[House Report 107-219]
[From the U.S. Government Publishing Office]



107th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                    107-219

======================================================================



 
          INTELLIGENCE AUTHORIZATION ACT FOR FISCAL YEAR 2002

                                _______
                                

 September 26, 2001.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

    Mr. Goss, from the Permanent Select Committee on Intelligence, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 2883]

      [Including cost estimate of the Congressional Budget Office]

  The Permanent Select Committee on Intelligence, to whom was 
referred the bill (H.R. 2883) to authorize appropriations for 
fiscal year 2002 for intelligence and intelligence-related 
activities of the United States Government, the Community 
Management Account, and the Central Intelligence Agency 
Retirement and Disability System, and for other purposes, 
having considered the same, report favorably thereon with an 
amendment and recommend that the bill as amended do pass.

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

  (a) Short Title.--This Act may be cited as the ``Intelligence 
Authorization Act for Fiscal Year 2002''.
  (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.

                    TITLE I--INTELLIGENCE ACTIVITIES

Sec. 101. Authorization of appropriations.
Sec. 102. Classified schedule of authorizations.
Sec. 103. Personnel ceiling adjustments.
Sec. 104. Intelligence community management account.
Sec. 105. Codification of the Coast Guard as an element of the 
intelligence community.

 TITLE II--CENTRAL INTELLIGENCE AGENCY RETIREMENT AND DISABILITY SYSTEM

Sec. 201. Authorization of appropriations.

                     TITLE III--GENERAL PROVISIONS

Sec. 301. Increase in employee compensation and benefits authorized by 
law.
Sec. 302. Restriction on conduct of intelligence activities.
Sec. 303. Sense of the Congress on intelligence community contracting.
Sec. 304. Requirements for lodging allowances in intelligence community 
assignment program benefits.
Sec. 305. Technical amendment.
Sec. 306. Commission on September 11 government preparedness and 
performance.

                 TITLE IV--CENTRAL INTELLIGENCE AGENCY

Sec. 401. Modifications to Central Intelligence Agency's central 
services program.
Sec. 402. Extension of CIA Voluntary Separation Pay Act.
Sec. 403. Guidelines for recruitment of certain foreign assets.

         TITLE V--DEPARTMENT OF DEFENSE INTELLIGENCE ACTIVITIES

Sec. 501. Authority to purchase items of nominal value for recruitment 
purposes.
Sec. 502. Funding for infrastructure and quality-of-life improvements 
at Menwith Hill and Bad Aibling stations.
Sec. 503. Continuation of Joint Interagency Task Force at current 
locations in Florida and California.
Sec. 504. Modification of authorities relating to interdiction of 
aircraft engaged in illicit drug trafficking.
Sec. 505. Undergraduate training program for employees of the National 
Imagery and Mapping Agency.
Sec. 506. Technical amendments.

                    TITLE I--INTELLIGENCE ACTIVITIES

SEC. 101. AUTHORIZATION OF APPROPRIATIONS.

  Funds are hereby authorized to be appropriated for fiscal year 2002 
for the conduct of the intelligence and intelligence-related activities 
of the following elements of the United States Government:
          (1) The Central Intelligence Agency.
          (2) The Department of Defense.
          (3) The Defense Intelligence Agency.
          (4) The National Security Agency.
          (5) The Department of the Army, the Department of the Navy, 
        and the Department of the Air Force.
          (6) The Department of State.
          (7) The Department of the Treasury.
          (8) The Department of Energy.
          (9) The Federal Bureau of Investigation.
          (10) The National Reconnaissance Office.
          (11) The National Imagery and Mapping Agency.
          (12) The Coast Guard.

SEC. 102. CLASSIFIED SCHEDULE OF AUTHORIZATIONS.

  (a) Specifications of Amounts and Personnel Ceilings.--The amounts 
authorized to be appropriated under section 101, and the authorized 
personnel ceilings as of September 30, 2002, for the conduct of the 
intelligence and intelligence-related activities of the elements listed 
in such section, are those specified in the classified Schedule of 
Authorizations prepared to accompany the bill H.R. 2883 of the One 
Hundred Seventh Congress.
  (b) Availability of Classified Schedule of Authorizations.--The 
Schedule of Authorizations shall be made available to the Committees on 
Appropriations of the Senate and House of Representatives and to the 
President. The President shall provide for suitable distribution of the 
Schedule, or of appropriate portions of the Schedule, within the 
executive branch.

SEC. 103. PERSONNEL CEILING ADJUSTMENTS.

  (a) Authority for Adjustments.--With the approval of the Director of 
the Office of Management and Budget, the Director of Central 
Intelligence may authorize employment of civilian personnel in excess 
of the number authorized for fiscal year 2002 under section 102 when 
the Director of Central Intelligence determines that such action is 
necessary to the performance of important intelligence functions, 
except that the number of personnel employed in excess of the number 
authorized under such section may not, for any element of the 
intelligence community, exceed two percent of the number of civilian 
personnel authorized under such section for such element.
  (b) Notice to Intelligence Committees.--The Director of Central 
Intelligence shall promptly notify the Permanent Select Committee on 
Intelligence of the House of Representatives and the Select Committee 
on Intelligence of the Senate whenever the Director exercises the 
authority granted by this section.

SEC. 104. INTELLIGENCE COMMUNITY MANAGEMENT ACCOUNT.

  (a) Authorization of Appropriations.--There is authorized to be 
appropriated for the Intelligence Community Management Account of the 
Director of Central Intelligence for fiscal year 2002 the sum of 
$152,776,000. Within such amount, funds identified in the classified 
Schedule of Authorizations referred to in section 102(a) for the 
Advanced Research and Development Committee shall remain available 
until September 30, 2003.
  (b) Authorized Personnel Levels.--The elements within the 
Intelligence Community Management Account of the Director of Central 
Intelligence are authorized 313 full-time personnel as of September 30, 
2002. Personnel serving in such elements may be permanent employees of 
the Intelligence Community Management Account or personnel detailed 
from other elements of the United States Government.
  (c) Classified Authorizations.--
          (1) Authorization of appropriations.--In addition to amounts 
        authorized to be appropriated for the Intelligence Community 
        Management Account by subsection (a), there are also authorized 
        to be appropriated for the Intelligence Community Management 
        Account for fiscal year 2002 such additional amounts as are 
        specified in the classified Schedule of Authorizations referred 
        to in section 102(a). Such additional amounts shall remain 
        available until September 30, 2003.
          (2) Authorization of personnel.--In addition to the personnel 
        authorized by subsection (b) for elements of the Intelligence 
        Community Management Account as of September 30, 2002, there 
        are hereby authorized such additional personnel for such 
        elements as of that date as are specified in the classified 
        Schedule of Authorizations.
  (d) Reimbursement.--Except as provided in section 113 of the National 
Security Act of 1947 (50 U.S.C. 404h), during fiscal year 2002, any 
officer or employee of the United States or a member of the Armed 
Forces who is detailed to the staff of the Intelligence Community 
Management Account from another element of the United States Government 
shall be detailed on a reimbursable basis, except that any such 
officer, employee, or member may be detailed on a nonreimbursable basis 
for a period not to exceed one year for the performance of temporary 
functions as required by the Director of Central Intelligence.
  (e) National Drug Intelligence Center.--
          (1) In general.--Of the amount authorized to be appropriated 
        in subsection (a), $27,000,000 shall be available for the 
        National Drug Intelligence Center. Within such amount, funds 
        provided for research, development, test, and evaluation 
        purposes shall remain available until September 30, 2003, and 
        funds provided for procurement purposes shall remain available 
        until September 30, 2004.
          (2) Transfer of funds.--The Director of Central Intelligence 
        shall transfer to the Attorney General funds available for the 
        National Drug Intelligence Center under paragraph (1). The 
        Attorney General shall utilize funds so transferred for the 
        activities of the National Drug Intelligence Center.
          (3) Limitation.--Amounts available for the National Drug 
        Intelligence Center may not be used in contravention of the 
        provisions of section 103(d)(1) of the National Security Act of 
        1947 (50 U.S.C. 403-3(d)(1)).
          (4) Authority.--Notwithstanding any other provision of law, 
        the Attorney General shall retain full authority over the 
        operations of the National Drug Intelligence Center.

SEC. 105. CODIFICATION OF THE COAST GUARD AS AN ELEMENT OF THE 
                    INTELLIGENCE COMMUNITY.

  Section 3(4)(H) of the National Security Act of 1947 (50 U.S.C. 
401a(4)(H) is amended--
          (1) by striking ``and'' before ``the Department of Energy''; 
        and
          (2) by inserting ``, and the Coast Guard'' before the 
        semicolon.

 TITLE II--CENTRAL INTELLIGENCE AGENCY RETIREMENT AND DISABILITY SYSTEM

SEC. 201. AUTHORIZATION OF APPROPRIATIONS.

  There is authorized to be appropriated for the Central Intelligence 
Agency Retirement and Disability Fund for fiscal year 2002 the sum of 
$212,000,000.

                     TITLE III--GENERAL PROVISIONS

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

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

SEC. 302. RESTRICTION ON CONDUCT OF INTELLIGENCE ACTIVITIES.

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

SEC. 303. SENSE OF THE CONGRESS ON INTELLIGENCE COMMUNITY CONTRACTING.

  It is the sense of the Congress that the Director of Central 
Intelligence should continue to direct that elements of the 
intelligence community, whenever compatible with the national security 
interests of the United States and consistent with operational and 
security concerns related to the conduct of intelligence activities, 
and where fiscally sound, should competitively award contracts in a 
manner that maximizes the procurement of products properly designated 
as having been made in the United States.

SEC. 304. REQUIREMENTS FOR LODGING ALLOWANCES IN INTELLIGENCE COMMUNITY 
                    ASSIGNMENT PROGRAM BENEFITS.

  Section 113(b) of the National Security Act of 1947 (50 U.S.C. 
404(h)) is amended--
          (1) by inserting ``(1)'' before ``An employee''; and
          (2) by adding at the end the following new paragraph:
  ``(2) The head of an agency of an employee detailed under subsection 
(a) may pay a lodging allowance for the employee subject to the 
following conditions:
          ``(A) The allowance shall be the lesser of the cost of the 
        lodging or a maximum amount payable for the lodging as 
        established jointly by the Director of Central Intelligence 
        and--
                  ``(i) with respect to detailed employees of the 
                Department of Defense, the Secretary of Defense; and
                  ``(ii) with respect to detailed employees of other 
                agencies and departments, the head of such agency or 
                department.
          ``(B) The detailed employee maintains a primary residence for 
        the employee's immediate family in the local commuting area of 
        the parent agency duty station from which the employee 
        regularly commuted to such duty station before the detail.
          ``(C) The lodging is within a reasonable proximity of the 
        host agency duty station.
          ``(D) The distance between the detailed employee's parent 
        agency duty station and the host agency duty station is greater 
        than 20 miles.
          ``(E) The distance between the detailed employee's primary 
        residence and the host agency duty station is 10 miles greater 
        than the distance between such primary residence and the 
        employees parent duty station.
          ``(F) The rate of pay applicable to the detailed employee 
        does not exceed the rate of basic pay for grade GS-15 of the 
        General Schedule.''.

SEC. 305. TECHNICAL AMENDMENT.

  Section 106(b)(2)(C) of the National Security Act of 1947 (50 U.S.C. 
403-6(b)(2)(C)) is amended by striking ``Nonproliferation and National 
Security'' and inserting ``Intelligence and the Director of the Office 
of Counterintelligence''.

SEC. 306. COMMISSION ON SEPTEMBER 11 GOVERNMENT PREPAREDNESS AND 
                    PERFORMANCE.

