[Congressional Record (Bound Edition), Volume 160 (2014), Part 12]
[House]
[Pages 17457-17462]
[From the U.S. Government Publishing Office, www.gpo.gov]




         FEDERAL INFORMATION SECURITY MODERNIZATION ACT OF 2014

  Mr. MEADOWS. Mr. Speaker, I ask unanimous consent to take from the

[[Page 17458]]

Speaker's table the bill (S. 2521) to amend chapter 35 of title 44, 
United States Code, to provide for reform to Federal information 
security, and ask for its immediate consideration in the House.
  The Clerk read the title of the bill.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from North Carolina?
  There was no objection.
  The text of the bill is as follows:

                                S. 2521

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Federal Information Security 
     Modernization Act of 2014''.

     SEC. 2. FISMA REFORM.

       (a) In General.--Chapter 35 of title 44, United States 
     Code, is amended by striking subchapters II and III and 
     inserting the following:

                 ``SUBCHAPTER II--INFORMATION SECURITY

     ``Sec. 3551. Purposes

       ``The purposes of this subchapter are to--
       ``(1) provide a comprehensive framework for ensuring the 
     effectiveness of information security controls over 
     information resources that support Federal operations and 
     assets;
       ``(2) recognize the highly networked nature of the current 
     Federal computing environment and provide effective 
     governmentwide management and oversight of the related 
     information security risks, including coordination of 
     information security efforts throughout the civilian, 
     national security, and law enforcement communities;
       ``(3) provide for development and maintenance of minimum 
     controls required to protect Federal information and 
     information systems;
       ``(4) provide a mechanism for improved oversight of Federal 
     agency information security programs, including through 
     automated security tools to continuously diagnose and improve 
     security;
       ``(5) acknowledge that commercially developed information 
     security products offer advanced, dynamic, robust, and 
     effective information security solutions, reflecting market 
     solutions for the protection of critical information 
     infrastructures important to the national defense and 
     economic security of the nation that are designed, built, and 
     operated by the private sector; and
       ``(6) recognize that the selection of specific technical 
     hardware and software information security solutions should 
     be left to individual agencies from among commercially 
     developed products.

     ``Sec. 3552. Definitions

       ``(a) In General.--Except as provided under subsection (b), 
     the definitions under section 3502 shall apply to this 
     subchapter.
       ``(b) Additional Definitions.--As used in this subchapter:
       ``(1) The term `binding operational directive' means a 
     compulsory direction to an agency that--
       ``(A) is for purposes of safeguarding Federal information 
     and information systems from a known or reasonably suspected 
     information security threat, vulnerability, or risk;
       ``(B) shall be in accordance with policies, principles, 
     standards, and guidelines issued by the Director; and
       ``(C) may be revised or repealed by the Director if the 
     direction issued on behalf of the Director is not in 
     accordance with policies and principles developed by the 
     Director.
       ``(2) The term `incident' means an occurrence that--
       ``(A) actually or imminently jeopardizes, without lawful 
     authority, the integrity, confidentiality, or availability of 
     information or an information system; or
       ``(B) constitutes a violation or imminent threat of 
     violation of law, security policies, security procedures, or 
     acceptable use policies.
       ``(3) The term `information security' means protecting 
     information and information systems from unauthorized access, 
     use, disclosure, disruption, modification, or destruction in 
     order to provide--
       ``(A) integrity, which means guarding against improper 
     information modification or destruction, and includes 
     ensuring information nonrepudiation and authenticity;
       ``(B) confidentiality, which means preserving authorized 
     restrictions on access and disclosure, including means for 
     protecting personal privacy and proprietary information; and
       ``(C) availability, which means ensuring timely and 
     reliable access to and use of information.
       ``(4) The term `information technology' has the meaning 
     given that term in section 11101 of title 40.
       ``(5) The term `intelligence community' has the meaning 
     given that term in section 3(4) of the National Security Act 
     of 1947 (50 U.S.C. 3003(4)).
       ``(6)(A) The term `national security system' means any 
     information system (including any telecommunications system) 
     used or operated by an agency or by a contractor of an 
     agency, or other organization on behalf of an agency--
       ``(i) the function, operation, or use of which--
       ``(I) involves intelligence activities;
       ``(II) involves cryptologic activities related to national 
     security;
       ``(III) involves command and control of military forces;
       ``(IV) involves equipment that is an integral part of a 
     weapon or weapons system; or
       ``(V) subject to subparagraph (B), is critical to the 
     direct fulfillment of military or intelligence missions; or
       ``(ii) is protected at all times by procedures established 
     for information that have been specifically authorized under 
     criteria established by an Executive order or an Act of 
     Congress to be kept classified in the interest of national 
     defense or foreign policy.
       ``(B) Subparagraph (A)(i)(V) does not include a system that 
     is to be used for routine administrative and business 
     applications (including payroll, finance, logistics, and 
     personnel management applications).
       ``(7) The term `Secretary' means the Secretary of Homeland 
     Security.

