[House Report 111-38]
[From the U.S. Government Publishing Office]



111th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     111-38

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



 
             REDUCING INFORMATION CONTROL DESIGNATIONS ACT

                                _______
                                

 March 16, 2009.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

   Mr. Towns, from the Committee on Oversight and Government Reform, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 1323]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Oversight and Government Reform, to whom 
was referred the bill (H.R. 1323) to require the Archivist of 
the United States to promulgate regulations regarding the use 
of information control designations, and for other purposes, 
having considered the same, report favorably thereon without 
amendment and recommend that the bill do pass.

                                 CONTENTS

                                                                   Page
Purpose and Summary..............................................     1
Background and Need for Legislation..............................     2
Legislative History..............................................     3
Section-by-Section...............................................     3
Explanation of Amendments........................................     5
Committee Consideration..........................................     5
Roll Call Votes..................................................     5
Application of Law to the Legislative Branch.....................     5
Statement of Oversight Findings and Recommendations of the 
  Committee......................................................     6
Statement of General Performance Goals and Objectives............     6
Constitutional Authority Statement...............................     6
Federal Advisory Committee Act...................................     6
Unfunded Mandates Statement......................................     6
Earmark Identification...........................................     6
Committee Estimate...............................................     6
Budget Authority and Congressional Budget Office Cost Estimate...     7
Changes in Existing Law Made by the Bill, as Reported............     8

                           PURPOSE AND SUMMARY

    H.R. 1323, the Reducing Information Control Designations 
Act, was introduced by Reps. Steve Driehaus and Edolphus Towns 
on March 5, 2009. The purpose of H.R. 1323 is to standardize 
and limit the use of information control designations.
    H.R. 1323 requires the Archivist to promulgate regulations 
regarding the use of information control designations, requires 
federal agencies to implement those regulations in a manner 
that reduces and minimizes the use of information control 
designations, and requires the inspector general of each 
federal agency to randomly audit unclassified information with 
information control designations.

                   BACKGROUND AND NEED FOR LEGISLATION

    In the final report on the attacks of September 11, 2001, 
the 9/11 Commission observed that the government keeps too many 
secrets. To address this problem, the Commission recommended 
that ``[t]he culture of agencies feeling they own the 
information they gathered at taxpayer expense must be replaced 
by a culture in which the agencies instead feel they have a 
duty . . . to repay the taxpayers' investment by making that 
information available.''\1\
---------------------------------------------------------------------------
    \1\National Commission on Terrorist Attacks upon the United States, 
The 9/11 Commission Report: Final Report of the National Commission on 
Terrorist Attacks upon the United States (July 22, 2004).
---------------------------------------------------------------------------
    Investigations by this Committee have found that there has 
been a proliferation of pseudo-classification designations such 
as ``sensitive but unclassified'' or ``for official use only.'' 
The Controlled Unclassified Information Office at the National 
Archives and Records Administration (NARA) reports that 
currently there are 107 known unique markings, or information 
control designations, applied across the federal government.\2\ 
These often vague and undefined markings can be used to prevent 
or delay public access to information and information sharing 
with interested stakeholders. The Government Accountability 
Office (GAO) has found that the inconsistent use of information 
control designations by agencies hinders information sharing 
between federal agencies and that it leads to confusion for end 
users of information marked with these designations.\3\
---------------------------------------------------------------------------
    \2\National Archives and Records Administration, Controlled 
Unclassified Information (Oct. 16, 2008) (online at www.archives.gov/
cui).
    \3\Government Accountability Office, Information Sharing: The 
Federal Government Needs to Establish Policies and Processes for 
Sharing Terrorism-Related and Sensitive but Unclassified Information 
(Mar. 2006) (GAO-06-385).
---------------------------------------------------------------------------
    In May 2008, the White House issued a Memorandum on 
``Designation and Sharing of Controlled Unclassified 
Information (CUI),'' establishing new rules governing the 
designation and sharing of CUI. However, that memorandum 
requires these consistent procedures only for ``terrorism-
related information'' used in the Information Sharing 
Environment (ISE), a framework established in the Intelligence 
Reform and Terrorism Prevention Act of 2004.
    H.R. 1323, the Reducing Information Control Designations 
Act, is written broader in order to address all types of 
information uses across the government. H.R. 1323 has the goal 
of reducing the total number of designations used on federal 
government information. H.R. 1323 attempts to resolve the 
growing problem of multiple information control designations by 
authorizing the Archivist to establish regulations to minimize 
and reduce the use of information control designations.