  (a) Establishment.--There is established a commission to be known as 
the ``Commission on Preparedness and Performance of the Federal 
Government for the September 11 Acts of Terrorism'' (in this section 
referred to as the ``Commission'').
  (b) Duty.--
          (1) Assessment of agency performance.--The Commission shall, 
        with respect to the acts of terrorism committed against the 
        United States on September 11, 2001, assess the performance of 
        those agencies and departments of the United States charged 
        with the responsibility to prevent, prepare for, or respond to 
        acts of terrorism up to and including that date. For purposes 
        of the preceding sentence, those agencies and departments 
        include--
                  (A) the Department of Defense (including the 
                intelligence elements of the Department),
                  (B) the Department of Justice (including the 
                intelligence elements of the Department),
                  (C) the Department of State (including the 
                intelligence elements of the Department),
                  (D) the Department of the Transportation (including 
                the intelligence elements of the Department),
                  (E) the Department of the Treasury (including the 
                intelligence elements of the Department),
                  (F) the Central Intelligence Agency, and
                  (G) the Federal Emergency Management Agency.
          (2) Report.--The Commission shall submit the report described 
        in subsection (g).
  (d) Membership.--
          (1) Number and appointment.--The Commission shall be composed 
        of 10 members appointed as follows:
                  (A) The President shall appoint 4 members.
                  (B) The Speaker of the House of Representatives shall 
                appoint 2 members.
                  (C) The majority leader of the Senate shall appoint 2 
                members.
                  (D) The minority leader of the House of 
                Representatives shall appoint 1 member.
                  (E) The minority leader of the Senate shall appoint 1 
                member.
          (2) Terms.--
                  (A) In general.--Each member shall be appointed for 
                the life of the Commission.
                  (B) Vacancies.--Any member appointed to fill a 
                vacancy occurring before the expiration of the term for 
                which the member's predecessor was appointed shall be 
                appointed only for the remainder of that term. A member 
                may serve after the expiration of that member's term 
                until a successor has taken office. A vacancy in the 
                Commission shall be filled in the manner in which the 
                original appointment was made.
          (3) Basic Pay.--
                  (A) Rates of pay.--Members shall serve without pay.
                  (B) Travel Expenses.--Each member shall receive 
                travel expenses, including per diem in lieu of 
                subsistence, in accordance with applicable provisions 
                under subchapter I of chapter 57 of title 5, United 
                States Code.
          (4) Quorum.--6 members of the Commission shall constitute a 
        quorum but a lesser number may hold hearings.
          (5) Chairperson.--The Chairperson of the Commission shall be 
        elected by the members.
  (e) Director and Staff of Commission.--
          (1) Director.--The Commission shall have a Director who shall 
        be appointed by the Chairperson.
          (2) Staff.--The Chairperson may appoint and fix the pay of 
        additional personnel as the Director considers appropriate.
          (3) Applicability of certain civil service laws.--The 
        Director and staff of the Commission shall be appointed subject 
        to the provisions of title 5, United States Code, governing 
        appointments in the competitive service, and shall be paid in 
        accordance with the provisions of chapter 51 and subchapter III 
        of chapter 53 of that title relating to classification and 
        General Schedule pay rates, except that an individual so 
        appointed may not receive pay in excess of the annual rate of 
        basic pay for GS-15 of the General Schedule.
          (4) Experts and consultants.--With the approval of the 
        Chairperson, the Director may procure temporary and 
        intermittent services under section 3109(b) of title 5, United 
        States Code, but at rates for individuals not to exceed the 
        daily equivalent of the maximum annual rate of basic pay for 
        GS-15 of the General Schedule.
          (5) Staff of federal agencies.--Upon request of the 
        Chairperson, the head of any Federal department or agency may 
        detail, on a reimbursable basis, any of the personnel of that 
        department or agency to the Commission to assist it in carrying 
        out its duties under this section.
  (f) Powers of Commission.--
          (1) Hearings and sessions.--The Commission may, for the 
        purpose of carrying out this section, hold hearings, sit and 
        act at times and places, take testimony, and receive evidence 
        as the Commission considers appropriate. The Commission may 
        administer oaths or affirmations to witnesses appearing before 
        it.
          (2) Powers of members and agents.--Any member or agent of the 
        Commission may, if authorized by the Commission, take any 
        action which the Commission is authorized to take by this 
        section.
          (3) Obtaining official data.--The Commission may secure 
        directly from any department or agency of the United States 
        information, including classified information, necessary to 
        enable it to carry out this Act. Upon request of the 
        Chairperson of the Commission, the head of that department or 
        agency shall furnish that information to the Commission.
          (4) Mails.--The Commission may use the United States mails in 
        the same manner and under the same conditions as other 
        departments and agencies of the United States.
          (5) Administrative Support Services.--Upon the request of the 
        Commission, the Administrator of General Services shall provide 
        to the Commission, on a reimbursable basis, the administrative 
        support services necessary for the Commission to carry out its 
        responsibilities under this section.
          (6) Subpoena power.--
                  (A) In general.--The Commission may issue subpoenas 
                requiring the attendance and testimony of witnesses and 
                the production of any evidence relating to any matter 
                under investigation by the Commission. The attendance 
                of witnesses and the production of evidence may be 
                required from any place within the United States at any 
                designated place of hearing within the United States.
                  (B) Failure to obey a subpoena.--If a person refuses 
                to obey a subpoena issued under subparagraph (A), the 
                Commission may apply to a United States district court 
                for an order requiring that person to appear before the 
                Commission to give testimony, produce evidence, or 
                both, relating to the matter under investigation. The 
                application may be made within the judicial district 
                where the hearing is conducted or where that person is 
                found, resides, or transacts business. Any failure to 
                obey the order of the court may be punished by the 
                court as civil contempt.
                  (C) Service of subpoenas.--The subpoenas of the 
                Commission shall be served in the manner provided for 
                subpoenas issued by a United States district court 
                under the Federal Rules of Civil Procedure for the 
                United States district courts.
                  (D) Service of process.--All process of any court to 
                which application is made under subparagraph (B) may be 
                served in the judicial district in which the person 
                required to be served resides or may be found.
                  (E) Immunity.--Except as provided in this paragraph, 
                a person may not be excused from testifying or from 
                producing evidence pursuant to a subpoena on the ground 
                that the testimony or evidence required by the subpoena 
                may tend to incriminate or subject that person to 
                criminal prosecution. A person, after having claimed 
                the privilege against self-incrimination, may not be 
                criminally prosecuted by reason of any transaction, 
                matter, or thing which that person is compelled to 
                testify about or produce evidence relating to, except 
                that the person may be prosecuted for perjury committed 
                during the testimony or made in the evidence.
          (7) Contract authority.--The Commission may contract with and 
        compensate government and private agencies or persons for 
        supplies and services, without regard to section 3709 of the 
        Revised Statutes (41 U.S.C. 5).
  (g) Report.--The Commission shall transmit a report to the President 
and the Congress not later than 6 months after the date by which the 
Director has been appointed by the Chairperson. The report shall 
contain a detailed statement of the findings and conclusions of the 
Commission, together with its recommendations for legislation and 
administrative actions the Commission considers appropriate.
  (h) Termination.--The Commission shall terminate on 30 days after 
submitting the report required under subsection (g).

                 TITLE IV--CENTRAL INTELLIGENCE AGENCY

SEC. 401. MODIFICATIONS TO CENTRAL INTELLIGENCE AGENCY'S CENTRAL 
                    SERVICES PROGRAM.

  Section 21 of the Central Intelligence Agency Act of 1949 (50 U.S.C. 
403u) is amended as follows:
          (1) Subsection (g)(1) is amended--
                  (A) by striking ``December'' and inserting 
                ``January''; and
                  (B) by striking ``conduct'' and inserting 
                ``complete''.
          (2) Subsection (h) is amended--
                  (A) by striking paragraph (1) and redesignating 
                paragraphs (2) and (3) as paragraphs (1) and (2), 
                respectively;
                  (B) in paragraph (1), as so redesignated, by striking 
                ``(3)'' and inserting ``(2)''; and
                  (C) in paragraph (2), as so redesignated, by striking 
                ``(2)'' and inserting ``(1)''.

SEC. 402. EXTENSION OF CIA VOLUNTARY SEPARATION PAY ACT.

  (a) Extension of Authority.--Section 2(f) of the Central Intelligence 
Agency Voluntary Separation Pay Act (Public Law 103-36, 50 U.S.C. 403-4 
note) is amended by striking ``September 30, 2002'' and inserting 
``September 30, 2003''.
  (b) Remittance of Funds.--Section 2(i) of that Act is amended by 
striking ``or 2002'' and inserting ``2002, or 2003''.

SEC. 403. GUIDELINES FOR RECRUITMENT OF CERTAIN FOREIGN ASSETS.

  Recognizing dissatisfaction with the provisions of the guidelines of 
the Central Intelligence Agency (promulgated in 1995) for handling 
cases involving foreign assets or sources with human rights concerns, 
the Director of Central Intelligence shall--
          (1) rescind the provisions of the guidelines for handling 
        such cases; and
          (2) provide for provisions for handling such cases that more 
        appropriately weigh and incentivize risks to achieve successful 
        operations.

         TITLE V--DEPARTMENT OF DEFENSE INTELLIGENCE ACTIVITIES

SEC. 501. AUTHORITY TO PURCHASE ITEMS OF NOMINAL VALUE FOR RECRUITMENT 
                    PURPOSES.

  (a) Authority.--Section 422 of title 10, United States Code, is 
amended by adding at the end the following:
  ``(b) Promotional Items for Recruitment Purposes.--The Secretary of 
Defense may use funds available for an intelligence element of the 
Department of Defense to purchase promotional items of nominal value 
for use in the recruitment of individuals for employment by that 
element.''.
  (b) Clerical Amendments.--(1) The heading of such section is amended 
to read as follows:

``Sec. 422. Use of funds for certain incidental purposes''.

  (2) Such section is further amended by inserting at the beginning of 
the text of the section the following: ``(a) Counterintelligence 
Official Reception and Representation Expenses.--''.
  (3) The item relating to such section in the table of sections at the 
beginning of subchapter I of chapter 21 of such title is amended to 
read as follows:

``422. Use of funds for certain incidental purposes.''.

SEC. 502. FUNDING FOR INFRASTRUCTURE AND QUALITY-OF-LIFE IMPROVEMENTS 
                    AT MENWITH HILL AND BAD AIBLING STATIONS.

  Section 506(b) of the Intelligence Authorization Act for Fiscal Year 
1996 (Public Law 104-93; 109 Stat. 974), as amended by section 502 of 
the Intelligence Authorization Act for Fiscal Year 1998 (Public Law 
105-107; 111 Stat. 2262) and by section 502 of the Intelligence 
Authorization Act for Fiscal Year 2000 (Public Law 106-120; 113 Stat. 
1619), is further amended by striking ``for fiscal years 2000 and 
2001'' and inserting ``for fiscal years 2002 and 2003''.

SEC. 503. CONTINUATION OF JOINT INTERAGENCY TASK FORCE AT CURRENT 
                    LOCATIONS IN FLORIDA AND CALIFORNIA.

  (a) Main Location.--The Secretary of Defense shall continue to 
maintain the Joint Interagency Task Force at Key West, Florida, with 
the responsibility for coordinating drug interdiction efforts in the 
Western Hemisphere and with such additional responsibilities regarding 
worldwide intelligence for counterdrug operations as the Secretary may 
assign.
  (b) Component Location.--The Secretary of Defense shall convert the 
Joint Interagency Task Force located at Alameda, California, to be a 
component site of the main location specified in subsection (a).
  (c) Director.--The Director of the Joint Interagency Task Force shall 
be a flag officer of the Coast Guard.

SEC. 504. MODIFICATION OF AUTHORITIES RELATING TO INTERDICTION OF 
                    AIRCRAFT ENGAGED IN ILLICIT DRUG TRAFFICKING.

  (a) Certification Required for Immunity.--Subsection (a)(2) of 
section 1012 of the National Defense Authorization Act for Fiscal Year 
1995 (Public Law 103-337; 108 Stat. 2837; 22 U.S.C. 2291-4) is amended 
by striking ``, before the interdiction occurs, has determined'' and 
inserting ``has, during the 12-month period ending on the date of the 
interdiction, certified to Congress''.
  (b) Annual Reports.--That section is further amended--
          (1) by redesignating subsection (c) as subsection (d); and
          (2) by inserting after subsection (b) the following new 
        subsection:
  ``(c) Annual Reports.--(1) Not later than February 1 each year, the 
President shall submit to Congress a report on the assistance provided 
under subsection (b) during the preceding calendar year. Each report 
shall include for the calendar year covered by such report the 
following:
          ``(A) A list specifying each country for which a 
        certification referred to in subsection (a)(2) was in effect 
        for purposes of that subsection during any portion of such 
        calendar year, including the nature of the illicit drug 
        trafficking threat to each such country.
          ``(B) A detailed explanation of the procedures referred to in 
        subsection (a)(2)(B) in effect for each country listed under 
        subparagraph (A), including any training and other mechanisms 
        in place to ensure adherence to such procedures.
          ``(C) A complete description of any assistance provided under 
        subsection (b).
          ``(D) A summary description of the aircraft interception 
        activity for which the United States Government provided any 
        form of assistance under subsection (b).
  ``(2) Each report under paragraph (1) shall be submitted in 
unclassified form, but may include a classified annex.''.

SEC. 505. UNDERGRADUATE TRAINING PROGRAM FOR EMPLOYEES OF THE NATIONAL 
                    IMAGERY AND MAPPING AGENCY.

  (a) Authority To Carry Out Training Program.--Subchapter III of 
chapter 22 of title 10, United States Code, is amended by adding at the 
end the following new section:

``Sec. 462. Financial assistance to certain employees in acquisition of 
                    critical skills

  ``The Secretary of Defense may establish an undergraduate training 
program with respect to civilian employees of the National Imagery and 
Mapping Agency that is similar in purpose, conditions, content, and 
administration to the program established by the Secretary of Defense 
under section 16 of the National Security Agency Act of 1959 (50 U.S.C. 
402 note) for civilian employees of the National Security Agency.''.
  (b) Clerical Amendment.--The table of sections at the beginning of 
such subchapter is amended by adding at the end the following new item:

``462. Financial assistance to certain employees in acquisition of 
critical skills.''.

SEC. 506. TECHNICAL AMENDMENTS.

  Section 2555 of title 10, United States Code, as added by section 
1203(a) of the Floyd D. Spence National Defense Authorization Act for 
Fiscal Year 2001 (as enacted by Public Law 106-398; 114 Stat. 1654, 
1654A-324), is amended--
          (1) in subsection (a)--
                  (A) by striking ``Convey or'' in the subsection 
                heading and inserting ``Transfer Title to or 
                Otherwise'';
                  (B) in paragraph (1)--
                          (i) by striking ``convey'' and inserting 
                        ``transfer title''; and
                          (ii) by striking ``and'' after 
                        ``equipment;'';
                  (C) by striking the period at the end of paragraph 
                (2) and inserting ``; and''; and
                  (D) by adding at the end the following new paragraph:
          ``(3) inspect, test, maintain, repair, or replace any such 
        equipment.''; and
          (2) in subsection (b)--
                  (A) by striking ``conveyed or otherwise provided'' 
                and inserting ``provided to a foreign government'';
                  (B) by inserting ``and'' at the end of paragraph (1);
                  (C) by striking ``; and'' at the end of paragraph (2) 
                and inserting a period; and
                  (D) by striking paragraph (3).

                                Purpose

    The bill would:
          (1) Authorize appropriations for fiscal year 2002 for 
        (a) the intelligence and intelligence-related 
        activities of the U.S. Government, (b) the Community 
        Management Account, and (c) the Central Intelligence 
        Agency Retirement and Disability System;
          (2) Authorize the personnel ceilings on September 30, 
        2002 for the intelligence and intelligence-related 
        activities of the U.S. Government and permit the 
        Director of Central Intelligence to authorize personnel 
        ceilings in Fiscal Year 2002 for any intelligence 
        element up to two percent above the authorized levels, 
        with the approval of the Director of the Office of 
        Management and Budget;
          (3) Authorize $27 million for the National Drug 
        Intelligence Center in Johnstown, Pennsylvania;
          (4) Establishes the United States Coast Guard as a 
        National Foreign Intelligence Program (NFIP) agency 
        under the National Security Act;
          (5) Creates an independent commission to review the 
        performance of those federal public safety, law 
        enforcement, and national security departments and 
        agencies responsible for preventing and/or responding 
        to acts of terrorism in the period prior to and 
        including September 11, 2001;
          (6) Rescinds the 1995 guidelines on recruitment of 
        foreign assets and sources;
          (7) Supports confirmation of Joint Inter-Agency Task 
        Force operations and facilities at current locations in 
        California and Florida;
          (8) Amends current law relating to official immunity 
        for employees and agents of the United States and 
        foreign countries engaged in the interdiction of 
        aircraft used in illicit drug trafficking.