     ``Sec. 3553. Authority and functions of the Director and the 
       Secretary

       ``(a) Director.--The Director shall oversee agency 
     information security policies and practices, including--
       ``(1) developing and overseeing the implementation of 
     policies, principles, standards, and guidelines on 
     information security, including through ensuring timely 
     agency adoption of and compliance with standards promulgated 
     under section 11331 of title 40;
       ``(2) requiring agencies, consistent with the standards 
     promulgated under such section 11331 and the requirements of 
     this subchapter, to identify and provide information security 
     protections commensurate with the risk and magnitude of the 
     harm resulting from the unauthorized access, use, disclosure, 
     disruption, modification, or destruction of--
       ``(A) information collected or maintained by or on behalf 
     of an agency; or
       ``(B) information systems used or operated by an agency or 
     by a contractor of an agency or other organization on behalf 
     of an agency;
       ``(3) ensuring that the Secretary carries out the 
     authorities and functions under subsection (b);
       ``(4) coordinating the development of standards and 
     guidelines under section 20 of the National Institute of 
     Standards and Technology Act (15 U.S.C. 278g-3) with agencies 
     and offices operating or exercising control of national 
     security systems (including the National Security Agency) to 
     assure, to the maximum extent feasible, that such standards 
     and guidelines are complementary with standards and 
     guidelines developed for national security systems;
       ``(5) overseeing agency compliance with the requirements of 
     this subchapter, including through any authorized action 
     under section 11303 of title 40, to enforce accountability 
     for compliance with such requirements; and
       ``(6) coordinating information security policies and 
     procedures with related information resources management 
     policies and procedures.
       ``(b) Secretary.--The Secretary, in consultation with the 
     Director, shall administer the implementation of agency 
     information security policies and practices for information 
     systems, except for national security systems and information 
     systems described in paragraph (2) or (3) of subsection (e), 
     including--
       ``(1) assisting the Director in carrying out the 
     authorities and functions under paragraphs (1), (2), (3), 
     (5), and (6) of subsection (a);
       ``(2) developing and overseeing the implementation of 
     binding operational directives to agencies to implement the 
     policies, principles, standards, and guidelines developed by 
     the Director under subsection (a)(1) and the requirements of 
     this subchapter, which may be revised or repealed by the 
     Director if the operational directives issued on behalf of 
     the Director are not in accordance with policies, principles, 
     standards, and guidelines developed by the Director, 
     including--
       ``(A) requirements for reporting security incidents to the 
     Federal information security incident center established 
     under section 3556;
       ``(B) requirements for the contents of the annual reports 
     required to be submitted under section 3554(c)(1);
       ``(C) requirements for the mitigation of exigent risks to 
     information systems; and
       ``(D) other operational requirements as the Director or 
     Secretary, in consultation with the Director, may determine 
     necessary;
       ``(3) monitoring agency implementation of information 
     security policies and practices;
       ``(4) convening meetings with senior agency officials to 
     help ensure effective implementation of information security 
     policies and practices;
       ``(5) coordinating Government-wide efforts on information 
     security policies and practices, including consultation with 
     the Chief Information Officers Council established under 
     section 3603 and the Director of the National Institute of 
     Standards and Technology;
       ``(6) providing operational and technical assistance to 
     agencies in implementing policies, principles, standards, and 
     guidelines on

[[Page 17459]]

