[Senate Report 111-55]
[From the U.S. Government Publishing Office]


                                                       Calendar No. 120
111th Congress                                                   Report
                                 SENATE
 1st Session                                                     111-55

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



 
          INTELLIGENCE AUTHORIZATION ACT FOR FISCAL YEAR 2010

                                _______
                                

                 July 22, 2009.--Ordered to be printed

                                _______
                                

 Mrs. Feinstein, from the Select Committee on Intelligence, submitted 
                             the following

                              R E P O R T

                             together with

                            ADDITIONAL VIEWS

                         [To accompany S. 1494]

    The Select Committee on Intelligence, having considered an 
original bill (S. 1494) to authorize appropriations for fiscal 
year 2010 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, reports favorably 
thereon and recommends that the bill do pass.

                CLASSIFIED ANNEX TO THE COMMITTEE REPORT

    The classified nature of United States intelligence 
activities precludes disclosure by the Committee of details of 
its budgetary recommendations. The Committee has prepared a 
classified annex to this report that contains a classified 
Schedule of Authorizations. The Schedule of Authorizations is 
incorporated by reference in the Act and has the legal status 
of public law. The classified annex is made available to the 
Committees of Appropriations of the Senate and the House of 
Representatives and to the President. It is also available for 
review by any Member of the Senate subject to the provisions of 
Senate Resolution 400 of the 94th Congress (1976).

              SECTION-BY-SECTION ANALYSIS AND EXPLANATION

    The following is a section-by-section analysis and 
explanation of the Intelligence Authorization Act for Fiscal 
Year 2010 that is being reported by the Committee.

              TITLE I--BUDGET AND PERSONNEL AUTHORIZATIONS


Section 101. Authorization of appropriations

    Section 101 lists the United States Government departments, 
agencies, and other elements for which the Act authorizes 
appropriations for intelligence and intelligence-related 
activities for fiscal year 2010.

Section 102. Classified Schedule of Authorizations

    Section 102 provides that the details of the amounts 
authorized to be appropriated for intelligence and 
intelligence-related activities and the applicable personnel 
levels (expressed as full-time equivalent positions) for fiscal 
year 2010 are contained in the classified Schedule of 
Authorizations and that the classified Schedule of 
Authorizations shall be made available to the Committees on 
Appropriations of the Senate and House of Representatives and 
to the President.

Section 103. Personnel ceiling adjustments

    Section 103 is intended to provide additional flexibility 
to the Director of National Intelligence (DNI) in managing the 
civilian personnel of the Intelligence Community. Section 
103(a) provides that the DNI may authorize employment of 
civilian personnel (expressed as full-time equivalent 
positions) in fiscal year 2010 in excess of the number of 
authorized full-time equivalent positions by an amount not 
exceeding 5 percent (rather than the 2 percent in prior law) of 
the total limit applicable to each Intelligence Community 
element under Section 102. The DNI may do so only if necessary 
to the performance of important intelligence functions.
    Section 103(b) provides additional flexibility when the 
heads of Intelligence Community elements determine that work 
currently performed by contract personnel should be performed 
by government employees. It does so by authorizing the DNI to 
authorize employment of additional full-time equivalent 
personnel in a number equal to the number of full-time 
equivalent contract personnel currently performing that work. 
The initial exercise of this authority must be reported in 
advance to the congressional intelligence committees. The 
Committee expects this authority to be implemented in 
accordance with a plan that includes adequate support for 
personnel. Exercise of this authority should result in an 
actual reduction of the number of contract personnel and not a 
shift of resources to hire other contract personnel.
    During consideration of the fiscal year 2008 request, the 
congressional intelligence committees learned that practices 
within different elements of the Intelligence Community on the 
counting of personnel with respect to legislatively-fixed 
ceilings were inconsistent, and included not counting certain 
personnel at all against personnel ceilings. The committees 
requested that the Intelligence Community Chief Human Capital 
Officer (IC CHCO) ensure that by the beginning of fiscal year 
2010 there would be a uniform and accurate method of counting 
all Intelligence Community employees under a system of 
personnel levels expressed as full-time equivalents. The 
committees also expressed their view that the DNI express the 
personnel levels for civilian employees of the Intelligence 
Community as full-time equivalent positions in the 
congressional budget justifications for fiscal year 2010. The 
DNI has done so. In addition, the IC CHCO and the Chief 
Financial Officer issued guidance in 2008 to ensure a uniform 
method for counting Intelligence Community employees. Section 
103(c) directs the DNI to establish formal guidance, including 
exemptions from personnel levels, for student, reserve corps, 
joint duty, long-term training and similar programs.
    In prior years the DNI has stated that statutory personnel 
ceilings have led to the increased use of contract personnel 
and have hindered the Intelligence Community's civilian joint 
duty, student employment, and National Intelligence Reserve 
Corps programs. The DNI has requested the flexibility to manage 
personnel levels according to budget resources rather than 
subject to fixed personnel numbers set for the end of the 
fiscal year. The DNI has stressed that no major departments in 
the U.S. government are subjected to statutory civilian 
personnel ceilings. In the Administration's request for 
legislative authorities as part of the Intelligence 
Authorization Act for Fiscal Year 2010, the DNI again requested 
the authority to manage personnel levels according to budget 
resources and in addition, for the first time, requested a 
legislative provision, similar to 10 U.S.C. 129, which would 
prohibit legislatively-fixed civilian end-strength personnel 
ceilings on the Intelligence Community.
    In general, the Committee is supportive of eliminating 
fixed personnel ceilings on the number of Intelligence 
Community civilian personnel in order to enable the 
Intelligence Community to manage to budget beginning in fiscal 
year 2011. The Committee has not adopted this legislative 
priority of the DNI at this time, however, in light of the fact 
that the IC CHCO is currently undertaking a study of the 
overall civilian personnel requirements for the Intelligence 
Community, which is expected to be completed in September 2009. 
The Committee believes there should be an analysis of the 
overall long-term personnel requirements of the Intelligence 
Community before the personnel ceiling requirement is removed. 
The Committee also requests that the DNI provide, in support of 
the fiscal year 2011 budget request, information about how 
full-time equivalent or other employment measurements will be 
used as a budgetary planning tool, and for administrative 
controls on personnel decisions, even if Congress determines to 
lift express statutory limits on personnel numbers in favor of 
management-to-budget.

Section 104. Intelligence Community Management Account

    Section 104 authorizes appropriations for the Intelligence 
Community Management Account (ICMA) of the DNI and sets the 
authorized full-time equivalent personnel levels for the 
elements within the ICMA for fiscal year 2010.
    Subsection (a) authorizes appropriations of $786,812,000 
for fiscal year 2010 for the activities of the ICMA. Subsection 
(b) authorizes 792 full-time equivalent personnel for elements 
within the ICMA for fiscal year 2010 and provides that such 
personnel may be permanent employees of the Office of the 
Director of National Intelligence (ODNI) or detailed from other 
elements of the United States Government.
    Subsection (c) provides that personnel level flexibility 
available to the DNI under Section 103 is also available to the 
DNI in adjusting personnel levels within the ICMA. Subsection 
(d) authorizes additional appropriations and full-time 
equivalent personnel for the classified Community Management 
Account as specified in the classified Schedule of 
Authorizations and permits the funding for advanced research 
and development to remain available through September 30, 2011.

Section 105. Restriction on conduct of intelligence activities

    Section 105 provides that the authorization of 
appropriations by the Act shall not be deemed to constitute 
authority for the conduct of any intelligence activity that is 
not otherwise authorized by the Constitution or laws of the 
United States.

 TITLE II--CENTRAL INTELLIGENCE AGENCY RETIREMENT AND DISABILITY SYSTEM


Section 201. Authorization of appropriations

    Section 201 authorizes appropriations in the amount of 
$290,900,000 for fiscal year 2010 for the Central Intelligence 
Agency (CIA) Retirement and Disability Fund.

Section 202. Technical modification to mandatory retirement provision 
        of the Central Intelligence Agency Retirement Act

    Section 202 updates the CIA Retirement Act to reflect the 
Agency's use of pay levels rather than pay grades within the 
Senior Intelligence Service.

           TITLE III--GENERAL INTELLIGENCE COMMUNITY MATTERS


                     Subtitle A--Personnel Matters


Section 301. Increase in employee compensation and benefits authorized 
        by law

    Section 301 provides that funds authorized to be 
appropriated 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 compensation or benefits authorized by law.

Section 302. Enhanced flexibility in details to elements of the 
        Intelligence Community

    Section 302 extends from one year to up to three years the 
length of time that United States Government personnel may be 
detailed to the staff of an element of the Intelligence 
Community funded through the National Intelligence Program from 
another element of the Intelligence Community or from another 
element of the United States Government on a reimbursable basis 
or non-reimbursable basis, under which the employee continues 
to be paid by the sending agency. To utilize this authority, 
the joint agreement of the head of the receiving element and 
the head of the detailing element (or the designees of such 
officials) is required. This authority will provide flexibility 
for elements of the Intelligence Community to receive support 
from other elements of the United States Government for 
community-wide activities where both the agencies would benefit 
from the detail. The DNI is seeking this authority primarily in 
aid of the Intelligence Community's Joint Duty Program which 
Congress has mandated to foster the development of personnel 
who have broad Intelligence Community experience and 
perspective. Joint duty assignments are from one to three years 
in length. The ability to provide for details of up to three 
years is therefore important in assisting in the achievement of 
the goals of the Joint Duty Program.

Section 303. Enhancement of authority of the Director of National 
        Intelligence for flexible personnel management among the 
        elements of the intelligence community

    Section 303 adds three subsections to Section 102A of the 
National Security Act of 1947, to promote the DNI's ability to 
manage the elements of the Intelligence Community as a single 
cohesive community.
    Subsection 102A(s) enables the DNI, with the concurrence of 
a department or agency head, to convert competitive service 
positions and incumbents within an Intelligence Community 
element to excepted positions. In requesting this authority, 
the DNI points out that because of their unique intelligence, 
investigative, and national security missions, most 
Intelligence Community elements are in the excepted civil 
service. However, civilian employees in several smaller 
Intelligence Community elements are still covered under 
competitive service rules. The ability to convert those 
positions to the excepted service will enable the DNI to 
establish a more uniform system throughout the Intelligence 
Community that will improve personnel flexibility and be 
responsive to the need for secrecy. Subsection 102A(s) 
additionally allows the DNI to establish the classification and 
ranges of rates of basic pay for positions so converted.
    Subsection 102A(t) provides enhanced pay authority for 
critical positions in portions of the Intelligence Community 
where that authority does not now exist. It allows the DNI, in 
consultation with the Director of the Office of Management and 
Budget (OMB) and the Director of the Office of Personnel 
Management (OPM), to authorize the head of a department or 
agency with an Intelligence Community element to fix a rate of 
compensation in excess of applicable limits with respect to a 
position that requires an extremely high level of expertise 
critical to accomplishing an important mission and to the 
extent necessary to recruit or retain an exceptionally well-
qualified individual for the position. A rate of pay higher 
than Executive Level II would require written approval of the 
DNI. A rate of pay higher than Executive Level I would require 
written approval of the President in response to a DNI request.
    Subsection 102A(u) grants authority to the DNI to authorize 
Intelligence Community elements, with concurrence of the 
concerned department or agency head and in coordination with 
the Director of the OPM, to adopt compensation, performance 
management, and scholarship authority that have been authorized 
for any other Intelligence Community element if the DNI 
determines that the adoption of such authority would improve 
the management and performance of the Intelligence Community 
and notice is provided to the congressional intelligence 
committees no later than 60 days in advance of adoption of the 
authority.

Section 304. Award of rank to members of the Senior National 
        Intelligence Service

    Section 304 adds another new subsection to Section 102A of 
the National Security Act of 1947. Subsection 102A(v) 
authorizes Presidential Rank awards to members of the Senior 
National Intelligence Service (SNIS) and other Intelligence 
Community senior civilian officers not already covered by such 
a rank award program.
    According to the DNI, the authority to issue Presidential 
Rank Awards was originally enacted in 1978 as a program of the 
Senior Executive Service (SES), to honor high-performing senior 
career employees. The CIA and other elements of the 
Intelligence Community were exempted by statute from the SES, 
and thus not eligible for Presidential Rank Awards. Legislation 
enacted since 1978 has opened the eligibility for Presidential 
Rank Awards to senior civilian officers of exempt agencies, 
including the Federal Bureau of Investigation (FBI), the Drug 
Enforcement Administration, and members of the Defense 
Intelligence Senior Executive Service. This legislation would 
authorize the President to recognize members of the SNIS and 
other senior civilian officers not already covered by such a 
program who deserve such recognition with Presidential Rank, in 
a manner consistent with rank awards conferred on other senior 
executives of the Executive Branch.

Section 305. Annual personnel level assessments for the Intelligence 
        Community

    Section 305 adds a new Section 506B to Title V of the 
National Security Act of 1947 (50 U.S.C. 413 et seq.), an 
oversight mechanism that requires the DNI to conduct, in 
consultation with the head of the element of the Intelligence 
Community concerned, an annual personnel level assessment for 
each of the elements within the Intelligence Community and 
provide those assessments with the submission of the 
President's budget request each year.
    The assessment consists of four parts. First, the 
assessment must provide basic personnel and contract personnel 
information for the concerned element of the Intelligence 
Community (with government personnel expressed as full-time 
equivalent positions) for the upcoming fiscal year. It requires 
that the data be compared against current fiscal year and 
historical five-year numbers and funding levels. Second, the 
assessment must include a written justification for the 
requested funding levels. This requirement is necessary to 
ensure that any personnel cost cuts or increases are fully 
documented and justified. Third, the assessment must contain a 
statement by the DNI that, based upon current and projected 
funding, the concerned element will have the internal 
infrastructure, training resources, and sufficient funding to 
support the administrative and operational activities of the 
requested civilian and contract personnel levels. Finally, the 
assessment must contain a list of all contract personnel who 
have been the subject of an investigation by the inspector 
general of any element of the Intelligence Community during the 
previous fiscal year or who are or have been the subject of an 
investigation during the current fiscal year.
    The Committee believes that the personnel level assessment 
tool is necessary for the Executive branch and Congress to 
fully understand the consequences of managing the Intelligence 
Community's personnel levels, particularly in light of a 
transition to managing personnel according to available funds. 
In recent years, the Committee has been concerned that the 
sharp growth in personnel numbers after the terrorist attacks 
on September 11, 2001, was unsustainable. In particular, when 
overall budgets do not keep pace with inflation and decline in 
real terms, personnel costs as a percentage of the budget 
increase each year and divert funds from operations and 
modernization.
    Another longstanding concern of the Committee has been the 
Intelligence Community's increasing reliance upon contract 
personnel to meet mission requirements. The Committee has taken 
steps to reduce this reliance upon contract personnel that are 
described in the classified annex, as well as in the authority 
for contract personnel conversion in Section 103. The Committee 
believes that the annual personnel level assessment tool will 
assist the DNI and the elements of the Intelligence Community 
in arriving at an appropriate balance of contract personnel and 
permanent government employees.
    With regard to historical contract personnel levels to be 
included in the annual assessments, the DNI has expressed 
concern that there was no completed effort, prior to the ODNI's 
contract personnel inventory initiated in June 2006, to 
comprehensively capture information on the number and costs of 
contract personnel throughout the Intelligence Community. 
Because of the concerns outlined by the DNI, the Committee 
understands that the information about contract personnel 
levels prior to June 2006 may need to be reported as a best 
estimate.

Section 306. Temporary personnel authorizations for critical language 
        training

    Section 306 contains findings regarding the continuing lack 
of critical language-capable personnel in the Intelligence 
Community, and the need to address this shortage through 
improved training for current employees, in addition to 
recruitment of new employees with these skills. It notes that 
existing personnel ceilings can make it difficult to send 
employees to get critical language training because individuals 
absent for long-term training can still count as part of an 
authorized personnel total, making it difficult to replace them 
while they are gone.
    Section 306 addresses this problem by giving the DNI the 
authority to transfer full-time equivalent positions to 
elements of the Intelligence Community on a temporary basis, to 
enable these elements to replace individuals who are 
participating in long-term language training, or to accept 
temporary transfers of language-capable employees from other 
elements of the Intelligence Community. This provision 
complements Section 103, which authorizes the DNI to issue 
guidance on the treatment of personnel under personnel 
ceilings, to include exemptions from personnel ceilings for 
personnel engaged in long-term full-time training. Section 306 
authorizes an additional 100 full-time equivalent positions for 
the ODNI, and notes that these positions are to be used 
specifically to implement the new authorities granted by this 
section.
    Section 306 refers to ``critical foreign language 
training,'' rather than ``foreign language training.'' The 
Committee understands that this phrasing will permit the DNI to 
use this new authority in situations where an employee of the 
Intelligence Community who speaks English as a second language 
needs further training in English, in order to comprehend 
particular complex or technical subjects.

                     Subtitle B--Education Programs


Section 311. Permanent authorization for the Pat Roberts Intelligence 
        Scholars Program

    Section 311 provides a permanent authorization for the Pat 
Roberts Intelligence Scholars Program (PRISP), which was 
originally authorized as a pilot program in Section 318 of the 
Intelligence Authorization Act for Fiscal Year 2004 and has 
continued under year-to-year appropriations. In addition, 
Section 311 would authorize the broader use of PRISP funds 
beyond intelligence analysts to include acquisition, science 
and technology, and other intelligence professionals, thus 
allowing the program to be used to develop the Intelligence 
Community workforce across a range of disciplines. Section 311 
also authorizes the use of funds to allow students 
participating in the program to receive funds for books, travel 
expenses and a stipend.
    The PRISP has provided education funds to over 800 
individuals since its inception in 2004, with an attrition of 
less than one percent of program participants. Intelligence 
agencies have been supportive of the program as it provides 
them the flexibility to compete effectively with the private 
sector to recruit individuals who possess critical skills 
sought by the Intelligence Community.

Section 312. Modifications to the Louis Stokes Educational Scholarship 
        Program

    Section 16 of the National Security Agency Act of 1959 (50 
U.S.C. 402 note) authorizes the National Security Agency (NSA) 
to establish an undergraduate training program to facilitate 
recruitment of individuals with skills critical to its mission. 
The program is known as the Stokes Educational Scholarship 
Program, named for Representative Louis Stokes, a former 
chairman of the Permanent Select Committee on Intelligence of 
the U.S. House of Representatives.
    Section 312 is intended to expand and strengthen the Stokes 
program. Section 312(a) expands the Stokes program to authorize 
the inclusion of graduate students. Section 312(e) amends 
Section 16 to permit the NSA Director to protect intelligence 
sources and methods by deleting a requirement that NSA publicly 
identify to educational institutions students who are NSA 
employees or training program participants. Deletion of this 
disclosure requirement will enhance the ability of NSA to 
protect personnel and prospective personnel and to preserve the 
ability of training program participants to undertake future 
clandestine or other sensitive assignments for the Intelligence 
Community.
    The Committee recognizes that nondisclosure is appropriate 
when disclosure would threaten intelligence sources or methods, 
would endanger the life or safety of the student, or would 
limit the employee's or prospective employee's ability to 
perform intelligence activities in the future. Notwithstanding 
the deletion of the disclosure requirement, the Committee 
expects NSA to continue to prohibit participants in the 
training program from engaging in any intelligence functions at 
the institutions they attend under the program. See H.R. Rep. 
No. 99-690, Part I (1986) (``NSA employees attending an 
institution under the program will have no intelligence 
function whatever to perform at the institution.'').
    Section 312 is also intended to make the program more 
effective by clarifying that ``termination of employment'' 
includes situations where employees fail to maintain 
satisfactory academic standards. According to the DNI, failure 
to maintain satisfactory academic performance has always been 
grounds for default resulting in the right of the government to 
recoup educational costs expended for the benefit of the 
defaulting employee. Section 312(c) would also expand the 
program by authorizing NSA to offer participation in the Stokes 
program to individuals who are not current federal employees.
    Finally, Section 312(e) authorizes other intelligence 
agencies to establish undergraduate or graduate training 
program for civilian employees or prospective civilian 
employees that are similar to programs under Section 16 of the 
National Security Agency Act.

Section 313. Intelligence officer education programs

    Section 313 authorizes the Intelligence Officer Training 
Program (IOTP), which builds on two pilot programs that were 
authorized in previous years: the NSA ``Pilot Program on 
Cryptologic Service Training,'' described in Section 922 of the 
Defense Authorization Act for Fiscal Year 2005, Public Law 108-
375 (2004) (50 U.S.C. 402 note), and the Director of Central 
Intelligence pilot program ``Improvement of Equality of 
Employment Opportunities in the Intelligence Community,'' under 
Section 319 of the Intelligence Authorization Act for Fiscal 
Year 2003, Public Law 108-177 (2003) (50 U.S.C. 403 note). The 
purpose of the IOTP is to encourage the preparation, 
recruitment, and retention of civilian personnel for careers in 
the Intelligence Community. It is also to help ensure that the 
Intelligence Community can better recruit and retain a 
workforce that is ethnically and culturally diverse so that it 
can accomplish its critical national security mission.
    The program is to consist of two parts. First, the program 
would to provide financial assistance to individuals through 
existing Intelligence Community scholarship authorities to 
pursue studies in critical language, analytic, scientific, 
technical, or other skills necessary to meet current or 
emerging needs of the Intelligence Community. Second, building 
on the ODNI's successful Centers for Academic Excellence 
program, IOTP is to solicit colleges and universities from 
across the country to apply for grants on a competitive basis 
to implement academic programs which will help students develop 
the critical skills needed for careers in the Intelligence 
Community.
    Students attending participating colleges and universities 
and taking the prescribed course of study may competitively 
apply for financial assistance including, but not limited to, a 
monthly stipend, tuition assistance, book allowances, and 
travel expenses. Students who receive a threshold amount of 
assistance are obligated to serve in the Intelligence 
Community. The ODNI is to develop application requirements for 
students, which could include the successful completion of a 
security background investigation.
    Section 313 makes permanent an NSA pilot program that 
provided grants to academic institutions. The original NSA 
pilot program, with its focus on cryptologic service at NSA, 
although beneficial to NSA, no longer meets the variety of the 
Intelligence Community's critical skills requirements. The 
IOTP, with its broader scope, is intended to assist the 
Intelligence Community in establishing and building 
partnerships with academic institutions and ensure a continuous 
pool of qualified entry-level applicants to Intelligence 
Community elements, tailored to changing priorities of an 
evolving Intelligence Community enterprise.
    Section 313 repeals the authorizations for the following 
programs that are either incorporated into or replaced by the 
IOTP: the pilot program authorized by Section 319 of the 
Intelligence Authorization Act for Fiscal Year 2004, Public Law 
108-177 (2003) (50 U.S.C. 403 note); the scholarship program 
authorized by Section 1043 of the Intelligence Reform and 
Terrorism Prevention Act, Public Law 108-458 (2004) (50 U.S.C. 
441g-2) (Intelligence Reform Act); and the pilot program 
authorized by Section 922 of the Ronald W. Reagan National 
Defense Authorization Act for Fiscal Year 2005, Public Law 108-
375 (50 U.S.C. 402 note).

Section 314. Review and report on education programs

    Section 314 requires the DNI to review and report on 
whether the Pat Roberts Intelligence Scholars Program, the 
Louis Stokes Educational Scholarship Program, the Intelligence 
Officer Training Program authorized under Section 313, and any 
other Intelligence Community education programs are meeting the 
needs of the Intelligence Community to prepare, recruit, and 
retain a skilled and diverse workforce, and whether they should 
be combined or otherwise integrated. The DNI is to submit the 
report to the congressional intelligence committees by February 
1, 2010.

