United States Code; and
(ii) additional cybersecurity procedures under section 3554
of title 44, United States Code.
(b) Reports.--The Director of the Cybersecurity and
Infrastructure Security Agency shall submit to the
appropriate congressional committees--
(1) not later than 30 days after the date on which the
Director of the Cybersecurity and Infrastructure Security
Agency completes the plan required under subsection (a)(2), a
report on the plan to provide threat hunting services to
agencies;
(2) not less than 30 days before the date on which the
Director of the Cybersecurity and Infrastructure Security
Agency begins providing threat hunting services under the
program under subsection (a)(1), a report providing any
updates to the plan developed under subsection (a)(2); and
(3) not later than 1 year after the date on which the
Director of the Cybersecurity and Infrastructure Security
Agency begins providing threat hunting services to agencies
other than the Cybersecurity and Infrastructure Security
Agency, a report describing lessons learned from providing
those services.
SEC. 5146. CODIFYING VULNERABILITY DISCLOSURE PROGRAMS.
(a) In General.--Chapter 35 of title 44, United States
Code, is amended by inserting after section 3559A, as added
by section 5144 of this division, the following:
``Sec. 3559B. Federal vulnerability disclosure programs
``(a) Definitions.--In this section:
``(1) Report.--The term `report' means a vulnerability
disclosure made to an agency by a reporter.
``(2) Reporter.--The term `reporter' means an individual
that submits a vulnerability report pursuant to the
vulnerability disclosure process of an agency.
``(b) Responsibilities of OMB.--
``(1) Limitation on legal action.--The Director, in
consultation with the Attorney General, shall issue guidance
to agencies to not recommend or pursue legal action against a
reporter or an individual that conducts a security research
activity that the head of the agency determines--
``(A) represents a good faith effort to follow the
vulnerability disclosure policy of the agency developed under
subsection (d)(2); and
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``(B) is authorized under the vulnerability disclosure
policy of the agency developed under subsection (d)(2).
``(2) Sharing information with cisa.--The Director, in
coordination with the Director of the Cybersecurity and
Infrastructure Security Agency and in consultation with the
National Cyber Director, shall issue guidance to agencies on
sharing relevant information in a consistent, automated, and
machine readable manner with the Cybersecurity and
Infrastructure Security Agency, including--
``(A) any valid or credible reports of newly discovered or
not publicly known vulnerabilities (including
misconfigurations) on Federal information systems that use
commercial software or services;
``(B) information relating to vulnerability disclosure,
coordination, or remediation activities of an agency,
particularly as those activities relate to outside
organizations--
``(i) with which the head of the agency believes the
Director of the Cybersecurity and Infrastructure Security
Agency can assist; or
``(ii) about which the head of the agency believes the
Director of the Cybersecurity and Infrastructure Security
Agency should know; and
``(C) any other information with respect to which the head
of the agency determines helpful or necessary to involve the
Cybersecurity and Infrastructure Security Agency.
``(3) Agency vulnerability disclosure policies.--The
Director shall issue guidance to agencies on the required
minimum scope of agency systems covered by the vulnerability
disclosure policy of an agency required under subsection
(d)(2).
``(c) Responsibilities of CISA.--The Director of the
Cybersecurity and Infrastructure Security Agency shall--
``(1) provide support to agencies with respect to the
implementation of the requirements of this section;
``(2) develop tools, processes, and other mechanisms
determined appropriate to offer agencies capabilities to
implement the requirements of this section; and
``(3) upon a request by an agency, assist the agency in the
disclosure to vendors of newly identified vulnerabilities in
vendor products and services.
``(d) Responsibilities of Agencies.--
``(1) Public information.--The head of each agency shall
make publicly available, with respect to each internet domain
under the control of the agency that is not a national
security system--
``(A) an appropriate security contact; and
``(B) the component of the agency that is responsible for
the internet accessible services offered at the domain.