     information security, including implementation of standards 
     promulgated under section 11331 of title 40, including by--
       ``(A) operating the Federal information security incident 
     center established under section 3556;
       ``(B) upon request by an agency, deploying technology to 
     assist the agency to continuously diagnose and mitigate 
     against cyber threats and vulnerabilities, with or without 
     reimbursement;
       ``(C) compiling and analyzing data on agency information 
     security; and
       ``(D) developing and conducting targeted operational 
     evaluations, including threat and vulnerability assessments, 
     on the information systems; and
       ``(7) other actions as the Director or the Secretary, in 
     consultation with the Director, may determine necessary to 
     carry out this subsection.
       ``(c) Report.--Not later than March 1 of each year, the 
     Director, in consultation with the Secretary, shall submit to 
     Congress a report on the effectiveness of information 
     security policies and practices during the preceding year, 
     including--
       ``(1) a summary of the incidents described in the annual 
     reports required to be submitted under section 3554(c)(1), 
     including a summary of the information required under section 
     3554(c)(1)(A)(iii);
       ``(2) a description of the threshold for reporting major 
     information security incidents;
       ``(3) a summary of the results of evaluations required to 
     be performed under section 3555;
       ``(4) an assessment of agency compliance with standards 
     promulgated under section 11331 of title 40; and
       ``(5) an assessment of agency compliance with data breach 
     notification policies and procedures issued by the Director.
       ``(d) National Security Systems.--Except for the 
     authorities and functions described in subsection (a)(5) and 
     subsection (c), the authorities and functions of the Director 
     and the Secretary under this section shall not apply to 
     national security systems.
       ``(e) Department of Defense and Intelligence Community 
     Systems.--(1) The authorities of the Director described in 
     paragraphs (1) and (2) of subsection (a) shall be delegated 
     to the Secretary of Defense in the case of systems described 
     in paragraph (2) and to the Director of National Intelligence 
     in the case of systems described in paragraph (3).
       ``(2) The systems described in this paragraph are systems 
     that are operated by the Department of Defense, a contractor 
     of the Department of Defense, or another entity on behalf of 
     the Department of Defense that processes any information the 
     unauthorized access, use, disclosure, disruption, 
     modification, or destruction of which would have a 
     debilitating impact on the mission of the Department of 
     Defense.
       ``(3) The systems described in this paragraph are systems 
     that are operated by an element of the intelligence 
     community, a contractor of an element of the intelligence 
     community, or another entity on behalf of an element of the 
     intelligence community that processes any information the 
     unauthorized access, use, disclosure, disruption, 
     modification, or destruction of which would have a 
     debilitating impact on the mission of an element of the 
     intelligence community.
       ``(f) Consideration.--
       ``(1) In general.--In carrying out the responsibilities 
     under subsection (b), the Secretary shall consider any 
     applicable standards or guidelines developed by the National 
     Institute of Standards and Technology and issued by the 
     Secretary of Commerce under section 11331 of title 40.
       ``(2) Directives.--The Secretary shall--
       ``(A) consult with the Director of the National Institute 
     of Standards and Technology regarding any binding operational 
     directive that implements standards and guidelines developed 
     by the National Institute of Standards and Technology; and
       ``(B) ensure that binding operational directives issued 
     under subsection (b)(2) do not conflict with the standards 
     and guidelines issued under section 11331 of title 40.
       ``(3) Rule of construction.--Nothing in this subchapter 
     shall be construed as authorizing the Secretary to direct the 
     Secretary of Commerce in the development and promulgation of 
     standards and guidelines under section 11331 of title 40.
       ``(g) Exercise of Authority.--To ensure fiscal and policy 
     consistency, the Secretary shall exercise the authority under 
     this section subject to direction by the President, in 
     coordination with the Director.