                    Subtitle C--Acquisition Matters


Section 321. Vulnerability assessments of major systems

    Section 321 adds a new Section 506C to the National 
Security Act of 1947. This provision creates an oversight 
mechanism that requires the DNI to conduct an initial 
vulnerability assessment and subsequent assessments of every 
major system and its significant items of supply in the 
National Intelligence Program. The intent of the provision is 
to provide Congress and the DNI with an accurate assessment of 
the unique vulnerabilities and risks associated with each 
National Intelligence Program major system to allow a 
determination of whether funding for a particular major system 
should be modified or discontinued. The vulnerability 
assessment process will also require the various elements of 
the Intelligence Community responsible for implementing major 
systems to give due consideration to the risks and 
vulnerabilities associated with such implementation.
    Section 321 requires the DNI to conduct an initial 
vulnerability assessment on every major system and its 
significant items of supply proposed for the National 
Intelligence Program prior to completion of Milestone B or an 
equivalent acquisition decision. The minimum requirements of 
the initial vulnerability assessment are fairly broad and 
intended to provide the DNI with significant flexibility in 
crafting an assessment tailored to the proposed major system. 
Thus, the DNI is required to use, at a minimum, an analysis-
based approach to identify vulnerabilities, define exploitation 
potential, examine the system's potential effectiveness, 
determine overall vulnerability, and make recommendations for 
risk reduction. The DNI is obviously free to adopt a more 
rigorous methodology for the conduct of initial vulnerability 
assessments.
    Vulnerability assessments should continue through the life 
of a major system and its significant items of supply. Numerous 
factors and considerations can affect the viability of a given 
major system. For that reason, Section 321 provides the DNI 
with the flexibility to set a schedule of subsequent 
vulnerability assessments for each major system when the DNI 
submits the initial vulnerability assessment to the 
congressional intelligence committees. The time period between 
assessments should depend upon the unique circumstances of a 
particular major system. For example, a new major system that 
is implementing some experimental technology might require 
annual assessments while a more mature major system might not 
need such frequent reassessment. The DNI is also permitted to 
adjust a major system's assessment schedule when the DNI 
determines that a change in circumstances warrants the issuance 
of a subsequent vulnerability assessment. Section 321 also 
provides that the DNI may conduct a subsequent vulnerability 
assessment of a major system when requested to do so by a 
congressional intelligence committee.
    The minimum requirements for a subsequent vulnerability 
assessment are almost identical to those of an initial 
vulnerability assessment. There are only two additional 
requirements. First, if applicable to the given major system 
during its particular phase of development or production, the 
DNI must also use a testing-based approach to assess the 
system's vulnerabilities. Obviously, common sense needs to 
prevail here. For example, the testing approach is not intended 
to require the ``crash testing'' of a satellite system. Nor is 
it intended to require the DNI to test system hardware. 
However, the vulnerabilities of a satellite's significant items 
of supply might be exposed by a rigorous testing regime. 
Second, the subsequent vulnerability assessment is required to 
monitor the exploitation potential of the major system. Thus, a 
subsequent vulnerability assessment should monitor ongoing 
changes to vulnerabilities and understand the potential for 
exploitation. Since new vulnerabilities can become relevant and 
the characteristics of existing vulnerabilities can change, it 
is necessary to monitor both existing vulnerabilities and their 
characteristics, and to check for new vulnerabilities on a 
regular basis.
    Section 321 requires the DNI to give due consideration to 
the vulnerability assessments prepared for the major systems 
within the National Intelligence Program. It also requires that 
the vulnerability assessments be provided to the congressional 
intelligence committees within ten days of their completion. 
The Committee encourages the DNI to share the results of these 
vulnerability assessments, as appropriate, with other 
congressional committees of jurisdiction.
    Finally, the section contains definitions for the terms 
``items of supply,'' ``major system,'' ``Milestone B,'' and 
``vulnerability assessment.''

Section 322. Intelligence Community business system transformation

    A business enterprise architecture incorporates an agency's 
financial, personnel, procurement, acquisition, logistics, and 
planning systems into one interoperable system. Historically, 
Intelligence Community elements have pursued unique, stovepiped 
systems that do not leverage the investments of other elements 
of the Intelligence Community. More recently there has been a 
more collaborative effort among the Intelligence Community 
elements on the development of business systems, but true 
transformation to an integrated Intelligence Community 
architecture has not been achieved.
    Section 322 adds a new Section 506D to the National 
Security Act of 1947. It requires that the DNI create a 
business enterprise architecture that defines all Intelligence 
Community business systems, as well as the functions and 
activities supported by those business systems, in order to 
guide with sufficient detail the implementation of 
interoperable Intelligence Community business system solutions. 
The business enterprise architecture and acquisition strategy 
are to be submitted to the congressional intelligence 
committees by December 31, 2009.
    Section 322 will provide the assurance that business 
systems that cost more than a million dollars will be 
efficiently and effectively coordinated. It will prohibit the 
obligation of appropriated funds for any system that has not 
been certified by the DNI either as complying with the 
enterprise architecture or as necessary for the national 
security or an essential capability. Section 322 will also 
require identification of all ``legacy systems'' that will be 
either terminated or transitioned into the new architecture. 
Further, this section will require the DNI to report to the 
Committee no less often than annually, for five years, on the 
progress being made in successfully implementing the new 
architecture.

Section 323. Reports on the acquisition of major systems

    Section 323 adds a new Section 506E to the National 
Security Act of 1947 to require a separate report on each major 
system acquisition by an element of the Intelligence Community.
    Among other items, the annual reports must include 
information about the current total acquisition cost for such 
system, the development schedule for the system including an 
estimate of annual development costs until development is 
completed, the planned procurement schedule for the system, 
including the best estimate of the DNI of the annual costs and 
units to be procured until procurement is completed, a full 
life-cycle cost analysis for such system, and the result of any 
significant test and evaluation of such major system as of the 
date of the submittal of such report. Section 323 requires that 
to the extent that the report is applicable to an element of 
the Intelligence Community within the Department of Defense, 
the report is to be submitted to the congressional armed 
services committees.
    Section 323 includes definitions for ``acquisition cost,'' 
``full life-cycle cost,'' ``major contract,'' ``major system,'' 
and ``significant test and evaluation.''

Section 324. Excessive cost growth of major systems

    Section 324 adds a new Section 506F to the National 
Security Act of 1947 to require that, in addition to the 
reporting required under Section 102A(q) of the Act and the 
amendments made by Section 323, the program manager of a major 
system acquisition project shall determine on a continuing 
basis if the acquisition cost of such major system has 
increased by at least 25 percent as compared to the baseline of 
such major system. The program manager must inform the DNI of 
any such determination and the DNI must submit a written 
notification to the congressional intelligence committees if 
the DNI makes the same such determination.
    Section 324 is intended to mirror the Nunn-McCurdy 
provision in Title 10 of the United States Code that applies to 
major defense acquisition programs. The Committee envisions 
that the determination will be done as needed by the program 
manager of the major system acquisition and should not wait 
until the time that the DNI's annual report is filed. In other 
words, the Committee expects the congressional intelligence 
committees to be advised on a regular basis by the DNI about 
the progress and associated costs of major system acquisitions 
within the Intelligence Community.
    If the cost growth of a major system is 25 percent or more, 
the DNI must prepare a notification and submit, among other 
items, an updated cost estimate to the congressional 
intelligence committees, and a certification that the 
acquisition is essential to national security, there are no 
other alternatives that will provide equal or greater 
intelligence capability at equal or lesser cost to completion, 
the new estimates of the full life-cycle cost for such major 
system are reasonable, and the structure for the acquisition of 
such major system is adequate to manage and control full life-
cycle cost of such major system.
    If the program manager makes a determination that the 
acquisition cost has increased by 50 percent or more as 
compared to the baseline, and the DNI makes the same such 
determination, then the DNI must submit to the congressional 
intelligence committees a written certification of the same 
four items as described above, as well as an updated 
notification and accompanying information. The Committee also 
expects that if milestone authority had been delegated to the 
program manager, such authority would be revoked and returned 
to the DNI, or to the Director and Secretary of Defense, 
jointly, with respect to Department of Defense programs.
    If the required certification, at either the 25 percent or 
50 percent level, is not submitted to the congressional 
intelligence committees within 90 days of the DNI's 
determination of cost growth, Section 324 creates a mechanism 
in which funds cannot be obligated for a period of time. If 
Congress does not act during that period, then the acquisition 
may continue.
    With respect to major systems for which certifications are 
required on the date of enactment of this Act, such 
certifications must be submitted within 180 days of the date of 
enactment. If the certification is not submitted to the 
congressional intelligence committees within 180 days, funds 
appropriated for the acquisition of the major system may not be 
obligated for a major contract under the program. The 
prohibition ceases to apply at the end of the 30-day period of 
a continuous session of Congress that begins on the date on 
which Congress receives the notification.
    Section 324 requires that to the extent that the report is 
applicable to an element of the Intelligence Community within 
the Department of Defense, the report is also to be submitted 
to the congressional armed services committees.

Section 325. Future budget projections

    Section 325 adds a new Section 506G to the National 
Security Act of 1947. It requires the DNI, with the concurrence 
of the OMB, to provide the congressional intelligence 
committees with two future budget projections that together 
span ten years and form the basis of affordability assessments 
required in this section. Section 325 thus ensures that the 
Intelligence Community will make long-term budgetary 
projections that span the same time frame as the funding needs 
of programs it initiates in the budget.
    Section 325 requires first a Future Year Intelligence Plan 
for at least four years after the budget year, which includes 
the year-by-year funding plan for each expenditure center and 
for each major system in the National Intelligence Program. 
Section 325 also requires lifecycle cost and milestones for 
major systems and a Long-term Budget Projection five years 
beyond the Future Year Intelligence Plan, but at a much higher 
level of budget aggregation. This Long-term Budget Projection 
is to be conducted under a constrained budget projection, but 
under two alternative sets of assumptions about cost growth--
one with virtually no cost growth, the other more in line with 
experience. Section 325 requires that the Long-term Budget 
Projection include a description of whether, and to what 
extent, the projection for each year for each element of the 
Intelligence Community exceeds the level that would result from 
applying the most recent OMB inflation estimate to that 
element. Both budget projections must be submitted to Congress 
with the President's budget request.
    Section 325 ensures that the Executive branch and Congress 
will be fully aware of the long-term budgetary impact of a 
major system acquisition prior to its development or 
production. This is achieved through a requirement that prior 
to a major system entering Milestone A and Milestone B or an 
analogous stage of system development, the DNI must report to 
the congressional intelligence committees whether and to what 
extent the proposed major system will increase the Future Year 
Intelligence Plan and the Long-term Budget Projection for that 
element of the Intelligence Community. If the proposed major 
system is estimated to cause an increase to these future budget 
projections, then the DNI and OMB Director must issue a 
determination that the anticipated budget increase is necessary 
for national security.

Section 326. National Intelligence Program funded acquisitions

    Section 326 adds a new subparagraph (4) to the acquisition 
authorities of the DNI collected in Section 102A(n) of the 
National Security Act of 1947. Existing subparagraph (1) 
authorizes the DNI to exercise the acquisition and 
appropriations authorities referred to in the Central 
Intelligence Agency Act of 1949 (CIA Act). Although 
subparagraph (1) is not explicit, those authorities are found 
in Sections 3 and 8 of the CIA Act, except, as provided in 
subparagraph (1), for the CIA's authority under section 8(b) to 
expend funds without regard to laws and regulations on 
Government expenditures for objects of a confidential, 
extraordinary, or emergency nature.
    Subparagraph (4)(A) authorizes the DNI to make acquisition 
authority referred to in Sections 3 and 8(a) of the CIA Act 
also available to any Intelligence Community element for an 
acquisition that is funded in whole or in majority part by the 
National Intelligence Program. Among Intelligence Community 
elements, the National Reconnaissance Office (NRO) and the 
National Geospatial-Intelligence Agency (NGA) already exercise 
these or similar authorities either directly or through the 
CIA. The grant of this authority to the DNI is part of the 
Committee's effort to ensure that the DNI has the ability to 
manage the elements of the Intelligence Community as a 
community by enabling the DNI to make available throughout the 
Intelligence Community, when warranted, authority originally 
enacted for one of its elements.
    Subparagraphs 4(B)-(G) establish procedures and controls on 
the grant of this authority. The head of an Intelligence 
Community element, without delegation, must request in writing 
the DNI make the authority available. The request must explain 
the need for the acquisition authority including an explanation 
why other authorities are insufficient and that the mission of 
the element would be impaired if the requested authority is not 
exercised. In turn, for the authority to be provided, the DNI, 
the Principal Deputy DNI, or a designated Deputy DNI must issue 
a written authorization that includes a justification which 
supports the use of the authority.
    Requests from the head of an Intelligence Community element 
that are within the Departments of Defense, Energy, Homeland 
Security, Justice, State, and Treasury shall be transmitted to 
the DNI in accordance with procedures established by the heads 
of those departments. Also, to ensure periodic review, 
authorities may not be granted for a class of acquisitions 
beyond a renewable 3 years except for a renewable 6 years if 
the DNI personally approves the authority. The congressional 
intelligence committees shall be notified of all authorizations 
granted under subparagraph (4).

        Subtitle D--Congressional Oversight, Plans, and Reports


Section 331. General congressional oversight

    Section 331 amends the requirements for notifications to 
Congress under section 501 of the National Security Act of 1947 
by adding a new paragraph stating that there shall be no 
exception to the requirements of Title V of the National 
Security Act of 1947 to inform the congressional intelligence 
committees of all intelligence activities and covert actions.

Section 332. Improvement of notification of Congress regarding 
        intelligence activities of the United States

    Section 332 further amends the requirements for 
notifications to Congress under Title V of the National 
Security Act of 1947. In the event the DNI or head of an 
Intelligence Community element does not provide to the full 
congressional intelligence committees the notification required 
by Section 502 (relating to intelligence activities other than 
covert actions) or Section 503 (relating to covert actions), 
the committees shall be provided notice of this fact. This 
notice must be submitted in writing in a classified form and 
include a description of the main features of the intelligence 
activity or covert action as well as a statement of the reasons 
for not briefing the full committee. The notice may not contain 
a restriction on access to it by all members of the committee.
    This section also extends to Section 503 of the National 
Security Act of 1947 requirements now in Section 502 of the Act 
on the form and contents of reports. Accordingly, reports on 
covert actions now shall also contain a concise statement of 
any facts pertinent to the covert action and an explanation of 
the significance of the covert action. In addition, rather than 
the existing requirement to report changes only if they are 
``significant,'' under the amendment any change to a covert 
action finding must be reported.

Section 333. Requirement to provide legal authority for intelligence 
        activities

    Section 333 amends the National Security Act of 1947 by 
requiring that the congressional intelligence committees be 
provided with the legal authorities under which all covert 
action and all other intelligence activities are or were 
conducted.

Section 334. Additional limitation on availability of funds for 
        intelligence and intelligence-related activities

    Section 334 adds to the requirements of Section 504 of the 
National Security Act of 1947 an enforcement mechanism for the 
notification provisions in Sections 501 through 503. The 
section provides that funds may be obligated or expended for an 
intelligence activity only if the congressional intelligence 
committees have been ``fully and currently informed'' of that 
activity. The committees will be considered to have been fully 
and currently informed only if all members of the committees 
are fully informed or, in the circumstances in which the 
amendments made by Section 332 apply, if the committees have 
been provided with a classified notice of the main features of 
the intelligence activity that does not contain a restriction 
on access by all members.

Section 335. Audits of Intelligence Community by the Government 
        Accountability Office

    Section 335 adds a new section to Title 31 on audits and 
evaluations of the Intelligence Community by the Government 
Accountability Office (GAO). With some modifications, it is 
based on S. 385, a bill entitled the ``Intelligence Community 
Audit Act of 2009'' which has been referred to the Committee.
    As added by Section 335, Section 3523a(b) of Title 31 sets 
forth findings by Congress on the authority of the Comptroller 
General under present law to perform audits and evaluations of 
Intelligence Community elements that are requested by 
committees of jurisdiction. Section 3523a(b)(2) states that 
requests for such audits may be made for matters relating to a 
list of subjects, namely, management and administration in 
areas such as strategic planning, financial management, 
information technology, human capital, and knowledge and 
information sharing. These are subjects on which GAO has 
established expertise.
    In order to protect national security interests, Section 
3523a(c) sets forth limitations and procedures concerning the 
use of this audit and evaluation authority when intelligence 
sources and methods or covert actions are involved. Among them 
are that such audits and evaluations may only be done on 
request of a congressional intelligence committee. The results 
of such audits and evaluations, or information obtained in the 
course of doing them, may only be provided to the congressional 
intelligence committees, the DNI, and the head of the relevant 
Intelligence Community element. It also states that GAO 
employees shall be subject to the same statutory penalties for 
unauthorized disclosure as Intelligence Community employees. 
Furthermore, all documents that are used during the audit or 
evaluation will remain in Intelligence Community facilities.
    The Committee intends that the authority provided by this 
amendment should be used as a tool to supplement and not 
replace existing oversight mechanisms, in order to fill in any 
gaps that the congressional intelligence committees, in 
consultation with the DNI and Comptroller General, may 
identify. The Committee requests that the DNI and Comptroller 
General confer periodically about matters for which the GAO may 
properly augment oversight, and advise the congressional 
intelligence committees about the proposed utilization of GAO 
expertise.

Section 336. Report on compliance with laws, international obligations, 
        and Executive orders on the detention and interrogation 
        activities of the Intelligence Community

    Section 336 requires the DNI to submit a comprehensive 
report to the congressional intelligence committees on all 
measures taken by the ODNI and by any Intelligence Community 
element with relevant responsibilities to comply with the 
provisions of applicable law, international obligations, and 
executive orders relating to detention or interrogation 
activities, including the Detainee Treatment Act of 2005 (title 
X of division A of Public Law 109-148) (2005), the Military 
Commissions Act of 2006 (Public Law 109-366) (2006), Common 
Article 3, the Convention Against Torture and Other Cruel, 
Inhuman or Degrading Treatment or Punishment, Executive Order 
13491 (74 Fed. Reg. 4893, relating to ensuring lawful 
interrogation) and Executive Order 13493 (74 Fed. Reg. 4901, 
relating to detention policy options). The report is to be 
submitted no later than December 1, 2009, in an unclassified 
form but may include a classified annex.
    The Detainee Treatment Act provides that no individual in 
the custody or under the physical control of the United States, 
regardless of nationality or physical location, shall be 
subject to cruel, inhuman, or degrading treatment. Congress 
reaffirmed this mandate in Section 6 of the Military 
Commissions Act, adding an implementation mechanism that 
required the President to take action to ensure compliance 
including through administrative rules and procedures. Section 
6 further provided not only that grave breaches of Common 
Article 3 of the Geneva Conventions are war crimes under Title 
18 of the United State Code, but also that the President has 
authority for the United States to promulgate higher standards 
and administrative regulations for violations of U.S. treaty 
obligations. It required the President to issue those 
interpretations by Executive order published in the Federal 
Register.
    The report required by Section 336 shall include a 
description of the detention or interrogation methods that have 
been determined to comply with applicable law, international 
obligations, and Executive order, including the prohibitions of 
the Detainee Treatment Act and the Military Commissions Act.
    The Detainee Treatment Act also provides for the protection 
against civil or criminal liability for United States 
Government personnel who had engaged in officially authorized 
interrogations that were determined to be lawful at the time. 
Section 336 requires the DNI to report on actions taken to 
implement that provision. In addition, the DNI is to report on 
actions relating to detention or interrogation taken pursuant 
to Executive Order 13941 or recommendations issued by task 
forces established under Executive Orders 13941 and 13943.
    The report shall include an appendix containing all 
guidelines on the application of all applicable law, 
international obligations, or Executive orders, including the 
Detainee Treatment Act and the Military Commissions Act, to the 
detention or interrogation activities, if any, of any 
Intelligence Community element. The appendix shall also include 
all legal justifications of the Department of Justice about the 
meaning or application, if applicable, of laws, international 
obligations, or Executive orders with respect to Intelligence 
Community detention or interrogation activities, if any, of any 
element of the Intelligence Community. The provision seeks only 
the legal justifications of any office of the Department of 
Justice that rendered an opinion on the matter.
    To the extent that the report required by Section 336 
addresses an element of the Intelligence Community within the 
Department of Defense, that portion of the report, and 
associated material that is necessary to make that portion 
understandable, shall also be submitted by the DNI to the 
congressional armed services committees.

Section 337. Reports on national security threat posed by Guantanamo 
        Bay detainees

    Section 337 requires the Intelligence Community to provide 
the congressional intelligence committees with a quarterly 
report outlining the Director of National Intelligence's 
assessment on the suitability of detainees previously released 
or transferred, or who may be released or transferred, from the 
Naval Detention Facility at Guantanamo Bay, Cuba to the United 
States or any other country. The quarterly report is to be 
provided in addition to, and on the same schedule as, the 
report on the prisoner population at the Guantanamo detention 
facility required by Section 319 of the Supplemental 
Appropriations Act of 2009 (Public Law 111-32).
    The report required by Section 337 must include: (1) any 
objection or recommendation against the release of a particular 
detainee by an element of the Intelligence Community which 
judged that the potential threat posed by a particular detainee 
warranted continued detention; (2) a detailed description of 
the intelligence information that led to such a determination; 
(3) if an element of the Intelligence Community previously 
recommended against the release of a particular detainee and 
later retracted that recommendation, a detailed explanation of 
the reasoning for the retraction; and (4) an assessment of 
lessons learned from previous releases and transfers of 
individuals for whom the Intelligence Community objected or 
recommended against release.
    The intent of the provision is to allow the congressional 
intelligence committees to review the threat assessment and 
perform needed oversight in this area. The congressional 
intelligence committees are among the few entities that can 
receive this kind of detailed information, and it is the 
responsibility of the committees to understand the Intelligence 
Community's assessments of the threat, or lack thereof, posed 
by individual detainees as the Administration considers actions 
on Guantanamo detainees in the near future.

Section 338. Report on retirement benefits for former employees of Air 
        America

    Section 338 provides for a report by the DNI on the 
advisability of providing federal retirement benefits to United 
States citizens who were employees of Air America or an 
associated company prior to 1977, during the time that the 
company was owned or controlled by the United States and 
operated by the CIA.
    There have been bills introduced in the Senate and House in 
the past that would have provided federal retirement benefits 
for those employees. By including Section 338 in this 
authorization bill, the Committee takes no position on the 
merits of that legislation.
    Although the section invites the DNI to submit any 
recommendations on the ultimate question of providing benefits, 
the main purpose of the report is to provide Congress with the 
facts upon which Congress can make that determination. 
Accordingly, Section 338 outlines the factual elements required 
by the report. To aid in the preparation of the report, the 
section authorizes the assistance of the Comptroller General. 
Among the elements of the report should be: (1) the 
relationship of Air America to the CIA; (2) the missions it 
performed; (3) the casualties its employees suffered; (4) a 
description of the retirement benefits that had been contracted 
for or promised to Air America employees; and (5) a description 
of the retirement benefits Air America employees received.
    On September 25, 2007, the CIA provided a three page letter 
to the congressional intelligence and appropriations committees 
in response to the Committee's report to accompany the 
Intelligence Authorization Act for Fiscal Year 2007, S. Rep. 
109-259, requesting a report on ``the advisability of providing 
federal retirement benefits to United States citizens who were 
employees of Air America or an associated company prior to 
1977, during the time that the company was owned or controlled 
by the United States and operated by the CIA.'' Although the 
letter described the legal basis under current law for denying 
federal retirement benefits to employees of Air America, it did 
not provide the factual background that would allow Congress to 
make an assessment of whether to amend current law to provide 
employees of Air America with federal retirement benefits. The 
report requested in Section 338 therefore continues to be 
necessary for a comprehensive exploration of the underlying 
issues.

Section 339. Report and strategic plan on biological weapons

    Section 339 provides for a report by the DNI on the 
intelligence collection efforts of the United States against 
biological weapons or the threat of biological weapons in the 
hands of terrorists, rogue states, or other actors, both 
foreign and domestic. The report also should cover intelligence 
collection efforts to protect the United States bio-defense 
knowledge and infrastructure.
    The report required by Section 339 should contain the 
following elements: (1) an accurate assessment of the 
intelligence collection efforts of the United States dedicated 
to detecting the development or use of biological weapons by 
state, non-state, or rogue actors, either foreign or domestic; 
(2) detailed information on fiscal, human, technical, open 
source, and other intelligence collection resources of the 
United States for use against the biological weapons threat; 
and (3) an assessment of any problems that may reduce the 
overall effectiveness of United States intelligence collection 
and analysis to identify and protect against biological weapons 
or the threat of biological weapons including intelligence 
collection gaps or inefficiencies, inadequate information 
sharing practices, or inadequate cooperation among agencies or 
departments of the United States.
    Additionally, Section 339 provides that this report include 
a strategic plan prepared by the DNI that, in coordination with 
the Attorney General, Secretary of Defense, and Secretary of 
Homeland Security, provides for a coordinated action plan for 
the Intelligence Community to address and close the gaps 
identified in the report required by Section 339(a). This 
strategic plan shall also include a description of appropriate 
goals, schedules, milestones, or metrics to measure the long-
term effectiveness of the plan and any long-term resource and 
human capital issues related to the collection of intelligence 
against biological weapons or the threat of biological weapons, 
including any recommendation to address shortfalls of 
experienced and qualified staff possessing relevant scientific, 
language, and technical skills.
    Section 339 requires that the DNI submit this report to the 
congressional intelligence committees no later than 180 days 
after the enactment of this bill. The DNI is required to begin 
implementing the strategic plan within 30 days of submitting 
the report.