``(2) Vulnerability disclosure policy.--The head of each
agency shall develop and make publicly available a
vulnerability disclosure policy for the agency, which shall--
``(A) describe--
``(i) the scope of the systems of the agency included in
the vulnerability disclosure policy;
``(ii) the type of information system testing that is
authorized by the agency;
``(iii) the type of information system testing that is not
authorized by the agency; and
``(iv) the disclosure policy of the agency for sensitive
information;
``(B) with respect to a report to an agency, describe--
``(i) how the reporter should submit the report; and
``(ii) if the report is not anonymous, when the reporter
should anticipate an acknowledgment of receipt of the report
by the agency;
``(C) include any other relevant information; and
``(D) be mature in scope, to cover all Federal information
systems used or operated by that agency or on behalf of that
agency.
``(3) Identified vulnerabilities.--The head of each agency
shall incorporate any vulnerabilities reported under
paragraph (2) into the vulnerability management process of
the agency in order to track and remediate the vulnerability.
``(e) Paperwork Reduction Act Exemption.--The requirements
of subchapter I (commonly known as the `Paperwork Reduction
Act') shall not apply to a vulnerability disclosure program
established under this section.
``(f) Congressional Reporting.--Not later than 90 days
after the date of enactment of the Federal Information
Security Modernization Act of 2021, and annually thereafter
for a 3-year period, the Director shall provide to the
Committee on Homeland Security and Governmental Affairs of
the Senate and the Committee on Oversight and Reform of the
House of Representatives a briefing on the status of the use
of vulnerability disclosure policies under this section at
agencies, including, with respect to the guidance issued
under subsection (b)(3), an identification of the agencies
that are compliant and not compliant.
``(g) Exemptions.--The authorities and functions of the
Director and Director of the Cybersecurity and Infrastructure
Security Agency under this section shall not apply to
national security systems.
``(h) Delegation of Authority for Certain Systems.--The
authorities of the Director and the Director of the
Cybersecurity and Infrastructure Security Agency described in
this section shall be delegated--
``(1) to the Secretary of Defense in the case of systems
described in section 3553(e)(2); and
``(2) to the Director of National Intelligence in the case
of systems described in section 3553(e)(3).''.
(b) Clerical Amendment.--The table of sections for chapter
35 of title 44, United States Code, is amended by adding
after the item relating to section 3559A, as added by section
204, the following:
``3559B. Federal vulnerability disclosure programs.''.
SEC. 5147. IMPLEMENTING PRESUMPTION OF COMPROMISE AND LEAST
PRIVILEGE PRINCIPLES.
(a) Guidance.--Not later than 1 year after the date of
enactment of this Act, the Director shall provide an update
to the appropriate congressional committees on progress in
increasing the internal defenses of agency systems,
including--
(1) shifting away from ``trusted networks'' to implement
security controls based on a presumption of compromise;
(2) implementing principles of least privilege in
administering information security programs;
(3) limiting the ability of entities that cause incidents
to move laterally through or between agency systems;
(4) identifying incidents quickly;
(5) isolating and removing unauthorized entities from
agency systems quickly;
(6) otherwise increasing the resource costs for entities
that cause incidents to be successful; and
(7) a summary of the agency progress reports required under
subsection (b).
(b) Agency Progress Reports.--Not later than 1 year after
the date of enactment of this Act, the head of each agency
shall submit to the Director a progress report on
implementing an information security program based on the
presumption of compromise and least privilege principles,
which shall include--
(1) a description of any steps the agency has completed,
including progress toward achieving requirements issued by
the Director;
(2) an identification of activities that have not yet been
completed and that would have the most immediate security
impact; and
(3) a schedule to implement any planned activities.
SEC. 5148. AUTOMATION REPORTS.
(a) OMB Report.--Not later than 180 days after the date of
enactment of this Act, the Director shall submit to the
appropriate congressional committees a report on the use of
automation under paragraphs (1), (5)(C) and (8)(B) of section
3554(b) of title 44, United States Code.
(b) GAO Report.--Not later than 1 year after the date of
enactment of this Act, the Comptroller General of the United
States shall perform a study on the use of automation and
machine readable data across the Federal Government for
cybersecurity purposes, including the automated updating of
cybersecurity tools, sensors, or processes by agencies.