     ``Sec. 3554. Federal agency responsibilities

       ``(a) In General.--The head of each agency shall--
       ``(1) be responsible for--
       ``(A) providing information security protections 
     commensurate with the risk and magnitude of the harm 
     resulting from unauthorized access, use, disclosure, 
     disruption, modification, or destruction of--
       ``(i) information collected or maintained by or on behalf 
     of the agency; and
       ``(ii) information systems used or operated by an agency or 
     by a contractor of an agency or other organization on behalf 
     of an agency;
       ``(B) complying with the requirements of this subchapter 
     and related policies, procedures, standards, and guidelines, 
     including--
       ``(i) information security standards promulgated under 
     section 11331 of title 40;
       ``(ii) operational directives developed by the Secretary 
     under section 3553(b);
       ``(iii) policies and procedures issued by the Director; and
       ``(iv) information security standards and guidelines for 
     national security systems issued in accordance with law and 
     as directed by the President; and
       ``(C) ensuring that information security management 
     processes are integrated with agency strategic, operational, 
     and budgetary planning processes;
       ``(2) ensure that senior agency officials provide 
     information security for the information and information 
     systems that support the operations and assets under their 
     control, including through--
       ``(A) assessing the risk and magnitude of the harm that 
     could result from the unauthorized access, use, disclosure, 
     disruption, modification, or destruction of such information 
     or information systems;
       ``(B) determining the levels of information security 
     appropriate to protect such information and information 
     systems in accordance with standards promulgated under 
     section 11331 of title 40, for information security 
     classifications and related requirements;
       ``(C) implementing policies and procedures to cost-
     effectively reduce risks to an acceptable level; and
       ``(D) periodically testing and evaluating information 
     security controls and techniques to ensure that they are 
     effectively implemented;
       ``(3) delegate to the agency Chief Information Officer 
     established under section 3506 (or comparable official in an 
     agency not covered by such section) the authority to ensure 
     compliance with the requirements imposed on the agency under 
     this subchapter, including--
       ``(A) designating a senior agency information security 
     officer who shall--
       ``(i) carry out the Chief Information Officer's 
     responsibilities under this section;
       ``(ii) possess professional qualifications, including 
     training and experience, required to administer the functions 
     described under this section;
       ``(iii) have information security duties as that official's 
     primary duty; and
       ``(iv) head an office with the mission and resources to 
     assist in ensuring agency compliance with this section;
       ``(B) developing and maintaining an agencywide information 
     security program as required by subsection (b);
       ``(C) developing and maintaining information security 
     policies, procedures, and control techniques to address all 
     applicable requirements, including those issued under section 
     3553 of this title and section 11331 of title 40;
       ``(D) training and overseeing personnel with significant 
     responsibilities for information security with respect to 
     such responsibilities; and
       ``(E) assisting senior agency officials concerning their 
     responsibilities under paragraph (2);
       ``(4) ensure that the agency has trained personnel 
     sufficient to assist the agency in complying with the 
     requirements of this subchapter and related policies, 
     procedures, standards, and guidelines;
       ``(5) ensure that the agency Chief Information Officer, in 
     coordination with other senior agency officials, reports 
     annually to the agency head on the effectiveness of the 
     agency information security program, including progress of 
     remedial actions;
       ``(6) ensure that senior agency officials, including chief 
     information officers of component agencies or equivalent 
     officials, carry out responsibilities under this subchapter 
     as directed by the official delegated authority under 
     paragraph (3); and
       ``(7) ensure that all personnel are held accountable for 
     complying with the agency-wide information security program 
     implemented under subsection (b).
       ``(b) Agency Program.--Each agency shall develop, document, 
     and implement an agency-wide information security program to 
     provide information security for the information and 
     information systems that support the operations and assets of 
     the agency, including those provided or managed by another 
     agency, contractor, or other source, that includes--
       ``(1) periodic assessments of the risk and magnitude of the 
     harm that could result from the unauthorized access, use, 
     disclosure, disruption, modification, or destruction of 
     information and information systems that support the 
     operations and assets of the agency, which may include using 
     automated tools consistent with standards and guidelines 
     promulgated under section 11331 of title 40;
       ``(2) policies and procedures that--
       ``(A) are based on the risk assessments required by 
     paragraph (1);
       ``(B) cost-effectively reduce information security risks to 
     an acceptable level;
       ``(C) ensure that information security is addressed 
     throughout the life cycle of each agency information system; 
     and
       ``(D) ensure compliance with--
       ``(i) the requirements of this subchapter;

[[Page 17460]]

       ``(ii) policies and procedures as may be prescribed by the 
     Director, and information security standards promulgated 
     under section 11331 of title 40;
       ``(iii) minimally acceptable system configuration 
     requirements, as determined by the agency; and
       ``(iv) any other applicable requirements, including 
     standards and guidelines for national security systems issued 
     in accordance with law and as directed by the President;
       ``(3) subordinate plans for providing adequate information 
     security for networks, facilities, and systems or groups of 
     information systems, as appropriate;
       ``(4) security awareness training to inform personnel, 
     including contractors and other users of information systems 
     that support the operations and assets of the agency, of--
       ``(A) information security risks associated with their 
     activities; and
       ``(B) their responsibilities in complying with agency 
     policies and procedures designed to reduce these risks;
       ``(5) periodic testing and evaluation of the effectiveness 
     of information security policies, procedures, and practices, 
     to be performed with a frequency depending on risk, but no 
     less than annually, of which such testing--
       ``(A) shall include testing of management, operational, and 
     technical controls of every information system identified in 
     the inventory required under section 3505(c);
       ``(B) may include testing relied on in an evaluation under 
     section 3555; and
       ``(C) shall include using automated tools, consistent with 
     standards and guidelines promulgated under section 11331 of 
     title 40;
       ``(6) a process for planning, implementing, evaluating, and 
     documenting remedial action to address any deficiencies in 
     the information security policies, procedures, and practices 
     of the agency;
       ``(7) procedures for detecting, reporting, and responding 
     to security incidents, which--
       ``(A) shall be consistent with the standards and guidelines 
     described in section 3556(b);
       ``(B) may include using automated tools; and
       ``(C) shall include--
       ``(i) mitigating risks associated with such incidents 
     before substantial damage is done;
       ``(ii) notifying and consulting with the Federal 
     information security incident center established in section 
     3556; and
       ``(iii) notifying and consulting with, as appropriate--