                           LEGISLATIVE HISTORY

    The Committee held two hearings in the 109th Congress on 
the issue of information control designations. See Subcommittee 
on National Security, Emerging Threats, and International 
Relations hearings: Drowning in a Sea of Faux Secrets: Policies 
on Handling of Classified and Sensitive Information (Mar. 14, 
2006) and Emerging Threats: Overclassification and Pseudo-
classification (Mar. 2, 2005).
    In addition, during the 109th Congress, the full Committee 
reported H.R. 5112, the Executive Branch Reform Act, to the 
House, H. Rept. 109-445. H.R. 5112 required the Archivist to 
issue regulations to standardize and limit the use of 
information control designations. In the 110th Congress, H.R. 
984 (legislation similar to H.R. 5112) was favorably ordered 
reported by the full Committee on a vote of 29-0.
    H.R. 1323, the Reducing Information Control Designations 
Act, was introduced by Reps. Steve Driehaus and Edolphus Towns 
on March 5, 2009, and referred to the Committee on Oversight 
and Government Reform.
    On March 10, 2009, the Committee on Oversight and 
Government Reform held a business meeting to consider H.R. 
1323, and ordered the bill to be favorably reported by a voice 
vote.

                            SECTION-BY-SECTION

Section 1: Short title

    This section provides that the short title of the bill is 
the ``Reducing Information Control Designations Act.''

Section 2: Purpose

    This section provides that the purpose of the Act is to 
increase the sharing of information across the government and 
the availability of information to the public by standardizing 
and limiting the use of information control designations.

Section 3: Regulations relating to information control designations 
        within the Federal Government

    Subsection (a) requires that each federal agency reduce and 
minimize its use of information control designations on 
information that is not classified.
    Subsection (b) requires the Archivist to promulgate 
regulations regarding the use of information control 
designations to address standards for the use of the 
information control designations in a way that maximizes public 
access to information, the process for removing a designation, 
procedures for identifying and tracking designated information, 
including the identity of the official making the designation, 
provisions to minimize the use of information control 
designations and protect against their misuse, provisions to 
ensure that there is a presumption against designating 
information, and methods to ensure that compliance protects 
national security and privacy rights.
    This subsection also requires that the regulations issued 
by the Archivist require federal agencies to establish a 
process for individuals to challenge the use of information 
control designations and to receive incentives for successful 
challenges, establish penalties for individuals who repeatedly 
fail to abide by these policies, and establish procedures 
allowing the public to identify improper applications of 
information control designations.
    This subsection requires the Archivist in developing the 
regulations to consult with relevant stakeholders.
    Subsection (c) requires the head of each federal agency to 
implement these new regulations in a way that ensures the 
appropriate sharing of information, limits the number of 
individuals with the authority to place these designations on 
information, and restricts the placement of designations to the 
portion of a document that requires control.

Section 4: Enforcement of information control designation regulations 
        within the Federal Government

    Subsection (a) requires the inspector general of each 
federal agency, in consultation with the Archivist, to randomly 
audit unclassified information with information control 
designations in order to determine whether agencies are 
properly implementing the regulations, to describe any problems 
with implementation, and to recommend improvements in awareness 
and training to address those problems. The inspector generals 
must report to the House Committee on Oversight and Government 
Reform and the Senate Committee on Homeland Security and 
Governmental Affairs, the Archivist, and the public on the 
findings of these audits.
    Under subsection (b), the Archivist must require that when 
marking information with a control designation, an individual 
provide unique identifying information including the 
individual's name or personal identifier and the individual's 
agency, office, and position. The purpose of this requirement 
is for the agency to be able to identify and address problems 
or misuse and assess the impact on information sharing of any 
problems or misuse.
    Subsection (c) requires the Archivist to require federal 
agencies to train, as needed, those who apply information 
control designations. That training shall include information 
on preventing the overuse of information control designations, 
standards for applying and properly using these designations, 
the consequences of repeated improper use and of failing to 
comply with the policies and procedures established under this 
section, and lessons learned about improper application of 
information control designations. This subsection clarifies 
that this training is to be conducted in conjunction with other 
training programs required by the agency to reduce the burden 
of this new requirement.
    Subsection (d) requires the Archivist to establish a 
program to detail personnel from federal agencies to NARA, on a 
nonreimbursable basis, in order to assist NARA with its 
oversight responsibilities and to provide the detailed 
employees with more extensive training on the use of 
information control designations. This subsection provides that 
the detailee program will continue through the year 2012.