SEC. 5149. EXTENSION OF FEDERAL ACQUISITION SECURITY COUNCIL.
Section 1328 of title 41, United States Code, is amended by
striking ``the date that'' and all that follows and inserting
``December 31, 2026.''.
SEC. 5150. COUNCIL OF THE INSPECTORS GENERAL ON INTEGRITY AND
EFFICIENCY DASHBOARD.
(a) Dashboard Required.--Section 11(e)(2) of the Inspector
General Act of 1978 (5 U.S.C. App.) is amended--
(1) in subparagraph (A), by striking ``and'' at the end;
(2) by redesignating subparagraph (B) as subparagraph (C);
and
(3) by inserting after subparagraph (A) the following:
``(B) that shall include a dashboard of open information
security recommendations identified in the independent
evaluations required by section 3555(a) of title 44, United
States Code; and''.
SEC. 5151. QUANTITATIVE CYBERSECURITY METRICS.
(a) Definition of Covered Metrics.--In this section, the
term ``covered metrics'' means the metrics established,
reviewed, and updated under section 224(c) of the
Cybersecurity Act of 2015 (6 U.S.C. 1522(c)).
(b) Updating and Establishing Metrics.--Not later than 1
year after the date of enactment of this Act, the Director of
the Cybersecurity and Infrastructure Security Agency, in
coordination with the Director, shall--
(1) evaluate any covered metrics established as of the date
of enactment of this Act; and
(2) as appropriate and pursuant to section 224(c) of the
Cybersecurity Act of 2015 (6 U.S.C. 1522(c))--
(A) update the covered metrics; and
(B) establish new covered metrics.
(c) Implementation.--
(1) In general.--Not later than 540 days after the date of
enactment of this Act, the Director, in coordination with the
Director of the Cybersecurity and Infrastructure Security
Agency, shall promulgate guidance that requires each agency
to use covered metrics to track trends in the cybersecurity
and incident response capabilities of the agency.
(2) Performance demonstration.--The guidance issued under
paragraph (1) and any subsequent guidance shall require
agencies to share with the Director of the Cybersecurity and
Infrastructure Security Agency data demonstrating the
performance of the agency using the covered metrics included
in the guidance.
(3) Penetration tests.--On not less than 2 occasions during
the 2-year period following
[[Page S8378]]
the date on which guidance is promulgated under paragraph
(1), the Director shall ensure that not less than 3 agencies
are subjected to substantially similar penetration tests, as
determined by the Director, in coordination with the Director
of the Cybersecurity and Infrastructure Security Agency, in
order to validate the utility of the covered metrics.
(4) Analysis capacity.--The Director of the Cybersecurity
and Infrastructure Security Agency shall develop a capability
that allows for the analysis of the covered metrics,
including cross-agency performance of agency cybersecurity
and incident response capability trends.
(d) Congressional Reports.--
(1) Utility of metrics.--Not later than 1 year after the
date of enactment of this Act, the Director of the
Cybersecurity and Infrastructure Security Agency shall submit
to the appropriate congressional committees a report on the
utility of the covered metrics.
(2) Use of metrics.--Not later than 180 days after the date
on which the Director promulgates guidance under subsection
(c)(1), the Director shall submit to the appropriate
congressional committees a report on the results of the use
of the covered metrics by agencies.
(e) Cybersecurity Act of 2015 Updates.--Section 224 of the
Cybersecurity Act of 2015 (6 U.S.C. 1522) is amended--
(1) by striking subsection (c) and inserting the following:
``(c) Improved Metrics.--
``(1) In general.--The Director of the Cybersecurity and
Infrastructure Security Agency, in coordination with the
Director, shall establish, review, and update metrics to
measure the cybersecurity and incident response capabilities
of agencies in accordance with the responsibilities of
agencies under section 3554 of title 44, United States Code.