Section 340. Cybersecurity oversight

    Section 340 seeks to set up a preliminary framework for 
executive and congressional oversight to ensure that the 
government's national cybersecurity mission is consistent with 
legal authorities and preserves reasonable expectations of 
privacy.
    Section 340(a) defines three terms: national cyber 
investigative joint task force, critical infrastructure, and 
cybersecurity program. The definition of the term 
``cybersecurity programs'' in section 340(a) is intentionally a 
narrow one. Routine firewalls and anti-virus programs, for 
example, might be considered cybersecurity programs. The 
definition of cybersecurity programs in this section 
intentionally excludes those types of routine programs. 
Instead, Section 340 focuses on government-wide cybersecurity 
programs. These programs use more effective technologies to 
integrate cyber defenses across the government among government 
entities that wish to, or are directed to, participate. These 
types of programs pose challenging new legal and privacy 
questions that make congressional and Executive branch 
oversight particularly important. Because the section seeks to 
provide oversight of only those programs that involve 
significant potential privacy implications, the term 
``cybersecurity programs'' is also limited by the requirement 
that the programs involve personally identifiable data.
    Additionally, to be covered by this section, a 
cybersecurity program must have one of three characteristics. 
First, the definition covers programs in which the agency or 
department whose personnel is the intended recipient of the e-
mail or other electronic communication uses another agency or 
department of the United States Government to screen personally 
identifiable data related to those communications. In these 
programs, the agency or department that is the intended 
recipient of the communication is not managing or operating the 
cybersecurity program; instead, the program is managed by a 
government entity like the Department of Homeland Security or 
the Department of Defense. Second, the definition covers 
programs in which personally identifiable data is transferred 
from the agency or department whose personnel is the intended 
recipient of the e-mail or other electronic communication to 
another agency or department for the purpose of cybersecurity. 
This would include, for example, programs in which tips or 
other results from cybersecurity operations that contain 
personally identifiable data are shared with law enforcement or 
other parts of the United States Government. Third, the 
definition covers programs in which personally identifiable 
data is transferred from the agency or department whose 
personnel is the intended recipient of the e-mail or other 
electronic communication to an element of the Intelligence 
Community.
    Section 340(b) requires the President to notify Congress of 
cybersecurity programs and provide Congress with five types of 
documents: the program's legal justification, any 
certifications of the program's legality under 18 U.S.C. 
2511(2)(a)(ii) or other statutory provision, any concept of 
operations, any privacy impact statement, and any plan for 
independent audit or review of the program to be carried out by 
the head of the relevant department or agency, in conjunction 
with the appropriate inspector general. The notification 
requirements of subsection (b) are designed to ensure that 
Congress is aware of significant legal, privacy and operational 
issues with respect to each new cybersecurity program. For 
existing cybersecurity programs, the notification and documents 
must be provided no later than 30 days after the date of the 
enactment of this Act. For new programs, the notification and 
documents must be provided not later than 30 days after the 
date of the commencement of operations of a new cybersecurity 
program.
    Section 340(c) requires the heads of agencies or 
departments with responsibility for a cybersecurity program, in 
conjunction with the inspector general for that department or 
agency, to prepare a report describing the results of any audit 
or review under the audit plan and assessing whether the 
cybersecurity program is in compliance with, and adequately 
described by, the documents submitted to Congress. This 
subsection is designed to provide an independent check that the 
agencies are conducting cyber operations in a manner consistent 
with Executive branch guidance and to supply Congress more 
information about the operation of those programs. In addition, 
these reports should help identify the key difficulties and 
challenges in the cybersecurity programs.
    Section 340(d) requires the Inspectors General of the 
Department of Homeland Security and the Intelligence Community 
to prepare a report on the sharing of cyber threat information 
both within the U.S. government and with those responsible for 
critical infrastructure. This report should be submitted one 
year after the enactment of this Act. In their report, the 
Inspectors General should identify any barriers to sharing 
cyber threat and vulnerability information, and assess the 
effectiveness of current sharing arrangements.
    Section 340(e) provides the head of an element of the 
Intelligence Community the authority to detail an officer or 
employee to the Department of Homeland Security or the National 
Cyber Investigative Joint Task Force to assist with 
cybersecurity for a period not to exceed three years. This 
section will allow Intelligence Community experts to be made 
available to the Department of Homeland Security, which serves 
as the civilian cyber defense manager but has not been given 
the same priority or funding as the Intelligence Community by 
the Executive branch. In recognition of this Committee's ample 
support for cyber over the last few years, the provision 
permits these details to be provided on a nonreimbursable 
basis. This detail authority, however, is restricted to a 
period not to exceed 3 years to prevent details from being used 
as an alternative to building expertise at civilian cyber 
defense agencies.
    Finally, Section 340(f) provides that the requirements of 
this section will terminate on December 31, 2012. During the 
next three years, the Executive branch will begin new and 
unprecedented cybersecurity programs with new technology and 
new legal and privacy challenges. Section 340 will allow 
Congress to follow these developments closely and gain a deeper 
and broader understanding of cybersecurity issues so that, upon 
the termination of this section, it may be replaced with a 
permanent framework for oversight.

Section 341. Sense of the Senate on a subcommittee related to 
        intelligence appropriations

    Section 341 is a Sense of the Senate that the Senate should 
agree to a resolution amending Section 402 of Senate Resolution 
445, 108th Congress, agreed to on October 9, 2004, as proposed 
in Senate Resolution 655, 110th Congress, introduced on 
September 11, 2008, to establish within the Committee on 
Appropriations of the Senate a Subcommittee on Intelligence.
    S. Res. 655 outlines the key features of the Subcommittee 
on Intelligence. First, the Subcommittee would have exclusive 
jurisdiction over all funding for the National Intelligence 
Program. Second, no other Appropriations subcommittee could 
intervene to review the work of the Intelligence Subcommittee. 
Third, Members of the Select Committee on Intelligence who are 
Members of the Committee on Appropriations shall have automatic 
membership on the Subcommittee on Intelligence. Fourth, the 
Chairman and Vice Chairman of the Select Committee on 
Intelligence shall serve as ex-officio members of the 
subcommittee, if they are not also Members of the Committee on 
Appropriations. Fifth, the Chairman and Ranking member of the 
Subcommittee on Defense of the Committee on Appropriations 
shall have automatic membership on the subcommittee. Finally, 
the Chairman and Ranking Member of the subcommittee shall be 
selected from among those members who are both members of the 
Committee on Appropriations and the Select Committee on 
Intelligence.
    The Committee believes that the establishment of an 
Appropriations Subcommittee on Intelligence will provide a 
strong, stable, and capable congressional committee structure 
that will improve congressional oversight of the intelligence 
activities of the United States and fulfill the recommendations 
of the 9/11 Commission as nearly as practicable.

Section 342. Repeal or modification of certain reporting requirements

    The Committee frequently requests information from the 
Intelligence Community in the form of reports, the contents of 
which are specifically defined by statute. The reports prepared 
pursuant to these statutory requirements provide this Committee 
with an invaluable source of information about specific matters 
of concern.
    The Committee recognizes, however, that congressional 
reporting requirements, and particularly recurring reporting 
requirements, can place a significant burden on the resources 
of the Intelligence Community. It is therefore important for 
the Congress to reconsider these reporting requirements on a 
periodic basis to ensure that the reports it has requested are 
the best mechanism for the Congress to receive the information 
it seeks. In some cases, annual reports can be replaced with 
briefings or notifications that provide the Congress with more 
timely information and offer the Intelligence Community a 
direct line of communication to respond to congressional 
concerns.
    In response to a request from the DNI, the Committee 
examined some of these recurring reporting requirements. 
Section 342 therefore eliminates certain reports that were 
particularly burdensome to the Intelligence Community when the 
information in the reports could be obtained through other 
means. It also eliminates reports whose usefulness has 
diminished either because of changing events or because the 
information contained in those reports is duplicative of 
information already obtained through other avenues.
    Because the majority of recurring reports provide critical 
information relevant to the many challenges facing the 
Intelligence Community today, the Committee has proceeded 
carefully in eliminating only seven statutory reporting 
requirements, a very small percentage of the many recurring 
reports currently requested. In addition, the Committee changed 
the requirement of one report to make its submission biennial, 
rather than annual. The Committee believes that elimination of 
these reports will help the Intelligence Community to allocate 
its resources properly towards areas of greatest congressional 
concern.
    The Committee recognizes the concern expressed by the 
Intelligence Community about the impact of reporting 
requirements. The Committee suggests, for the fiscal year 2011 
authorization act request, that the ODNI submit, even in 
advance of the Administration's formal requests for 
legislation, facts (including the cost of preparing particular 
reports and the use of contract personnel, if any, to prepare 
reports) and proposals (including the consolidation of reports 
and lengthening the intervals between them) that will enable a 
fuller evaluation of alternatives for providing information to 
Congress. Also, for reports that by law are unclassified, the 
Committee requests that the ODNI advise the congressional 
intelligence committees about any system that is in place, or 
should be put in place, for their public dissemination.

                       Subtitle E--Other Matters


Section 351. Extension of authority to delete information about receipt 
        and disposition of foreign gifts and decorations

    Current law (5 U.S.C. 7342) requires that certain federal 
``employees''--a term that generally applies to all 
Intelligence Community officials and personnel and certain 
contract personnel, spouses, dependents, and others--file 
reports with their employing agency regarding receipt of gifts 
or decorations from foreign governments. Following compilation 
of these reports, the employing agency is required to file 
annually with the Secretary of State detailed information about 
the receipt of foreign gifts and decorations by its employees, 
including the source of the gift. The Secretary of State is 
required to publish a comprehensive list of the agency reports 
in the Federal Register.
    With respect to Intelligence Community activities, public 
disclosure of gifts or decorations in the Federal Register has 
the potential to compromise intelligence sources (e.g., 
confirmation of an intelligence relationship with a foreign 
government) and could undermine national security. Recognizing 
this concern, the Director of Central Intelligence (DCI) was 
granted a limited exemption from reporting certain information 
about such foreign gifts or decorations where the publication 
of the information could adversely affect United States 
intelligence sources. Section 1079 of the Intelligence Reform 
Act extended a similar exemption to the DNI in addition to 
applying the existing exemption to the CIA Director.
    Section 351 provides to the heads of each Intelligence 
Community element the same limited exemption from specified 
public reporting requirements that is currently authorized for 
the DNI and CIA Director. The national security concerns that 
prompt those exemptions apply equally to other Intelligence 
Community elements. Section 351 mandates that the information 
not provided to the Secretary of State be provided to the DNI, 
who is required to keep a record of such information, to ensure 
continued independent oversight of the receipt by Intelligence 
Community personnel of foreign gifts or decorations.
    Gifts received in the course of ordinary contact between 
senior officials of elements of the Intelligence Community and 
their foreign counterparts should not be excluded under the 
provisions of Section 351 unless there is a serious concern 
that such contacts and gifts would adversely affect United 
States intelligence sources or methods.

Section 352. Exemption of dissemination of terrorist identity 
        information from Freedom of Information Act

    Section 352 provides an exemption for terrorist identity 
information disseminated for terrorist screening purposes from 
disclosure under the Freedom of Information Act (5 U.S.C. 552) 
in order to facilitate on an unclassified basis the sharing of 
those elements of information necessary for terrorist screening 
purposes.

Section 353. Modification of availability of funds for different 
        intelligence activities

    Section 353 conforms the text of Section 504(a)(3)(B) of 
the National Security Act of 1947 (50 U.S.C. 414(a)(3)(B) 
(governing the funding of intelligence activities)) with the 
text of Section 102A(d)(5)(A)(ii) of that Act (50 U.S.C. 403-
1(d)(5)(A)(ii)), as amended by Section 1011(a) of the 
Intelligence Reform Act (governing the transfer and 
reprogramming by the DNI of certain intelligence funding).
    The amendment replaces the ``unforeseen requirements'' 
standard in Section 504(a)(3)(B) with a more flexible standard 
to govern reprogrammings and transfers of funds authorized for 
a different intelligence or intelligence-related activity. 
Under the new standard, a reprogramming or transfer is 
authorized if, in addition to the other requirements of Section 
504(a)(3), the new use of funds would ``support an emergent 
need, improve program effectiveness, or increase efficiency.'' 
This modification brings the standard for reprogrammings or 
transfers of intelligence funding into conformity with the 
standards applicable to reprogrammings and transfers under 
Section 102A of the National Security Act of 1947. The 
modification preserves congressional oversight of proposed 
reprogrammings and transfers while enhancing the Intelligence 
Community's ability to carry out missions and functions vital 
to national security.

Section 354. Limitation on reprogrammings and transfers of funds

    Section 354 modifies the reprogramming requirements set 
forth in Section 504 of the National Security Act of 1947 (50 
U.S.C. 414) to provide in statute that, following a 
reprogramming notification from the DNI, Attorney General, or 
Secretary of Defense, appropriated funds may not be expended 
for a period of up to 90 days after a request for information 
about the reprogramming is made by one of the congressional 
intelligence committees. It also allows the President to 
authorize the reprogramming, regardless of the 90-day review 
period, to fulfill an urgent operational requirement (excluding 
cost overruns) when it is necessary for the Intelligence 
Community to carry out the reprogrammed activity prior to the 
completion of the review period set by the congressional 
intelligence committees.
    Section 504 of the National Security Act of 1947 allows the 
Intelligence Community a certain degree of flexibility in 
reprogramming authorized and appropriated funds, as amended by 
Section 353, without having to seek additional legislation from 
Congress. Section 354 of the bill alters this delegation of 
authority to reprogram and transfer funds by formalizing a 
maximum time period for review by the congressional 
intelligence committees and instituting a waiver mechanism to 
ensure that such review does not hamper urgent operational 
requirements.

Section 355. Protection of certain national security information

    Section 355 amends Section 601 of the National Security Act 
of 1947 (50 U.S.C. 421) to increase the criminal penalties 
involving the disclosure of the identities of undercover 
intelligence officers and agents.
    Section 355(a) amends Section 601(a) to increase criminal 
penalties for an individual with authorized access to 
classified information who intentionally discloses any 
information identifying a covert agent, if the individual knows 
that the United States is taking affirmative measures to 
conceal the covert agent's intelligence relationship to the 
United States. Currently, the maximum sentence for disclosure 
by someone who has had ``authorized access to classified 
information that identifies a covert agent'' is 10 years. 
Subsection (a)(1) of Section 345 of this Act increases that 
maximum sentence to 15 years.
    Currently, under Section 601(b) of the National Security 
Act of 1947, the maximum sentence for disclosure by someone who 
``as a result of having authorized access to classified 
information, learns of the identity of a covert agent'' is 5 
years. Subsection (a)(2) of Section 355 of this Act increases 
that maximum sentence to 10 years.
    Subsection (b) of Section 355 amends Section 603(a) of the 
National Security Act of 1947 (50 U.S.C. 423(a)) to provide 
that the annual report from the President on the protection of 
identities of certain United States undercover intelligence 
officers, agents, informants, and sources, also include an 
assessment of the need for any modification for the purpose of 
improving legal protections for covert agents.

Section 356. National Intelligence Program budget request

    Section 601(a) of the Implementing Recommendations of the 
9/11 Commission Act of 2007, Public Law 110-53 (2007) (50 
U.S.C. 415c), requires the DNI to disclose the aggregate amount 
of funds appropriated by Congress for the National Intelligence 
Program for each fiscal year beginning with fiscal year 2007. 
Section 601(b) provides that the President may waive or 
postpone such disclosure if certain conditions are met, 
beginning with fiscal year 2009.
    Section 356 of the bill amends Section 601 of the 
Implementing Recommendations of the 9/11 Commission Act of 2007 
to require that, on the date that the President submits to 
Congress the annual budget request, the President shall 
disclose to the public the aggregate amount of appropriations 
requested for that fiscal year for the National Intelligence 
Program. The section also eliminates the presidential waiver 
authority related to the public disclosure by the DNI of the 
aggregate amount of funds appropriated by Congress for the 
National Intelligence Program for any fiscal year.

Section 357. Improving the review authority of the Public Interest 
        Declassification Board

    Section 357 clarifies that the Public Interest 
Declassification Board may conduct reviews in response to 
requests from the committee of jurisdiction, or from individual 
members of the committee. This will, among other things, 
protect the opportunity of a committee's minority to obtain the 
benefit of a Public Interest Declassification Board review. It 
also clarifies that the Board may consider the proper 
classification level of records, rather than simply consider 
whether or not they should be classified. This authority is 
important to address questions of excessive compartmentation or 
other over classification that may impede needed information 
sharing or impede adequate reviews within the Executive branch 
and oversight by the Congress.

Section 358. Authority to designate undercover operations to collect 
        foreign intelligence or counterintelligence

    Various provisions in the United States Code preclude the 
government from conducting the following activities: (1) the 
deposit of funds in a financial institution; (2) the lease or 
purchase of real property; (3) the establishment and operation 
of a proprietary business on a commercial basis; and (4) the 
utilization of proceeds of the operation to offset necessary 
and reasonable operational expenses. In recognition, however, 
of the important role such activities may play in the conduct 
of undercover operations, Public Law 102-395 (1992) (28 U.S.C. 
533 note) provides a mechanism for the FBI to obtain an 
exemption from these otherwise applicable laws.
    Under Public Law 102-395, an exemption may be obtained if 
the proposed activity is certified by the Director of the FBI 
and the Attorney General as being necessary to the conduct of 
the undercover operation. For national security investigations, 
the Director of the FBI may delegate certifying authority to an 
Assistant Director in the Counterterrorism, 
Counterintelligence, or Cyber Divisions at the FBI, and the 
Attorney General may delegate such authority to the Assistant 
Attorney General for the National Security Division at the 
Department of Justice.
    Section 358 amends the current delegation level for both 
the FBI and the Department of Justice. It allows the FBI 
Director to delegate certifying authority to a level not lower 
than a Deputy Assistant Director in the National Security 
Branch. It also allows the Attorney General to delegate the 
certifying authority to a level not lower than a Deputy 
Assistant Attorney General in the National Security Division. 
It should be noted that this delegation level for the 
Department of Justice remains at a higher level than that which 
is currently required in criminal undercover operations.
    The Committee is concerned that, because of both statutory 
and administrative limitations, the current delegation levels 
are insufficient to allow for timely processing of undercover 
exemptions. The success and safety of undercover operations can 
depend in part on the ability to do such simple tasks as open a 
bank account or rent an apartment for cover purposes in a 
timely manner. While the creation of the National Security 
Division at the Department of Justice has led to more efficient 
processing of some exemption requests, there remains room for 
improvement. The Committee believes that the new delegation 
levels established in Section 358 will encourage and facilitate 
further internal and administrative improvements in processing 
undercover exemptions both at the FBI and the Department of 
Justice, without sacrificing needed oversight within the FBI 
and Department of Justice.

Section 359. Correcting long-standing material weaknesses

    Section 359 requires the heads of the five intelligence 
agencies that have been specifically required to produce 
auditable financial statements (the CIA, Defense Intelligence 
Agency (DIA), NGA, NRO, and NSA) to designate each senior 
management official who is responsible for correcting long-
standing, correctable material weaknesses, and to notify the 
DNI and the congressional intelligence committees of these 
designations.
    Under Section 359, the term ``material weakness'' has the 
meaning given that term under OMB Circular A-123, Management's 
Responsibility for Internal Control, revised December 21, 2004. 
In particular, ``[a] material weakness in internal controls is 
a reportable condition, or combination of reportable 
conditions, that results in more than a remote likelihood that 
a material misstatement of the financial statements, or other 
significant financial reports, will not be prevented or 
detected.''
    The Committee has been dissatisfied with the lack of 
progress in correcting material weaknesses. Section 359 is 
intended to ensure there is clear accountability about who is 
responsible for correcting these deficiencies.
    Section 359 pertains only to ``long-standing'' material 
weaknesses, defined as those that were identified in annual 
financial reports no later than fiscal year 2006. Also, Section 
359 pertains only to material weaknesses that are correctable 
in the near term, i.e., those whose correction is not 
substantially dependent on a business information system that 
will not be fielded prior to fiscal year 2011. The head of an 
Intelligence Community agency head may be designated as the 
responsible official.
    Section 359 also requires a senior intelligence management 
official to notify his agency head within five days of 
correcting a long-standing material weakness. The head of the 
agency then has 10 days to appoint an independent auditor who 
will determine whether the specified long-standing correctable 
material weakness has been corrected. If the correction is 
verified by the independent audit, the agency head shall notify 
the congressional intelligence committees that the material 
weakness has been corrected.
    The Committee believes that this legislative step is 
necessary to establish clear accountability for correcting 
these long-standing correctable material weaknesses. The 
Committee expects the DNI and Intelligence Community agency 
heads to consider progress towards correcting these material 
weaknesses to be an important consideration in determining any 
awards, bonuses, or promotions for these designated senior 
officials.

  TITLE IV--MATTERS RELATING TO ELEMENTS OF THE INTELLIGENCE COMMUNITY


      Subtitle A--Office of the Director of National Intelligence


Section 401. Accountability reviews by the Director of National 
        Intelligence

    Section 401 provides that the DNI shall have new authority 
to conduct accountability reviews of elements within the 
Intelligence Community and the personnel of those elements. The 
primary innovation of this provision is the authority to 
conduct accountability reviews concerning an entire element of 
the Intelligence Community in relation to failures or 
deficiencies.
    This accountability process is intended to be separate and 
distinct from any accountability reviews being conducted 
internally by the elements of the Intelligence Community or 
their Inspectors General, and is not intended to limit the 
authorities of the DNI with respect to his supervision of the 
CIA.
    Section 401 requires that the DNI, in consultation with the 
Attorney General, formulate guidelines and procedures that will 
govern accountability reviews. The Committee envisions that 
these guidelines will govern the process by which the DNI can 
collect sufficient information from the Intelligence Community 
to assess accountability for a given incident.
    Any findings and recommendations for corrective or punitive 
action made by the DNI shall be provided to the head of the 
applicable element of the Intelligence Community. If the head 
of such element does not implement the recommendations, then 
the congressional intelligence committees must be notified and 
provided the reasons for the determination by the head of the 
element.
    In addition, to avoid a construction that a committee of 
Congress on its own could require such a review over the 
objection of the DNI, a concern raised by the ODNI, the section 
makes clear that the DNI shall conduct a review if the DNI 
determines it is necessary, and the DNI may conduct an 
accountability review (but is not statutorily required to do 
so) if requested by one of the congressional intelligence 
committees.
    This enhancement to the authority of the DNI is warranted 
given the apparent reluctance of various elements of the 
Intelligence Community to hold their agencies or personnel 
accountable for significant failures or deficiencies. Recent 
history provides several examples of serious failures to adhere 
to sound analytic tradecraft. In its reviews of both the 
September 11, 2001 terrorist attacks and the faulty Iraq prewar 
assessments on weapons of mass destruction, the Committee found 
specific examples of these failures yet no one within the 
Intelligence Community has been held accountable. Other 
examples of a lack of accountability within the Intelligence 
Community can be found by examining the history of certain 
major system acquisition programs. Despite clear management 
failures that resulted in significant cost overruns and 
unreasonable scheduling delays, these programs continued to 
stumble along without any imposition of accountability.
    The Committee hopes that this modest increase in the DNI's 
authorities will encourage elements within the Intelligence 
Community to put their houses in order by imposing 
accountability for significant failures and deficiencies. 
Section 401 will enable the DNI to get involved in the 
accountability process in the event that an element of the 
Intelligence Community cannot or will not take appropriate 
action.