       ``(I) law enforcement agencies and relevant Offices of 
     Inspector General and Offices of General Counsel;
       ``(II) an office designated by the President for any 
     incident involving a national security system;
       ``(III) for a major incident, the committees of Congress 
     described in subsection (c)(1)--

       ``(aa) not later than 7 days after the date on which there 
     is a reasonable basis to conclude that the major incident has 
     occurred; and
       ``(bb) after the initial notification under item (aa), 
     within a reasonable period of time after additional 
     information relating to the incident is discovered, including 
     the summary required under subsection (c)(1)(A)(i); and

       ``(IV) any other agency or office, in accordance with law 
     or as directed by the President; and

       ``(8) plans and procedures to ensure continuity of 
     operations for information systems that support the 
     operations and assets of the agency.
       ``(c) Agency Reporting.--
       ``(1) Annual report.--
       ``(A) In general.--Each agency shall submit to the 
     Director, the Secretary, the Committee on Government Reform, 
     the Committee on Homeland Security, and the Committee on 
     Science of the House of Representatives, the Committee on 
     Homeland Security and Governmental Affairs and the Committee 
     on Commerce, Science, and Transportation of the Senate, the 
     appropriate authorization and appropriations committees of 
     Congress, and the Comptroller General a report on the 
     adequacy and effectiveness of information security policies, 
     procedures, and practices, including--
       ``(i) a description of each major information security 
     incident or related sets of incidents, including summaries 
     of--

       ``(I) the threats and threat actors, vulnerabilities, and 
     impacts relating to the incident;
       ``(II) the risk assessments conducted under section 
     3554(a)(2)(A) of the affected information systems before the 
     date on which the incident occurred;
       ``(III) the status of compliance of the affected 
     information systems with applicable security requirements at 
     the time of the incident; and
       ``(IV) the detection, response, and remediation actions;

       ``(ii) the total number of information security incidents, 
     including a description of incidents resulting in significant 
     compromise of information security, system impact levels, 
     types of incident, and locations of affected systems;
       ``(iii) a description of each major information security 
     incident that involved a breach of personally identifiable 
     information, as defined by the Director, including--

       ``(I) the number of individuals whose information was 
     affected by the major information security incident; and
       ``(II) a description of the information that was breached 
     or exposed; and

       ``(iv) any other information as the Director or the 
     Secretary, in consultation with the Director, may require.
       ``(B) Unclassified report.--
       ``(i) In general.--Each report submitted under subparagraph 
     (A) shall be in unclassified form, but may include a 
     classified annex.
       ``(ii) Access to information.--The head of an agency shall 
     ensure that, to the greatest extent practicable, information 
     is included in the unclassified version of the reports 
     submitted by the agency under subparagraph (A).
       ``(2) Other plans and reports.--Each agency shall address 
     the adequacy and effectiveness of information security 
     policies, procedures, and practices in management plans and 
     reports.
       ``(d) Performance Plan.--(1) In addition to the 
     requirements of subsection (c), each agency, in consultation 
     with the Director, shall include as part of the performance 
     plan required under section 1115 of title 31 a description 
     of--
       ``(A) the time periods; and
       ``(B) the resources, including budget, staffing, and 
     training,

     that are necessary to implement the program required under 
     subsection (b).
       ``(2) The description under paragraph (1) shall be based on 
     the risk assessments required under subsection (b)(1).
       ``(e) Public Notice and Comment.--Each agency shall provide 
     the public with timely notice and opportunities for comment 
     on proposed information security policies and procedures to 
     the extent that such policies and procedures affect 
     communication with the public.