``(2) Qualities.--With respect to the metrics established,
reviewed, and updated under paragraph (1)--
``(A) not less than 2 of the metrics shall be time-based,
such as a metric of--
``(i) the amount of time it takes for an agency to detect
an incident; and
``(ii) the amount of time that passes between--
``(I) the detection of an incident and the remediation of
the incident; and
``(II) the remediation of an incident and the recovery from
the incident; and
``(B) the metrics may include other measurable outcomes.'';
(2) by striking subsection (e); and
(3) by redesignating subsection (f) as subsection (e).
TITLE LIII--RISK-BASED BUDGET MODEL
SEC. 5161. DEFINITIONS.
In this title:
(1) Appropriate congressional committees.--The term
``appropriate congressional committees'' means--
(A) the Committee on Homeland Security and Governmental
Affairs and the Committee on Appropriations of the Senate;
and
(B) the Committee on Homeland Security and the Committee on
Appropriations of the House of Representatives.
(2) Covered agency.--The term ``covered agency'' has the
meaning given the term ``executive agency'' in section 133 of
title 41, United States Code.
(3) Director.--The term ``Director'' means the Director of
the Office of Management and Budget.
(4) Information technology.--The term ``information
technology''--
(A) has the meaning given the term in section 11101 of
title 40, United States Code; and
(B) includes the hardware and software systems of a Federal
agency that monitor and control physical equipment and
processes of the Federal agency.
(5) Risk-based budget.--The term ``risk-based budget''
means a budget--
(A) developed by identifying and prioritizing cybersecurity
risks and vulnerabilities, including impact on agency
operations in the case of a cyber attack, through analysis of
cyber threat intelligence, incident data, and tactics,
techniques, procedures, and capabilities of cyber threats;
and
(B) that allocates resources based on the risks identified
and prioritized under subparagraph (A).
SEC. 5162. ESTABLISHMENT OF RISK-BASED BUDGET MODEL.
(a) In General.--
(1) Model.--Not later than 1 year after the first
publication of the budget submitted by the President under
section 1105 of title 31, United States Code, following the
date of enactment of this Act, the Director, in consultation
with the Director of the Cybersecurity and Infrastructure
Security Agency and the National Cyber Director and in
coordination with the Director of the National Institute of
Standards and Technology, shall develop a standard model for
creating a risk-based budget for cybersecurity spending.
(2) Responsibility of director.--Section 3553(a) of title
44, United States Code, as amended by section 5121 of this
division, is further amended by inserting after paragraph (6)
the following:
``(7) developing a standard risk-based budget model to
inform Federal agency cybersecurity budget development;
and''.
(3) Contents of model.--The model required to be developed
under paragraph (1) shall--
(A) consider Federal and non-Federal cyber threat
intelligence products, where available, to identify threats,
vulnerabilities, and risks;
(B) consider the impact of agency operations of compromise
of systems, including the interconnectivity to other agency
systems and the operations of other agencies;
(C) indicate where resources should be allocated to have
the greatest impact on mitigating current and future threats
and current and future cybersecurity capabilities;
(D) be used to inform acquisition and sustainment of--
(i) information technology and cybersecurity tools;
(ii) information technology and cybersecurity
architectures;
(iii) information technology and cybersecurity personnel;
and
(iv) cybersecurity and information technology concepts of
operations; and
(E) be used to evaluate and inform Government-wide
cybersecurity programs of the Department of Homeland
Security.
(4) Required updates.--Not less frequently than once every
3 years, the Director shall review, and update as necessary,
the model required to be developed under this subsection.
(5) Publication.--The Director shall publish the model
required to be developed under this subsection, and any
updates necessary under paragraph (4), on the public website
of the Office of Management and Budget.
(6) Reports.--Not later than 1 year after the date of
enactment of this Act, and annually thereafter for each of
the 2 following fiscal years or until the date on which the
model required to be developed under this subsection is
completed, whichever is sooner, the Director shall submit a
report to Congress on the development of the model.
(b) Required Use of Risk-based Budget Model.--
(1) In general.--Not later than 2 years after the date on
which the model developed under subsection (a) is published,
the head of each covered agency shall use the model to
develop the annual cybersecurity and information technology
budget requests of the agency.