Section 402. Authorities for intelligence information sharing

    Section 402 amends Section 102A(g)(1) of the National 
Security Act of 1947 (50 U.S.C. 403-1(g)(1)) to provide the DNI 
statutory authority to use National Intelligence Program funds 
to quickly address deficiencies or needs that arise in 
intelligence information access or sharing capabilities.
    The new Section 102A(g)(1)(G) authorizes the DNI to provide 
to a receiving agency or component, and for that agency or 
component to accept and use, funds or systems (which would 
include services or equipment) related to the collection, 
processing, analysis, exploitation, and dissemination of 
intelligence information.
    The new Section 102A(g)(1)(H) grants the DNI authority to 
provide funds to non-National Intelligence Program activities 
for the purpose of addressing critical gaps in intelligence 
information access or sharing capabilities. Without this 
authority, development and implementation of necessary 
capabilities could be delayed by an agency's lack of authority 
to accept or utilize systems funded from the National 
Intelligence Program, inability to use or identify current-year 
funding, or concerns regarding the augmentation of 
appropriations.
    These are similar to authorities granted to the NGA for 
developing and fielding systems of common concern relating to 
imagery intelligence and geospatial intelligence. See Section 
105(b)(2)(D)(ii) of the National Security Act of 1947 (50 
U.S.C. 403-5). Section 402 also requires the DNI to submit a 
report to the congressional intelligence committees by February 
1st annually from fiscal year 2010 through fiscal year 2013 
providing details on how this authority has been exercised 
during the preceding fiscal year.

Section 403. Authorities for interagency funding

    The DNI should be able to rapidly focus the Intelligence 
Community on an intelligence issue through a coordinated effort 
that uses all available resources. The ability to coordinate 
the Intelligence Community response to an emerging threat 
should not depend on the budget cycle and should not be 
constrained by general limitations in appropriations law (e.g., 
31 U.S.C. 1346) or other prohibitions on interagency financing 
of boards, commissions, councils, committees, or similar 
groups.
    To provide this flexibility, Section 403 grants the DNI the 
authority to approve interagency financing of national 
intelligence centers established under Section 119B of the 
National Security Act of 1947 (50 U.S.C. 404o-2). The section 
also authorizes interagency funding for boards, commissions, 
councils, committees, or similar groups established by the DNI 
for a period not to exceed two years. This would include the 
interagency funding of Intelligence Community mission managers. 
Under Section 402, the DNI could authorize the pooling of 
resources from various Intelligence Community agencies to 
finance national intelligence centers or other organizational 
groupings designed to address identified intelligence matters. 
The provision also expressly permits Intelligence Community 
elements, upon the request of the DNI, to fund or participate 
in these interagency activities. The DNI is limited in his use 
of this authority to appropriated funds.
    Under Section 403, the DNI is to submit a report to the 
congressional intelligence committees by February 1st annually 
from fiscal year 2011 through fiscal year 2014 providing 
details on how this authority has been exercised during the 
preceding fiscal year.

Section 404. Location of the Office of the Director of National 
        Intelligence

    Section 404 addresses the issue of the location of the 
Office of the DNI. Section 404 repeals the ban on the co-
location of the Office of the DNI with any other Intelligence 
Community element, which was to take effect on October 1, 2008, 
by replacing that provision of the National Security Act of 
1947 (50 U.S.C. 403-3) with a new subsection 103(e) that allows 
the ODNI to be located outside the District of Columbia within 
the Washington Metropolitan Region.
    In his 2008 legislative request for the fiscal year 2009 
authorization, the DNI asked, for the first time, that Congress 
provide that ``[t]he headquarters of the Office of the Director 
of National Intelligence may be located in the District of 
Columbia or elsewhere in the Metropolitan Region, as that term 
is defined in Section 8301 of title 40, United States Code.'' 
The purpose of this section is to provide statutory 
authorization for the location of the ODNI outside of the 
District of Columbia.
    Section 72 of Title 4, United States Code--a codification 
enacted in 1947 which derived from a statute signed into law by 
President George Washington in 1790--requires that ``[a]ll 
offices attached to the seat of government shall be exercised 
in the District of Columbia and not elsewhere, except as 
otherwise expressly provided by law.'' In 1955, just eight 
years after the 1947 codification, Congress granted statutory 
authority for the Director of Central Intelligence to provide 
for a headquarters of the Central Intelligence Agency either in 
the District of Columbia ``or elsewhere.'' 69 Stat. 324, 349.
    Pursuant to the Committee's direction during consideration 
of the fiscal year 2009 authorization act, the ODNI requested 
guidance from the Department of Justice's Office of Legal 
Counsel (OLC) about the need for a statute authorizing the 
location of the ODNI outside the District of Columbia. The ODNI 
has informed the Committee that OLC has informally advised the 
ODNI that there is no basis to exclude the ODNI from the 
requirement of 4 U.S.C. 72 and that a specific exception is 
needed to authorize the location of the ODNI headquarters 
outside the District of Columbia. The Committee urges the ODNI 
to continue to study, and report to the congressional 
intelligence committees, about the impact if any of the ODNI's 
current location outside of the District of Columbia on the 
daily implementation of the ODNI's responsibilities with 
respect to the President, the Congress, and the elements of the 
Intelligence Community.

Section 405. Additional duties of the Director of Science and 
        Technology

    Section 405 clarifies the duties of the Director of Science 
and Technology (DS&T) and the Director of the National 
Intelligence Science and Technology Committee (NISTC). The 
Committee expects the DS&T to systematically identify, assess, 
and prioritize the most significant intelligence challenges 
that require technical solutions, set long-term science and 
technology goals, develop a strategy/roadmap to be shared with 
the congressional intelligence committees that meets these 
goals, and prioritize and coordinate efforts across the 
Intelligence Community. As chair of the NISTC, the DS&T should 
leverage the expertise of the committee to accomplish these 
duties. Section 405(b) is a Sense of the Congress that the DS&T 
should report only to a member of the ODNI who is appointed by 
the President and confirmed by the Senate.

Section 406. Title and appointment of Chief Information Officer of the 
        Intelligence Community

    Section 406 expressly designates the position of Chief 
Information Officer in the Office of the Director of National 
Intelligence as Chief Information Officer of the Intelligence 
Community (IC CIO). The modification to this title is 
consistent with the position's overall responsibilities as 
outlined in Section 103G of the National Security Act of 1947 
(50 U.S.C. 403-3g). Section 406 also eliminates the requirement 
that the IC CIO be confirmed by the Senate while retaining the 
requirement that the IC CIO be appointed by the President. The 
continued requirement of presidential appointment emphasizes 
that the IC CIO has important responsibilities for the 
Intelligence Community enterprise architecture with respect to 
the whole of the Intelligence Community.

Section 407. Inspector General of the Intelligence Community

    Section 1078 of the Intelligence Reform Act authorizes the 
DNI to establish an Office of Inspector General if the DNI 
determines that an Inspector General (IG) would be beneficial 
to improving the operations and effectiveness of the ODNI. It 
further provides that the DNI may grant to the IG any of the 
duties, responsibilities, and authorities set forth in the 
Inspector General Act of 1978. The DNI has appointed an IG and 
has granted certain authorities pursuant to DNI Instruction No. 
2005-10 (September 7, 2005).
    As this Committee urged in reports on proposed 
authorization acts for fiscal years 2006 through 2009, a strong 
IG is vital to achieving the goal, set forth in the 
Intelligence Reform Act, of improving the operations and 
effectiveness of the Intelligence Community. It is also vital 
to achieving the broader goal of identifying problems and 
deficiencies, wherever they may be found in the Intelligence 
Community, with respect to matters within the responsibility 
and authority of the DNI, including the manner in which 
elements of the Intelligence Community interact with each other 
in providing access to information and undertaking joint or 
cooperative activities. By way of a new Section 103H of the 
National Security Act of 1947, Section 407 of this Act 
establishes an Inspector General of the Intelligence Community 
in order to provide to the DNI, and, through reports, to the 
Congress, the benefits of an IG with full statutory authorities 
and the requisite independence.
    The Office of the IG is to be established within the ODNI. 
The Office of the IG created by this bill is to replace and not 
duplicate the current Office of the IG for the ODNI. The IG 
will keep both the DNI and the congressional intelligence 
committees fully and currently informed about problems and 
deficiencies in Intelligence Community programs and operations 
and the need for corrective actions. The IG will be appointed 
by the President, with the advice and consent of the Senate, 
and will report directly to the DNI. To bolster the IG's 
independence within the Intelligence Community, the IG may be 
removed only by the President, who must communicate the reasons 
for the removal to the congressional intelligence committees.
    Under the new subsection 103H(e), the DNI may prohibit the 
IG from conducting an investigation, inspection, audit, or 
review if the DNI determines that is necessary to protect vital 
national security interests. If the DNI exercises this 
authority, the DNI must provide the reasons to the 
congressional intelligence committees within seven days. The IG 
may submit comments in response to the congressional 
intelligence committees.
    The IG will have direct and prompt access to the DNI and 
any Intelligence Community employee, or employee of a 
contractor, whose testimony is needed. The IG will also have 
direct access to all records that relate to programs and 
activities for which the IG has responsibility. Failure to 
cooperate will be grounds for appropriate administrative 
action.
    The IG will have subpoena authority. However, information 
within the possession of the United States Government must be 
obtained through other procedures. Subject to the DNI's 
concurrence, the IG may request information from any United 
States Government department, agency, or element. They must 
provide the information to the IG insofar as is practicable and 
not in violation of law or regulation.
    The IG must submit semiannual reports to the DNI that 
include a description of significant problems relating to 
Intelligence Community programs and activities within the 
responsibility and authority of the DNI. Portions of the 
reports involving a component of a department of the United 
States Government are to be provided to the head of the 
department at the same time the report is provided to the DNI. 
The reports must include a description of IG recommendations 
and a statement whether corrective action has been completed. 
Within 30 days of receiving each semiannual report from the IG, 
the DNI must submit it to Congress.
    The IG must immediately report to the DNI particularly 
serious or flagrant problems, abuses, or deficiencies. Within 
seven days, the DNI must transmit those reports to the 
intelligence committees together with any comments. In the 
event the IG is unable to resolve any differences with the DNI 
affecting the duties or responsibilities of the IG or the IG 
conducts on investigation, inspection, audit or review that 
focuses on certain high-ranking officials, the IG is authorized 
to report directly to the congressional intelligence 
committees.
    Intelligence Community employees, or employees of 
contractors, who intend to report to Congress an ``urgent 
concern''--such as a violation of law or Executive order, a 
false statement to Congress, or a willful withholding from 
Congress--may report such complaints and supporting information 
to the IG. Following a review by the IG to determine the 
credibility of the complaint or information, the IG must 
transmit such complaint and information to the DNI. On 
receiving the complaints or information from the IG (together 
with the IG's credibility determination), the DNI must transmit 
the complaint or information to the intelligence committees. If 
the IG finds a complaint or information not to be credible, the 
reporting individual may still submit the matter directly to 
the committees by following appropriate security practices 
outlined by the DNI. Reprisals or threats of reprisal against 
reporting individuals constitute reportable ``urgent 
concerns.'' The Committee will not tolerate actions by the DNI, 
or by any Intelligence Community element, constituting a 
reprisal for reporting an ``urgent concern'' or any other 
matter to Congress. Nonetheless, reporting individuals should 
ensure that the complaint and supporting information are 
provided to Congress consistent with appropriate procedures 
designed to protect intelligence sources and methods and other 
sensitive matters.
    For matters within the jurisdiction of both the IG of the 
Intelligence Community and an IG for another Intelligence 
Community element (or for a parent department or agency), the 
Inspectors General shall expeditiously resolve who will 
undertake the investigation, inspection, audit, or review. In 
attempting to resolve that question, the Inspectors General may 
request the assistance of the Intelligence Community Inspectors 
General Forum (a presently functioning body whose existence is 
ratified by Section 407). In the event that the Inspectors 
General are still unable to resolve the question, they shall 
submit it to the DNI and the head of the agency or department 
for resolution.
    An IG for an Intelligence Community element must share the 
results of any investigation, inspection, audit, or evaluation 
with any other IG, including the Inspector General of the 
Intelligence Community, who otherwise would have had 
jurisdiction over the investigation, inspection, audit, or 
evaluation.
    Consistent with existing law, the Inspector General must 
report to the Attorney General any information, allegation, or 
complaint received by the Inspector General relating to 
violations of Federal criminal law.
    Section 407 also provides for the transition from the 
Office of the IG of the ODNI to the Office of the IG of the 
Intelligence Community.
    Following the Committee's last report in May 2008 of a 
provision establishing an IG of the Intelligence Community, 
Congress enacted the Inspector General Reform Act of 2008, 
Public Law 110-409. In light of this recent determination by 
the Congress to protect and augment the authority of Inspectors 
General throughout the Government, the Committee has provided 
for conforming changes in the IG provision it is now reporting. 
Among these provisions is authority for the IG to appoint a 
counsel. Section 407 makes clear that it is not to be construed 
to alter the duties and responsibilities of the General Counsel 
of the Office of the Director of National Intelligence.

Section 408. Chief Financial Officer of the Intelligence Community

    Section 408 amends Title I of the National Security Act of 
1947 (50 U.S.C. 402 et seq.) to establish in statute a Chief 
Financial Officer of the Intelligence Community (IC CFO) to 
assist the DNI in carrying out budgetary, acquisition, and 
financial management responsibilities.
    By way of a new Section 103I of the National Security Act 
of 1947, under Section 408, the IC CFO will, to the extent 
applicable, have the duties, responsibilities, and authorities 
specified in the Chief Financial Officers Act of 1990. The IC 
CFO will serve as the principal advisor to the DNI and the 
Principal Deputy DNI on the management and allocation of 
Intelligence Community budgetary resources, and shall establish 
and oversee a comprehensive and integrated strategic process 
for resource management within the Intelligence Community. 
Section 408 charges the IC CFO with ensuring that the strategic 
plan and architectures of the DNI are based on budgetary 
constraints as specified in the future budget projections 
required in Section 325.
    Section 408 also charges the IC CFO with ensuring that 
major system acquisitions satisfy validated national 
requirements for meeting the DNI's strategic plans and that 
such requirements are prioritized based on budgetary 
constraints as specified in the future budget projections 
required in Section 325. To guarantee this is achieved in 
practice, under Section 408, prior to obligation or expenditure 
of funds for major system acquisitions to proceed to Milestone 
A (development) or Milestone B (production), requirements must 
be validated and prioritized based on budgetary constraints as 
specified in Section 325.
    Section 408 requires that the IC CFO preside, or assist in 
presiding, over any mission requirement, architectural, or 
acquisition board formed by the ODNI, and to coordinate and 
approve representations to Congress by the Intelligence 
Community regarding National Intelligence Program budgetary 
resources. An individual serving as the IC CFO may not at the 
same time also serve as a CFO of any other department or 
agency.

Section 409. Leadership and location of certain offices and officials

    Section 409 confirms in statute that various offices are 
within the ODNI: (1) the Chief Information Officer of the 
Intelligence Community; (2) the Inspector General of the 
Intelligence Community; (3) the Director of the National 
Counterterrorism Center (NCTC); (4) the Director of the 
National Counter Proliferation Center (NCPC); and (5) the Chief 
Financial Officer of the Intelligence Community. It also 
expressly provides in statute that the DNI shall appoint the 
Director of the NCPC, which is what has been done by 
administrative delegation from the President.

Section 410. National Space Intelligence Office

    Section 410 establishes a National Space Intelligence 
Office (NSIO) within the ODNI to facilitate a better 
understanding of future threats to U.S. space assets, as well 
as potential threats to the United States from space. It is not 
the intent of the Committee that the NSIO be a physical 
consolidation of existing intelligence entities with 
responsibilities for various types of intelligence related to 
space. Rather, the functions of the NSIO, among others 
delineated in Section 410, will be to coordinate and provide 
policy direction for the management of space-related 
intelligence assets as well as to prioritize collection 
activities consistent with the DNI's National Intelligence 
Collection Priorities.
    The NSIO is to augment the existing efforts of the National 
Air and Space Intelligence Center (NASIC) and Missile and Space 
Intelligence Center (MSIC); it is not designed to replace them. 
The Committee intends that NSIO work closely with NASIC and 
MSIC to ensure a coordinated Intelligence Community response to 
issues that intersect the responsibilities of all three 
organizations.
    The NSIO Director shall be the National Intelligence 
Officer for Science and Technology. The Committee encourages 
appointment of an Executive Director from the Senior 
Intelligence Service.

Section 411. Operational files in the Office of the Director of 
        National Intelligence

    In the CIA Information Act (Public Law 98-477 (1984) (50 
U.S.C. 431 et seq.)), Congress authorized the DCI to exempt 
operational files of the CIA from several requirements of the 
Freedom of Information Act (FOIA), particularly those requiring 
search and review in response to FOIA requests. In a series of 
amendments to Title VII of the National Security Act of 1947, 
Congress has extended the exemption to the operational files of 
the NGA, the NSA, the NRO, and the DIA. It has also provided 
that files of the Office of the National Counterintelligence 
Executive (NCIX) should be treated as operational files of the 
CIA (to the extent they meet the criteria for CIA operational 
files).
    Section 411 adds a new Section 706 to the National Security 
Act of 1947. Components of the ODNI, including the NCTC, 
require access to information contained in CIA and other 
operational files. The purpose of Section 411 is to make clear 
that the operational files of any Intelligence Community 
component, for which an operational files exemption is 
applicable, retain their exemption from FOIA search, review, 
disclosure, or publication. They also retain their exemption 
when they are incorporated in any substantially similar files 
of the ODNI.
    Section 411 provides several limitations. The exemption 
does not apply to information disseminated beyond the ODNI. 
Also, as Congress has provided in the operational files 
exemptions for the CIA and other Intelligence Community 
elements, Section 411 provides that the exemption from search 
and review does not apply to requests by United States citizens 
or permanent residents for information about themselves 
(although other FOIA exemptions, such as appropriate 
classification, may continue to protect such files from public 
disclosure). The search and review exemption would not apply to 
the subject matter of congressional or Executive branch 
investigations into improprieties or violations of law.
    Section 411 also provides for a decennial review by the DNI 
to determine whether exemptions may be removed from any 
category of exempted files. It provides that this review shall 
include consideration of the historical value or other public 
interest in the subject matter of those categories and the 
potential for declassifying a significant part of the 
information contained in them. The Committee underscores the 
importance of this requirement, which applies to the other 
operational exemptions in Title VII.
    The Committee also reiterates its interest in being advised 
by the DNI about the benefits of coordinating all the decennial 
reviews required by Title VII. Specifically, the Committee 
requests the DNI, through the Chief Information Officer of the 
Intelligence Community, to consider, and advise the 
congressional intelligence committees about, conducting the 
next review in each covered Intelligence Community element 
during Fiscal Year 2010 so that the next review for every 
element covered by an operational files exemption under Title 
VII, and the following decennial reviews, are conducted in an 
integrated manner in accordance with consistent standards 
developed under guidance established by the Chief Information 
Officer. The committees should be informed about the design, 
conduct, and results of these reviews, which should include the 
administrative and judicial experience of the various elements 
of the Intelligence Community under operational file 
exemptions.

Section 412. Counterintelligence initiatives for the Intelligence 
        Community

    Section 412 amends Section 1102(a) of the National Security 
Act of 1947 (50 U.S.C. 442a) to eliminate the requirement that 
the NCIX perform certain security functions more appropriately 
carried out by other components of the Intelligence Community.

Section 413. Applicability of the Privacy Act to the Director of 
        National Intelligence and the Office of the Director of 
        National Intelligence

    The Privacy Act (5 U.S.C. 552a) has long contained a 
provision under which the DCI and then (after enactment of the 
Intelligence Reform Act) the CIA Director could promulgate 
rules to exempt any system of records within the CIA from 
certain disclosure requirements under the Act. The provision 
was designed to ensure that the CIA could provide safeguards 
for certain sensitive information in its records systems. In 
assuming the leadership of the Intelligence Community, the DNI 
similarly requires the ability to safeguard sensitive 
information in records systems within the ODNI. Section 413 
extends to the DNI the authority to promulgate rules under 
which records systems of the ODNI may be exempted from certain 
Privacy Act disclosure requirements.

Section 414. Inapplicability of Federal Advisory Committee Act to 
        advisory committees of the Office of the Director of National 
        Intelligence

    Congress enacted the Federal Advisory Committee Act (FACA) 
(5 U.S.C. App.) to regulate the use of advisory committees 
throughout the Federal Government. FACA sets forth the 
responsibilities of the Executive branch with regard to such 
committees and outlines procedures and requirements for them. 
As originally enacted in 1972, FACA expressly exempted advisory 
committees utilized by the CIA and the Federal Reserve System. 
Section 414 amends FACA to extend this exemption, for the same 
policy reasons underlying the original CIA exemption, to 
advisory committees established or used by the ODNI. Section 
414 requires the DNI and the Director of the CIA to inform the 
intelligence committees on a yearly basis about the composition 
and use by the ODNI and the CIA of advisory committees.

Section 415. Membership of the Director of National Intelligence on the 
        Transportation Security Oversight Board

    Section 415 substitutes the DNI, or the DNI's designee, as 
a member of the Transportation Security Oversight Board 
established under Section 115(b)(1) of Title 49, United States 
Code, in place of the CIA Director or CIA Director's designee.

Section 416. Repeal of certain authorities relating to the Office of 
        the National Counterintelligence Executive

    Section 416 amends the authorities and structure of the 
Office of the NCIX to eliminate certain independent 
administrative authorities that had been vested in the NCIX 
when that official was appointed by and reported to the 
President. Those authorities are unnecessary now that the NCIX 
is to be appointed by and is under the authority of the DNI.

Section 417. Misuse of the Office of the Director of National 
        Intelligence name, initials, or seal

    Section 417 prohibits the unauthorized use of the official 
name, initials or seal of the ODNI. Section 417 also permits 
the Attorney General to pursue injunctive relief for such 
unauthorized use. The provision is modeled on section 13 of the 
CIA Act of 1949 (50 U.S.C. 403(m)) which provides similar 
protection against misuse of the name, initials, or seal of the 
CIA.

                Subtitle B--Central Intelligence Agency


Section 421. Additional functions and authorities for protective 
        personnel of the Central Intelligence Agency

    Section 421 amends Section 5(a)(4) of the CIA Act of 1949 
(50 U.S.C. 403f(a)(4)) which authorizes protective functions by 
designated security personnel who serve on CIA protective 
details. Section 421 authorizes the CIA Director on the request 
of the DNI to make CIA protective detail personnel available to 
the DNI and to other personnel within the ODNI.

Section 422. Appeals from decisions involving contracts of the Central 
        Intelligence Agency

    Section 422 amends Section 8(d) of the Contract Disputes 
Act of 1978 (41 U.S.C. 607(d)) to provide that an appeal from a 
dispute arising out of a CIA contract shall be filed with 
whichever of the Armed Services Board of Contract Appeals or 
the Civilian Board of Contract Appeals is specified in the 
contract and that such board shall have jurisdiction to decide 
the appeal.

Section 423. Deputy Director of the Central Intelligence Agency

    Section 423 provides for a Deputy Director of the CIA in a 
new Section 104B of the National Security Act of 1947 (50 
U.S.C. 402 et seq.). Under the new Section 104B, the Deputy 
Director of the CIA shall be appointed by the President and 
confirmed by the Senate, shall assist the Director of the CIA 
in carrying out the Director's duties and responsibilities, and 
shall assume those duties and responsibilities in the event of 
the Director's absence, disability, or when the position is 
vacant.
    Prior to the Intelligence Reform Act, Congress had provided 
by law for the appointment by the President, with Senate 
confirmation, of a Deputy Director of Central Intelligence. The 
Intelligence Reform Act abolished that position and was silent 
on any deputy to the Director of the CIA. Since enactment of 
the Intelligence Reform Act, the position of Deputy Director at 
the CIA has been solely a product of administrative action.
    Given the sensitive nature of the CIA's operations, the 
position of Deputy Director as well as that of the position of 
the Director merit consideration through the process of 
presidential appointment and Senate confirmation. That process 
also ensures that in the event of a vacancy in the position of 
Director, or during the absence or disability of the Director, 
Congress will have previously expressed its confidence in the 
ability of the Deputy Director to assume those additional 
duties.
    Section 423(c) provides that the amendments made by Section 
423 apply prospectively. Therefore, the Deputy Director of the 
CIA on the date of enactment will not be affected by the 
amendments.

Section 424. Authority to authorize travel on a common carrier

    Section 424 amends Section 116(b) of the National Security 
Act of 1947 (50 U.S.C. 404k(b)). Section 116(b) of the National 
Security Act of 1947 allows the DNI to authorize travel on 
common carriers for certain intelligence collection personnel, 
and it further allows the DNI to delegate this authority to the 
Principal Deputy Director of National Intelligence or to the 
Director the Central Intelligence Agency. This provision 
permits the Director of the CIA to re-delegate this authority 
within the Central Intelligence Agency.