Section 5: Releasing information pursuant to the Freedom of Information 
        Act

    This section explains that information control designations 
should have no relationship to determinations of public 
disclosure pursuant to the Freedom of Information Act (FOIA).
    Subsection (a) requires the head of each federal agency to 
ensure that information control designations are not a 
determinant of public disclosure pursuant to FOIA. This means 
that the agency must conduct an independent review of 
information to determine whether it is releasable pursuant to 
FOIA and should not consider the existence of an information 
control designation in that independent review. If the agency 
determines in response to a FOIA request that the information 
is releasable, the agency is required under this subsection to 
make that information publicly available.
    Subsection (b) clarifies that nothing in this Act is 
intended to limit or discourage agency officials from 
voluntarily releasing any unclassified information that is not 
exempt under FOIA.

Section 6: Definitions

    The term ``information control designations'' is defined in 
this section as information dissemination controls that are not 
defined by federal statute or by an executive order relating to 
the classification of national security information, that are 
used to manage, direct, or route information, or control the 
accessibility of information, regardless of its form or format. 
The term includes, but is not limited to, the designations of 
``controlled unclassified information,'' ``sensitive but 
unclassified,'' and ``for official use only.''
    The term ``information'' is defined as any communicable 
knowledge or documentary material, regardless of its physical 
form or characteristics, which is owned by, is produced by or 
for, or is under control of the federal government.
    The term ``federal agency'' is defined in this section as 
(1) any executive agency, which means an executive department, 
a government corporation, and an independent establishment; (2) 
any military department, which means the Department of the 
Army, the Department of the Navy, or the Department of the Air 
Force; and (3) any other entity within the executive branch 
that comes into the possession of classified information.

Section 7: Deadline for regulations and implementation

    This section provides that the regulations required by the 
bill must be promulgated in final form with implementation to 
begin no later than 24 months after the date of enactment.

                       EXPLANATION OF AMENDMENTS

    No amendments were offered to this legislation.

                        COMMITTEE CONSIDERATION

    On Tuesday, March 10, 2009, the Committee met in open 
session and ordered H.R. 1323 to be reported to the House by a 
voice vote.

                            ROLL CALL VOTES

    No roll call votes were held.

              APPLICATION OF LAW TO THE LEGISLATIVE BRANCH

    Section 102(b)(3) of P.L. 104-1 requires a description of 
the application of this bill to the legislative branch where 
the bill relates to terms and conditions of employment or 
access to public services and accommodations. H.R. 1323 relates 
to the use of information controls by the executive branch and 
therefore does not apply to the legislative branch.

  STATEMENT OF OVERSIGHT FINDINGS AND RECOMMENDATIONS OF THE COMMITTEE

    In compliance with clause 3(c)(1) of rule XIII and clause 
(2)(b)(1) of Rule X of the Rules of the House of 
Representatives, the Committee's oversight findings and 
recommendations are reflected in the descriptive portions of 
this report, including the need to standardize and limit the 
use of information control designations.

         STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES

    In accordance with clause 3(c)(4) of rule XIII of the Rules 
of the House of Representatives, the Committee's performance 
goals and objectives are reflected in the descriptive portions 
of this report, including reducing and minimizing the use of 
information control designations.

                   CONSTITUTIONAL AUTHORITY STATEMENT

    Under clause 3(d)(1) of rule XIII of the Rules of the House 
of Representatives, the Committee must include a statement 
citing the specific powers granted to Congress to enact the law 
proposed by H.R. 1323. Article I, Section 8, Clause 18 of the 
Constitution of the United States grants the Congress the power 
to enact this law.

                     FEDERAL ADVISORY COMMITTEE ACT

    The Committee finds that the legislation does not establish 
or authorize the establishment of an advisory committee within 
the definition of 5 U.S.C. App., Section 5(b).