(2) Agency performance plans.--Section 3554(d)(2) of title
44, United States Code, is amended by inserting ``and the
risk-based budget model required under section 3553(a)(7)''
after ``paragraph (1)''.
(c) Verification.--
(1) In general.--Section 1105(a)(35)(A)(i) of title 31,
United States Code, is amended--
(A) in the matter preceding subclause (I), by striking ``by
agency, and by initiative area (as determined by the
administration)'' and inserting ``and by agency'';
(B) in subclause (III), by striking ``and'' at the end; and
(C) by adding at the end the following:
``(V) a validation that the budgets submitted were
developed using a risk-based methodology; and
``(VI) a report on the progress of each agency on closing
recommendations identified under the independent evaluation
required by section 3555(a)(1) of title 44.''.
(2) Effective date.--The amendments made by paragraph (1)
shall take effect on the date that is 2 years after the date
on which the model developed under subsection (a) is
published.
(d) Reports.--
(1) Independent evaluation.--Section 3555(a)(2) of title
44, United States Code, is amended--
(A) in subparagraph (B), by striking ``and'' at the end;
(B) in subparagraph (C), by striking the period at the end
and inserting ``; and''; and
(C) by adding at the end the following:
``(D) an assessment of how the agency implemented the risk-
based budget model required under section 3553(a)(7) and an
evaluation of whether the model mitigates agency cyber
vulnerabilities.''.
(2) Assessment.--Section 3553(c) of title 44, United States
Code, as amended by section 5121, is further amended by
inserting after paragraph (5) the following:
``(6) an assessment of--
``(A) Federal agency implementation of the model required
under subsection (a)(7);
``(B) how cyber vulnerabilities of Federal agencies changed
from the previous year; and
``(C) whether the model mitigates the cyber vulnerabilities
of the Federal Government.''.
(e) GAO Report.--Not later than 3 years after the date on
which the first budget of the President is submitted to
Congress containing the validation required under section
1105(a)(35)(A)(i)(V) of title 31, United States Code, as
amended by subsection (c), the Comptroller General of the
United States shall submit to the appropriate congressional
committees a report that includes--
(1) an evaluation of the success of covered agencies in
developing risk-based budgets;
(2) an evaluation of the success of covered agencies in
implementing risk-based budgets;
(3) an evaluation of whether the risk-based budgets
developed by covered agencies mitigate cyber vulnerability,
including the extent to which the risk-based budgets inform
Federal Government-wide cybersecurity programs; and
(4) any other information relating to risk-based budgets
the Comptroller General determines appropriate.
[[Page S8379]]
TITLE LIV--PILOT PROGRAMS TO ENHANCE FEDERAL CYBERSECURITY
SEC. 5181. ACTIVE CYBER DEFENSIVE STUDY.
(a) Definition.--In this section, the term ``active defense
technique''--
(1) means an action taken on the systems of an entity to
increase the security of information on the network of an
agency by misleading an adversary; and
(2) includes a honeypot, deception, or purposefully feeding
false or misleading data to an adversary when the adversary
is on the systems of the entity.
(b) Study.--Not later than 180 days after the date of
enactment of this Act, the Director of the Cybersecurity and
Infrastructure Security Agency, in coordination with the
Director, shall perform a study on the use of active defense
techniques to enhance the security of agencies, which shall
include--
(1) a review of legal restrictions on the use of different
active cyber defense techniques in Federal environments, in
consultation with the Department of Justice;
(2) an evaluation of--
(A) the efficacy of a selection of active defense
techniques determined by the Director of the Cybersecurity
and Infrastructure Security Agency; and
(B) factors that impact the efficacy of the active defense
techniques evaluated under subparagraph (A);
(3) recommendations on safeguards and procedures that shall
be established to require that active defense techniques are
adequately coordinated to ensure that active defense
techniques do not impede threat response efforts, criminal
investigations, and national security activities, including
intelligence collection; and
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