     ``Sec. 3555. Annual independent evaluation

       ``(a) In General.--(1) Each year each agency shall have 
     performed an independent evaluation of the information 
     security program and practices of that agency to determine 
     the effectiveness of such program and practices.
       ``(2) Each evaluation under this section shall include--
       ``(A) testing of the effectiveness of information security 
     policies, procedures, and practices of a representative 
     subset of the agency's information systems;
       ``(B) an assessment of the effectiveness of the information 
     security policies, procedures, and practices of the agency; 
     and
       ``(C) separate presentations, as appropriate, regarding 
     information security relating to national security systems.
       ``(b) Independent Auditor.--Subject to subsection (c)--
       ``(1) for each agency with an Inspector General appointed 
     under the Inspector General Act of 1978, the annual 
     evaluation required by this section shall be performed by the 
     Inspector General or by an independent external auditor, as 
     determined by the Inspector General of the agency; and
       ``(2) for each agency to which paragraph (1) does not 
     apply, the head of the agency shall engage an independent 
     external auditor to perform the evaluation.
       ``(c) National Security Systems.--For each agency operating 
     or exercising control of a national security system, that 
     portion of the evaluation required by this section directly 
     relating to a national security system shall be performed--
       ``(1) only by an entity designated by the agency head; and
       ``(2) in such a manner as to ensure appropriate protection 
     for information associated with any information security 
     vulnerability in such system commensurate with the risk and 
     in accordance with all applicable laws.
       ``(d) Existing Evaluations.--The evaluation required by 
     this section may be based in whole or in part on an audit, 
     evaluation, or report relating to programs or practices of 
     the applicable agency.
       ``(e) Agency Reporting.--(1) Each year, not later than such 
     date established by the Director, the head of each agency 
     shall submit to the Director the results of the evaluation 
     required under this section.
       ``(2) To the extent an evaluation required under this 
     section directly relates to a national security system, the 
     evaluation results submitted to the Director shall contain 
     only a summary and assessment of that portion of the 
     evaluation directly relating to a national security system.
       ``(f) Protection of Information.--Agencies and evaluators 
     shall take appropriate steps to ensure the protection of 
     information which, if disclosed, may adversely affect 
     information security. Such protections shall be commensurate 
     with the risk and comply with all applicable laws and 
     regulations.
       ``(g) OMB Reports to Congress.--(1) The Director shall 
     summarize the results of the evaluations conducted under this 
     section in the report to Congress required under section 
     3553(c).
       ``(2) The Director's report to Congress under this 
     subsection shall summarize information regarding information 
     security relating to national security systems in such a 
     manner as to ensure appropriate protection for information 
     associated with any information security vulnerability in 
     such system

[[Page 17461]]

     commensurate with the risk and in accordance with all 
     applicable laws.
       ``(3) Evaluations and any other descriptions of information 
     systems under the authority and control of the Director of 
     National Intelligence or of National Foreign Intelligence 
     Programs systems under the authority and control of the 
     Secretary of Defense shall be made available to Congress only 
     through the appropriate oversight committees of Congress, in 
     accordance with applicable laws.
       ``(h) Comptroller General.--The Comptroller General shall 
     periodically evaluate and report to Congress on--
       ``(1) the adequacy and effectiveness of agency information 
     security policies and practices; and
       ``(2) implementation of the requirements of this 
     subchapter.
       ``(i) Assessment Technical Assistance.--The Comptroller 
     General may provide technical assistance to an Inspector 
     General or the head of an agency, as applicable, to assist 
     the Inspector General or head of an agency in carrying out 
     the duties under this section, including by testing 
     information security controls and procedures.
       ``(j) Guidance.--The Director, in consultation with the 
     Secretary, the Chief Information Officers Council established 
     under section 3603, 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.

     ``Sec. 3556. Federal information security incident center

       ``(a) In General.--The Secretary shall ensure the operation 
     of a central Federal information security incident center 
     to--
       ``(1) provide timely technical assistance to operators of 
     agency information systems regarding security incidents, 
     including guidance on detecting and handling information 
     security incidents;
       ``(2) compile and analyze information about incidents that 
     threaten information security;
       ``(3) inform operators of agency information systems about 
     current and potential information security threats, and 
     vulnerabilities;
       ``(4) provide, as appropriate, intelligence and other 
     information about cyber threats, vulnerabilities, and 
     incidents to agencies to assist in risk assessments conducted 
     under section 3554(b); and
       ``(5) consult with the National Institute of Standards and 
     Technology, agencies or offices operating or exercising 
     control of national security systems (including the National 
     Security Agency), and such other agencies or offices in 
     accordance with law and as directed by the President 
     regarding information security incidents and related matters.
       ``(b) National Security Systems.--Each agency operating or 
     exercising control of a national security system shall share 
     information about information security incidents, threats, 
     and vulnerabilities with the Federal information security 
     incident center to the extent consistent with standards and 
     guidelines for national security systems, issued in 
     accordance with law and as directed by the President.