  Overall Perspective on the Intelligence Budget and Committee Intent

    The classified Annex to this public report includes the 
classified Schedule of Authorizations and its associated 
language. The committee views the classified Annex as an 
integral part of this legislation. The classified Annex 
contains a thorough discussion of all budget issues considered 
by the committee, which underlies the funding authorization 
found in the Schedule of Authorizations. The Committee intends 
that all intelligence programs and intelligence-related 
activities discussed in the classified Annex to this report be 
conducted in accord with the guidance and limitations set forth 
as associate language therein. The classified Schedule is 
incorporated directly into this legislation by virtue of 
section 102 of the bill. The classified Annex is available for 
review by all Members of the House of Representatives, subject 
to the requirements of clause 13 of Rule XXIV of the House.

                       Scope of Committee Review

    U.S. intelligence and intelligence-related activities under 
the jurisdiction of the committee include the National Foreign 
Intelligence Program (NFIP), and the Tactical Intelligence and 
Related Activities (TIARA) and the Joint Military Intelligence 
Program (JMIP) of the Department of Defense.
    The NFIP consists of all programs of the Central 
Intelligence Agency, as well as those national foreign 
intelligence and/or counterintelligence programs conducted by: 
(1) the Department of Defense; (2) the Defense Intelligence 
Agency; (3) the National Security Agency; (4) the Departments 
of the Army, Navy, and Air Force; (5) the Department of State; 
(6) the Department of the Treasury; (7) the Department of 
Energy; (8) the Federal Bureau of Investigation; (9) the 
National Reconnaissance Office; (10) the National Imagery and 
Mapping Agency.
    The Department of Defense TIARA is a diverse array of 
reconnaissance and target acquisition programs that are a 
functional part of the basic military force structure and 
provide direct information support to military operations. 
TIARA, as defined by the Joint Chiefs of Staff and the 
Secretary of Defense, include those military intelligence 
activities outside the General Defense Intelligence Program 
that respond to the needs of military commanders for 
operational support information, as well as to national 
command, control, and intelligence requirements. The Armed 
Services Committee in the House Committee in the House of 
Representatives has joint oversight and authorizing 
jurisdiction of the programs compromising TIARA.
    The JMIP was established in 1995 to provide integrated 
program management of defense intelligence elements that 
support defense-wide or theater-level consumers. Included 
within JMIP are aggregations created for management efficiency 
and characterized by similarity, either in intelligence 
discipline (e.g., Signals Intelligence (SIGINT), Imagery 
Intelligence (IMINT)), or function (e.g., satellite support, 
aerial reconnaissance). The following aggregations are included 
in the JMIP: (1) the Defense Cryptologic Program (DCP); (2) the 
Defense Imagery and Mapping Agency (DIMAP); (3) the Defense 
General Intelligence Applications Program (DGIAP), which itself 
includes (a) the Defense Airborne Reconnaissance Program 
(DARP), (b) the Defense Intelligence Tactical Program (DITP), 
(c) the Defense Intelligence Special Technologies Program 
(DISTP), (d) the Defense Intelligence Counterdrug Program 
(DICP), and (e) the Defense Space Reconnaissance Program 
(DSRP). As with TIARA programs, the Armed Services Committee in 
the House of Representatives has joint oversight and 
authorizing jurisdiction of the programs compromising the JMIP.

             Overall Committee Findings and Recommendations

    The Committee completed its review of the President's 
fiscal year 2002 budget, carrying out its annual responsibility 
to prepare an authorization based on close examination of 
intelligence programs and proposed expenditures. The review 
reflected the Committee's continuing belief that intelligence 
activities must be examined by function, as well as by program. 
Due to the late delivery of the details of the President's 
amended budget request and to circumstances caused by the 
deplorable terrorist attacks against the United States on 
September 11, 2001, the Committee conducted only a limited 
number of budget-related hearings. The Committee's membership 
also had numerous discussions and briefings with the White 
House and the IntelligenceCommunity leadership to examine the 
views and plans for the future of intelligence and the Intelligence 
Community. There were, in addition, numerous individual briefings to 
Members and over one hundred staff briefings on programs, specific 
activities, and budget requests.
    In the classified schedule of authorizations and the 
accompanying explanatory language, the Committee has addressed 
numerous specific matters related to the fiscal year 2002 
budget. In the following section, the Committee addresses many 
issues that it believes are particularly important although 
there may have been no direct budgetary action. It should be 
noted that, because of the extraordinary circumstances with 
respect to the national security environment in the aftermath 
of the terrorist attacks, the Committee made a determination to 
make very few modifications to the President's request. Those 
changes that are made primarily are focused on responding to 
deficiencies that could quickly impact the Community's ability 
to provide warning against future such attacks.
    Taken as a whole, the Committee's budgetary actions and 
general provisions reflect the Committee's concern that the 
United States has placed, and continues to place, undue risks 
on its national security interests by not redressing the many 
critical problems facing the Intelligence Community. Many of 
these are enduring issues that the Committee has repeatedly 
highlighted in the past. However, the ominous message sent by 
the terrorist actions in New York and Washington D.C. 
demonstrates an urgency to correct these Intelligence Community 
deficiencies like no other time in our Nation's history.
    The United States cannot continue to use the same processes 
and priorities to build the intelligence budgets of the 21st 
century that were used in the Cold War. American interests have 
changed, new threats, particularly the elusive and unrestricted 
terrorist threat, have evolved and the priorities placed on 
intelligence and the role of the Intelligence Community have 
grown. For the President and senior policymakers, intelligence 
often forms the basis for key foreign policy strategies and 
decisions, and can provide insights as to the effect of such 
decisions. At its best, intelligence provides key indications 
and warning (I&W) information that can direct national command 
authority attention to issues and areas before crises occur. 
When fully successful, such intelligence support allows for 
appropriate actions to provide regional stability or, 
hopefully, ward off an attack or larger conflict. Yet, despite 
the Committee's repeated direction to more broadly provide this 
information on the myriad threats world-wide, the nation's 
intelligence resources remain highly focused on only the 
highest priority military support issues and nations, leaving 
few resources for the critical I&W functions, especially 
against transnational, non-nation state actors or against areas 
of the world that could erupt overnight.
    For the military, intelligence is now the basis for, and 
organic to everything it does. HUMINT and SIGINT, in 
particular, provide direct and immediate threat data to 
personnel engaged in activities that risk their lives on a 
daily basis: our ground forces in Kosovo, our pilots conducting 
Northern and Southern Watch missions in Iraq, our forces on the 
border between North and South Korea, our forces engaged in 
counternarcotics operations in Latin America, and our Special 
Operations personnel who may have to enter a country 
unannounced and undetected, and require the on-scene 
intelligence officer to give them ``ground truth.''
    It must be pointed out that the requirements for 
intelligence support have grown at a rapid pace, making the 
relatively status quo intelligence budget more and more 
inadequate. Increasingly, existing resources are being siphoned 
off to meet day-to-day tactical requirements. Global coverage 
and predictive, strategic intelligence have suffered as a 
result, contributing to shortfalls such as the lack of warning 
of recent nuclear tests, the lack of information on the New 
York and Washington D.C. terrorist attacks, the inability to 
monitor key facilities suspected of producing weapons of mass 
destruction, the bombing of the Chinese Embassy in Belgrade, 
and the shortage of ISR assets around the world.
    Intelligence should be the first line of defense, yet, it 
is not treated as such. Remedying this situation, however, is 
not a task that Congress can, or should, take on alone. Along 
with a new focus on intelligence budgeting and conduct by the 
Administration, there also must be a Community-wide effort 
actually to work as a ``community.'' Although there have been 
some areas of progress, not nearly enough is apparent.
    The Committee's review of this year's budget request 
included in-depth discussions with, or testimony from, the 
Director of Central Intelligence (DCI), the Community's senior 
leadership the managers of individual programs and agencies, as 
well as leaders from the Department of Defense and the military 
services who produce intelligence or who use or rely on 
intelligence systems and information on a daily basis. Their 
message continues to be that, despite the increases in the 
President's amended request for the Intelligence Community's 
people and programs, there are insufficient intelligence 
resources to meet the immediate national security intelligence 
needs, let alone future needs. Although the Committee does not 
believe that additional funding alone will correct all the 
Community's deficiencies, indeed the Committee believes that 
there is a fundamental need for both a cultural revolution 
within the Intelligence Community as well as significant 
structural changes, the Committee is concerned that the 
additional funding sought for the Community constitutes a 
misjudgment in national security priorities. As an example, the 
Committee notes that intelligence funding constituted a 
significantly lower percentage of the overall amended defense 
request for fiscal year 2002. This amount is inconsistent with 
the overall Intelligence Community funding percentage relative 
to national defense and does not seem to comport with the 
Administration's or the Secretary of Defense's emphasis on 
intelligence. Moreover, the fact that intelligence must 
continue to compete with other defense needs is a Cold War 
legacy that does not reflect the new national security 
definitions nor encompass the realities of today's and 
tomorrow's threats. The Committee is also concerned that 
increasing requirements for greater volume, higher fidelity, 
and more timely intelligence, especially by the military, is 
forcing the Intelligence Community to ``accomplish much more, 
with much less.'' The lack of long-term analysis to provide 
predictive warningagainst acts of war against the United 
States, such as that perpetrated by the attacks on the World Trade 
Center and Pentagon, is indicative of this problem.
    For the past six years, the Committee and Congress have 
sought to increase the ``top line,'' or overall funding level 
for the Intelligence Community. The President's amendment to 
the fiscal year 2002 request was welcomed as a recognition that 
the congressional priorities for national defense, and 
particularly intelligence operations, were justified. However 
the extremely modest increase to the request does not 
demonstrate to this Committee the full commitment by the 
Administration to build a healthy, future years' intelligence 
budget that meets national security needs. The Committee does 
understand that the Administration's request that resulted in 
the ``The Supplemental Appropriations Act for Recovery and 
Response to Terrorist Attacks on the United States'' includes 
resources for the Intelligence Community. Further, the 
Committee recognizes that the new Administration is attempting 
to conduct a full review of the Intelligence Community to 
determine its future needs. The Committee must assume that the 
supplemental appropriation is not a long-term ``fix,'' and must 
caution that the requested increase in this single fiscal year 
must be sustained in the future years' request so that no 
future unfunded bills will result. The Committee is compelled 
to highlight this issue, since it is our understanding that the 
preliminary budget guidance for fiscal year 2003 appears to 
fall into the same, status quo, bureaucratic construct that 
will result in, at best, having intelligence on a flat-line 
funding track. With this in mind, the Committee has made some 
adjustments and recommendations in this bill in order to 
implore and to prod the President, the Director of Central 
Intelligence and the Secretary of Defense to re-examine the 
basic process used to put the yearly budget request together.
    It is imperative that the Executive Branch address these 
critical shortfalls in planning and its intelligence 
capabilities, especially to include the following areas:
     In the Human Intelligence (HUMINT) arena, ill-
advised reductions of resources after the Cold War, combined 
with poor planning, infrastructure problems, extended 
requirements for military force protection, and unexpected 
contingency operations have all worked to take resources from 
the ``front line'' field officers, thus limiting our efforts to 
rebuild our ``eyes and ears'' around the globe. In stark 
contrast to the Community's budget request that actually cuts 
manpower, it is imperative that the Intelligence Community 
increase its efforts to add to its HUMINT capabilities, 
particularly in the areas of increasing the number of 
clandestine case officers and defense attaches around the 
world, improving language and specialized skills training, and 
creating and fostering a positive career culture for 
specialists.
     Also critical is the rebuilding and restructuring 
of the Community's all-source analytic resources and tools. The 
number of analysts needs to increase, and collaboration across 
the Community and across intelligence disciplines must occur. 
The Committee believes that physical collocation of analysts 
may well serve to create a better, stronger analytic base for 
the Community.
     Despite the oversight committees' exhortations, 
the Intelligence Community is still faced with totally 
inadequate planning and investment for systems to correct the 
Community's multi-intelligence tasking, processing, 
exploitation, and dissemination (TPED) problems. This is 
particularly true for current imagery intelligence collection 
capabilities, and more so for planned capabilities. The 
Intelligence Authorization Act for fiscal year 2002 has begun 
to address imagery tasking, processing, exploitation, and 
dissemination deficiencies by providing the initial funding for 
the National Imagery and Mapping Agency's modernization. The 
funding will enable the initiation of acquisition reform, 
improved information management capabilities, new business 
processes to better produce innovative imagery and geo-spatial 
products, and greater access to all imagery sources.
     As the Committee stated last year, in the area of 
Intelligence, Surveillance and Reconnaissance (ISR) assets, we 
continue to see extensive over-utilization of very limited, but 
critical airborne assets, with little relief in sight. While 
planning for deployment of new ISR airborne capabilities, the 
Department of Defense has taken money from existing, supposedly 
complementary, platforms to pay for future capabilities. The 
aging manned reconnaissance fleets are in clear need of 
recapitalization with no funded plan to do so. The result: our 
overall ISR capabilities and resources, in practical terms, are 
decreasing at a time when our military forces are relying on 
them more and more.
     The most serious and immediate problems continue 
to be with signals intelligence (SIGINT) resources. The 
Director of the National Security Agency (NSA) has a new team 
in place to correct many of the significant infrastructure and 
modernization problems caused by nearly a decade of decline in 
resources and severe internal mismanagement. In the same decade 
the signals targets increased dramatically in both number and 
technological sophistication. The problems have been daunting: 
infrastructure needs went unfunded and major interruptions of 
service occurred, Information Technology (IT) resources were 
mismanaged and collection and analysis efforts suffered, and 
the lack of sufficient acquisition processes and expertise 
brought critical modernization efforts to a crawl. This did not 
come as a surprise: indeed, the Committee has, for over four 
years, warned the NSA and the Director of Central Intelligence 
about these problems. As stated, the Director of NSA has begun 
efforts to address these issues, and his efforts have the 
Committee's support. However, the Committee is concerned about 
NSA internal management's willingness to fully understand the 
need for radical change and to get behind these programs.
    The Committee recognizes that the men and women who work in 
the Intelligence Community are taking the events of September 
11 very hard and personally. These extremely hard working, 
dedicated, and courageous individuals are doing good work with 
what they have. Terrorism is an extremely difficult target, and 
the resources that the Community has appear inadequate. This 
reason alone should compel the Administration and Congress to 
heavily invest in our intelligence disciplines. The government 
cannot, however, stop by responding to terrorism alone. There 
are many other issues that theIntelligence Community also must 
attend to in order to assure that our nation's security is best 
maintained.
    Heavy investments alone also will not sufficiently address 
the national security challenge and needs. As we sit today, it 
appears that many of the questions that are being asked after 
the attacks on September 11, 2001, are similar to those asked 
in the aftermath of the attack on U.S. forces at Pearl Harbor. 
As was done after Pearl Harbor, the Committee believes, that 
the Government must conduct a thorough review of our national 
security structures to determine whether these are the right 
structures to address the security challenges of the future.
    The Committee will be discussing this issue in greater 
detail in the next few months, and stands ready to work with 
the Administration to undertake this review and make whatever 
changes are deemed appropriate. This is not a time to preserve 
the status quo, although there will be a tendency to do so as 
we embark on this war on terrorism. Now, more than ever, we 
must be bold in addressing our needs for intelligence--our 
first line of defense--and for our overall security.