Section 425. Inspector General of the Central Intelligence Agency

    Section 425 amends Section 17 of the Central Intelligence 
Agency Act of 1949 (50 U.S.C. 403q(b)) which established a 
statutory CIA Inspector General. The amendment updates and 
clarifies the statute in light of revisions made by Congress in 
the Inspector General Reform Act of 2008 (Public Law 110-409) 
and the recommendations in the most recent semiannual report of 
the CIA IG. Among other provisions, Section 425 expands the 
protections against reprisals that now apply to CIA employees 
who bring complaints to the CIA IG to any CIA employee who 
provides information to the CIA IG. Section 425 provides that 
the CIA IG has final approval of the selection of internal and 
external candidates for employment with the Office of the IG 
and may appoint a counsel who reports to the IG. Section 425 
provides that this is not to be construed to alter the duties 
and responsibilities of the General Counsel of the CIA.

Section 426. Budget of the Inspector General of the Central 
        Intelligence Agency

    Section 426 further amends Section 17 of the CIA Act to 
require the DNI to provide to the President the budget amount 
requested by the CIA IG and to provide that information to the 
congressional appropriations and intelligence committees, 
together with any comments of the CIA IG.

Section 427. Public availability of unclassified versions of certain 
        intelligence products

    Section 427 requires the Director of the Central 
Intelligence Agency to make public unclassified versions of 
four documents which assess the information gained from the 
interrogation of high-value detainees. One of the documents is 
a memorandum and the other three are finished intelligence 
products. The unclassified versions of these documents will 
permit the American people to make their own determination of 
the value of the material included in these documents.

              Subtitle C--Defense Intelligence Components


Section 431. Inspector General matters

    The Inspector General Act of 1978 (5 U.S.C. App.) 
establishes a government-wide system of Inspectors General, 
some appointed by the President with the advice and consent of 
the Senate and others ``administratively appointed'' by the 
heads of their respective Federal entities. These IGs are 
authorized to ``conduct and supervise audits and investigations 
relating to the programs and operations'' of the government and 
``to promote economy, efficiency, and effectiveness in the 
administration of, and . . . to prevent and detect fraud and 
abuse in, such programs and operations.'' 5 U.S.C. App. 2. They 
also perform an important reporting function, ``keeping the 
head of the establishment and the Congress fully and currently 
informed about problems and deficiencies relating to the 
administration of . . . programs and operations and the 
necessity for and progress of corrective action.'' Id. The 
investigative authorities exercised by Inspectors General, and 
their relative independence from the government operations they 
audit and investigate, provide an important mechanism to ensure 
that the operations of the government are conducted as 
efficiently and effectively as possible.
    The IGs of the CIA and Departments of Defense, Energy, 
Homeland Security, Justice, State, and Treasury are appointed 
by the President with the advice and consent of the Senate. 
These IGs--authorized by either the Inspectors General Act of 
1978 or Section 17 of the CIA Act--enjoy a degree of 
independence from all but the head of their respective 
departments or agencies. They also have explicit statutory 
authority to access information from their departments or 
agencies or other United States Government departments and 
agencies and may use subpoenas to access information (e.g., 
from an agency contractor) necessary to carry out their 
authorized functions.
    The NRO, DIA, NSA and NGA have established their own 
``administrative'' Inspectors General. However, because they 
are not identified in Section 8G of the Inspector General Act 
of 1978, they lack explicit statutory authorization to access 
information relevant to their audits or investigations, or to 
compel the production of information via subpoena. This lack of 
authority could impede access to information, in particular 
information from contractors that is necessary for them to 
perform their important function. These Inspectors General also 
lack the indicia of independence necessary for the Government 
Accountability Office to recognize their annual financial 
statement audits as being in compliance with the Chief 
Financial Officers Act of 1990 (Public Law 101-576). The lack 
of independence also prevents the DoD IG, and would prevent the 
Inspector General of the Intelligence Community, from relying 
on the results of NRO, DIA, NSA, or NGA Inspector General 
audits or investigations when such audits must meet ``generally 
accepted government auditing standards.''
    To provide an additional level of independence and to 
ensure prompt access to the information necessary for these IGs 
to perform their audits and investigations, Section 431 amends 
Section 8G(a)(2) of the Inspector General Act of 1978 to 
include the NRO, DIA, NSA, and NGA as ``designated federal 
entities.'' As so designated, the heads of these Intelligence 
Community elements will be required by statute to 
administratively appoint Inspectors General for these agencies.
    Also, as designated Inspectors General under the Inspector 
General Act of 1978, these Inspectors General will be 
responsible to the heads of the NRO, DIA, NSA, and NGA. The 
removal or transfer of any of these Inspectors General by the 
head of their office or agency must be promptly reported to the 
congressional intelligence committees. These Inspectors General 
will also be able to exercise other investigative authorities, 
including those governing access to information and the 
issuance of subpoenas, utilized by other Inspectors General 
under the Inspector General Act of 1978.
    To protect vital national security interests, Section 431 
permits the Secretary of Defense, in consultation with the DNI, 
to prohibit the Inspectors General of the NRO, DIA, NSA, and 
NGA from initiating, carrying out, or completing any audit or 
investigation they are otherwise authorized to conduct. This 
authority is similar to the authority of the CIA Director under 
Section 17 of the CIA Act with respect to the Inspector General 
of the CIA and the authority of the Secretary of Defense under 
Section 8 of the Inspector General Act of 1978 with respect to 
the DoD Inspector General. It will provide the Secretary of 
Defense, in consultation with the DNI, a mechanism to protect 
extremely sensitive intelligence sources and methods or other 
vital national security interests. The Committee expects that 
this authority will be exercised rarely by the DNI or the 
Secretary of Defense.

Section 432. Confirmation of appointment of heads of certain components 
        of the Intelligence Community

    Under present law and practice, the Directors of the NSA, 
NGA, and NRO, each with a distinct and significant role in the 
national intelligence mission, are not confirmed by the Senate 
in relation to their leadership of these agencies. Presently, 
the President appoints the Directors of NSA and NGA, and the 
Secretary of Defense appoints the Director of the NRO. None of 
the appointments must be confirmed by the Senate, unless a 
military officer is promoted or transferred into the position. 
Under that circumstance, Senate confirmation of the promotion 
or assignment is the responsibility of the Committee on Armed 
Services. That committee's review, however, relates to the 
military promotion or assignment and not specifically to the 
assumption by the individual of the leadership of a critical 
Intelligence Community element.
    Section 432 provides, expressly and uniformly, that the 
heads of each of these entities shall be nominated by the 
President and that the nominations will be confirmed by the 
Senate. The NSA, NGA, and NRO play a critical role in the 
national intelligence mission. Their spending comprises a 
significant portion of the entire intelligence budget of the 
United States, and a substantial portion of the National 
Intelligence Program. Through advice and consent, the Senate 
can enable the Congress to fulfill more completely its 
responsibility for providing oversight to the intelligence 
activities of the United States Government. Section 432 does 
not alter the role of the Committee on Armed Services in 
reviewing and approving the promotion or assignment of military 
officers.
    Section 432(e) provides that the amendments made by Section 
432 apply prospectively. Therefore, the Directors of the NSA, 
NGA, and NRO on the date of the enactment of this Act will not 
be affected by the amendments, which will apply initially to 
the appointment and confirmation of their successors.
    The Committee undertakes to work with the Committee on 
Armed Services, as it has done and will do with any other 
committee that has jurisdiction over the Executive branch 
department of an Intelligence Community element, to provide for 
an appropriate manner of proceeding that recognizes the 
interests of both committees and ultimately the Senate in an 
efficient and thorough nomination process.

Section 433. Clarification of national security missions of National 
        Geospatial-Intelligence Agency for analysis and dissemination 
        of certain intelligence information

    The National Imagery and Mapping Agency Act of 1996 (Public 
Law 104-201 (1996) (NIMA Act)) formally merged the imagery 
analysis and mapping efforts of the Department of Defense and 
the CIA. In the NIMA Act, Congress cited a need ``to provide a 
single agency focus for the growing number and diverse types of 
customers for imagery and geospatial information resources 
within the Government . . . to harness, leverage, and focus 
rapid technological developments to serve the imagery, imagery 
intelligence, and geospatial information customers.'' Section 
1102(1) of the NIMA Act. Since then, there have been rapid 
developments in airborne and commercial imagery platforms, new 
imagery and geospatial phenomenology, full motion video, and 
geospatial analysis tools.
    Section 921 of the National Defense Authorization Act for 
Fiscal Year 2004 (Public Law 108-136 (2003)) changed the name 
of the National Imagery and Mapping Agency to the National 
Geospatial-Intelligence Agency. The name change was intended to 
introduce the term ``geospatial intelligence'' to better 
describe the unified activities of NGA related to the 
``analysis and visual representation of characteristics of the 
earth and activity on its surface.'' See S. Rep. 108-46 (2003) 
(accompanying The National Defense Authorization Act for Fiscal 
Year 2004, S. 1050, 108th Cong., 1st Sess.).
    Though the NGA has made significant progress toward 
unifying the traditional imagery analysis and mapping missions 
of the CIA and Department of Defense, it has been slow to 
embrace other facets of ``geospatial intelligence,'' including 
the processing, storage, and dissemination of full motion video 
(FMV) and ground-based photography. Rather, the NGA's 
geospatial products repositories--containing predominantly 
overhead imagery and mapping products--continue to reflect its 
heritage. While the NGA is belatedly beginning to incorporate 
more airborne and commercial imagery, its data holdings and 
products are nearly devoid of FMV and ground-based photography.
    The Committee believes that FMV and ground-based 
photography should be included, with available positional data, 
in NGA data repositories for retrieval on Department of Defense 
and Intelligence Community networks. Current mission planners 
and military personnel are well-served with traditional imagery 
products and maps, but FMV of the route to and from a facility 
or photographs of what a facility would look like to a foot 
soldier--rather than from an aircraft--would be of immense 
value to military personnel and intelligence officers. Ground-
based photography is amply available from open sources, as well 
as other government sources such as military units, United 
States embassy personnel, Defense Attaches, Special Operations 
Forces, foreign allies, and clandestine officers. These 
products should be better incorporated into NGA data holdings.
    To address these concerns, Section 433 adds an additional 
national security mission to the responsibilities of the NGA. 
To fulfill this new mission, NGA would be required, as directed 
by the DNI, to develop a system to facilitate the analysis, 
dissemination, and incorporation of likenesses, videos, or 
presentations produced by ground-based platforms, including 
handheld or clandestine photography taken by or on behalf of 
human intelligence collection organizations or available as 
open-source information into the national system for geospatial 
intelligence.
    Section 433 also makes clear that this new responsibility 
does not include the authority to manage the tasking of 
handheld or clandestine photography taken by or on behalf or 
human intelligence collection organizations. Although Section 
433 does not give the NGA direct authority to set technical 
requirements for collection of handheld or clandestine 
photography, the Committee encourages the NGA to engage 
Intelligence Community partners on these technical requirements 
to ensure that their output can be incorporated into the 
National System for Geospatial-Intelligence.
    Section 433 does not modify the definition of ``imagery'' 
found in Section 467(2)(A) of Title 10 of the United States 
Code, or alter any of the existing national security missions 
of the NGA. With Section 433, the Committee stresses the merits 
of FMV and ground-based photography and clarifies that the 
exclusion of ``handheld or clandestine photography taken by or 
on behalf of human intelligence organizations'' from the 
definition of ``imagery'' under the NIMA Act does not prevent 
the exploitation, dissemination, and archiving of that 
photography. In other words, NGA would still not dictate how 
human intelligence agencies collect such ground-based 
photography, have authority to modify its classification or 
dissemination limitations, or manage the collection 
requirements for such photography. Rather, NGA should simply 
avail itself of this ground-based photography, regardless of 
the source, but within the security handling guidelines 
consistent with the photography's classification as determined 
by the appropriate authority.

Section 434. Defense Intelligence Agency counterintelligence and 
        expenditures

    Section 434 amends Section 105 of the National Security Act 
of 1947, on the responsibilities of Intelligence Community 
elements in the Department of Defense, to make clear that the 
responsibilities of the DIA include counterintelligence as well 
as human intelligence activities. Section 434 also provides 
authority for the Director of the DIA to account for 
expenditures for human intelligence and counterintelligence in 
a manner, similar to that available to the CIA, which does not 
disclose human sources. The amendment requires that the DIA 
Director shall report annually to the congressional 
intelligence committees on the use of that expenditure 
authority. It is the intention of the Committee that the DIA 
Director shall carefully monitor the use of this authority to 
ensure that the flexibility it permits is used only in 
furtherance of the counterintelligence and human intelligence 
responsibilities of the DIA.

                       Subtitle D--Other Elements


Section 441. Codification of additional elements of the intelligence 
        community

    Section 441 restores, with respect to the United States 
Coast Guard, the prior definition of ``intelligence community'' 
in the National Security Act of 1947 applicable to that 
service. See 50 U.S.C. 401a. Section 1073 of the Intelligence 
Reform Act modified the definition of ``intelligence 
community,'' inadvertently limiting the Coast Guard's inclusion 
in the Intelligence Community to the Office of Intelligence or 
those portions of the Coast Guard concerned with the analysis 
of intelligence. Section 441 clarifies that all of the Coast 
Guard's intelligence elements are included within the 
definition of the ``intelligence community.''
    Section 441 also codifies the joint decision of the DNI and 
Attorney General to designate an office within the Drug 
Enforcement Administration as an element of the Intelligence 
Community.

Section 442. Authorization of appropriations for Coast Guard National 
        Tactical Integration Office

    Section 442 provides research and development (R&D) 
appropriation authorization authority to the Coast Guard 
National Technical Integration Office (NTIO), which is the 
Coast Guard counterpart to the Tactical Exploitation of 
National Capabilities programs in each of the military 
services. The NTIO explores the use of national intelligence 
systems in support of Coast Guard operations. Section 442 is 
intended to enable the National Technical Integration Office to 
monitor the development, procurement, and management of 
tactical intelligence systems and equipment and to conduct 
related research, development, and test and evaluation 
activities within the context of the Coast Guard's existing R&D 
authority.

Section 443. Retention and relocation bonuses for the Federal Bureau of 
        Investigation

    Section 443 makes permanent the authority of the Director 
of the FBI to pay bonuses to retain certain employees, such as 
those who have unusually high or unique qualifications or who 
are likely to leave the Federal service, and to pay relocation 
bonuses to employees who are transferred to areas in which 
there is a shortage of critical skills.

Section 444. Extending the authority of the Federal Bureau of 
        Investigation to waive mandatory retirement provisions

    Existing law permits agencies to exempt law enforcement 
officers from mandatory retirement (generally applicable at age 
57 with 20 years of service) until age 60. Under 5 U.S.C. 
8335(b)(2), pertaining to the Civil Service Retirement System, 
and 5 U.S.C. 8425(b)(2), pertaining to the Federal Employee 
Retirement System, the Director of the FBI may exempt FBI 
officers from mandatory retirement until age 65, if such an 
extension is in the public interest. Section 444 extends the 
waiver authority, which expires at the end of 2009, until the 
end of 2011.

Section 445. Report and assessments on transformation of the 
        intelligence capabilities of the Federal Bureau of 
        Investigation

    Section 445 requires the Director of the FBI, in 
consultation with the DNI, to submit to the congressional 
intelligence committees, not later than 180 days after 
enactment of this Act, a report describing the long-term vision 
for the intelligence capabilities of the FBI's National 
Security Branch, a strategic plan for the National Security 
Branch, and the progress in advancing the capabilities of the 
branch. Among other things, the report is to include a 
description of the intelligence and national security 
capabilities that will be fully functional within the 5-year 
period beginning on the date the report is submitted and a 
description of the metrics, timetables, and corrective actions. 
The report will also describe the activities being carried out 
to ensure the NSB is improving its performance. In addition, 
Section 445 requires the DNI, in consultation with the Director 
of the FBI, to conduct for five years an annual assessment of 
the NSB's progress based on those performance metrics and 
timetables.

 TITLE V--REORGANIZATION OF THE DIPLOMATIC TELECOMMUNICATIONS SERVICE 
                             PROGRAM OFFICE


Section 501. Reorganization of the Diplomatic Telecommunications 
        Service Program Office

    Section 501 provides for the reorganization of the 
Diplomatic Telecommunications Service (DTS) which is 
compromised of the Diplomatic Telecommunications Service 
Program Office (DTS-PO) and the DTS Network. The purpose of the 
DTS-PO is to establish and maintain a DTS Network that is 
capable of meeting the worldwide communications service needs 
of United States Government departments and agencies operating 
from diplomatic and consular facilities including their 
national security needs for secure, reliable, and robust 
communications. Section 501 replaces a reorganization plan 
enacted in the Intelligence Authorization Act for Fiscal Year 
2001, and is formally an amendment to that Act which will 
appear in Title 22 of the U.S. Code.
    Section 501 establishes a Governance Board which shall 
direct and oversee the activities of the DTS-PO. The Director 
of OMB shall designate from the departments and agencies that 
use the DTS Network those departments and agencies whose heads 
will appoint the Governance Board from among their personnel. 
The OMB Director shall designate the Chair of the Board from 
among its five voting members and also designate from among the 
users of the network the department or agency which shall be 
the DTS-PO Executive Agent.
    The Governance Board shall determine the written 
arrangements, which may be classified, for managing the DTS-PO. 
The Board shall have the power to approve and monitor the DTS-
PO's plans, services, policies, and pricing methodology, and to 
recommend to the DTS-PO Executive Agent the Board's approval, 
disapproval, or modification of the DTS-PO's annual budget 
requests. The Board will also approve or disapprove of the 
Executive Agent's nomination of a Director of the DTS Program 
Office.
    Section 501 authorizes two-year appropriations for the DTS-
PO. It requires that the DTS-PO shall charge only for bandwidth 
costs attributable to a department or agency and for specific 
customer projects.
    In requesting enactment of Section 501, the DNI advised the 
Committee as follows about its purpose: ``The appropriations 
authorized by this measure will promote modernization of the 
[DTS] network and the expansion of its architecture. With the 
authority to recover bandwidth costs, the DTS-PO can vastly 
improve the overall business management and effectiveness of 
DTS-PO operations. The measure will facilitate the 
establishment of a financial management system that employs a 
single system of records, that increases transparency and 
traceability in customer billing, that promotes responsiveness 
to customer requirements, that insures timely acquisition of 
bandwidth and receipt of vendor payments, and that promotes 
cost-conscious behavior among DTS-PO customers.''

     TITLE VI--FOREIGN INTELLIGENCE AND INFORMATION COMMISSION ACT


Section 601. Short Title

    Title VI of the bill establishes a Foreign Intelligence and 
Information Commission (``the Commission'') to provide 
recommendations to improve foreign intelligence and information 
collection, analysis, and reporting through the strategic 
integration of the Intelligence Community and other elements of 
the United States Government. Section 601 provides that this 
title may be cited as the ``Foreign Intelligence and 
Information Commission Act.''

Section 602. Definitions

    Section 602 provides definitions, including subsection 
602(5) which defines ``information'' to include information of 
relevance to the foreign policy of the United States collected 
and conveyed through diplomatic reporting and other reporting 
by personnel of the Government of the United States who are not 
employed by an element of the Intelligence Community, including 
public and open-source information.

Section 603. Findings

    Section 603 provides findings of Congress. Among the 
findings are: accurate, timely, and comprehensive foreign 
intelligence and information are critical to the national 
security of the United States and the furtherance of the 
foreign policy goals of the United States; and it is in the 
national security and foreign policy interests of the United 
States to ensure the global deployment of personnel of the 
Government of the United States who are responsible for 
collecting and reporting foreign intelligence and information, 
including personnel from the Intelligence Community, the 
Department of State, and other agencies and departments of the 
Government of the United States, and that adequate resources 
are committed to effect such collection and reporting.

Section 604. Establishment and functions of the Commission

    Section 604 sets forth the functions of the Commission to 
include evaluating any current processes or systems for the 
strategic integration of the Intelligence Community, including 
the Open Source Center, and other elements of the United States 
Government, including the Department of State, with regard to 
the collection, reporting and analysis of foreign intelligence 
information; providing recommendations to improve or develop 
such processes or systems to include the development of an 
inter-agency strategy; and providing recommendations on how to 
incorporate into the inter-agency strategy the means to 
anticipate future threats, challenges, and crises, including by 
identifying and supporting collection, reporting and analytical 
capabilities which are global in scope and which are directed 
at emerging, long-term, and strategic threats.
    The functions of the Commission also include providing 
recommendations related to the establishment of any new 
Executive branch entity, or the expansion of the authorities of 
any existing Executive branch entity, as needed to improve the 
strategic integration of foreign intelligence and information 
collection, reporting and analysis capabilities and oversee the 
implementation of the inter-agency strategy; and providing 
recommendations on any legislative changes necessary to 
establish any new entity or to expand the authorities of any 
existing entity.
    In addition, the functions of the Commission include 
providing recommendations on strategies for sustaining human 
and budgetary resources to effect the global collection and 
reporting missions identified in the inter-agency strategy, 
including the prepositioning of collection and reporting 
capabilities; and providing recommendations on processes for 
developing and presenting to Congress budget requests for each 
relevant element of the United States Government that reflect 
the allocations identified in the inter-agency strategy and for 
congressional oversight of the development and implementation 
of the strategy.

Section 605. Members and staff of the Commission

    Section 605 establishes that the Commission shall be 
composed of 10 members, to include two members appointed by the 
majority leader of the Senate, two members appointed by the 
minority leader of the Senate, two members appointed by the 
Speaker of the House of Representatives, two members appointed 
by the minority leader of the House of Representatives, one 
nonvoting member appointed by the Director of National 
Intelligence, and one nonvoting member appointed by the 
Secretary of State.
    Members of the Commission shall be private citizens with: 
knowledge and experience in foreign information and 
intelligence collection, reporting, and analysis; knowledge and 
experience in issues related to the national security and 
foreign policy of the United States gained by serving in the 
Department of State, other appropriate agency or department or 
independent organization with expertise in the field of 
international affairs; or knowledge and experience with foreign 
policy decision making. The members of the Commission shall 
designate one of the voting members to serve as chair.
    Subsection 605(b) provides for the staff of the Commission 
and the selection of an Executive Director.

Section 606. Powers and duties of the Commission

    Section 606 provides the powers and duties of the 
Commission, including holding hearings, receiving evidence, and 
issuing and enforcement of subpoenas.

Section 607. Report of the Commission

    Section 607 provides that no later than one year after the 
appointment of members, the Commission shall submit an interim 
report to the congressional intelligence committees. No later 
than 4 months thereafter, the Commission shall submit a final 
report to the President, the Director of National Intelligence, 
the Secretary of State, the congressional intelligence 
committees, and the Committee on Foreign Relations of the 
Senate and the Committee on Foreign Affairs of the House of 
Representatives.

Section 608. Termination

    Section 608 provides that the Commission shall terminate 60 
days after the submission of the Commission's final report.

Section 609. Nonapplicability of Federal Advisory Committee Act

    Section 609 provides that the Federal Advisory Committee 
Act (5 U.S.C. App.) does not apply to the Commission.

Section 610. Funding

    Section 610 authorizes that of the amounts available for 
the National Intelligence Program for fiscal year 2009, 
$4,000,000 shall be available for transfer to the Commission.

                    TITLE VII--TECHNICAL AMENDMENTS


Section 701. Technical amendments to the Foreign Intelligence 
        Surveillance Act of 1978

    Section 701 makes technical amendments to the Foreign 
Intelligence Surveillance Act of 1978 to correct typographical 
and grammatical errors.

Section 702. Technical amendments to the Central Intelligence Agency 
        Act of 1949

    Section 702 amends Section 5(a)(1) of the CIA Act of 1949 
by striking or updating outdated references to the National 
Security Act of 1947. The Intelligence Reform Act significantly 
restructured and renumbered multiple sections of the National 
Security Act of 1947, leaving references in Section 5(a)(1) of 
the CIA Act to provisions that no longer exist or that are no 
longer pertinent.

Section 703. Technical amendments to Title 10, United States Code

    Section 703 amends Section 528(c) to update references to 
the names of positions at the Central Intelligence Agency.

Section 704. Technical amendments to the National Security Act of 1947

    Section 704 corrects and updates technical anomalies in the 
National Security Act of 1947 arising in part from the 
amendments made to that Act by the Intelligence Reform Act. 
Among other provisions, Section 704 amends Section 3(4)(L) of 
the National Security Act of 1947 (50 U.S.C. 401a(4)(L)) to 
permit the designation as ``elements of the intelligence 
community'' of elements of departments and agencies of the 
United States Government whether or not those departments and 
agencies are listed in Section 3(4).