                      UNFUNDED MANDATES STATEMENT

    Section 423 of the Congressional Budget and Impoundment 
Control Act (as amended by Section 101(a)(2) of the Unfunded 
Mandates Reform Act, P.L. 104-4) requires a statement on 
whether the provisions of the report include unfunded mandates. 
In compliance with this requirement the Committee has received 
a letter from the Congressional Budget Office included herein.

                         EARMARK IDENTIFICATION

    H.R. 1323 does not include any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9(e), 9(f), or 9(g) of rule XXI.

                           COMMITTEE ESTIMATE

    Clause 3(d)(2) of rule XIII of the Rules of the House of 
Representatives requires an estimate and a comparison by the 
Committee of the costs that would be incurred in carrying out 
H.R. 1323. However, clause 3(d)(3)(B) of that rule provides 
that this requirement does not apply when the Committee has 
included in its report a timely submitted cost estimate of the 
bill prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act.

     BUDGET AUTHORITY AND CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

    With respect to the requirements of clause 3(c)(2) of rule 
XIII of the Rules of the House of Representatives and section 
308(a) of the Congressional Budget Act of 1974 and with respect 
to requirements of clause 3(c)(3) of rule XIII of the Rules of 
the House of Representatives and section 402 of the 
Congressional Budget Act of 1974, the Committee has received 
the following cost estimate for H.R. 1323 from the Director of 
the Congressional Budget Office:

                                                    March 16, 2009.
Hon. Edolphus Towns,
Chairman, Committee on Oversight and Government Affairs,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1323, the Reducing 
Information Control Designations Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Matthew 
Pickford.
            Sincerely,
                                              Douglas W. Elmendorf.
    Enclosure.

H.R. 1323--Reducing Information Control Designations Act

    Summary: H.R. 1323 would amend federal law concerning the 
security classification of government documents. The 
legislation would require the National Archives and Records 
Administration, in consultation with other affected federal 
agencies, to develop regulations that minimize the government's 
use of information-control designations on information that is 
not classified. The bill also would require training for 
employees on using classifications and random audits by 
inspectors general to assess the proper use of information-
control designations.
    CBO estimates that implementing H.R. 1323 would cost $45 
million over the 2010-2014 period, assuming appropriation of 
the necessary amounts. Although the legislation could affect 
agencies not funded through annual appropriations (such as the 
Tennessee Valley Authority or the U.S. Postal Service), CBO 
estimates that any net increase in spending by those agencies 
would not be significant. As a result, enacting the bill would 
have no significant impact on direct spending or revenues.
    H.R. 1323 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would not affect the budgets of state, local, or tribal 
governments.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 1323 is shown in the following table. 
The costs of this legislation fall within most budget functions 
that contain salaries and expenses.

----------------------------------------------------------------------------------------------------------------
                                                                    By fiscal year, in millions of dollars--
                                                              --------------------------------------------------
                                                                2010    2011    2012    2013    2014   2010-2014
----------------------------------------------------------------------------------------------------------------
                                  CHANGES IN SPENDING SUBJECT TO APPROPRIATION

Estimated Authorization Level................................      15      15       5       5       5        45
Estimated Outlays............................................      15      15       5       5       5        45
----------------------------------------------------------------------------------------------------------------

    Basis of estimate: For this estimate, CBO assumes that the 
bill will be enacted near the end of fiscal year 2009 and that 
spending will follow historical patterns for similar programs.
    Based on the information provided by federal agencies and 
inspectors general about the current use of information-control 
designations, CBO estimates that implementing H.R. 1323 would 
cost $45 million over the 2010-2014 period, assuming 
appropriation of the necessary amounts. Initial costs for 
developing regulations and implementing governmentwide training 
would total about $30 million and would be incurred in 2010 and 
2011. Ongoing costs would total about $15 million over the 
2012-2014 period, mostly for subsequent training and random 
audits by inspectors general.
    Intergovernmental and private-sector impact: H.R. 1323 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would not affect the budgets of state, 
local, or tribal governments.
    Estimate prepared by: Federal Costs: Matthew Pickford, 
Impact on State, Local, and Tribal Governments: Elizabeth Cove 
Delisle, Impact on the Private Sector: Paige Piper/Bach.
    Estimate approved by: Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.

         CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

    No changes to existing law are made by H.R. 1323, as 
reported.

                                  
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