                       areas of special interest

    In the following several pages, the Committee has chosen to 
highlight areas of special interest that it believes must be 
addressed by the Intelligence Community and the Administration 
if our country is to have sufficient intelligence resources to 
protect our national security. The Committee has chosen to 
identify those issues that address the Intelligence Community 
as a whole or that cross bureaucratic boundaries of the various 
programs. These primarily relate to broader investment and 
management policies rather than individual programs and 
projects within the NFIP, JMIP or TIARA that are addressed with 
these accounts.
    The order of these issues is, by and large, irrelevant in 
terms of priority for the Committee--all are important. 
Moreover, these provisions, along with others in this bill, are 
intended to highlight for the new Administration the critical 
need for intelligence, the critical state in which the 
Intelligence Community finds itself, and to emphasize that the 
Administration must broadly address the shortfalls and needs of 
the Community, least we continue to suffer attacks such as 
those inflicted on September 11, 2001--or worse!

Terrorism threat analysis

    In the wake of the USS Cole bombing, senior Defense 
intelligence officials were directed to devise and initiate 
sweeping structural and procedural changes to strengthen the 
Defense Intelligence Agency's (DIA) counterterrorism analysis 
and threat warning efforts. The focus of this task was to 
improve long-term threat analysis, reduce duplication of 
effort, more precisely apply all-source intelligence, expand 
the base of source information to include location and 
disposition of U.S. forces, and sharpen the focus of threat 
warning intelligence to those forces. The result was the 
formation of a new terrorism analysis center within the DIA.
    Although the Committee applauded the innovative thinking of 
Defense Department officials with respect to the development of 
this center, the Committee was concerned that the initiative 
was moving forward without the resolution of significant 
implementation issues, particularly those involving information 
sharing of sensitive source data, and how such data might be 
reported--and more importantly protected in such a way as to be 
effective. Further, the Committee questioned the rationale for 
such a capability within DoD, since the CIA's existing center 
was designed to provide the all-source analysis needed by the 
Defense Department. The Committee has determined to support 
both capabilities, but in a much more community wide sense.
    The events of September 11, 2001, highlighted why and how 
the Intelligence Community, as a whole, must respond to the 
myriad national security requirements, especially to the war on 
terrorism. The Committee believes there can no longer be any 
cultural, bureaucratic or other artificial barriers to impede 
the flow and analysis of information related to countering this 
threat. Information must be ubiquitous and available to all-
source analysts. The artificial, but existing barriers to true 
information sharing must be overcome. Security issues must be 
resolved such that source identifying information that needs 
protecting is protected and information that is needed to piece 
together terrorist activities be made available. Additionally, 
all technological impediments, such as on-line accesses to 
databases, must be immediately overcome. Existing data mining 
tools must be put to full use and additional tools must be 
developed. Most importantly, the concepts of the two centers 
must be adopted as a community-wide inter-agency approach. The 
war against terrorism necessarily crosses all boundaries. The 
Intelligence Community must, therefore, support all of its 
customers equally well--from the President, to the ``soldier,'' 
to those in law enforcement. Thus, the Committee has supported 
a new construct; one that leverages all the concepts of the 
military and civilian analytical functions, and that is 
Intelligence Community-wide in composition and in service.

Focusing on people as long-term intelligence needs

    Congress has provided an initial response to the horrific 
terrorist attacks suffered by the United States on September 
11. Emergency funds and grants of authority to the President 
have been provided. Additional responses will be necessary in 
the weeks ahead as the international effort against terrorism 
proceeds and as assessments are made about the performance of 
those federal agencies charged with safeguarding national 
security in the period before and during the September 11 
attacks.
    The Committee believes it critical that a comprehensive 
examination be conducted independently of the federal 
government. Section 306 of the bill establishes a ten member 
commission to conduct such a review of the activities of the 
Departments of Defense, Justice, State, Transportation, and 
Treasury (including the intelligencecomponents of those 
departments), the Federal Emergency Management Agency, and the Central 
Intelligence Agency. The report of the commission is to include 
recommendations on changes in activities and programs, structure, and/
or responsibilities of the departments and agencies reviewed.
    This Committee conducts oversight of the Intelligence 
Community and has been concerned for some time that 
intelligence agencies were not well positioned to respond to 
the national security challenges of the 21st century, including 
terrorism. Despite a succession of congressionally-provided 
funding increases to spur investment in all areas of 
intelligence, including human intelligence, the Committee is 
not satisfied that the Intelligence Community is moving quickly 
enough. There is a shortage of intelligence officers with the 
linguistic, operational, and analytic skills, as well as 
foreign area expertise and cultural background to discharge 
effectively the foreign intelligence mission.
    Although a start has been made in increasing the ranks of 
officers, the Committee is not convinced that there is an 
Intelligence Community-wide strategy for ensuring that 
recruited persons have the diverse mix of skills and background 
necessary to enhance mission effectiveness. Accordingly, the 
Committee requests that the DCI submit a report to the 
congressional intelligence committees, by April 1, 2002, 
detailing employment and training initiatives within the 
Community, including spending plans, through which a diverse 
workforce will be recruited and trained. The report shall 
comment specifically on those spending and policy plans 
designed to enhance language training and cultural expertise. 
The Committee acknowledges that there is no quick fix to 
remedying skills mix problems, but believes that a commitment 
to their solution needs a well considered strategy to be 
successful. The Committee expects the DCI's report to present 
that strategy so that the authorization bill for fiscal year 
2003 can provide resources against well defined objectives. In 
the Committee's view, those objectives must include: aggressive 
recruitment of case officer candidates, particularly those with 
ethnic and language backgrounds needed by the Community; more 
overseas-based operations officers; increases in the numbers of 
civilian and military analysts; a greater emphasis on improving 
language skills through training and language proficiency 
incentives; a higher priority attached to building and 
maintaining expertise in foreign areas and cultures; and 
greater support for improving technological and operational 
disciplines. The Committee recommends consideration of the 
creation of a scholarship program, similar to the Former 
Defense Language Scholarship program, to assist in the 
recruitment of undergraduate and graduate students with 
proficiencies of use to the Community in areas such as foreign 
language and area studies, foreign cultural studies, and 
appropriate technical disciplines. The DCI's assessment of such 
a program will be expected in the report.

Emergency supplemental funding

    The emergency supplemental appropriations measure passed in 
response to the September 11 terrorist attacks contains 
significant sums to support Intelligence Community needs. The 
Committee expects to be notified promptly by the DCI when 
decisions are made as to how these funds are allocated to 
specific intelligence programs and activities. A considered 
allocation of these funds could greatly enhance intelligence 
capabilities against terrorism. The Committee believes that 
priority should be given in the use of supplemental funds to: 
improving the effectiveness of human intelligence, particularly 
through language training and proficiency; improving the 
effectiveness of signals intelligence, particularly in the 
analysis function; and improving the effectiveness of 
measurement and signature intelligence, particularly in the 
fielding of new technologies to discover weapons of mass 
destruction, including chemical and biological agents which may 
be employed by terrorists. It is the Committee's expectation 
that all measures taken by the Intelligence Community in 
response to acts of terrorism will preserve a balance between 
the preservation of civil liberties and the need to improve the 
effectiveness of intelligence and law enforcement agencies.

Intelligence Community for the 21st century

    The Committee continues to believe that there is a need for 
a fundamental review of the Intelligence Community's 
authorities, structure, funding levels, procedures, areas of 
mission emphasis, security procedures, depth and breadth of 
analytic expertise, and inter-agency relationships. The 
terrorist attacks on the World Trade Center and the Pentagon 
provided tragic emphasis for that position. The Committee does 
not, in any way, lay blame to the dedicated men and women of 
the U.S. Intelligence Community for the success of these 
attacks. If blame must be assigned, the blame lies with a 
government, as a whole, that did not fully understand nor 
wanted to appreciate the significance of the new threats to our 
national security, despite the warnings offered by the 
Intelligence Community. In many respects, however, the Nation 
now has witnessed another Pearl Harbor event, and the President 
has called for all means at our disposal, including placing a 
great responsibility on the Intelligence Community, to wage the 
worldwide war on terrorism. The Committee believes that there 
are both short-term and long-term issues that must be addressed 
if the nation is to win this war.
    The Committee is fully aware of the ongoing internal and 
external reviews of the Intelligence Community under NSPD-5. 
The outcomes of those reviews are not yet determined, and may 
result in some recommendations for changes. If history serves, 
however, no major substantive changes will occur after these 
reviews are complete. The Committee believes that major changes 
are necessary. They were necessary in 1996 when the Committee 
released its Intelligence Community for the 21st Century 
report, and they are necessary today. The only thing that has 
changed is the cause for immediate emphasis.
    The Committee's response to the President's fiscal year 
2002 National Foreign Intelligence Program budget request is in 
many ways modest, but focused. The time and ability for change, 
however, is now. Programs that the Committee believes warrant a 
``fresh'' look include the establishment of a separate 
Clandestine Service that would combine all HUMINT resources 
under a similar tasking and operating structure; a Technical 
Collection Agency that would operate all technical collectors 
under a singlemanagement structure to eliminate ``stove-
piping'' and enhance cross-collection capabilities; a Technology 
Development Office that provides Community Research and Development and 
a new, all-source analytic effort that enhances collaboration and, 
thus, analysis. These are but some of the options. Clearly, changes in 
funding processes, authorities, and mechanisms are also warranted. The 
Committee had planned to address many of these issues prior to 
September 11th, in order to serve notice to the Administration that the 
Intelligence Community is in dire need of attention and investment, 
that structure and management changes may well be necessary, and that 
it is a time for the Administration to be bold, innovative, and to 
think ``out of the box''. The Committee retains these views, especially 
given the war on terrorism. Thus, the Committee requests that the 
Administration begin to make such changes with the fiscal year 2003 
budget submission.
    The Committee believes the Director of Central Intelligence 
must take the lead in making these changes, working closely 
with Congress to effect the right changes.

Foreign language expertise

    There continues to be a great need throughout the 
Intelligence Community for increased expertise in a number of 
intelligence-related disciplines and specialties. However, the 
Committee believes the most pressing such need is for greater 
numbers of foreign language-capable intelligence personnel, 
with increased fluency in specific and multiple languages. The 
Committee has heard repeatedly from both military and civilian 
intelligence producers and consumers that this is the single 
greatest limitation in intelligence agency personnel expertise 
and that it is a deficiency throughout the Intelligence 
Community. The principle agencies dealing with foreign 
intelligence--CIA, NSA, FBI, DIA and the military services--
have all admitted they do not have the language talents, in 
breadth or in depth, to fully and effectively accomplish their 
missions. Too often, the Committee has seen these organizations 
focus on developing ``intelligence generalists,'' rather than 
intelligence professionals with strong linguistic capabilities 
and extensive expertise in a specific foreign language, culture 
and area.
    This has certainly long been the trend in CIA's Directorate 
of Operations. Too often CIA, and other intelligence agencies 
have neglected long-term priorities, such as building in-depth 
expertise in the intelligence collection and analysis cadres. 
Rather, people are readily assigned and reassigned to confront 
the burning issues of the day. At the NSA and CIA, thousands of 
pieces of data are never analyzed, or are analyzed ``after the 
fact,'' because there are too few analysts; even fewer with the 
necessary language skills. Written materials can sit for 
months, and sometimes years, before a linguist with proper 
security clearances and skills can begin a translation. 
Intelligence officers overseas often cannot contact and recruit 
key potential sources because they do not possess the requisite 
language skills. This language skill limitation dramatically 
affects our national security posture. The key to minimizing 
terrorist and other threats is clear: build a professional 
intelligence cadre with the requisite linguistic skills and in-
depth expertise, with a long-term focus on areas of 
specialization. Advanced knowledge of the plans and intentions 
of America's enemies, who almost never use the English language 
to conduct their deadly business, requires trained and 
experienced specialists, not generalists. This is not to say 
that some generalists are not needed. Indeed, given the 
complexity of many transnational targets and issues, 
individuals who can place a broader view on intelligence that 
is collected can be critical to assuring quality reporting. 
There must be a balance struck.
    The Committee is so concerned about foreign language 
capabilities that it believes the Intelligence Community must 
make major changes in policies and funding regarding foreign 
language proficiency for the HUMINT services, and for analysts 
at CIA, DIA, NSA, and elsewhere. The Committee believes that 
the DCI and the Secretary of Defense must enhance the current 
system of bonuses to provide additional positive incentives for 
employees to achieve and maintain proficiency, especially in 
the languages of the toughest and most important targets, 
particularly state sponsors and other nations that support 
terrorism. The size of the bonuses should be established based 
on the level of proficiency and the value of the language, as 
reflected in the CIA and DoD Operating Directives. Language 
specialists should be afforded the same or better opportunities 
for advancement as managers and other intelligence 
professionals enjoy. The Committee also believes that the IC 
and DoD should establish a policy, to be phased in 
appropriately to reflect current workforce realities that 
personnel engaged in foreign areas or subjects must demonstrate 
appropriate levels of proficiency in at least one foreign 
language relevant to their area of expertise in order to gain 
promotion. The Committee recognizes that such demands and 
requirements will probably exceed the infrastructure in place 
for instruction and proficiency testing. There is every 
indication that the Community requirements cannot be met by 
existing schools. Therefore, the Committee believes that it is 
time to consider a dedicated Intelligence Community school that 
addresses future language needs as well as allowing 
Intelligence Community officers the ability to keep and build 
proficiency. The Committee directs the Director of Central 
Intelligence, in consultation with the Secretary of Defense, to 
develop a plan to implement these concepts/changes, conveying 
the plan to the congressional intelligence committees within 
120 days after the date of enactment of this Act. The Committee 
urges the Director and the Secretary to implement the plan as 
rapidly as possible, and thus would fully support use of 
supplemental appropriations for these important efforts, 
recognizing that sustaining funding would have to be included 
in future years' budget requests.