Section 705. Technical amendments relating to the multiyear National 
        Intelligence Program

    Section 705 updates references to the ``multiyear national 
foreign intelligence program'' in the National Security Act of 
1947 to incorporate and reflect organizational and nomenclature 
changes made by the Intelligence Reform Act.

Section 706. Technical amendments to the Intelligence Reform and 
        Terrorism Prevention Act of 2004

    Section 706 makes a number of technical and conforming 
amendments to the Intelligence Reform Act.

Section 707. Technical amendments to the Executive Schedule

    Section 707 makes technical amendments to the Executive 
Schedule to correct outdated and incorrect references. This 
section substitutes the ``Director of the Central Intelligence 
Agency'' for the previous reference in Executive Schedule Level 
II to the ``Director of Central Intelligence.'' See 5 U.S.C. 
5313. Section 507 also strikes outdated references to Deputy 
Directors of Central Intelligence from Executive Schedule Level 
III. See 5 U.S.C. 5314. The provision also corrects the 
erroneous reference to the ``General Counsel to the National 
Intelligence Director'' in Executive Schedule Level IV. See 5 
U.S.C. 5315.

Section 708. Technical amendments to section 105 of the Intelligence 
        Authorization Act for Fiscal Year 2004

    Section 708 changes the reference to the Director of 
Central Intelligence to the DNI in Section 105 of the 
Intelligence Authorization Act for Fiscal Year 2004 (Public Law 
108-77 (December 13, 2003)) to clarify that the establishment 
of the Office of Intelligence and Analysis within the 
Department of the Treasury, and its reorganization within the 
Office of Terrorism and Financial Intelligence (Section 222 of 
the Transportation, Treasury, Independent Agencies, and General 
Government Appropriations Act, 2005 Division H, Public Law 108-
447 (December 8, 2004)), do not affect the authorities and 
responsibilities of the DNI with respect to the Office of 
Intelligence and Analysis as an element of the Intelligence 
Community.

Section 709. Technical amendments to section 602 of the Intelligence 
        Authorization Act for Fiscal Year 1995

    Section 709 changes references to the Director of Central 
Intelligence in Section 602 of the Intelligence Authorization 
Act for Fiscal Year 1995 to the Director of National 
Intelligence or to the Director of the Central Intelligence 
Agency as appropriate.

Section 710. Technical amendments to section 403 of the Intelligence 
        Authorization Act, Fiscal Year 1992

    Section 710 makes technical amendments to Section 403 of 
the Intelligence Authorization Act, Fiscal Year 1992, to 
reflect the creation of the position of the Director of 
National Intelligence and the appropriate definition of the 
Intelligence Community.

                           COMMITTEE COMMENTS

Leadership of the Intelligence Community

    The National Security Act of 1947 is clear. As amended by 
the Intelligence Reform Act, the Director of National 
Intelligence is the ``head of the intelligence community.'' 50 
U.S.C. Sec. 403(b)(1). With respect to the CIA, the DNI's 
authority is direct and immediate. Under the heading of 
``Supervision,'' the Act provides that ``[t]he Director of the 
Central Intelligence Agency shall report to the Director of 
National Intelligence regarding the activities of the Central 
Intelligence Agency.'' Id., Sec. 403-4(a).
    The National Security Act of 1947 specifically addresses 
coordination with foreign governments. Under the President's 
direction, the DNI shall ``oversee'' the coordination of the 
relationship between Intelligence Community elements and 
foreign government or international organization intelligence 
or security services. Id., Sec. 403-1(k). The CIA has, of 
course, important responsibilities concerning that coordination 
but, in keeping with the Act, those responsibilities are to be 
exercised ``[u]nder the direction of the Director of National 
Intelligence.'' Id., Sec. 403-4(f).
    Effective May 19, 2009, DNI Dennis Blair, completing a 
process that began under DNI Michael McConnell, issued 
Intelligence Community Directive 402 (ICD-402) on the 
designation by the DNI of DNI representatives to U.S. foreign 
partners and international organizations. In recognition of the 
historical overseas role of the CIA, ICD-402 provides that in 
``virtually all cases globally'' the CIA Chief of Station shall 
serve as the DNI representative to U.S. diplomatic missions. 
Nevertheless, in ``rare circumstances'' the DNI, in 
consultation with Chiefs of Mission, the Director of the CIA, 
and other affected departments or agencies, may designate a DNI 
representative other than a CIA Chief of Station.
    ICD-402 is faithful to the National Security Act. The DNI 
is not only the head of the Intelligence Community in 
Washington, D.C. The DNI is the Community's head wherever it 
operates in the world.
    The directive recognizes the value of turning to the CIA 
Chief of Station to be the DNI's representative in foreign 
countries, but also recognizes that some locations may give 
rise to circumstances where that responsibility is best met by 
an official with expertise derived from another Intelligence 
Community element, which in fact is already current practice 
and is not disputed by anyone.
    In any event, the DNI, exercising his authority under the 
law, has made the decision that the directive is the right 
choice for the Intelligence Community. The Committee supports 
the DNI in that choice and looks forward to the CIA's prompt 
adherence to his decision.

Cyber issues

    Cybersecurity is a serious national security and economic 
security challenge of great complexity, deserving of increased 
attention from the Congress. Because the Comprehensive National 
Cybersecurity Initiative (CNCI) in 2008 assigned the DNI and 
Intelligence Community components key national roles in 
cybersecurity, the Committee has invested significant time 
assessing the cyber threat to our country and potential 
government responses through scores of Member meetings and 
staff briefings with government, private sector, academic, and 
nonprofit thought-leaders, six full-Committee closed cyber 
hearings in the last two years, four six-month studies by the 
Committee's Technical Advisory Group, and regular outreach to 
other congressional committees. The reporting requirements in 
Section 340 are, in part, to encourage continued dialogue with 
the Executive branch on these issues.
    Recently, the Committee closely followed and offered 
comments on the Administration's 60-day Cyberspace Policy 
Review directed by the President. The Committee appreciates the 
White House's effort to be transparent and open with Congress 
and has high expectations for continued healthy cooperation. 
The Committee looks forward to building on the current 
portfolio of CNCI projects, with course-corrections where 
necessary, and to developing longer-term strategies for 
national cybersecurity.
    Though the Committee continues to deliberate in classified 
sessions, a few cyber-related observations and concerns can be 
mentioned here. First, the Committee is troubled by the lack of 
situational awareness about the opportunities, activities, and 
identities of cyber thieves or potential attackers on U.S. 
information networks. This is a serious weakness and a source 
of frustration for those responsible for oversight and 
strategic decision-making. Unfortunately, it will not be easy 
to remedy this, as incentives to report cyber intrusions and 
vulnerabilities are generally negative in the U.S. government 
and private sector. The Committee believes this must change so 
that cybersecurity leaders can make well-informed decisions and 
respond to problems quickly.
    Next, it is clear that cybersecurity activities must be 
conducted with an expectation of particularly strong 
congressional oversight that will require solid Executive 
branch planning before funding for multi-billion dollar 
programs are authorized and appropriated. In addition, there 
must be a rigorous analysis of the government's use of legal 
authorities for national cybersecurity missions that preserve 
the reasonable privacy expectations of U.S. persons. The 
government's role must be well-defined as activities involving 
the Internet evolve.
    The Committee seeks an effective governance model for the 
management of cybersecurity expenditures and operations, with a 
clear relationship among homeland security, intelligence, 
military, foreign policy, law enforcement, and other components 
involved in cybersecurity. It must be clear which government 
leaders are to be held accountable for new cybersecurity 
activities. Further, the Committee expects the President to 
provide a clear vision, strategic direction, and effective 
integration of the wide range of cybersecurity activities.
    The federal government's communication strategy concerning 
cybersecurity must be improved as well. The prior reluctance to 
invite Congress into the cybersecurity debate in a timely 
manner was to the detriment of what could have been a more 
cooperative and productive interaction between the branches. 
Also, the Committee believes there should be a new plan on the 
best way to communicate the national cybersecurity policy to 
the public. Though some elements must be classified, it is 
important that the U.S. people understand the government's 
basic role in helping to secure information networks. The 
general rules and expectations for government involvement, and 
how these may affect privacy, must be clearly explained.
    In addition, the government must consider international 
relations and how our country's intentions are transmitted 
overseas. Indeed, the Committee supports stronger international 
outreach with traditional allies and other key nations to 
develop consensus on what cyber activities will be promoted, 
tolerated, and censured. An international framework on cyber 
warfare, much like international conventions on traditional 
warfare, is needed to govern this rapidly growing field.
    The Committee believes there should be a significant 
emphasis in the government's cyber investment portfolio on 
long-term issues such as research and development (R&D), 
recruiting experts into government, and education and training. 
In particular, recent studies sponsored by the Committee have 
concluded that the Intelligence Community must dramatically 
increase funding for R&D in order to be effective in the 
future. The cyber technology world is moving quickly, with 
cutting-edge technology expertise spread across the globe, and 
the United States cannot presume a clear-cut technology 
advantage as it has in other areas of national security. The 
Committee recommends a balanced portfolio approach that 
includes a nationally coordinated program of long-term, high-
risk research aimed at revolutionary breakthroughs, sustained 
even when faced with near-term budget pressures. The Committee 
strongly supports a rebalancing of the CNCI budget to address 
these concerns.
    Finally, as a step beyond the CNCI's focus on securing 
federal government information networks, the Committee is 
highly concerned about protecting the U.S. critical 
infrastructure. For example, the country's electric power grid, 
communications systems, and financial infrastructure are all 
critical to our way of life yet unacceptably vulnerable to 
cyber attack. The government and the private sector must work 
together to share more effectively cyber threat and 
vulnerability information, and the Administration and the 
Congress must work together to determine the best mix of 
mandates, incentives, and other tools to improve critical 
infrastructure security. The Committee also supports recent 
recommendations from its Technical Advisory Group stressing the 
importance of a survivable government communications network to 
sustain critical national security functions under and 
following major cyber attack.
    In addition, the Committee requests the following near-term 
actions for the Administration. As requested in a March 23, 
2009, letter from the Chairman and Vice Chairman of the 
Committee to the DNI, the Committee recommends that the 
Administration propose legislation giving the Director of 
National Intelligence primary authority to manage all aspects 
of cybersecurity pertaining to any Intelligence Community 
communication and information system. This should include the 
ability to mandate red-team penetration testing, using any 
Intelligence Community red team, on any Intelligence Community 
communication or information system at any time, with test 
results reportable to the Director of National Intelligence.
    Also, the Committee recommends that the DNI, in 
consultation with the OMB, implement a system (``dashboard'') 
to provide dynamic, comprehensive, real-time cybersecurity 
status and vulnerability information of all Intelligence 
Community communication and information systems to the DNI.
    To ensure that cybersecurity best practices spread through 
the entire Intelligence Community enterprise, the Committee 
requests that the DNI: (1) direct an Intelligence Community 
cybersecurity awareness campaign that covers all Intelligence 
Community employees and contractors; (2) direct that 
cybersecurity become a significant part of the performance and 
bonus evaluations for all Senior Intelligence Service (SIS) 
members; and (3) create a Secure Products and Services 
Acquisitions Board, responsible for ensuring all Intelligence 
Community purchases meet standards for cybersecurity as 
established by the Board. For this last recommendation, the 
Committee notes that its intent is not to create another time-
consuming approval layer and slow acquisitions; the Board 
should adjudicate in a timely manner, or not at all.
    Beyond Intelligence Community issues, the Committee is 
interested in accelerating the growth of the national cyber 
investigative and law enforcement capabilities, toward the goal 
of improved national ability to attribute and prosecute cyber 
adversaries. Therefore the Committee recommends that the DNI 
increase support for the National Cyber Investigative Joint 
Task Force and ensure appropriately cleared, full-time staff 
are detailed to the Task Force with complete access to any 
intelligence information that could support cyber 
investigations on foreign adversaries.
    Also, the Committee recommends that the DNI and the 
Secretary of Homeland Security perform a joint, comprehensive, 
up-to-date assessment of risk due to cyber threats to and cyber 
vulnerabilities in the U.S. critical infrastructure and submit 
a report on this assessment to Congress by January 1, 2010. The 
assessment should consider all types of cyber threats, of 
domestic or foreign origin, particularly those to U.S. electric 
power command and control systems, and all types of cyber 
vulnerabilities, and combine them to create the risk 
assessment.
    Finally, the Committee supports recent recommendations from 
its Technical Advisory Group that the Administration should 
consider changes to U.S. immigration policy that would offer 
expedited citizenship to certain foreign nationals studying in 
the United States who graduate with degrees in science, 
technology, engineering, and mathematics, with particular focus 
on computer science.

Foreign language capability of the Intelligence Community

    The Committee is concerned about the abysmal state of the 
Intelligence Community's foreign language programs. The 
collection of intelligence depends heavily on language, whether 
information is gathered in the field from a human source or 
from a technical collection system. Even traditionally 
nonlinguistic operations such as imagery rely on foreign 
language skills to focus and direct collection efforts. But 
almost eight years after the terrorist attacks of September 
11th and the shift in focus to a part of the world with 
different languages than previous targets, the cadre of 
intelligence professionals capable of speaking, reading, or 
understanding critical regional languages such as Pashto, Dari 
or Urdu remains essentially nonexistent.
    Section 1041 of the Intelligence Reform Act required the 
DNI to identify the linguistic requirements of the Intelligence 
Community, and to develop a comprehensive plan to meet those 
requirements. Five years later, the ODNI has still not 
completed an IC-wide comprehensive foreign language plan that 
designates specific linguist or language requirements, lays out 
goals or timelines, or designates specific actions required to 
meet them.
    Furthermore, individual agency and military service 
programs aimed at creating strategies to improve foreign 
language programs are inconsistent across the Intelligence 
Community. NSA has near-real-time visibility of its language-
capable employees and hires and trains according to actual 
needs, but most other Intelligence Community agencies have no 
similar capability. The new Director of the CIA recently 
announced a major overhaul of the CIA's foreign language 
hiring, training, maintenance, and use policies which should 
eventually result in a more language capable workforce, but 
other agencies have not been similarly aggressive. DIA 
continues to suffer from chronic shortages of language-capable 
employees, but has not developed a strategy for improvement. To 
explain their failure to redress critical gaps in national 
security foreign language capacity, agencies point to their 
lack of control over clearance processes, shallow hiring pools, 
the inability to allocate time to training, insufficient 
resources, and, in some cases, a dearth of qualified 
instructors. Yet, the United States is one of the most polyglot 
of developed countries--more than one in five Americans speak a 
language other than English in the home and more than a million 
citizens are of Middle East or South Asian descent.
    The Committee is concerned that persistent critical 
shortages in some languages contribute to the loss of 
intelligence information and affect the ability of the 
Intelligence Community to process and exploit what it does 
collect. This seriously hampers the nation's ability to engage 
constructively and appropriately overseas.
    The Committee expects to receive by the end of this year a 
comprehensive strategy for improving foreign language 
capabilities across the Intelligence Community, including but 
not limited to meeting the requirements for translators, 
interpreters, collectors, analysts, liaison officers and 
attaches. The Committee has provided additional resources to 
address this perpetual shortcoming in Section 306 and as 
discussed in the classified annex.

Intelligence Community core contract personnel

    The Committee remains concerned over the number of contract 
personnel engaged in core activities in the Intelligence 
Community. For the last three years, the IC CHCO has gathered 
data and presented analysis on the number and cost of these 
core contract personnel. The most recent Intelligence Community 
Core Contract Personnel Review for 2008 found that core 
contract personnel made up 29 percent of the total Intelligence 
Community personnel yet represented 49 percent of the total 
personnel budget. Overall, the Intelligence Community reduced 
its use of contract personnel for these core positions by 3 
percent last year. The NRO and NGA, however, had considerable 
growth in their contract personnel ranks in 2008.
    While recognizing that core contract personnel may be 
necessary for short-term assignments or to allow intelligence 
agencies to acquire unique expertise, the Intelligence 
Community agencies themselves have determined that many of the 
functions currently performed by contract personnel can be 
successfully performed by government employees at a 
considerable savings to the government. The CIA in particular 
has taken a leadership role in identifying these positions, 
converting contract personnel into agency employees, and 
redirecting the resulting savings to more productive uses.
    As set forth in Section 103 of the bill, the Committee 
recommends that the Intelligence Community agencies be 
authorized to convert their contract personnel positions into 
civilian employees. The Committee believes the IC CHCO has been 
conducting important oversight in bringing uniform personnel 
procedures to the Intelligence Community and requiring the 
intelligence agencies to analyze their usage of contract 
personnel. These are important steps that must be taken before 
determining the correct size and composition of the 
Intelligence Community workforce today and in the future.
    Nevertheless, the Committee believes the Intelligence 
Community should further reduce its dependence on contract 
personnel. Therefore, the Committee directs that the 
Intelligence Community reduce its core contract personnel by at 
least 5 percent below the level requested for fiscal year 2010.

Information Integration and the Intelligence Community Chief 
        Information Officer

    The Committee was impressed with the vision and 
accomplishments of the Information Integration Program (I2P). 
The I2P was initiated in the summer of 2008 as an informal 
means of determining areas within the Intelligence Community's 
information technology systems that could be altered to better 
enable information sharing and access, and then providing the 
guidance and resources to enable these changes to take place. 
Unlike similar efforts in the private sector which are driven 
by cost savings, I2P had a primary goal of demonstrating how 
improved connectivity between and among intelligence agencies 
could help Intelligence Community components perform their 
mission better. While cost savings may be an ancillary benefit, 
the mission focus of I2P proved to be an attractive motivation 
for Intelligence Community personnel.
    Almost eight years after the attacks of September 11th, and 
five years after its creation by passage of the Intelligence 
Reform Act, the ODNI has found a process to build links among 
communication systems and to develop common information 
technologies and standards--the infrastructure on which 
intelligence information can be shared and accessed. As 
improved information sharing had been a fundamental rationale 
for creating the DNI, these improvements are long overdue. 
Intelligence Community Directive 501, Discovery and 
Dissemination or Retrieval of Information within the 
Intelligence Community, issued by the DNI on January 21, 2009, 
sets forth new policies that establish the ``responsibility to 
provide'' information to authorized personnel and a framework 
to implement this policy. Taken together, the Committee 
believes these actions will create a fundamental change in how 
intelligence collection and analysis may be distributed, if 
appropriate, among and between intelligence agencies, the U.S. 
government, state and local authorities, and the general 
public.
    Despite the substantial promise of I2P's reforms, the 
Committee had been concerned that the effort might disappear 
once the individuals leading I2P moved on, given its ad hoc 
nature within the ODNI. Therefore, the Committee supports the 
decision by the DNI to continue the I2P reforms through the IC 
CIO and believes the IC CIO's primary mission should be to 
continue and build upon the I2P effort. Additionally, the 
Committee has recommended a fence on enterprise management 
information technology funds requested for each agency pending 
certification by the IC CIO that an agency is addressing 
specific issues related to the I2P effort. Further, the 
Committee expects the IC CIO to continue to provide quarterly 
update briefings on the initiatives begun under I2P to the 
congressional intelligence committees as this effort 
progresses.

Need for increased and stable research and development funding

    The Committee remains concerned about the chronic 
underfunding of research and development in the Intelligence 
Community. The Intelligence Community has traditionally 
developed its own advanced technologies rather than looking 
outside to meet intelligence operational needs. The funds 
invested in the past for research and development of new 
technology have made the Intelligence Community the world 
leader in most technical collection disciplines. Without these 
investments, the U.S. would be facing much greater risks and 
threats to its national security. The Committee believes the 
Intelligence Community must retain its technological edge.
    Last year, the Administration's National Intelligence 
Program budget request devoted only 3 percent of the total 
request to R&D. Congress added significant funding for R&D to 
the National Intelligence Program request in the fiscal year 
2009 appropriations. The Administration, however, did not 
sustain these increases and the fiscal year 2010 National 
Intelligence Program request again only has 3 percent of the 
total request directed towards research and development.
    The Committee does not support the established budgetary 
practice of raiding R&D accounts to address short-term budget 
problems within the Intelligence Community. While not unique to 
the Intelligence Community, the chronic under-funding of R&D 
programs will have long-term effects on the ability of the 
United States to know what adversaries are planning and to 
protect its citizens from these threats. In particular, the 
Committee is seriously concerned with the NRO's decision to 
reduce its R&D funding from 8 percent of the budget in fiscal 
year 2006 to just 6 percent of its budget in fiscal year 2010. 
For an organization whose mission is focused on advanced 
technical collection of intelligence, these cuts are puzzling 
and short-sighted.
    Despite the inadequate funding request for R&D, the 
Intelligence Community has made some progress in promoting 
advanced research and development through the establishment of 
the Intelligence Advanced Research Projects Agency (IARPA). 
Similar to the Department of Defense Advanced Research Projects 
Agency (DARPA), which developed the Internet and Predator UAVs, 
the IARPA has the charge to identify, nurture, and promote 
long-term R&D projects with the potential to alter 
fundamentally intelligence collection and analysis. The 
Administration, however, did not sustain the substantial 
increases Congress approved for IARPA in fiscal year 2009 in 
this year's budget request.
    The Committee recommends increases in the National 
Intelligence Program budget for R&D spending to 4 percent of 
the total Intelligence Community budget and believes the 
Intelligence Community should sustain and eventually increase 
this funding to 5 percent of the total National Intelligence 
Program budget in next year's budget request.

Intelligence Community financial management

    The Intelligence Community must be able to produce 
financial reports that pass independent audit if the taxpayers 
and Congress are to have confidence that the National 
Intelligence Program budget, which was $47.5 billion for fiscal 
year 2008, is being spent effectively. The Committee formally 
began advocating for increased Intelligence Community 
compliance with federal financial accounting standards in 
September 2001. The report language accompanying the 
Committee's Fiscal Year 2002 Intelligence Authorization bill 
noted that as early as January 1997, the President had called 
for selected Intelligence Community agencies to begin producing 
classified financial statements. The report language called for 
the financial statements of the NRO, NSA, CIA, DIA, and what is 
now the NGA to be audited by a statutory Inspector General or 
independent public accounting firm by March 1, 2005. The intent 
was that by that time, the statements would be auditable.
    Progress over the last decade toward the goal of auditable 
financial statements has been woefully insufficient. Since 
September 2001 each agency has overstated its progress in 
establishing the processes, procedures, and internal controls 
that would allow for the production of auditable statements. 
These promises have been accompanied by the hiring of multiple 
contract personnel who have created numerous studies and plans 
that have often been duplicative and merely pointed out the 
obvious. There has also been a lack of senior management 
attention to the need for improved financial accountability. 
One symptom of this inattention is the existence of over a 
dozen long-standing, correctable, material weaknesses, which 
pose serious obstacles to financial auditability. To ensure 
clear accountability and to focus senior management attention 
on their correction, Section 359 requires the heads of the CIA, 
DIA, NGA, NRO, and NSA to designate each senior management 
official who is responsible for correcting these weaknesses, 
and to notify the DNI and the congressional intelligence 
committees of these designations.
    The NRO received a favorable audit opinion auditable 
financial statement in fiscal year 2003, but since then has 
slipped to the point of not doing an audit of its fiscal year 
2007 statement pending further improvements to internal 
processes. The NSA put into operation a new commercial off-the-
shelf financial management system, which also supports the DIA, 
but, as the Chairman and Vice Chairman pointed out in a March 
9, 2009, letter to the DNI, the NSA grossly mismanaged the 
implementation of the system. The NGA was scheduled to move to 
this NSA-DIA accounting system, but that move is on hold 
pending resolution of NSA's implementation problems and IC-wide 
business system architecture deliberations coordinated by the 
DNI's new Business Transformation Office (BTO). The bottom line 
is that more than ten years after the President called for 
action, and more than four years after the Committee 
anticipated receiving auditable statements, the five agencies 
are still unable either to produce auditable financial 
statements or receive favorable audit opinions on those that 
are auditable. The current projection for doing so is at least 
four years away.
    The first, and so far only, serious IC-wide plan for 
producing auditable statements is contained in an April 2007 
DNI report titled Financial Statement Auditability Plan. The 
report outlined the current state of the Intelligence 
Community's financial management systems, explained the 
challenges to achieving unqualified audit opinions, and 
specified key milestones for each agency on the path to clean 
audit opinions in fiscal year 2012. The report failed, however, 
to explain how independent audit assessments of important 
milestones would be conducted, and it contained no plan for 
when individual agency systems could be merged into an IC-wide 
business enterprise architecture (BEA).
    Accordingly, the April 2007 plan has now been superseded by 
the imperative to construct a BEA, which makes the 2012 
auditability timeline difficult or impossible to achieve for 
most agencies. Nonetheless, the Committee strongly supports 
this BEA work, which, if successful, will provide a stronger 
foundation for sustainable, financial auditability. Indeed, the 
Committee has repeatedly called for a BEA over the last four 
years. Section 322 of this bill is designed to empower the 
DNI's fledgling BTO to produce this business systems 
architecture. The Committee strongly believes that a separate 
BTO, staffed with officers with relevant experience, is 
indispensible to progress towards the BEA--as a similar office 
has shown to be in the Department of Defense. Accordingly, the 
Committee would view as unwise and counterproductive any 
dilution of the BTO. The Committee awaits the next major 
milestone in the BTO's efforts to construct an effective BEA, 
the December 31, 2009, delivery of the rigorous BEA framework 
mandated by the Committee.
    Nonetheless, the BTO's work must not delay sorely-needed 
improvements to internal controls, which are critical to 
preventing millions of dollars of potential fraud, waste, and 
abuse, as well as providing reliable business information for 
sound decision-making. Many of these process controls do not 
need to await the result of BTO's architectural deliberations. 
We therefore urge the DNI and Intelligence Community agency 
heads to take strong and decisive action to see that 
appropriate reforms and oversight controls are in place as soon 
as possible.
    Finally, the Committee believes that both the Congress and 
the DNI would benefit from the creation of a consolidated 
National Intelligence Program financial statement. Such a 
statement would provide valuable macro-level data and, once 
established, offer insight into financial trends within the 
Intelligence Community. Therefore, the Committee requests that 
the DNI begin preparing a consolidated financial statement for 
the National Intelligence Program beginning with fiscal year 
2011. In accordance with the DNI's Financial Statement 
Auditability Plan, this statement should be based on the fully 
auditable data provided by each of the Intelligence Community 
agencies. As such, a separate audit will not be required for 
the consolidated statement.