     ``Sec. 3557. National security systems

       ``The head of each agency operating or exercising control 
     of a national security system shall be responsible for 
     ensuring that the agency--
       ``(1) provides information security protections 
     commensurate with the risk and magnitude of the harm 
     resulting from the unauthorized access, use, disclosure, 
     disruption, modification, or destruction of the information 
     contained in such system;
       ``(2) implements information security policies and 
     practices as required by standards and guidelines for 
     national security systems, issued in accordance with law and 
     as directed by the President; and
       ``(3) complies with the requirements of this subchapter.

     ``Sec. 3558. Effect on existing law

       ``Nothing in this subchapter, section 11331 of title 40, or 
     section 20 of the National Standards and Technology Act (15 
     U.S.C. 278g-3) may be construed as affecting the authority of 
     the President, the Office of Management and Budget or the 
     Director thereof, the National Institute of Standards and 
     Technology, or the head of any agency, with respect to the 
     authorized use or disclosure of information, including with 
     regard to the protection of personal privacy under section 
     552a of title 5, the disclosure of information under section 
     552 of title 5, the management and disposition of records 
     under chapters 29, 31, or 33 of title 44, the management of 
     information resources under subchapter I of chapter 35 of 
     this title, or the disclosure of information to the Congress 
     or the Comptroller General of the United States.''.
       (b) Major Incident.--The Director of the Office of 
     Management and Budget shall--
       (1) develop guidance on what constitutes a major incident 
     for purposes of section 3554(b) of title 44, United States 
     Code, as added by subsection (a); and
       (2) provide to Congress periodic briefings on the status of 
     the developing of the guidance until the date on which the 
     guidance is issued.
       (c) Continuous Diagnostics.--During the 2 year period 
     beginning on the date of enactment of this Act, the Director 
     of the Office of Management and Budget, with the assistance 
     of the Secretary of Homeland Security, shall include in each 
     report submitted under section 3553(c) of title 44, United 
     States Code, as added by subsection (a), an assessment of the 
     adoption by agencies of continuous diagnostics technologies, 
     including through the Continuous Diagnostics and Mitigation 
     program, and other advanced security tools to provide 
     information security, including challenges to the adoption of 
     such technologies or security tools.
       (d) Breaches.--
       (1) Requirements.--The Director of the Office of Management 
     and Budget shall ensure that data breach notification 
     policies and guidelines are updated periodically and 
     require--
       (A) except as provided in paragraph (4), notice by the 
     affected agency to each committee of Congress described in 
     section 3554(c)(1) of title 44, United States Code, as added 
     by subsection (a), the Committee on the Judiciary of the 
     Senate, and the Committee on the Judiciary of the House of 
     Representatives, which shall--
       (i) be provided expeditiously and not later than 30 days 
     after the date on which the agency discovered the 
     unauthorized acquisition or access; and
       (ii) include--

       (I) information about the breach, including a summary of 
     any information that the agency knows on the date on which 
     notification is provided about how the breach occurred;
       (II) an estimate of the number of individuals affected by 
     the breach, based on information that the agency knows on the 
     date on which notification is provided, including an 
     assessment of the risk of harm to affected individuals;
       (III) a description of any circumstances necessitating a 
     delay in providing notice to affected individuals; and
       (IV) an estimate of whether and when the agency will 
     provide notice to affected individuals; and

       (B) notice by the affected agency to affected individuals, 
     pursuant to data breach notification policies and guidelines, 
     which shall be provided as expeditiously as practicable and 
     without unreasonable delay after the agency discovers the 
     unauthorized acquisition or access.
       (2) National security; law enforcement; remediation.--The 
     Attorney General, the head of an element of the intelligence 
     community (as such term is defined under section 3(4) of the 
     National Security Act of 1947 (50 U.S.C. 3003(4)), or the 
     Secretary of Homeland Security may delay the notice to 
     affected individuals under paragraph (1)(B) if the notice 
     would disrupt a law enforcement investigation, endanger 
     national security, or hamper security remediation actions.
       (3) Reports.--
       (A) Director of omb.--During the first 2 years beginning 
     after the date of enactment of this Act, the Director of the 
     Office of Management and Budget shall, on an annual basis--
       (i) assess agency implementation of data breach 
     notification policies and guidelines in aggregate; and
       (ii) include the assessment described in clause (i) in the 
     report required under section 3553(c) of title 44, United 
     States Code.
       (B) Secretary of homeland security.--During the first 2 
     years beginning after the date of enactment of this Act, the 
     Secretary of Homeland Security shall include an assessment of 
     the status of agency implementation of data breach 
     notification policies and guidelines in the requirements 
     under section 3553(b)(2)(B) of title 44, United States Code.
       (4) Exception.--Any element of the intelligence community 
     (as such term is defined under section 3(4) of the National 
     Security Act of 1947 (50 U.S.C. 3003(4)) that is required to 
     provide notice under paragraph (1)(A) shall only provide such 
     notice to appropriate committees of Congress.
       (5) Rule of construction.--Nothing in paragraph (1) shall 
     be construed to alter any authority of a Federal agency or 
     department.
       (e) Technical and Conforming Amendments.--
       (1) Table of sections.--The table of sections for chapter 
     35 of title 44, United States Code is amended by striking the 
     matter relating to subchapters II and III and inserting the 
     following:

                  ``subchapter ii--information security

``3551. Purposes.
``3552. Definitions.
``3553. Authority and functions of the Director and the Secretary.
``3554. Federal agency responsibilities.
``3555. Annual independent evaluation.
``3556. Federal information security incident center.
``3557. National security systems.
``3558. Effect on existing law.''.
       (2) Cybersecurity research and development act.--Section 
     8(d)(1) of the Cybersecurity Research and Development Act (15 
     U.S.C. 7406) is amended by striking ``section 3534'' and 
     inserting ``section 3554''.

[[Page 17462]]

       (3) Homeland security act of 2002.--The Homeland Security 
     Act of 2002 (6 U.S.C. 101 et seq.) is amended--
       (A) in section 223 (6 U.S.C. 143)
       (i) in the section heading, by inserting ``federal and'' 
     before ``non-federal'';
       (ii) in the matter preceding paragraph (1), by striking 
     ``the Under Secretary for Intelligence and Analysis, in 
     cooperation with the Assistant Secretary for Infrastructure 
     Protection'' and inserting ``the Under Secretary appointed 
     under section 103(a)(1)(H)'';
       (iii) in paragraph (2), by striking the period at the end 
     and inserting ``; and''; and
       (iv) by adding at the end the following:
       ``(3) fulfill the responsibilities of the Secretary to 
     protect Federal information systems under subchapter II of 
     chapter 35 of title 44, United States Code.'';
       (B) in section 1001(c)(1)(A) (6 U.S.C. 511(c)(1)(A)), by 
     striking ``section 3532(3)'' and inserting ``section 
     3552(b)(5)''; and
       (C) in the table of contents in section 1(b), by striking 
     the item relating to section 223 and inserting the following:

``Sec. 223. Enhancement of Federal and non-Federal cybersecurity.''.
       (4) 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--
       (A) in subsection (a)(2), by striking ``section 
     3532(b)(2)'' and inserting ``section 3552(b)(5)''; and
       (B) in subsection (e)--
       (i) in paragraph (2), by striking ``section 3532(1)'' and 
     inserting ``section 3552(b)(2)''; and
       (ii) in paragraph (5), by striking ``section 3532(b)(2)'' 
     and inserting ``section 3552(b)(5)''.
       (5) Title 10.--Title 10, United States Code, is amended--
       (A) in section 2222(j)(5), by striking ``section 
     3542(b)(2)'' and inserting ``section 3552(b)(5)'';
       (B) in section 2223(c)(3), by striking ``section 
     3542(b)(2)'' and inserting ``section 3552(b)(5)''; and
       (C) in section 2315, by striking ``section 3542(b)(2)'' and 
     inserting ``section 3552(b)(5)''.
       (f) Other Provisions.--
       (1) Circular a-130.--Not later than 1 year after the date 
     of enactment of this Act, the Director of the Office of 
     Management and Budget shall amend or revise Office of 
     Management and Budget Circular A-130 to eliminate inefficient 
     or wasteful reporting. The Director of the Office of 
     Management and Budget shall provide quarterly briefings to 
     Congress on the status of the amendment or revision required 
     under this paragraph.
       (2) ISPAB.--Section 21(b) of the National Institute of 
     Standards and Technology Act (15 U.S.C. 278g-4(b)) is 
     amended--
       (A) in paragraph (2), by inserting ``, the Secretary of 
     Homeland Security,'' after ``the Institute''; and
       (B) in paragraph (3), by inserting ``the Secretary of 
     Homeland Security,'' after ``the Secretary of Commerce,''.

  The bill was ordered to be read a third time, was read the third 
time, and passed, and a motion to reconsider was laid on the table.

                          ____________________