Airborne signals intelligence recapitalization and modernization

    The Committee has been vitally interested in properly 
sustaining the nation's tactical airborne reconnaissance 
platforms. These aircraft provide the bulk of the real-time, 
tactical imagery and signals intelligence to theater 
commanders. Included in their numbers are operational RC-135 
RIVET JOINT, the EP-3 AIRES II, and the U-2 Dragonlady; and the 
future Aerial Common Sensor and Global Hawk aircraft. Longevity 
for the operational systems has become an issue. The Committee 
learned last year that most of the EP-3 aircraft will soon 
reach end of service fatigue life. Although not as urgent a 
problem, the RC-135 family of aircraft is aging and becoming 
more expensive tomaintain. The U-2 fleet has fewer average 
total hours than either of the larger aircraft, and are expected to be 
operational beyond 2020.
    In addition to the longevity of the airframes, the 
Committee remains fully aware of the state of the individual 
collection systems, particularly the SIGINT systems, that must 
constantly be improved to maintain parity with the threat 
environment. Unfortunately, the common SIGINT development, the 
Joint SIGINT Avionics Family (JSAF) Lowband Subsystem failed to 
produce the expected SIGINT collection system upgrade. Because 
the Department of Defense made the management decision to 
pursue this single SIGINT upgrade, foregoing most other 
airborne SIGINT improvements, the state of the operational 
collection systems has suffered tremendously.
    Prior to the decision to pursue the single JSAF approach, 
the individual Services had effective but disparate upgrade 
programs, and technology sharing was sporadic and 
uncoordinated. However, the individual collection system 
capabilities against the fielded threats remained relatively 
good, as the Service program offices pursued mission-specific 
requirements and continually upgraded their weapon systems. The 
Committee is adamant that the Services must be allowed to 
return to constant and incremental system upgrades as the 
standard method of modernization. This modernization approach 
must be properly overseen by the Office of the Secretary of 
Defense to ensure a standardized architectural approach, guided 
by detailed standards promulgated by the Director of the 
National Security Agency (DIRNSA). Further, in his SIGINT 
functional manager's role, the DIRNSA should ensure the service 
program offices share technologies consistent with Service 
mission requirements, funding, and unique integration 
challenges.
    However, the state of the airframes themselves continues to 
be a concern. The Committee is aware of the discussions within 
the Navy to possibly replace the EP-3 aircraft with its future 
Multi-Mission Manned Aircraft (MMA). The Air Force, too, is 
discussing replacement of its reconnaissance aircraft with the 
Multi-Mission Command and Control aircraft (MC2A). Both of 
these concepts have positive and negative aspects. For example, 
the Committee is concerned that the replacement airframe type 
the Navy is currently considering will have severe limitations 
as a SIGINT collection platform. Further, the Air Force's 
concept may likely limit the number of aircraft available for 
world-wide reconnaissance operations. The Committee does not 
see budget requests that will make these proposals reality, nor 
does it see a coordinated approach that will maximize 
operational capability and flexibility while minimizing cost.
    The Committee believes that the concept of replacing the 
two fleets with two new fleets is not the right direction. The 
Committee believes a single manned reconnaissance fleet that is 
``owned'' by an ``executive agent'' service, but co-operated by 
the two services is the right model for the future. This would 
be a concept analogous to the electronic combat EA-6B model in 
service today, and would be a concept that allows for the best 
operational concepts from each of the services to be put into 
use. Further, a combined fleet of dedicated reconnaissance 
aircraft could be smaller in number than two separate fleets of 
dissimilar aircraft.
    From the Committee's perspective, there seems to be a 
logical ``way ahead'' for both the multi-place, self-contained 
aircraft and the smaller manned or unmanned aircraft that 
depend on data-link tethers to ground stations or, in the 
future, other ``mothership'' aircraft such as the RC-135 or its 
replacement. This ``way ahead'' also appears to have a logical 
progression of sensor and sensor developments that would 
improve the flexibility and mission capability, while 
minimizing costs.
    The Committee's concept consists of three basic parts: the 
replacement of the RC-135 and EP-3 fleets with a single Boeing 
767-sized aircraft fleet, with the first aircraft beginning 
delivery as early as 2012; the continuing improvement and 
eventual ``cross-decking'' of the RC-135 collection system to 
the new reconnaissance aircraft; and the continuing upgrade and 
eventual ``cross-decking'' of the U-2 collection system to the 
Global Hawk and the Army's ACS programs.
    Although, the Committee does not presume to choose the 
airframe, it firmly believes that the next generation, manned 
reconnaissance aircraft should be based on the same type 
airframe that the Air Force chooses for its next tanker 
aircraft--likely the B-767 aircraft. The concept for the 
development and fielding of this new reconnaissance aircraft 
includes the necessary life extension modifications to keep the 
EP-3 fleet capable until the first new aircraft can begin 
replacing them on a one-for-one basis. Under this concept, the 
new would first replace the EP-3s, and then later the RC-135s. 
The study for concepts, numbers of aircraft, and the design and 
modification of the new aircraft should begin no later than 
calendar year 2004, with the first funding provided in the 
President's fiscal year 2004 budget request. The modification 
of the future aircraft will clearly require an acquisition 
process and organization that both understands the airborne 
reconnaissance mission and requirements, and has a proven 
record of delivering operational systems. The Committee 
believes the Air Force's Big Safari program office is the only 
logical choice for fielding the new reconnaissance aircraft.
    The concept for the future of the new aircraft's sensor 
systems is likewise relatively straight-forward. There is 
little question that the most sophisticated and capable 
collection system today is the 85000 System onboard the RIVET 
JOINT aircraft. The Committee's concept would continue the 
incremental and continuous sensor improvement to the 85000 
System with the goal of ``cross-decking'' it to the new 
aircraft in the then-current state of modification when the 
first aircraft is ready to accept it. This would require 
``new'' equipment purchases for the first number of new 
aircraft that replace the EP-3, and the later number of 
aircraft would be outfitted with equipment directly transferred 
from the RC-135 aircraft as each is retired. The cost savings 
realized with this concept would be substantial over the 
alternative option to develop an entirely new SIGINT system.
    Lastly, the Committee believes the sensor approach outlined 
above would work well for the U-2, Global Hawk and ACS 
aircraft. the U-2's collection system is very sophisticated, 
and moreover, operational. It, too, can be upgraded both 
architecturally and technically to maintain capability against 
the evolving threat. This needs to be done regardless of the 
new aircraft that will augment the U-2. The concept the 
Committeeenvisions is to incrementally improve the U-2's sensor 
suite and eventually ``cross-deck'' it to the Global Hawk and the ACS 
aircraft. For the Global Hawk, this accomplishes several important 
tasks. First, and foremost, it provides a single collection system for 
the Air Force's two high-altitude collection systems, simplifying both 
maintenance and logistics at the single main operating base location. 
Secondly, it results in no major ground station modifications to accept 
two separate SIGINT systems, thereby saving significant amounts of 
money. For the ACS, this would preclude the Army having to develop, on 
its own, a new SIGINT collection system, as the Air Force's previous 
investments would be completely leveraged. Secondly, this would provide 
true interoperability between the Air Force and Army ground stations--
allowing both services to draw on the assets of the other. Lastly, this 
would allow both services to share future research and development 
costs.
    The Committee understands that this concept is a radical 
departure from the programs of record within the Services and 
that it forces a new way of doing business. However, the future 
of airborne reconnaissance systems must be addressed now, and 
concrete actions must begin. Therefore, the Committee requests 
that the Secretary of Defense conduct a study of this concept 
and provide the congressional defense and intelligence 
committees a recommendation on the path to recapitalizing the 
Department's reconnaissance aircraft. The Committee serves 
notice that it will not entertain a status quo answer, and that 
it will take direct fiscal action in future years' request to 
ensure the nation's reconnaissance capabilities.

              Section-by-Section Analysis and Explanation


                    TITLE 1--INTELLIGENCE ACTIVITIES


Section 101--authorization of appropriations

    Section 101 lists departments, agencies, and other elements 
of the United States Government for whose intelligence-related 
activities the Act authorizes appropriations for fiscal year 
2002.

Section 102--classified schedule of authorizations

    Section 102 makes clear that the details of the amounts 
authorized to be appropriated for intelligence and 
intelligence-related activities and personnel ceilings for the 
entities listed in section 101 for fiscal year 2002 are 
contained in the classified Schedule of Authorizations. The 
Schedule of Authorizations is incorporated as to section 101 by 
section 102.

Section 103--personnel ceiling adjustments

    Section 103 authorizes the Director of Central 
Intelligence, with the approval of the Director of the Office 
of Management and Budget, in fiscal year 2002 to exceed the 
personnel ceilings applicable to the components of the 
Intelligence Community under section 102 by an amount not to 
exceed 2 percent of the total of the ceilings applicable under 
section 102. The Director may exercise this authority only when 
necessary to the performance of important intelligence 
functions, and any exercise of this authority must be reported 
to the two intelligence committees of the Congress.

Section 104--intelligence community management account

    Section 104 provides certain details concerning the amount 
and composition of the Community Management Account (CMA) of 
the Director of Central Intelligence.
    Subsection (a) authorizes appropriations in the amount of 
$152,776,000 for fiscal year 2002 for the staffing and 
administration of various components under the CMA. Subsection 
(a) also authorizes funds identified for the Advanced Research 
and Development Committee to remain available for two years.
    Subsection (b) authorizes a total of 313 full-time 
personnel for elements within the CMA for fiscal year 2002 and 
provides that such personnel may be permanent employees of the 
CMA element or detailed from other elements of the United 
States Government.
    Subsection (c) explicitly authorizes the classified portion 
of the CMA.
    Subsection (d) requires that personnel be detailed on a 
reimbursable basis, with certain exceptions. Personnel may be 
detailed on a non-reimbursable basis for a period not to exceed 
one year.
    Subsection (e) authorizes $27,000,000 of the amount 
authorized for the CMA under subsection (a) to be made 
available for the National Drug Intelligence Center (NDIC) in 
Johnstown, Pennsylvania. Subsection (e) requires the Director 
of Central Intelligence to transfer $27,000,000 to the 
Department of Justice to be used for NDIC activities under the 
authority of the Attorney General, and subject to section 
103(d)(1) of the National Security Act.

Section 105--codification of the United States Coast Guard as an 
        element of the intelligence community

    Section 105 establishes the United States Coast Guard as a 
National Foreign Intelligence Program (NFIP) agency under the 
National Security Act. The Commandant of the Coast Guard 
recently explained that the definition of national security 
``has widened to include many of the things for which the Coast 
Guard has been responsible for years. These are the so-called 
asymmetric array of threats that are now added to the classical 
inventory of nation-state engagement, potentially leading to 
armed conflict. It certainly now includes counter-terrorism, 
counter-narcotics, illegal alien smuggling, and worrying about 
our Exclusive Economic Zone.'' The Coast Guard is the only 
organization responsible for law enforcement, intelligence and 
military activities simultaneously. As a humanitarian 
organization, it has access to ports unreachable by other U.S. 
entities and welcomed by foreign navies. Under the aegis of law 
enforcement, the Coast Guard can board and search vessels in 
our territorial waters, exclusive economic zones or on high 
seas.
    The Coast Guard is the organization with the primary 
responsibility for maritime interdiction and at sea enforcement 
of U.S. immigration laws. The Coast Guard routinely intercepts 
illegal migrants and returns them to their countries of origin. 
As such, the Coast Guard gains particular insight on migration 
patterns and pressures.
    The Coast Guard is charged with eliminating environmental 
damage and natural resource degradation associated with 
maritime transportation, fishing, and recreational boating. The 
Coast Guard supports important national interests in living 
marine resources enforcement, maritime environmental 
protection, and maritime pollution enforcement.
    Relative to its law enforcement mission, the Coast Guard is 
the U.S. Government agency with primary responsibility for 
maritime drug interdiction. The strategic goal is to protect 
our maritime borders by halting the flow of illegal drugs, 
aliens, and contraband into this country through maritime 
routes, preventing illegal incursions of our exclusive economic 
zone, and suppressing violations of federal law in the maritime 
region. Thus, the Coast Guard has particular insight into the 
operations of international criminal organizations dealing with 
illegal drugs, aliens, and other contraband.
    Coast Guard Captains of the Port in major U.S. ports are 
intimately aware of the foreign maritime presence and have 
ready access to foreign vessels. This allows the Coast Guard to 
play a major role in homeland defense, counter-terrorism, and 
consequence management in U.S. ports.
    In support of military commanders, the Coast Guard has 
national security objectives in the areas of maritime 
interception operations, port operations security and defense, 
military environmental response operations, and peacetime 
military engagement. The Coast Guard is an armed service ``at 
all times'' and conducts defense missions outlined in the 1995 
Department of Transportation/Department of Defense Memorandum 
of Agreement.
    The current Coast Guard intelligence training program can 
better take advantage of available Intelligence Community 
intelligence training courses to increase Coast Guard expertise 
at negligible cost. Additionally, at negligible cost, the Coast 
Guard could elevate the Coast Guard Intelligence Program (CGIP) 
to a flag level directorate. An intelligence directorate would 
facilitate improved coordination of limited Coast Guard assets, 
recognize the increasing value provided by intelligence across 
all Coast Guard million areas, and place this organizational 
element on a par with those of other armed services and 
agencies.