Resource Management and the Chief Financial Officer for the 
        Intelligence Community

    It is widely recognized that the Intelligence Community's 
process for generating requirements for major acquisitions is 
broken. For instance, as the Committee has noted previously, a 
significant percentage of major acquisition programs have not 
been linked to providing intelligence requirements that have 
been formally validated. Moreover, the process of identifying 
intelligence requirements is not sufficiently linked to 
budgetary constraints, leading to budget requests that include 
more programs than can sustainably be funded. To remedy this 
situation, budgetary constraints need to be explicitly 
considered throughout the entire resource process. In addition, 
the Chief Financial Officer in the ODNI, whose responsibility 
it is to prepare a budget for the DNI, needs to be centrally 
involved throughout the entire decision-making process--not 
just the budgeting at the end of the process.
    By the ODNI's own assessment, the current resource 
management process is ``fragmented, unsynchronized, complex, 
and opaque.'' Past efforts to address this problem have been 
ineffective and set aside.
    The Committee applauds the current DNI's efforts to perform 
more rigorous, quantitative, long-term analyses of resource 
issues. To lead this effort, he has established a new Associate 
Director of National Intelligence for Systems and Resource 
Analyses. The Committee is concerned, however, that creating 
yet another senior resource position further balkanizes an 
already fragmented resource process.
    Unless one senior officer has exclusive responsibility for 
end-to-end resource management, resource decisions will 
continue to be slow, needlessly complex, subject to contentious 
revisits, and certainly not integrated. One, and only one, 
senior officer reporting to the DNI must be in charge and 
accountable. Therefore, Section 408 of the bill creates the 
position of the IC CFO, investing that position with the 
duties, responsibilities, and authorities of the CFO Act of 
1990, as appropriate. The section makes clear that the IC CFO 
will serve as the principal advisor to the DNI on Intelligence 
Community budgetary resources, and that this officer will 
establish and oversee a comprehensive and integrated strategic 
process for managing Intelligence Community resources. Other 
senior officers may be primarily responsible for certain 
aspects of this overall process, such as strategic planning, 
long-range investment analysis, independent cost estimation, or 
acquisition milestone decision authority, but Section 407 makes 
the IC CFO responsible for the coordination of all resource 
processes. The Committee intends and expects that, as the 
principal advisor to the DNI on resource allocation, the IC CFO 
will consider and balance the equities of all Intelligence 
Community parties in his or her recommendations to the DNI, and 
that the DNI in turn, will receive recommendations directly 
from the IC CFO.

Independent cost estimation

    The Committee believes that the greater number of 
intelligence programs that are subjected to the discipline of 
an Independent Cost Estimate (ICE) or other independent cost 
assessment, the more financially realistic and sustainable the 
National Intelligence Program budget becomes. Therefore, the 
bill reduces the threshold cost of a program from $500 million 
to about $170 million before an ICE is required. This threshold 
is used throughout the U.S. government to define a major system 
acquisition, and its adoption in the bill responds to the 
ODNI's request to make this definition uniform in statute. The 
Committee anticipates that the ODNI's Intelligence Community 
Cost Analysis and Improvement Group (IC CAIG) will delegate 
many of the resulting additional ICEs for smaller programs to 
those executing agencies with independent cost estimating 
capabilities. The Committee also strongly encourages the IC 
CAIG to continue to expand its purview to large programs that 
are not usually considered ``systems acquisition,'' such as 
Intelligence Community data centers, the pending cyber 
initiative, and large personnel increases that function 
together to fulfill a mission need.
    Also, while the Committee is impressed with the 
professionalism and productivity of the IC CAIG, it believes it 
is incumbent on the IC CAIG to establish and publish the track 
record of its ICEs in predicting actual program costs. 
Accordingly, the Committee requests that future budget requests 
or annual Program Management Plan Reports include a comparison 
of all IC CAIG ICEs to the actual costs of completed and 
ongoing programs. The comparison should be on a basis that is 
consistent from year to year and from program to program. Such 
a comparison may account for changes in program scope, but it 
should also compare estimates to actual costs without scope 
changes. The Committee recommends that the IC CFO consult with 
the Committee on its proposed methodology for establishing such 
a track record prior to its publication in the congressional 
budget justification books.

Performance based budgeting: major progress made in FY 2010 Budget

    This year's FY 2010 National Intelligence Program budget 
request builds on last year's progress in performance-based 
budgeting. It represents the first full performance budget, 
providing the Committee valuable new information for oversight. 
The Committee is especially pleased that the improvements it 
urged last year in the performance budget for counterterrorism 
have been made. The Committee also applauds the ODNI's adoption 
of facility condition index metrics, CIA's advancement of 
measures for HUMINT and covert action performance, and the 
NRO's use of functional availability as a performance 
methodology. Even so, the DNI and the Intelligence Community 
are years behind much of the rest of the government. The 
quality of the measures, targets, performance assessments, and 
linkage to funding is highly uneven. In addition, too often the 
performance information appears to be an administrative after-
thought to the budget rather than an integral part of its 
development. As the government-wide fiscal picture tightens, it 
will be increasingly incumbent on the Intelligence Community to 
justify its resource requests on the basis of improved 
performance.

Principal Deputy Director of National Intelligence

    The Principal Deputy Director of National Intelligence 
position was established as a Presidentially-appointed, Senate-
confirmed position by the Intelligence Reform Act, but has been 
filled by a confirmed individual for barely half of the 
intervening four years. The Office was vacant for over a year 
from 2006 to 2007, and has been vacant again since January 
2009. As of the date of filing this report, no nomination for 
this position is pending.
    The Principal Deputy position is among the most important 
in the Intelligence Community. The Principal Deputy is charged 
with assisting the DNI in the performance of the DNI's duties, 
and of exercising the DNI's authorities and carrying out the 
DNI's responsibilities when the DNI is absent or when the DNI 
position is vacant. While the Committee does not wish to fault 
the performance of either the incumbent DNI or the incumbent 
Acting Principal Deputy, it notes that the Principal Deputy 
position was created because Congress believed that leading the 
Intelligence Community was a job which required that the DNI be 
assisted by a confirmed, full-time appointee, rather than an 
acting appointee who has other full-time job responsibilities. 
Moreover, the intention of the Congress, and the law that it 
enacted, is that a confirmed Principal Deputy would stand ready 
to act as the DNI in the event that a vacancy occurred so there 
would be no gap in the leadership of the Intelligence 
Community.
    The Intelligence Reform Act states that when the Principal 
Deputy position is vacant the DNI shall recommend an individual 
for appointment. The Committee hopes to receive a nomination 
for this position from the President in the very near future.

National Counterterrorism Center

    The Committee receives regular briefings on terrorism 
threats from intelligence analysts at the NCTC and commends the 
Center for its continued success in improving the quality of 
their briefings and intelligence products. The Committee looks 
forward to additional advances in quality as the NCTC matures. 
The Committee is also encouraged by recent improvements in the 
NCTC's Department of Strategic Operational Planning, a function 
the Committee will continue to focus on throughout 2009 and 
2010.
    The Committee understands that NCTC has developed an 
effective mechanism for sharing intelligence information among 
personnel serving at the Center, but that there continues to be 
concern among counterterrorism analysts serving at the 
individual intelligence agencies about the degree to which they 
have access to relevant terrorism-related intelligence 
information from other agencies. The Committee will continue to 
look into this issue as the bill is considered by the Congress.

Defense Intelligence Agency--Counterterrorism Analysis

    The DIA details a significant number of its 
counterterrorism analysts on rotations to support the missions 
of other commands, agencies, organizations, deployed forces, 
and the NCTC. The Committee is concerned that many of these 
analysts--particularly those assigned to NCTC--do not return to 
the Joint Intelligence Task Force-Combating Terrorism or 
another DIA office upon completion of this rotational 
assignment, and instead chose to leave DIA.
    Therefore, the Committee requests that the Director of the 
DIA undertake a study to examine factors that may lead analysts 
who undertake rotational assignments at other agencies or 
organizations to leave DIA employment, as well as to propose 
mitigation strategies. The study should be briefed to the 
Committee no later than December 31, 2009.

Federal Bureau of Investigation intelligence transformation

    The Committee has closely examined efforts by the FBI to 
transform its National Security Branch into a premier 
intelligence and national security organization. While the FBI 
has made progress in its efforts to fulfill its national 
security and intelligence mission, the Committee believes the 
FBI must accelerate its intelligence reform efforts and improve 
its performance.
    In addition, the Committee expects the FBI to increase its 
transparency and cooperation with Committee oversight. In 
several instances the FBI has not kept the Committee ``fully 
and currently'' informed of its intelligence activities, nor 
has it responded to Congressional Questions for the Record in a 
reasonable time frame. While responsibility for this deficiency 
lies at least partially with the Department of Justice, the 
Committee adamantly believes the FBI itself must take 
corrective steps. The Committee requests that a report be 
provided to the intelligence committees detailing how the 
National Security Branch of the FBI will improve its 
cooperation with oversight and align its briefing policies on 
intelligence matters with the requirements of the National 
Security Act. The report should be submitted by November 1, 
2009. The Committee has fenced a portion of funds, as discussed 
in the classified annex, until this matter is adequately 
addressed.
    Furthermore, as set forth in Section 445 of the bill, the 
Committee recommends that the Director of the FBI, in 
consultation with the DNI, be required to submit a report 
describing the long-term vision for the intelligence 
capabilities of the National Security Branch, a strategic plan 
for the National Security Branch, and details on the progress 
made to date in advancing the intelligence capabilities of the 
branch. Section 445 also directs that the DNI, in consultation 
with the Director of the FBI, submit an annual assessment that 
tracks the progress of the National Security Branch in 
strengthening its intelligence capabilities. This report is to 
be provided to the congressional intelligence committees 
annually for a period of five years.

FBI National Security workforce management and the advancement of an 
        FBI analytic culture

    Intelligence Analysts and Professional Staff: The Committee 
remains concerned that the FBI continues to lack a robust 
Intelligence Analyst career path. Furthermore, the Committee 
believes there are too few intelligence analysts in senior 
positions of responsibility and that the FBI has neglected 
opportunities to utilize intelligence analysts and other 
professional staff to fill inherently non-law enforcement, 
intelligence-focused positions. The FBI was granted authority 
in the Consolidated Appropriations Act of 2005 to utilize 
critical pay authority to obtain twenty-four Senior 
Intelligence Officer (SIO) positions, which were portrayed as 
``critical to the FBI's intelligence mission.'' In testimony 
provided to this Committee on January 25, 2007, the FBI 
described these SIOs as ``senior analysts who will sustain the 
focus on issues about which policy makers and planners need 
information now.'' As of June 2009, the FBI has hired only six 
of the twenty-four SIOs. The Committee believes this is 
unacceptable and that the FBI must do more to advance its non-
agent intelligence cadre.
    Special Agents: The Committee is concerned about the FBI's 
continued reliance on Special Agents in the National Security 
Branch to fill all types of positions and urges the FBI to be 
more strategic in its deployment and use of special agents. 
Substantial resources are devoted to providing Special Agents 
with unique skill sets and their appointments should be made in 
a manner that is effective and efficient. The Committee 
believes the use of Special Agents in organizational support 
functions unrelated to intelligence or law enforcement should 
be given careful consideration based upon the nature of the 
particular support function. This is not only cost-effective, 
but allows for better continuity and strategic positioning of 
the FBI national security workforce.

Regionalization of the FBI Intelligence Program

    While the FBI has made strides in reforming Field 
Intelligence Groups, additional reforms are required. 
Specifically, the Committee believes the FBI should give fuller 
consideration to the creation of regional intelligence groups, 
placed organizationally above Field Intelligence Groups, to 
create an intelligence and national security reporting chain 
that would be more manageable and accountable.

The state of counterintelligence in the Intelligence Community

    The Committee is concerned about the management, 
leadership, and focus of the counterintelligence discipline 
within the Intelligence Community. A number of espionage cases 
since 2001 have underscored the threat posed by foreign 
intelligence services to the United States of America. Recent 
press coverage has highlighted the enduring threat posed by the 
Cuban intelligence services. The threat from Russia, China, and 
other nations is no less serious.
    An improved approach to counterintelligence will not deter 
any and all forms of espionage from occurring. However, a 
heightened counterintelligence posture in the Intelligence 
Community will better detect and disrupt the sustained threat 
posed to the US and its interests by foreign intelligence 
services.
    To effectuate meaningful change in counterintelligence, 
leadership from the DNI is required. Unfortunately, the NCIX is 
hampered in its ability to execute this leadership role by the 
authorities assigned to the office and the limited, if any, 
visibility into counterintelligence operations.
    The Committee is supportive of the preliminary steps the 
DNI has taken by convening a senior panel to review the state 
of counterintelligence. The DNI should use this opportunity to 
augment the vital fundamentals of a strong, cohesive 
counterintelligence posture for the Intelligence Community. 
This includes enhancing existing counterintelligence training, 
producing more timely counterintelligence analysis, improving 
cooperation on counterintelligence operations and analysis 
between agencies, and more effectively linking 
counterintelligence and cyber threats.
    The Committee looks forward to working with the DNI to 
improve the state of counterintelligence in the Intelligence 
Community.

Department of Homeland Security--Personnel

    Although the Committee commends the Office of Intelligence 
and Analysis (OIA) of the Department of Homeland Security for 
recognizing the importance of converting contractor positions 
to government civilian personnel in fiscal year 2010, the 
Department's plans to continue a gradual conversion of contract 
personnel positions to government civilian personnel through 
2015, when the workforce mix will be about 50/50, is 
unacceptable. The Committee has consistently underscored its 
concerns regarding the long-term use of private contract 
personnel and the associated costs compared to government 
civilian employees. Currently, contract personnel make up 63 
percent of the workforce of the OIA. The OIA must improve its 
ratio of contract personnel to government civilian personnel to 
levels at least comparable to the rest of the Intelligence 
Community. According to the annual inventory of core contract 
personnel for fiscal year 2008, issued by the ODNI, contract 
personnel constitute 29 percent of the Intelligence Community's 
total personnel. As stated previously, the Committee believes 
that this figure is substantially above what it should be.
    Moreover, the Department of Homeland Security OIA workforce 
request reflects a disproportionately high percentage increase 
in total personnel over the past few years. The Committee 
requests the ODNI work with the next Under Secretary for 
Intelligence and Analysis to complete a comprehensive study to 
determine the appropriate number of personnel, define 
inherently government functions, identify where contract 
personnel might be performing those functions, and specify how 
the Office intends to transition contract personnel from those 
functions within the fiscal year given the statutory mission of 
the OIA, as described on its website, to ``ensure that 
information related to homeland security threats is collected, 
analyzed, and disseminated to the full spectrum of homeland 
security customers in the Department, at state, local, and 
tribal levels, in the private sector, and in the Intelligence 
Community.''

Department of Homeland Security--Analysis

    The Committee has raised a number of concerns with reports 
issued by the Department of Homeland Security OIA that 
inappropriately analyze the legitimate activities of U.S. 
persons. These reports raised fundamental questions about the 
mission of the OIA and often used certain questionable open 
source information as a basis of their conclusions. The 
Committee recommends that the next Under Secretary for 
Intelligence and Analysis conduct a comprehensive review of the 
quality and relevance of the intelligence products produced by 
the OIA, and provide this review to the congressional 
intelligence committees within 180 days of enactment.

National Immigration Information Sharing Office of the Department of 
        Homeland Security

    The Committee has closely followed the development of the 
National Immigration Information Sharing Office (NIISO) within 
the Department of Homeland Security. NIISO is intended to 
facilitate the use of citizenship and immigration information 
currently being collected and housed at a U.S. Citizenship and 
Immigration Service's facility. Because the NIISO relates to 
the use of citizenship and immigration information for 
intelligence purposes, the Congress has been attentive to civil 
liberties and privacy concerns associated with the NIISO.
    According to the Consolidated Security, Disaster 
Assistance, and Continuing Appropriations Act, 2009, ``[n]one 
of the funds provided in this or any other Act shall be 
available to commence operations of the National Immigration 
Information Sharing Operation until the Secretary certifies 
that such program complies with all existing laws, including 
all applicable privacy and civil liberties standards, the 
Comptroller General of the United States notifies the 
Committees on Appropriations of the Senate and the House of 
Representatives and the Secretary that the Comptroller has 
reviewed such certification, and the Secretary notifies the 
Committees on Appropriations of the Senate and the House of 
Representatives of all funds to be expended on the National 
Immigration Information Sharing Operation pursuant to section 
503.'' The Committee endorses this provision and awaits the 
Secretary's certification.

Compliance with Senate Rule XLIV

    The bill and classified annex create no earmarks as defined 
by rule XLIV of the Standing Rules of the Senate, which 
requires publication of a list of congressionally directed 
spending items. The bill and classified annex contain no 
limited tax benefits or limited tariff benefits.

                            COMMITTEE ACTION

Vote to report the committee bill

    On July 16, 2009, a quorum for reporting being present, the 
Committee voted to report the bill, by a vote of 15 ayes and no 
noes. The votes in person or by proxy were as follows: Chairman 
Feinstein--aye; Senator Rockefeller--aye; Senator Wyden--aye; 
Senator Bayh--aye; Senator Mikulski--aye; Senator Feingold--
aye; Senator Nelson--aye; Senator Whitehouse--aye; Vice 
Chairman Bond--aye; Senator Hatch--aye; Senator Snowe--aye; 
Senator Chambliss--aye; Senator Burr--aye; Senator Coburn--aye; 
Senator Risch--aye.