 TITLE II--CENTRAL INTELLIGENCE AGENCY RETIREMENT AND DISABILITY SYSTEM


Section 201--authorization of appropriations

    Section 201 authorizes appropriations authorized by the 
conference report for salary, pay, retirement, and other 
benefits for federal employees may be increased by such 
additional or supplemental amounts as may be necessary for 
increases in such compensation or benefits authorized by law.

                     TITLE III--GENERAL PROVISIONS


Section 301--increase in employee compensation and benefits authorized 
        by law

    Section 301 provides that appropriations authorized by the 
conference report for salary, pay, retirement, and other 
benefits for federal employees may be increased by such 
additional or supplemental amounts as may be necessary for 
increases in such compensation or benefits authorized by law.

Section 302--restriction on conduct of intelligence activities

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

Section 303--Sense of the Congress regarding Intelligence Community 
        contracting

    Section 303 is a Sense of the Congress provision to 
encourage the Intelligence Community to maximize the 
procurement of U.S.-made products.

Section 304--requirements for lodging allowances in Intelligence 
        Community Assignment Program benefits

    Section 304 enhances benefits paid under the Intelligence 
Community Assignment Program (ICAP). ICAP provides 
opportunities for Intelligence Community employees to gain 
experience and perspective through rotational details to 
intelligence-related positions external to an employee's parent 
organization. In order to avoid the significant familial impact 
of a detail and relocating under ICAP, this section authorizes 
the payment of a lodging allowance, subject to conditions, when 
an employee leaves his or her immediate family at the permanent 
duty station to participate in the ICAP. The section does not 
mandate the payment of the lodging allowance. Rather, it 
authorizes the detailing agency, within its discretion, to pay 
an allowance up to a maximum amount determined by the Secretary 
of Defense and the Director of Central Intelligence with regard 
to detailed employees of the Department of Defense, or by such 
other appropriate agency head and the Director of Central 
Intelligence, but no more than the actual lodging expense at 
the new duty station.
    This section sets forth five conditions that must be met 
prior to receipt of the lodging allowance under this program. 
First, it requires that the employee maintain a primary 
residence for his or her immediate family in the local 
commuting area of the permanent duty station from which the 
employee regularly commuted to the former duty station prior to 
the detail. Second, the employee must actually incur lodging 
expenses within reasonable proximity of the new duty station. 
The third condition limits the payment of the allowance to 
circumstances where the new duty station is more than 20 miles 
from the employee's former duty station. Fourth, the section 
requires that the distance from the employee's primary 
residence to the new duty station be at least 10 miles farther 
than the distance from the employee's primary residence to the 
former duty station. The 10-mile requirement parallels the 
current limitation in the federal travel regulations for short 
distance transfers. Finally, the section limits the payment of 
the lodging allowance to employees compensated at or below the 
maximum annual rate of pay for grade GS-15 of the General 
Schedule.

Section 305--technical amendment

    Section 305 provides a technical correction to the National 
Security Act.

Section 306--commission on September 11 government preparedness and 
        performance

    Section 306 of the bill establishes an independent 
commission to review the performance of those federal public 
safety, law enforcement, and national security departments and 
agencies responsible for preventing and/or responding to acts 
of terrorism in the period prior to and including September 11, 
2001. The review is to include the activities of the 
Departments of Defense, Justice, State, Transportation, and 
Treasury (including the intelligence components of those 
departments), the Federal Emergency Management Agency, and the 
Central Intelligence Agency. The commission is to submit a 
report to the President and the Congress with recommendations 
for changes in activities and programs, structure, and/or 
responsibilities of the departments and agencies reviewed. The 
report is to be submitted no later than six months from the 
date the commission's director is appointed. The commission 
shall consist of ten members, four of whom are to be appointed 
by the President, two by the Majority Leader of the Senate, two 
by the Speaker of the House, one by the Minority Leader of the 
Senate, and one by the Minority Leader of the House.
    The committee believes that the commission will only be 
successful if it is seen to be truly independent of any 
preconceived notions about the effectiveness of the activities 
of the departments and agencies it will review. Appointing 
members with a reputation for challenging conventional wisdom, 
wide perspective, bold and innovative thought and broad 
experience in dealing with complex problems will contribute 
directly to instilling the commission with an independence of 
spirit which will enhance the credibility of its work. Those 
given the authority to appoint members of the commission are 
urged to be especially sensitive to the committee's concerns in 
this regard.

                 TITLE IV--CENTRAL INTELLIGENCE AGENCY


Section 401--modifications to Central Intelligence Agency's Central 
        Services Program

    Section 401 makes several changes to the Central 
Intelligence Agency's Central Services Program (CSP). This 
section changes the date the annual audit is required to be 
completed from 31 December to 31 January. This brings the 
financial audit requirements of the CIA Inspector General in 
line with similar requirements placed on other Inspectors 
General in the Federal government. Moreover, it eliminates a 
sunset date for the CSP.

Section 402--extension of Central Intelligence Agency Voluntary 
        Separation Pay Act

    Section 402 extends to September 30, 2003 the DCI's ability 
to offer separation pay incentives, which otherwise would 
expire as of September 30, 2002.
    The Central Intelligence Agency has used the Central 
Intelligence Agency Voluntary Separation Pay Act authority over 
the past several years to restructure and ``re-skill'' its 
workforce to support the Strategic Division that the DCI has 
outlined. The use of incentives, and early-outs, has 
contributed greatly to Agency efforts to re-tool the Agency 
workforce for the challenges of the 21st century, and is a 
critical tool in providing the Director of Central Intelligence 
the flexibility to adapt the workforce as priorities change. 
The changes in the workforce required to support the DCI's 
direction have an impact on the number of areas within the 
Agency. Authority to offer incentives, and early outs, to 
targeted groups of employees to encourage separation, 
therefore, remains important to the success of Agency 
restructuring. Data from the Agency's exit survey indicate that 
the separation incentive pay has accelerated the departure of 
employees in targeted groups.
    The Agency is engaged in a concerted effort to further 
streamline its administrative processes. As that effort bears 
fruit, the Agency will need to continue restructuring the CIA 
workforce. The recent disestablishment of the Agency's 
Directorate of Administration and the creation of five new 
Mission Support Offices also may necessitate additional 
reconfiguration of Agency staffing.
    In addition to the restructuring outlined above, other 
ongoing initiatives are intended to better position the Agency 
workforce to support the DCI's vision of intelligence 
collection, analysis, and dissemination in the coming years. Of 
continuing importance is the ability to redirect middle- and 
senior-level management positions in the Directorate of 
Intelligence and the Directorate of Science and Technology. 
Reductions in managerial ranks will make available positions 
for senior substantive experts in the analysis and technology 
fields. Separation incentive and early out authority will 
substantially assist in achieving this transition without 
serious adverse impact on the managerial workforce.

Section 403--guidelines for recruitment of certain foreign assets

    Section 403 addresses the CIA's 1995 guidelines on 
recruitment of foreign assets and sources. The Committee 
believes that the 1995 CIA guidelines on the handling of cases 
involving foreign assets and sources with human rights concerns 
have had the unintended consequence of deterring the effective 
recruitment of potentially high-value assets. The Committee has 
long been concerned that a culture of ``risk aversion'' has 
hindered decision-making across the Intelligence Community, and 
especially within the CIA. In the instance of the 1995 
guidelines, we are concerned that excessive caution and a 
burdensome vetting process have undermined the CIA's ability to 
recruit assets. The Committee is concerned that the guidelines 
have had a negative impact on the recruitment of sources 
against terrorist organizations and other hard targets as well. 
Admittedly, in the past, there have been recruitments that have 
proved to be inappropriate. Since 1995, CIA's well-intended 
effort to address human rights concerns may have significantly 
limited the U.S. Government's access to foreign assets and 
sources.
    Far too often, Committee members have learned of field 
officers who have been deterred from recruiting promising 
assets or who have lost potential assets to competing 
intelligence services, because of a slow and overly litigious 
vetting process. Legal and bureaucratic concerns must not be 
ignored, but neither should they dictate the asset recruitment 
process. New guidelines must rebalance the equation between 
potential gain and risk. Clearly, there is a certain class of 
individuals who, because of their unreliability, instability, 
or nature of past misconduct, should be avoided. A new balance 
must be struck that recognizes concerns about egregious human 
rights behavior, but provides the much needed flexibility to 
seize upon opportunities as they present themselves. The 
Committee looks to the Director of Central Intelligence to 
promulgate new guidelines that restore equilibrium to the asset 
vetting process, satisfactorily address legal questions in a 
time-urgent manner, thereby expediting recruitment of foreign 
assets and sources, and provide confidence to personnel in the 
field that their best judgment will be supported.

         TITLE V--DEPARTMENT OF DEFENSE INTELLIGENCE ACTIVITIES


Section 501--authority to purchase items of nominal value for 
        recruiting purposes

    Section 501 helps to align the recruiting practices of 
Intelligence Community elements of DoD with those of private 
industry in order to assist these agencies in maintaining their 
competitiveness for prospective employees in the marketplace. 
Express authority is granted to the Secretary of Defense with 
respect to the Intelligence Community elements of DoD to use 
appropriated funds for the purchase of promotional items of 
nominal value for recruitment purposes. Such items would 
include hi-liters, mugs, magnets, letter openers, and other 
nominal-value items deemed necessary by agency recruiters to 
establish an agency presence on campuses and at job fairs. The 
provision of such items will assist these agencies in 
attracting students on college and university campuses or 
prospective applicants at job fairs.
    Recruitment give-away items are commonly offered to 
prospective applicants by private sector employers as part of 
normal recruiting activities. These give-away items help the 
employer to establish a presence at recruiting functions by 
serving as a reminder to potential applicants of the 
prospective employer's name and contact number, and as a means 
of attracting attention to the employer's lines of business. 
Intelligence Community elements of DoD currently lack the 
authority to offer these nominal-value items.
    Expressly authorizing Intelligence Community elements of 
DoD to use this standard private-sector recruiting practice 
will enhance their ability to attract the attention of 
prospective job applicants, as well as their ability to 
participate in various recruitment activities and at job fairs. 
The mission of each of these agencies is largely dependent on 
attracting the broadest possible range of potential applicants. 
It is therefore necessary that their recruiting activities be 
as competitive as possible with those activities practicedby 
the private-sector entities with whom they vie most vigorously for 
talent, especially in the technical disciplines.

Section 502--fund for infrastructure and quality-of life improvements 
        at Menwith Hill and Bad Aibling stations

    Section 502 would extend through the end of FY 2003 
authority granted the Army in the Intelligence Authorization 
Act for Fiscal Year 1996 for the enhancement of capabilities to 
include infrastructure and quality of life concerns at Bad 
Aibling and Menwith Hill Stations. With respect to Bad Aibling 
Station, this authority is requested as an interim measure 
pending any final decision on the future operations of this 
station.
    The Army became the Executive Agent for Bad Aibling Station 
in FY 1995 and Menwith Hill Station in FY 1996. Without 
congressional action, the Army is prohibited by 31 U.S.C. 1301 
from using appropriated funds to support these field sites, 
notwithstanding that the Army is the Executive Agent for them. 
Language in the Intelligence Authorization Act for Fiscal Year 
1996 provided the necessary flexibility to allow the Army to 
transfer or reprogram relatively minor amounts of funds (up to 
$2 million in FY 1996 O&M and $2 million in FY 1997 O&M funds) 
for necessary enhancements at these stations. However, 
sufficient funding has not been available to allow the Army to 
meet all of the stations's needs, given financial constraints 
and increasing operational tempo. Consequently, in order to 
continue addressing enhancements to include infrastructure and 
quality of life needs at Menwith Hill Station and to be able to 
continue operations on an interim basis at Bad Aibling Station, 
the Army requests that its flexible transfer and reprogramming 
authority be extended through FY 2003.

Section 503--continuation of Joint Inter-Agency Task Force at current 
        locations in Florida and California

    Section 503 supports retention of Joint Inter-Agency Task 
Force intelligence and law enforcement operations in Florida 
and California. In 1989, Congress designated the Department of 
Defense (DoD) as the ``Lead Agency'' for the detection and 
monitoring (D&M) of aerial and maritime trafficking. To carry 
out their new mission, the Defense Department built upon the 
Unified Command Structure and established several Joint Task 
Force operations centers.
    Joint Interagency Task Force (JIATF) East was created as a 
result of Presidential Decision Directive 14, which ordered a 
review of the nation's command and control intelligence centers 
involved in international counter-narcotics operations.
    The principal statutory authority of JIATF counterdrug 
detection and monitoring activities is set forth in 10 USC 124, 
which directs the Defense Department to serve as the single 
lead agency of the Federal Government for the detection and 
monitoring of aerial and maritime transit of illegal drugs into 
the United States. JIATF activities implement this Defense 
Department authority.
    JIATF operations are also based on the authority of Section 
1004 of Public Law 101-510, Division A, Title X, of the 
National Defense Authorization Act of Fiscal Year 1991, as 
amended, which provides additional authority for Defense 
Department counterdrug activities in support of any Federal 
agency or department, and of any State, local, or foreign law 
enforcement agency for various purposes, to include the 
detection, monitoring, and communication of the movement of air 
and sea traffic within 25 miles of and outside the geographic 
boundaries of the United States. Other counterdrug support 
authorized by Section 1004 includes maintaining and repairing 
equipment; transporting personnel and equipment; establishing 
bases of operations; providing counterdrug related training; 
constructing roads and fences and installing lighting to block 
drug smuggling corridors; establishing command, control 
communications, and computer networks; providing linguist and 
intelligence analysis services; and producing aerial and ground 
reconnaissance.
    Additionally, JIATF operates under the authority and 
restrictions provided for in Chapter 18 of Title 10 of the U.S. 
Code (Sections 371-382) governing military support for U.S. 
Federal, State, and local civilian law enforcement agencies. 
These provisions include authority for the Defense Department 
to support civilian law enforcement agencies by various means, 
to include sharing information (Section 371), making equipment 
available (Section 372), training in operation of equipment 
made available and providing expert advice (Section 373), and 
making Defense Department personnel available for among other 
purposes, to operate equipment for the purposes of detecting, 
monitoring, and communicating the movement of air and sea 
traffic, and of surface traffic outside the United States in 
support of civilian law enforcement agencies (10 USC 374).
    JIATFs are ``DoD intelligence components'' within the 
meaning of DoD Directive 5240.1, DoD Intelligence Activities 
(25 April 1988) and DoD Regulation 5240.1, Procedures Governing 
the Activities of DoD Intelligence Components that affect 
United States Persons (December 1082). These Defense Department 
publications implement Executive Order 12333, United States 
Intelligence Activities (4 Dec 1981). As a Defense Department 
intelligence component, JIATF activities are conducted in 
compliance with DoD Directive 5240.1, DoD Regulation 5240.1, 
and Executive Order 12333. Procedure 12 of DoD Regulation 
5240.1, entitled ``Provision of Assistance to Law Enforcement 
Authorities,'' specifically authorizes DoD intelligence 
components to cooperate with law enforcement authorities for 
the purpose of international narcotics activities. Procedure 12 
incorporates the limitations on assistance to law enforcement 
authorities contained in Executive Order 12333, and the general 
limitations and approval requirements pertaining to the 
provision of assistance to civilian law enforcement agencies 
set forth in DoD Directive 5525.5. The provisions of 10 USC 371 
provide Defense Department authority to share intelligence 
information collected during the normal course of military 
training or operation that is relevant to a violation of any 
Federal or State law with Federal, State, or local civilian law 
enforcement officials.

Section 504--modification of authorities relating to interdiction of 
        aircraft engaged in illicit drug-trafficking

    Section 504 amends current law (22 U.S.C. 2291-4) relating 
to official immunity for employees and agents of the United 
States and foreign countries engaged in the interdiction of 
aircraft used in illicit drug trafficking. Under this section, 
the President must make an annual certification to Congress 
concerning both the existence of a drug threat in the country 
at issue and the existence in that country of appropriate 
procedures to protect against innocent loss of life. An annual 
report to Congress by the President concerning United States 
Government assistance to such interdiction programs is also 
required by this section.

Section 505--undergraduate training program for employees of the 
        National Imagery and Mapping Agency

    Section 505 amends the National Imagery and Mapping Act of 
1996 to authorize the Secretary of Defense to establish a 
program to send NIMA civilian employees to accredited 
professional, technical, and other institutions of higher 
learning for training at the undergraduate level. It is similar 
in purpose, content, and administration to the NSA program 
established under the National Security Agency Act of 1959 (50 
USC 402(note)).

Section 506--technical amendments

    Section 506 is a technical amendment that deletes the 
requirement contained in 10 U.S.C. Section 2555(b)(3) that 
foreign governments return transferred nuclear test monitoring 
equipment if either the United States or the foreign government 
terminate an agreement to share the information collected 
through such an agreement. The proposal further clarifies that 
the Secretary of Defense has authority to convey, transfer 
title to, or otherwise provide such equipment to a foreign 
government and may maintain, repair, or replace equipment so 
transferred.

               Committee Position and Record Votes Taken

    On September 24, 2001, in open session, a quorum being 
present, the Permanent Select Committee on Intelligence, by a 
recorded vote of 18 ayes to 0 noes, approved the bill, H.R. 
2883, as amended by an amendment in the nature of a substitute 
offered by Chairman Goss. By that vote, the committee ordered 
the bill reported favorably to the House. On that vote, the 
Members present recorded their votes as follows: Mr. Goss 
(Chairman)--aye; Mr. Bereuter--aye; Mr. Castle--aye; Mr. 
Boehlert--aye; Mr. Gibbons--aye; Mr. LaHood--aye; Mr. 
Cunningham--aye; Mr. Hoekstra--aye; Mr. Burr--aye; Mr. 
Chambliss--aye; Ms. Pelosi--aye; Mr. Bishop--aye; Ms. Harman--
aye; Mr. Condit--aye; Mr. Roemer--aye; Mr. Hastings--aye; Mr. 
Reyes--aye; Mr. Boswell--aye.
    During consideration of the bill, Mr. LaHood offered an 
amendment to the legislative provisions. The amendment would 
have removed section 306 from the bill. Section 306 establishes 
an independent commission to assess the performance of those 
agencies and departments of the United States charged with the 
responsibility to prevent, prepare for, or respond to acts of 
terrorism up to and including the events of September 11, 2001. 
The Permanent Select Committee on Intelligence rejected Mr. 
LaHood's amendment by a vote of 7 ayes to 11 noes, a quorum 
being present. On that vote, the Members present recorded their 
votes as follows: Mr. Goss (Chairman)--no; Mr. Bereuter--aye; 
Mr. Castle--aye; Mr. Boehlert--no; Mr. Gibbons--aye; Mr. 
LaHood--aye; Mr. Cunningham--aye; Mr. Hoekstra--no; Mr. Burr--
aye; Mr. Chambliss--aye; Ms. Pelosi--no; Mr. Bishop--no; Ms. 
Harman--no; Mr. Condit--no; Mr. Roemer--no; Mr. Hastings--no; 
Mr. Reyes--no; Mr. Boswell--no.

   Findings and Recommendations of the Committee on Government Reform

    With respect to clause 3(c)(4) of rule XIII of the House of 
Representatives, the committee is not subject to this 
requirement; therefore, the committee has not received a report 
from the Committee on Government Reform pertaining to the 
subject of this bill.

                           Oversight Findings

    With respect to clause 3(c)(1) of rule XIII of the Rules of 
the House of Representatives, the committee held three hearings 
and numerous briefings on the classified budgetary issues 
raised by H.R. 2883. Testimony was taken from senior officials 
of the Central Intelligence Agency, the National Security 
Agency, the Defense Intelligence Agency, the Federal Bureau of 
Investigation, the National Reconnaissance Office, the National 
Imagery and Mapping Agency, the Department of Defense, the 
Department of State, the Department of Treasury, the Department 
of Justice, and the Department of Transportation regarding the 
activities and plans of the Intelligence Community covered by 
the provisions and authorizations, both classified and 
unclassified, of the Intelligence Authorization Act for Fiscal 
Year 2002. The bill, as reported by the committee, reflects 
conclusions reached by the committee in light of this oversight 
activity.

                      Fiscal Year Cost Projections

    The committee has attempted, pursuant to clause 3(d)(2) of 
rule XIII of the Rules of the House of Representatives, to 
ascertain the outlays that will occur in fiscal year 2002 and 
the five years following, if the amounts authorized are 
appropriated. These estimates are contained in the classified 
annex and are in accordance with those of the Executive Branch.

                 Congressional Budget Office Estimates

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, and pursuant to sections 308 
and 402 of the Congressional Budget Act of 1974, the committee 
submits the following estimate prepared by the Congressional 
Budget Office:

                          House of Representatives,
                Permanent Select Committee on Intelligence,
                                Washington, DC, September 24, 2001.
Dr. Dan Crippen,
Director, Congressional Budget Office,
Ford House Office Building, Washington, DC.
    Dear Dr. Crippen: In compliance with clause 3 of Rule XIII 
of the Rules of the House of Representatives, I am writing to 
request a cost estimate of H.R. 2883, the Intelligence 
Authorization Act for Fiscal Year 2002, pursuant to sections 
308 and 403 of the Congressional Budget Act of 1974. I have 
attached a copy of the bill as approved today by the House 
Permanent Select Committee on Intelligence.
    As I hope to bring this legislation to the House floor in 
the very near term, I would very much appreciate an expedited 
response to this request by the CBO's staff. Should you have 
any questions related to this request, please contact Chris 
Barton, the Committee's Acting Chief Counsel. Thank you in 
advance for your assistance with this request.
            Sincerely,
                                            Porter J. Goss,
                                                          Chairman.
                                ------                                

                                     U.S. Congress,
                               Congressional Budget Office,
                                Washington, DC, September 25, 2001.
Hon. Porter J. Goss,
Chairman, Permanent Select Committee on Intelligence,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 2883, the 
Intelligence Authorization Act for Fiscal Year 2002.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Matthew 
Schmit.
            Sincerely,
                                           Steven Lieberman
                                    (For Dan L. Crippen, Director).
    Enclosure.

H.R. 2883--Intelligence Authorization Act for Fiscal Year 2002

    Summary: H.R. 2883 would authorize appropriations for 
fiscal year 2002 for intelligence activities of the United 
States government, the Intelligence Community Management 
Account, and the Central Intelligence Agency Retirement and 
Disability System (CIARDS).
    This estimate addresses only the unclassified portion of 
the bill. On that limited basis, CBO estimates that 
implementing the bill would cost $156 million over the 2002-
2006 period, assuming appropriation of the necessary funds. The 
bill would affect direct spending by insignificant amounts; 
thus, pay-as-you-go procedures would apply.
    H.R. 2883 contains an intergovernmental and private-sector 
mandate as defined in the Unfunded Mandates Reform Act (UMRA). 
CBO estimates that the costs of the mandate would not exceed 
the thresholds established in that act ($56 million for 
intergovernmental mandates and $113 million for private-sector 
mandates in 2001, adjusted annually for inflation).
    Estimated cost to the Federal Government: The estimated 
budgetary impact for the specified authorization of 
appropriations in the unclassified portions of H.R. 2883 is 
shown in the following table. CBO cannot obtain the necessary 
information to estimate the costs for the entire bill because 
parts are classified at a level above clearances held by CBO 
employees. For purposes of this estimate, CBO assumes that the 
bill will be enacted near the start of fiscal year 2002, and 
that the necessary amount will be appropriated for that year. 
Estimated outlays are based on historical spending patterns. 
The costs of this legislation fall within budget function 050 
(national defense).

----------------------------------------------------------------------------------------------------------------
                                                                     By fiscal year, in millions of dollars--
                                                                 -----------------------------------------------
                                                                   2001    2002    2003    2004    2005    2006
----------------------------------------------------------------------------------------------------------------
                                    INTELLIGENCE COMMUNITY MANAGEMENT ACCOUNT

Spending Under Current Law
    Budget Authority \1\........................................     149       0       0       0       0       0
    Estimated Outlays...........................................     155      58      15       2       0       0
Proposed Changes
    Authorization Level.........................................       0     153       0       0       0       0
    Estimated Outlays...........................................       0     198      43       8       3       0
Spending Under H.R. 2883
    Authorization Level \1\.....................................     149     153       0       0       0       0
    Estimated Outlays...........................................     155     156      58      10       3       0

                                      COMMISSION ON TERRORISM PREPAREDNESS

Spending Under Current Law
    Budget Authority............................................       0       0       0       0       0       0
    Estimated Outlays...........................................       0       0       0       0       0       0
Proposed Changes
    Estimated Authorization Level...............................       0       3       0       0       0       0
    Estimated Outlays...........................................       0       3       0       0       0       0
Spending Under H.R. 2883
    Estimated Authorization Level...............................       0       3       0       0       0       0
    Estimated Outlays...........................................       0       3       0       0       0       0

                             SUMMARY OF CHANGES IN SPENDING SUBJECT TO APPROPRIATION

    Estimated Authorization Level \2\...........................       0     156       0       0       0       0
    Estimated Outlays...........................................       0     101      43       8       3       0
----------------------------------------------------------------------------------------------------------------
\1\ The 2001 level is the amount appropriated for that year.
\2\ In addition to effects on spending subject to appropriations, H.R. 2883 would affect direct spending, but
  CBO estimates that such changes would be less than $500,000 a year.

Spending subject to appropriation

    The bill would authorize appropriations of $153 million for 
the Intelligence Community Management Account, which funds the 
coordination of programs, budget oversight, andmanagement of 
the intelligence agencies and unspecified amounts for intelligence 
activities in fiscal year 2002.
    Section 306 would establish a commission to examine the 
federal government's preparedness to prevent, prepare for, or 
respond to acts of terrorism up to and including the terrorist 
acts on September 11, 2001. Based on costs for similar 
commissions, CBO estimates implementing this section would cost 
about $3 million in fiscal year 2002.

Direct spending and revenues

    The bill would authorize $212 million for CIARDS to cover 
retirement costs attributable to military service and various 
unfunded liabilities. The payment to CIARDS is considered 
mandatory, and the authorization under this bill would be the 
same as assumed in the CBO baseline. Thus, this estimate does 
not ascribe any additional cost to that provision.
    Section 401 would provide permanent authority for a program 
that authorizes the CIA to provide goods and services on a 
reimbursable basis. CBO estimates that the costs of providing 
those goods and services would be offset by the reimbursements 
and that this provision would have an insignificant net impact 
each year and no net budgetary impact over the long run.
    Section 402 would extend the authority of the Central 
Intelligence Agency (CIA) to offer incentive payments to 
employees who voluntarily retire or resign. The authority, 
which will expire on September 30, 2002, would be extended 
through fiscal year 2003. Section 402 also would require the 
CIA to make a deposit to the Civil Service Retirement and 
Disability Fund equal to 15 percent of final pay for each 
employee who accepts an incentive payment. Although the timing 
of agency payments and the additional benefit payments would 
not match on a yearly basis, CBO believes that these deposits 
would be sufficient to cover the cost of any long-term increase 
in benefits that would result from induced retirements. CBO 
cannot provide a precise estimate of the direct spending 
effects because the data necessary for an estimate are 
classified.
    Pay-as-you-go considerations: The Balanced Budget and 
Emergency Deficit Control Act sets up pay-as-you-go procedures 
for legislation affecting direct spending or receipts. CBO 
estimates that the net change in outlays for section 401 that 
are subject to pay-as-you-go procedures would be insignificant 
for each year. CBO cannot estimate the precise direct spending 
effects of section 402 because the necessary data are 
classified.
    Intergovernmental and private-sector impact: H.R. 2883 
would establish the Commission on Preparedness and Performance 
of the Federal Government for the September 11 Acts of 
Terrorism and would give it the power to subpoena testimony and 
evidence. Such power would constitute an intergovernmental and 
private-sector mandate under UMRA. CBO estimates that the costs 
of the mandate would not exceed the thresholds established in 
UMRA ($56 million for intergovernmental mandates and $113 
million for private-sector mandates in 2001, adjusted annually 
for inflation). The remaining provisions of the bill contain no 
intergovernmental or private-sector mandates and would impose 
no costs on state, local, or tribal governments.
    Previous CBO estimate: On September 14, 2001, CBO 
transmitted a cost estimate for the unclassified portion of S. 
1428, the Intelligence Authorization Act for Fiscal Year 2002, 
as ordered reported by the Senate Select Committee on 
Intelligence on September 6, 2001. The differences in the 
estimated costs reflect differences in the bills. In 
particular, S. 1428 would authorize $238 million for the 
Intelligence Community Management Account, while H.R. 2883 
would authorize $153 million for that account.
    Estimate prepared by: Federal Costs: Matthew Schmit. Impact 
on State, Local, and Tribal Governments: Elyse Goldman. Impact 
on the Private Sector: Zachary Selden.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                        Committee Cost Estimates

    The committee agrees with the estimate of the Congressional 
Budget Office.