Votes on amendments to committee bill and the classified annex

    On July 15, 2009, by a voice vote, the Committee agreed to 
a managers' amendment by Chairman Feinstein and Vice Chairman 
Bond to authorize: (1) additional fulltime equivalent personnel 
in order to improve proficiency in critical foreign languages 
(Section 306) (sponsored by Senator Wyden and Senator 
Chambliss); (2) the DNI to make available CIA acquisition 
authorities to other elements of the Intelligence Community 
(Section 326); (3) a requirement for a study and strategy on 
intelligence collection capabilities against the threat of 
biological weapons (Section 339) (sponsored by Senator Burr and 
Senator Mikulski); (4) expenditure authority for the Director 
of the DIA (Section 434); and (5) a governance structure for 
the Diplomatic Telecommunications Service Network (Title V). In 
addition, the amendment narrowed Section 352, relating to 
sharing terrorist identification information, and incorporated 
technical and conforming amendments.
    On July 15, 2009, by a voice vote, the Committee agreed to 
an amendment by Chairman Feinstein as modified concerning 
classified activities that are further described in the 
classified annex.
    On July 15, 2009, by a vote of 11 ayes to 4 noes, the 
Committee adopted an amendment by Chairman Feinstein concerning 
congressional notifications further described in the classified 
annex. The votes in person or by proxy were as follows: 
Chairman Feinstein--aye; Senator Rockefeller--aye; Senator 
Wyden--aye; Senator Bayh--aye; Senator Mikulski--aye; Senator 
Feingold--aye; Senator Nelson--aye; Senator Whitehouse--aye; 
Vice Chairman Bond--no; Senator Hatch--no; Senator Snowe--aye; 
Senator Chambliss--no; Senator Burr--aye; Senator Coburn--no; 
Senator Risch--aye.
    On July 15, 2009, by a voice vote, the Committee agreed to 
an amendment by Chairman Feinstein, Senator Rockefeller, 
Senator Bayh, Senator Mikulski, Senator Feingold, Senator 
Whitehouse and Senator Snowe to improve congressional and 
Executive branch oversight of cyber security activities 
(Section 340).
    On July 15, 2009, by a vote of 9 ayes to 6 noes, the 
Committee adopted an amendment by Chairman Feinstein pertaining 
to congressional oversight (Section 331). The votes in person 
or by proxy were as follows: Chairman Feinstein--aye; Senator 
Rockefeller--aye; Senator Wyden--aye; Senator Bayh--aye; 
Senator Mikulski--aye; Senator Feingold--aye; Senator Nelson--
aye; Senator Whitehouse--aye; Vice Chairman Bond--no; Senator 
Hatch--no; Senator Snowe--aye; Senator Chambliss--no; Senator 
Burr--no; Senator Coburn--no; Senator Risch--no.
    On July 15, 2009, by a voice vote, the Committee agreed to 
an amendment by Vice Chairman Bond as modified to require the 
identification of senior intelligence management officials 
responsible for correcting long-standing correctable material 
weaknesses (Section 359).
    On July 15, 2009, by a voice vote, the Committee agreed to 
an amendment by Vice Chairman Bond concerning classified 
activities that are further described in the classified annex.
    On July 15, 2009, by a voice vote, the Committee agreed to 
a second amendment by Vice Chairman Bond concerning classified 
activities that are further described in the classified annex.
    On July 15, 2009, by a voice vote, the Committee agreed to 
a third amendment by Vice Chairman Bond concerning classified 
activities that are further described in the classified annex.
    On July 15, 2009, by a vote of 13 ayes to 2 noes, the 
Committee adopted an amendment by Vice Chairman Bond expressing 
a Sense of the Senate that a subcommittee on intelligence 
should be created by the Senate Appropriations Committee 
(Section 341). The votes in person or by proxy were as follows: 
Chairman Feinstein--aye; Senator Rockefeller--aye; Senator 
Wyden--aye; Senator Bayh--aye; Senator Mikulski--aye; Senator 
Feingold--no; Senator Nelson--no; Senator Whitehouse--aye; Vice 
Chairman Bond--aye; Senator Hatch--aye; Senator Snowe--aye; 
Senator Chambliss--aye; Senator Burr--aye; Senator Coburn--aye; 
Senator Risch--aye.
    On July 15, 2009, by a vote of 8 ayes to 7 noes, the 
Committee adopted an amendment by Senator Rockefeller 
concerning congressional notifications (Sections 332 and 334). 
The votes in person or by proxy were as follows: Chairman 
Feinstein--aye; Senator Rockefeller--aye; Senator Wyden--aye; 
Senator Bayh--aye; Senator Mikulski--aye; Senator Feingold--
aye; Senator Nelson--no; Senator Whitehouse--aye; Vice Chairman 
Bond--no; Senator Hatch--no; Senator Snowe--aye; Senator 
Chambliss--no; Senator Burr--no; Senator Coburn--no; Senator 
Risch--no.
    On July 15, 2009, by a voice vote, the Committee agreed to 
an amendment by Senator Wyden and Senator Feingold as modified 
concerning the Public Interest Declassification Board (Section 
357).
    On July 15, 2009, by a vote of 8 ayes to 7 noes, the 
Committee adopted an amendment by Senator Wyden and Senator 
Feingold concerning Government Accountability Office audits of 
the Intelligence Community (Section 335). The votes in person 
or by proxy were as follows: Chairman Feinstein--aye; Senator 
Rockefeller--aye; Senator Wyden--aye; Senator Bayh--aye; 
Senator Mikulski--aye; Senator Feingold--aye; Senator Nelson--
aye; Senator Whitehouse--aye; Vice Chairman Bond--no; Senator 
Hatch--no; Senator Snowe--no; Senator Chambliss--no; Senator 
Burr--no; Senator Coburn--no; Senator Risch--no.
    On July 15, 2009, by a voice vote, the Committee agreed to 
an amendment by Senator Chambliss and Senator Bayh as modified 
concerning classified activities that are further described in 
the classified annex.
    On July 16, 2009, by a vote of 10 ayes to 5 noes, the 
Committee adopted an amendment by Vice Chairman Bond concerning 
the publication of unclassified versions of intelligence 
products (Section 427). The votes in person or by proxy were as 
follows: Chairman Feinstein--no; Senator Rockefeller--no; 
Senator Wyden--aye; Senator Bayh--aye; Senator Mikulski--no; 
Senator Feingold--aye; Senator Nelson--no; Senator Whitehouse--
no; Vice Chairman Bond--aye; Senator Hatch--aye; Senator 
Snowe--aye; Senator Chambliss--aye; Senator Burr--aye; Senator 
Coburn--aye; Senator Risch aye.
    On July 16, 2009, by a vote of 9 ayes to 6 noes, the 
Committee adopted an amendment by Senator Feingold and Vice 
Chairman Bond, that requires the President to disclose to the 
public the funding level requested for the National 
Intelligence Program on the date the budget request is 
submitted and eliminates the provision in current law whereby 
the President may waive or postpone the disclosure of the 
aggregate amount of funds appropriated by Congress for the 
National Intelligence Program on national security grounds 
starting after fiscal year 2009, superseding a provision that 
would have delayed the President's authority to waive or 
postpone the aggregate amount of funds appropriated by Congress 
starting after fiscal year 2011 (Section 356). The votes in 
person or by proxy were as follows: Chairman Feinstein--aye; 
Senator Rockefeller--aye; Senator Wyden--aye; Senator Bayh--
aye; Senator Mikulski--aye; Senator Feingold--aye; Senator 
Nelson--no; Senator Whitehouse--no; Vice Chairman Bond--aye; 
Senator Hatch--aye; Senator Snowe--aye; Senator Chambliss--no; 
Senator Burr--no; Senator Coburn--no; Senator Risch--no.
    On July 16, 2009, by a vote of 10 ayes to 5 noes, the 
Committee adopted an amendment by Senator Feingold to establish 
a commission on foreign intelligence and information (Title 
VI). The votes in person or by proxy were as follows: Chairman 
Feinstein--aye; Senator Rockefeller--aye; Senator Wyden--aye; 
Senator Bayh--aye; Senator Mikulski--aye; Senator Feingold--
aye; Senator Nelson--aye; Senator Whitehouse--aye; Vice 
Chairman Bond--no; Senator Hatch--no; Senator Snowe--aye; 
Senator Chambliss--no; Senator Burr--no; Senator Coburn--aye; 
Senator Risch--no.
    On July 16, 2009, by a vote of 14 ayes to 1 no, the 
Committee adopted an amendment by Senator Feingold to amend the 
National Security Act of 1947 by requiring that the 
congressional intelligence committees be provided with the 
legal authorities under which all covert action and all other 
intelligence activities are or were conducted (Section 333). 
The votes in person or by proxy were as follows: Chairman 
Feinstein--aye; Senator Rockefeller--aye; Senator Wyden--aye; 
Senator Bayh--aye; Senator Mikulski--aye; Senator Feingold--
aye; Senator Nelson--aye; Senator Whitehouse--aye; Vice 
Chairman Bond--aye; Senator Hatch--aye; Senator Snowe--aye; 
Senator Chambliss--no; Senator Burr--aye; Senator Coburn--aye; 
Senator Risch aye.
    On July 16, 2009, by a voice vote, the Committee adopted an 
amendment by Senator Coburn, as amended by Chairman Feinstein, 
concerning reports on national security threats posed by 
Guantanamo Bay detainees (Section 337). The second degree 
amendment by Chairman Feinstein was adopted by a vote of 9 ayes 
and 6 noes. The votes in person or by proxy were as follows: 
Chairman Feinstein--aye; Senator Rockefeller--aye; Senator 
Wyden--aye; Senator Bayh--aye; Senator Mikulski--aye; Senator 
Feingold--aye; Senator Nelson--aye; Senator Whitehouse--aye; 
Vice Chairman Bond--no; Senator Hatch--no; Senator Snowe--aye; 
Senator Chambliss--no; Senator Burr--no; Senator Coburn--no; 
Senator Risch--no. The amendment was further amended by 
unanimous consent.
    On July 16, 2009, by a voice vote, the Committee agreed to 
an amendment by Senator Hatch to establish an awards program 
for certain exceptional Intelligence Community officers that is 
further described in the classified annex.
    On July 16, 2009, by a voice vote, the Committee agreed to 
an amendment offered by Senator Chambliss on behalf of Senator 
Hatch concerning classified activities that are further 
described in the classified annex.

                           ESTIMATE OF COSTS

    Pursuant to paragraph 11(a)(3) of rule XXVI of the Standing 
Rules of the Senate, the Committee deems it impractical to 
include an estimate of the costs incurred in carrying out the 
provisions of this report due to the classified nature of the 
operations conducted pursuant to this legislation. On July 21, 
2009, the Committee transmitted this bill to the Congressional 
Budget Office and requested it to conduct an estimate of the 
costs incurred in carrying out its provisions.

                    EVALUATION OF REGULATORY IMPACT

    In accordance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee finds that no 
substantial regulatory impact will be incurred by implementing 
the provisions of this legislation.

                        CHANGES IN EXISTING LAWS

    In the opinion of the Committee, it is necessary to 
dispense with the requirements of paragraph 12 of rule XXVI of 
the Standing Rules of the Senate in order to expedite the 
business of the Senate.

 ADDITIONAL VIEWS OF VICE CHAIRMAN BOND AND SENATORS HATCH, CHAMBLISS, 
                        BURR, COBURN, AND RISCH

    For the first time in several years, the Committee has 
successfully voted out a relatively clean bill that should pass 
muster with the House and Senate and be signed into law by the 
President. We attribute much of this success to the leadership 
of our Chairman, Senator Dianne Feinstein, who worked with all 
of the Members of the Committee to fashion a bipartisan bill.

                       GOOD GOVERNMENT PROVISIONS

    We are pleased that our bill contains a number of good 
government provisions that we have been developing over the 
past several years. These provisions will improve the 
efficiency and accountability of the Intelligence Community and 
provide the Director of National Intelligence (DNI) with some 
additional tools to better perform his duties under the 
National Security Act of 1947.
    A number of these good government provisions relate to the 
Intelligence Community's budgetary and acquisition processes. 
Sections 323 and 324 will operate together to address the 
problem of cost overruns in major system acquisitions by the 
Intelligence Community. These provisions were modeled on the 
Nunn-McCurdy provision in title 10 of the United States Code. 
They encourage greater DNI involvement in the acquisition 
process and enable the congressional intelligence committees to 
perform more effective and timely oversight of cost increases.
    Section 321 requires the DNI to conduct initial and 
subsequent vulnerability assessments for any major system, and 
its items of supply, that is included in the National 
Intelligence Program (NIP). Such assessments will ensure that 
any vulnerabilities or risks associated with a particular 
system are identified and resolved at the earliest possible 
stage.
    Section 325 requires the DNI, with the concurrence of the 
Office of Management and Budget, to provide the congressional 
intelligence committees with a future year intelligence plan 
and a long-term budget projection each fiscal year beginning 
with the budget for fiscal year 2011. These important planning 
tools will enable the DNI and the congressional intelligence 
committees to ``look over the horizon'' and resolve significant 
budgetary issues before they become problematic.
    Section 322 requires the DNI to create a comprehensive 
business enterprise architecture that will define all 
Intelligence Community business systems. This architecture will 
incorporate Intelligence Community financial, personnel, 
procurement, acquisition, logistics, and planning systems into 
one interoperable and modernized system.
    Vice Chairman Bond sponsored a new provision this year, 
Section 359, which is intended to help the Intelligence 
Community correct several long-standing management 
deficiencies, known as ``material weaknesses.'' These material 
weaknesses have contributed to the inability of certain 
Intelligence Community agencies to pass an independent 
financial audit. Section 359 addresses this problem by 
requiring the agency heads for the Central Intelligence Agency 
(CIA), Defense Intelligence Agency, National Geospatial-
Intelligence Agency, National Reconnaissance Office, and 
National Security Agency to identify the specific senior 
intelligence management officials within their respective 
agencies who are responsible for correcting applicable long-
standing material weaknesses.
    Section 305 continues the theme of encouraging good 
government. This section directs the DNI to conduct annual 
personnel level assessments of each element of the Intelligence 
Community that capture the number and costs of personnel, 
including contractors, for that element. These assessments will 
aid both the DNI and the congressional intelligence committees 
in the exercise of their respective responsibilities on 
personnel funding issues.
    Finally, Section 401 provides the DNI with the authority to 
conduct accountability reviews of elements and personnel of the 
Intelligence Community in relation to their significant 
failures or deficiencies. This section will encourage 
Intelligence Community elements to address their own internal 
failures or deficiencies--something they at times have been 
reluctant to do before now. In the event that they are 
reluctant or unable to do so, this provision gives the DNI the 
authority he needs to conduct his own reviews.
    We are confident that these good government measures will 
lead to a stronger, more efficient, and more effective 
Intelligence Community. Major systems acquisition is an 
important issue for our warfighters and intelligence 
collectors, especially as technological capabilities evolve. It 
is also essential that the Intelligence Community has 
sufficient and appropriate personnel to do the demanding jobs 
that are required to keep our nation safe and defeat our 
enemies.

                         CLASSIFIED INFORMATION

    We have always been strong proponents of protecting 
classified information. Some might find it strange, then, that 
Vice Chairman Bond sponsored, and we all supported, an 
amendment requiring the Director of the CIA to make publicly 
available an unclassified version of four classified documents 
assessing the information obtained from certain high-value 
terrorists.
    We believe this amendment, Section 427, was necessary in 
light of the Administration's recent declassification and 
publication of numerous documents about the CIA's detention and 
interrogation program. At the time, we objected to the release 
of these documents because it would give our enemies valuable 
insights into the types of limitations we impose on our 
intelligence collectors and allow terrorists to improve their 
interrogation resistance tactics. That damage has now been 
done.
    Unfortunately, the released documents, selectively chosen 
and selectively redacted, do not provide the American public 
with any objective perspective on the value of the information 
obtained from these high-value detainees. Indeed, with one 
highly sensitive document, the Administration declassified 
virtually the entire memo, except for those paragraphs in which 
the value of the intelligence obtained was discussed. By 
requiring the Director of the CIA to provide an unclassified 
version of these four documents to the public, the American 
people can make their own assessment of the value of the 
information obtained from these high-value terrorists.
    Let us be clear about what Section 427 does not do: unlike 
the Administration's recent declassification of highly 
sensitive detention and interrogation documents, Section 427 
does not require the declassification of these four documents. 
Rather, it requires only the release of an unclassified version 
prepared by the Central Intelligence Agency. We have reviewed 
each of the documents covered by this amendment. By limiting 
Section 427 in this manner, we are confident that no 
intelligence sources and methods will be disclosed and that 
there will be no damage to our national security.

                    RELEASE OR TRANSFER OF DETAINEES

    Beginning during the Bush Administration and continuing 
under the current Administration, hundreds of detainees from 
the Naval Detention Facility at Guantanamo Bay, Cuba (GTMO) 
have been released or transferred to other countries. 
Unfortunately, many of these released individuals remain a 
threat to the United States and its interests. According to 
information released by the Department of Defense in March of 
this year, the recidivism rate for these former detainees was 
more than 14 percent. It is now judged to be even higher. Yet, 
not one of the threat assessments on these detainees was 
provided to the congressional intelligence committees prior to 
their release. This is unacceptable.
    In May 2009, the Committee learned that of the 60 detainees 
at GTMO who have been judged by the current and previous 
Administrations to be eligible for release or transfer, the 
Defense Intelligence Agency recommended that 25 continue to be 
held, due to the threat they posed. Five of those 25 were 
assessed to ``pose the most significant threat of reengagement 
in serious acts of terrorism.'' Congress should not be placed 
in the position of not knowing whether dangerous individuals 
are being released who may threaten our homeland again.
    Senator Coburn offered an amendment that would have solved 
this problem by requiring the DNI to report to the 
congressional intelligence committees at least 30 days prior to 
the release or transfer of any GTMO detainee with an assessment 
of the detainee's suitability for release or transfer. When his 
amendment was replaced with a second degree amendment, this 
useful congressional oversight tool was lost. In its place, 
Section 337 requires a less timely quarterly report from the 
DNI that assesses the suitability for release or transfer of 
detainees previously released or transferred, or to be released 
or transferred from GTMO. It is conceivable that this 
formulation could result in certain detainees being transferred 
or released prior to congressional review of threat assessment 
information. Also lost as a result of the second degree 
amendment was a provision that would have allowed the American 
people to be told when a detainee was released or transferred 
in spite of a negative threat assessment. We find it ironic, 
and highly disturbing, that the American people can know when a 
sex offender resides in the community, but cannot be told when 
a former detainee moves in down the street.

                       CONGRESSIONAL NOTIFICATION

    Section 332, which we opposed, modifies the current balance 
in the National Security Act with respect to the congressional 
notification procedures. It imposes new requirements when the 
Executive branch determines that disclosure to less than the 
full membership of the Committee is appropriate. Section 332 
requires that, in those cases, the Executive branch must 
provide the ``main features'' of the program to the entire 
membership of the intelligence committees. Although Members who 
supported this amendment made it clear that they would defer to 
the Administration's determination of what ``main features'' to 
provide, we are concerned that in the future we may face a 
circumstance similar to one in which we find ourselves today--
where the Administration met the requirements of the National 
Security Act, but for reasons of political expediency, is 
nonetheless accused of not fully informing Congress. Closed 
door assurances will be of small consolation to future CIA 
employees accused of not adequately providing the ``main 
features.'' For this reason, while this general notice 
requirement is significantly less controversial than its 
predecessors, we believe this requirement will unnecessarily 
increase the tension between the Legislative and Executive 
branches over information access.
    We also opposed the adoption of Section 331 because it 
appears to be little more than legislative surplusage. Section 
331 states that ``there shall be no exception to the 
requirements to inform the congressional intelligence 
committees of all intelligence activities and covert action.'' 
The Select Committee on Intelligence expects the Intelligence 
Community to comply with the congressional notification 
procedures in the National Security Act and keep it ``fully and 
currently informed'' of all covert actions and intelligence 
activities. As long as further substantive changes are not made 
to congressional notification requirements, including Gang of 
Eight provisions, the addition of this ``no exception'' clause 
to the general congressional oversight provision should have 
little, if any, practical impact on the interpretation of the 
notification procedures.

                                   Christopher ``Kit'' Bond.
                                   Orrin G. Hatch.
                                   Saxby Chambliss.
                                   Richard Burr.
                                   Tom Coburn.
                                   James E. Risch.

           ADDITIONAL VIEWS OF SENATORS ROCKEFELLER AND SNOWE

    Title V of the National Security Act of 1947 requires the 
President to ensure that the congressional intelligence 
committees are kept ``fully and currently informed'' of the 
intelligence activities of the United States, including any 
significant anticipated intelligence activity. For years, we 
have been very concerned about the way in which the Executive 
branch has interpreted this obligation. Rather than briefing 
the full Committee, the Executive branch has restricted 
briefings about certain classified programs to the Chairman and 
Vice Chairman of the Committee and the Chairman and Ranking 
Member of the House Permanent Select Committee on Intelligence.
    This is not an academic issue; it is an issue of how our 
democracy makes critical and secret national security 
decisions. Without the intelligence committees' meaningful 
independent review and oversight--the very reason for the 
committees' existence--intelligence programs are susceptible to 
both mistakes and illegitimacy. This is the case regardless of 
which party is in the White House or which party has a majority 
in Congress.
    With this in mind, we supported an amendment to the 
authorization bill that will establish in statute new 
requirements regarding notification. This amendment is not a 
wholesale change to the longstanding law of congressional 
notifications, and it does not eliminate the ``Gang of Eight'' 
notification process regarding covert actions, which many of us 
believe can serve an important purpose for quick and timely 
notifications on extraordinarily sensitive covert actions.
    Instead, the amendment seeks to improve the notification 
processes that have existed for years. The amendment will 
require that whenever the DNI or an intelligence agency chief 
chooses to brief less than the full committee on an 
intelligence activity or invokes the ``Gang of Eight'' 
provision regarding covert action, he or she must (1) notify 
the full committee of that fact and (2) provide a description 
of the ``main features'' of the activity or covert action in 
question. The amendment enforces these requirements by 
prohibiting funds for intelligence activities and covert 
actions that are not so notified.
    This amendment has had bipartisan support for many years. 
In fact, a bipartisan majority of the Senate Intelligence 
Committee has adopted this amendment in fiscal years 2007, 
2008, 2009, and 2010. In three different Congresses and under 
two different Administrations, this Committee has on four 
occasions expressed its view regarding congressional 
notifications in cases when the full Committee is not briefed. 
It should be clear that year in and year out, this Committee 
holds the same consistent opinion on this fundamental issue of 
Congressional oversight--no matter who is in power at either 
end of Pennsylvania Avenue.
    This amendment favors no particular party and no particular 
branch of government; it simply addresses an important concern. 
The Committee's oversight of the Executive branch's 
intelligence activities should not be adversarial; it should be 
a true, trusted and confidential partnership aimed exclusively 
at improving our nation's collection and analysis capabilities, 
and ensuring the effectiveness and legitimacy of our covert 
action programs.
    Together with the other congressional notification 
amendments that the Committee has accepted in the fiscal year 
2010 authorization bill, this amendment will strengthen our 
constructive oversight relationship with the Executive branch 
and the intelligence community.

                                   John D. Rockefeller IV.
                                   Olympia J. Snowe.

                  ADDITIONAL VIEWS OF SENATOR FEINGOLD

    The Fiscal Year 2010 Intelligence Authorization bill 
includes an amendment I offered to establish an independent 
commission to significantly reform and improve our intelligence 
capabilities. The amendment, which is similar to the Feingold-
Hagel amendment of last year and which was again approved on a 
bipartisan basis, addresses structural problems in our 
government that prevent global coverage and perpetuate gaps in 
our ability to anticipate terrorist as well as other threats 
and crises before they appear. For example, the 9/11 Commission 
recommended that the ``U.S. government must identify and 
prioritize actual or potential terrorist sanctuaries.'' Yet, as 
the Director of the National Counterterrorism Center has 
testified, ``much of the information about the instability that 
can lead to safe havens or ideological radicalization comes not 
from covert collection but from open collection, best done by 
Foreign Service Officers.'' The commission established by the 
amendment would thus focus on the critical reform of 
integrating the country's intelligence capabilities with the 
open gathering and reporting of information by other elements 
of the United States Government, particularly the State 
Department, thereby strengthening our overall collection, 
reporting and analytical capabilities.
    The Committee also approved my amendment, cosponsored by 
Committee Vice Chairman Bond and Senator Wyden, requiring the 
president to submit an unclassified top-line budget request for 
the National Intelligence Program. This reform makes possible a 
recommendation of the 9/11 Commission to improve oversight by 
passing a separate intelligence appropriations bill and 
provides for greater transparency and accountability for 
intelligence spending. It is my view that the Senate should 
also implement another one of the Commission's 
recommendations--granting appropriations authorities to the 
Senate Intelligence Committee--by passing the bipartisan S. 
Res. 164.
    The Committee approved an amendment I offered requiring 
that the congressional intelligence committees be provided with 
the legal authorities under which all covert action and other 
intelligence activities are or were conducted. This 
requirement, which will allow the committees to review the 
opinions of the Department of Justice's Office of Legal Counsel 
(OLC), those of the General Counsels of entities of the 
Intelligence Community, and other legal bases for intelligence 
activities, follows years of efforts by the Committee to obtain 
legal justifications for various intelligence programs. The 
Fiscal Year 2007, 2008, 2009 and 2010 Intelligence 
Authorization bills required that the Committee be provided all 
guidelines on the application of the Detainee Treatment Act to 
the detention and interrogation activities of the Intelligence 
Community, including legal opinions of the Department of 
Justice on the matter. The Committee also repeatedly requested 
Department of Justice legal opinions that supported the 
warrantless wiretapping program, the actual text of which the 
Committee described, in its report accompanying the FISA 
Amendments Act (FAA), as ``important for obtaining a complete 
understanding of the program.'' The frequent challenges faced 
by the Committee, as well as the highly selective nature of 
executive branch cooperation (opinions related to the 
warrantless wiretapping program were only made available nine 
days before the Committee's mark-up of the FAA) require a clear 
statutory obligation to provide legal opinions as a matter of 
course.
    The bill also includes a number of important efforts to 
improve oversight of current intelligence activities. An 
amendment offered by Chairman Feinstein that I co-sponsored 
requires that the Committee be provided critical documents 
related to cybersecurity activities, including the legal 
justifications for those activities, any certifications of 
legality, privacy impact assessments, and a plan for 
independent audits. The bill also limits funding for elements 
of the Comprehensive Cybersecurity Initiative pending receipt 
of documents related to the privacy of Americans and to the 
legal basis for the Initiative, including any analysis by the 
OLC under the current administration. This follows an amendment 
I included in last year's bill to limit funding until the 
Committee received other critical information related to the 
Initiative. Finally, the bill withholds funding for a different 
intelligence program until members' committee staff have access 
to the program. Limited staff access impedes meaningful 
oversight and I have repeatedly registered my concerns about 
the persistence of this problem.
    Efforts in recent years to improve congressional oversight 
have also included addressing the abuse of the so-called ``Gang 
of Eight'' provision of the National Security Act, most notably 
in the cases of the previous administration's detention and 
interrogation and warrantless wiretapping programs. The bill 
includes an amendment ensuring that all members of the 
Committee receive basic information about matters only briefed 
to the Chairman and Vice Chairman. While I supported the 
amendment, I am concerned that, unless all members of the 
Committee are fully notified of all intelligence activities, 
including covert action, effective oversight of operational, 
policy, budgetary and legal aspects of those activities will 
not be possible. It is therefore my position that the ``Gang of 
Eight'' provision should be eliminated entirely.
    It is my position that legislative action is still required 
in the area of interrogation, detention and rendition. While I 
applauded President Obama's swift, unilateral action to end the 
CIA's detention and interrogation program, Executive Orders can 
be withdrawn, and the previous administration even asserted the 
authority to do so secretly. Moreover, the overwhelming legal, 
moral and policy grounds for prohibiting torture and secret 
detention transcend changes in administration and require clear 
statutory language to bind future presidents as well.
    Greater statutory clarity is also needed in the area of 
rendition. Under the January 22, 2009 Executive Order on 
detention and the interrogation, the CIA has the authority to 
temporarily detain individuals and transfer them to foreign 
countries. While the law prohibits transfer if a detainee is 
likely to be tortured, it does not specifically prohibit the 
CIA from knowingly transferring a detainee to extended 
incommunicado detention or indefinite detention without charge. 
Yet State Department human rights reports have made clear the 
direct connection between indefinite, incommunicado detention 
and torture. Moreover, our government has condemned such 
detention by other countries around the world, regardless of 
whether the detained individuals were subjected to physical 
mistreatment. New legislation is therefore required to ensure 
that any CIA renditions are consistent, not only with our legal 
obligations, but with U.S. policy and with our values.
    The bill includes two amendments offered by Senator Wyden 
that I co-sponsored, ensuring access to the Intelligence 
Community by the Government Accountability Office, and 
strengthening the role of the Public Interest Declassification 
Board. These provisions further accountability and 
transparency.
    Finally, I am concerned about a provision of the bill 
creating an exemption from the Freedom of Information Act for 
certain information related to terrorist watchlisting. It is 
not yet clear that this new statutory exemption is needed and I 
will continue to work with the Committee and with the ODNI on 
this matter.

                                   Russell D. Feingold.

                                  
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