 Specific Constitutional Authority for Congressional Enactment of This 
                              Legislation

    The intelligence and intelligence-related activities of the 
United States government are carried out to support the 
national security interests of the United States, to support 
and assist the armed forces of the United States, and to 
support the President in the execution of the foreign policy of 
the United States. Article 1, section 8 of the Constitution of 
the United States provides, in pertinent part, that ``Congress 
shall have power * * * to pay the debts and provide for the 
common defence and general welfare of the United States; * * 
*''; ``to raise and support Armies, * * *'' ``to provide and 
maintain a Navy; * * *'' and ``to make all laws which shall be 
necessary and proper for carrying into execution * * * all 
other powers vested by this Constitution in the Government of 
the United States, or in any Department or Officer thereof.'' 
Therefore, pursuant to such authority, Congress is empowered to 
enact this legislation.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

                    NATIONAL SECURITY ACT OF 1947

           *       *       *       *       *       *       *



                              DEFINITIONS

  Sec. 3. As used in this Act:
          (1) * * *

           *       *       *       *       *       *       *

          (4) The term ``intelligence community'' includes--
                  (A) * * *

           *       *       *       *       *       *       *

                  (H) the intelligence elements of the Army, 
                the Navy, the Air Force, the Marine Corps, the 
                Federal Bureau of Investigation, the Department 
                of the Treasury, [and] the Department of 
                Energy, and the Coast Guard;

           *       *       *       *       *       *       *


              TITLE I--COORDINATION FOR NATIONAL SECURITY

           *       *       *       *       *       *       *



     appointment of officials responsible for intelligence-related 
                               activities

  Sec. 106. (a) * * *
  (b) Consultation with DCI in Certain Appointments.--(1) * * *
  (2) Paragraph (1) applies to the following positions:
          (A) * * *

           *       *       *       *       *       *       *

          (C) The Director of the Office of [Nonproliferation 
        and National Security] Intelligence and the Director of 
        the Office of Counterintelligence of the Department of 
        Energy.

           *       *       *       *       *       *       *


  detail of intelligence community personnel--intelligence community 
                           assignment program

  Sec. 113. (a) * * *
  (b) Benefits, Allowances, Travel, Incentives.--(1) An 
employee detailed under subsection (a) may be authorized any 
benefit, allowance, travel, or incentive otherwise provided to 
enhance staffing by the organization from which the employee is 
detailed.
  (2) The head of an agency of an employee detailed under 
subsection (a) may pay a lodging allowance for the employee 
subject to the following conditions:
          (A) The allowance shall be the lesser of the cost of 
        the lodging or a maximum amount payable for the lodging 
        as established jointly by the Director of Central 
        Intelligence and--
                  (i) with respect to detailed employees of the 
                Department of Defense, the Secretary of 
                Defense; and
                  (ii) with respect to detailed employees of 
                other agencies and departments, the head of 
                such agency or department.
          (B) The detailed employee maintains a primary 
        residence for the employee's immediate family in the 
        local commuting area of the parent agency duty station 
        from which the employee regularly commuted to such duty 
        station before the detail.
          (C) The lodging is within a reasonable proximity of 
        the host agency duty station.
          (D) The distance between the detailed employee's 
        parent agency duty station and the host agency duty 
        station is greater than 20 miles.
          (E) The distance between the detailed employee's 
        primary residence and the host agency duty station is 
        10 miles greater than the distance between such primary 
        residence and the employees parent duty station.
          (F) The rate of pay applicable to the detailed 
        employee does not exceed the rate of basic pay for 
        grade GS-15 of the General Schedule.

           *       *       *       *       *       *       *

                              ----------                              


        SECTION 21 OF THE CENTRAL INTELLIGENCE AGENCY ACT OF 1949

           *       *       *       *       *       *       *


                        central services program

  Sec. 21. (a) * * *

           *       *       *       *       *       *       *

  (g) Audit.--(1) Not later than [December] January 31 each 
year, the Inspector General of the Central Intelligence Agency 
shall [conduct] complete an audit of the activities under the 
program during the preceding fiscal year.

           *       *       *       *       *       *       *

  (h) Termination.--[(1) The authority of the Director to carry 
out the program under this section shall terminate on March 31, 
2002.]
  [(2)] (1) Subject to paragraph [(3)] (2), the Director of 
Central Intelligence and the Director of the Office of 
Management and Budget, acting jointly--
          (A) may terminate the program under this section and 
        the Fund at any time; and
          (B) upon such termination, shall provide for the 
        disposition of the personnel, assets, liabilities, 
        grants, contracts, property, records, and unexpended 
        balances of appropriations, authorizations, 
        allocations, and other funds held, used, arising from, 
        available to, or to be made available in connection 
        with the program or the Fund.
  [(3)] (2) The Director of Central Intelligence and the 
Director of the Office of Management and Budget may not 
undertake any action under paragraph [(2)] (1) until 60 days 
after the date on which the Directors jointly submit notice of 
such action to the Permanent Select Committee on Intelligence 
of the House of Representatives and the Select Committee on 
Intelligence of the Senate.

           *       *       *       *       *       *       *

                              ----------                              


 SECTION 2 OF THE CENTRAL INTELLIGENCE AGENCY VOLUNTARY SEPARATION PAY 
                                  ACT

SEC. 2. SEPARATION PAY.

  (a) * * *

           *       *       *       *       *       *       *

  (f) Termination.--No amount shall be payable under this 
section based on any separation occurring after September 30, 
[2002] 2003.

           *       *       *       *       *       *       *

  (i) Remittance of Funds.--The Director shall remit to the 
Office of Personnel Management for deposit in the Treasury of 
the United States to the credit of the Civil Service Retirement 
and Disability Fund (in addition to any other payments which 
the Director is required to make under subchapter III of 
chapter 83 and subchapter II of chapter 84 of title 5, United 
States Code), an amount equal to 15 percent of the final basic 
pay of each employee who, in fiscal year 1998, 1999, 2000, 
2001, [or 2002] 2002, or 2003, retires voluntarily under 
section 8336, 8412, or 8414 of such title or resigns and to 
whom a voluntary separation incentive payment has been or is to 
be paid under this section. The remittance required by this 
subsection shall be in lieu of any remittance required by 
section 4(a) of the Federal Workforce Restructuring Act of 1994 
(5 U.S.C. 8331 note).
                              ----------                              


                      TITLE 10, UNITED STATES CODE

           *       *       *       *       *       *       *


                   Subtitle A--General Military Law

           *       *       *       *       *       *       *


           PART I--ORGANIZATION AND GENERAL MILITARY POWERS

           *       *       *       *       *       *       *


         CHAPTER 21--DEPARTMENT OF DEFENSE INTELLIGENCE MATTERS

           *       *       *       *       *       *       *



                     SUBCHAPTER I--GENERAL MATTERS

Sec.
421.  Funds for foreign cryptologic support.
[422.  Counterintelligence official reception and representation 
          expenses.]
422.  Use of funds for certain incidental purposes.

           *       *       *       *       *       *       *


[Sec. 422. Counterintelligence official reception and representation 
                    expenses]

Sec. 422. Use of funds for certain incidental purposes

  (a) Counterintelligence Official Reception and Representation 
Expenses.--The Secretary of Defense may use funds available to 
the Department of Defense for counterintelligence programs to 
pay the expenses of hosting foreign officials in the United 
States under the auspices of the Department of Defense for 
consultation on counterintelligence matters.
  (b) Promotional Items for Recruitment Purposes.--The 
Secretary of Defense may use funds available for an 
intelligence element of the Department of Defense to purchase 
promotional items of nominal value for use in the recruitment 
of individuals for employment by that element.

           *       *       *       *       *       *       *


            CHAPTER 22--NATIONAL IMAGERY AND MAPPING AGENCY

           *       *       *       *       *       *       *


                  SUBCHAPTER III--PERSONNEL MANAGEMENT

Sec.
461.  Management rights.
462.  Financial assistance to certain employees in acquisition of 
          critical skills.

           *       *       *       *       *       *       *


Sec. 462. Financial assistance to certain employees in acquisition of 
                    critical skills

  The Secretary of Defense may establish an undergraduate 
training program with respect to civilian employees of the 
National Imagery and Mapping Agency that is similar in purpose, 
conditions, content, and administration to the program 
established by the Secretary of Defense under section 16 of the 
National Security Agency Act of 1959 (50 U.S.C. 402 note) for 
civilian employees of the National Security Agency.

           *       *       *       *       *       *       *


               PART IV--SERVICE, SUPPLY, AND PROCUREMENT

           *       *       *       *       *       *       *


       CHAPTER 152--ISSUE OF SUPPLIES, SERVICES, AND FACILITIES

           *       *       *       *       *       *       *


Sec. 2555. Nuclear test monitoring equipment: furnishing to foreign 
                    governments

  (a) Authority To [Convey or] Transfer Title to or Otherwise 
Provide Nuclear Test Monitoring Equipment.--Subject to 
subsection (b), the Secretary of Defense may--
          (1) [convey] transfer title or otherwise provide to a 
        foreign government (A) equipment for the monitoring of 
        nuclear test explosions, and (B) associated equipment; 
        [and]
          (2) as part of any such conveyance or provision of 
        equipment, install such equipment on foreign territory 
        or in international waters[.]; and
          (3) inspect, test, maintain, repair, or replace any 
        such equipment.
  (b) Agreement Required.--Nuclear test explosion monitoring 
equipment may be [conveyed or otherwise provided] provided to a 
foreign government under subsection (a) only pursuant to the 
terms of an agreement between the United States and the foreign 
government receiving the equipment in which the recipient 
foreign government agrees--
          (1) to provide the United States with timely access 
        to the data produced, collected, or generated by the 
        equipment; and
          (2) to permit the Secretary of Defense to take such 
        measures as the Secretary considers necessary to 
        inspect, test, maintain, repair, or replace that 
        equipment, including access for purposes of such 
        measures[; and].
          [(3) to return such equipment to the United States 
        (or allow the United States to recover such equipment) 
        if either party determines that the agreement no longer 
        serves its interests.]

           *       *       *       *       *       *       *

                              ----------                              


 SECTION 506 OF THE INTELLIGENCE AUTHORIZATION ACT FOR FISCAL YEAR 1996

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

  (a) * * *
  (b) Source of Funds.--Funds available for the Army for 
operations and maintenance for fiscal years [2000 and 2001] 
2002 and 2003 shall be available to carry out subsection (a).

           *       *       *       *       *       *       *

                              ----------                              


SECTION 1012 OF THE NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 
                                  1995

SEC. 1012. OFFICIAL IMMUNITY FOR AUTHORIZED EMPLOYEES AND AGENTS OF THE 
                    UNITED STATES AND FOREIGN COUNTRIES ENGAGED IN 
                    INTERDICTION OF AIRCRAFT USED IN ILLICIT DRUG 
                    TRAFFICKING.

  (a) Employees and Agents of Foreign Countries.--
Notwithstanding any other provision of law, it shall not be 
unlawful for authorized employees or agents of a foreign 
country (including members of the armed forces of that country) 
to interdict or attempt to interdict an aircraft in that 
country's territory or airspace if--
          (1) * * *
          (2) the President of the United States[, before the 
        interdiction occurs, has determined] has, during the 
        12-month period ending on the date of the interdiction, 
        certified to Congress with respect to that country 
        that--
                  (A) interdiction is necessary because of the 
                extraordinary threat posed by illicit drug 
                trafficking to the national security of that 
                country; and
                  (B) the country has appropriate procedures in 
                place to protect against innocent loss of life 
                in the air and on the ground in connection with 
                interdiction, which shall at a minimum include 
                effective means to identify and warn an 
                aircraft before the use of force directed 
                against the aircraft.

           *       *       *       *       *       *       *

  (c) Annual Reports.--(1) Not later than February 1 each year, 
the President shall submit to Congress a report on the 
assistance provided under subsection (b) during the preceding 
calendar year. Each report shall include for the calendar year 
covered by such report the following:
          (A) A list specifying each country for which a 
        certification referred to in subsection (a)(2) was in 
        effect for purposes of that subsection during any 
        portion of such calendar year, including the nature of 
        the illicit drug trafficking threat to each such 
        country.
          (B) A detailed explanation of the procedures referred 
        to in subsection (a)(2)(B) in effect for each country 
        listed under subparagraph (A), including any training 
        and other mechanisms in place to ensure adherence to 
        such procedures.
          (C) A complete description of any assistance provided 
        under subsection (b).
          (D) A summary description of the aircraft 
        interception activity for which the United States 
        Government provided any form of assistance under 
        subsection (b).
  (2) Each report under paragraph (1) shall be submitted in 
unclassified form, but may include a classified annex.
  [(c)] (d) Definitions.--For purposes of this section:
          (1) * * *

           *       *       *       *       *       *       *


                                  
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