Intelligence Reform: GAO Can Assist the Congress and the	 
Intelligence Community on Management Reform Initiatives 	 
(29-FEB-08, GAO-08-413T).					 
                                                                 
For decades, GAO has assisted Congress in its oversight role and 
helped federal departments and agencies with disparate missions  
to improve the economy, efficiency, and effectiveness of their	 
operations. GAO's work provides important insight on matters such
as best practices to be shared and benchmarked and how government
and nongovernmental partners can become better aligned to achieve
important outcomes for the nation. In addition, GAO provides	 
Congress with foresight by highlighting the long-term		 
implications of today's decisions and identifying key trends and 
emerging challenges facing our nation before they reach crisis	 
proportions. For this hearing, GAO was asked to (1) highlight	 
governmentwide issues where it has made a major contribution to  
oversight and could assist the intelligence and other		 
congressional committees in their oversight of the Intelligence  
Community, and (2) comment on the potential impact on GAO's	 
access to perform audit work on personnel security clearances if 
the Office of the Director of National Intelligence (ODNI) were  
to assume management of this issue from the Office of Management 
and Budget (OMB). Given historical challenges to GAO's ability to
audit the Intelligence Community's programs and activities, this 
testimony also discusses GAO's views on Senate bill S. 82, known 
as the Intelligence Community Audit Act of 2007.		 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-08-413T					        
    ACCNO:   A81170						        
  TITLE:     Intelligence Reform: GAO Can Assist the Congress and the 
Intelligence Community on Management Reform Initiatives 	 
     DATE:   02/29/2008 
  SUBJECT:   Congressional oversight				 
	     Evaluation criteria				 
	     Information management				 
	     Mission essential operations			 
	     Risk management					 
	     Standards evaluation				 
	     Strategic planning 				 
	     Systems evaluation 				 
	     Technical proposal evaluation			 

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GAO-08-413T

   

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Testimony Before the Subcommittee on Oversight of Government 
Management, the Federal Workforce, and the District of Columbia, 
Committee on Homeland Security and Governmental Affairs, U.S. Senate: 

United States Government Accountability Office: 

GAO:  

For Release on Delivery Expected at 10:00 a.m. EDT: 
 
Friday, February 29, 2008: 
 
Intelligence Reform: 
 
GAO Can Assist the Congress and the Intelligence Community on 
Management Reform Initiatives: 
 
Statement of David M. Walker Comptroller General of the United States: 
 
GAO-08-413T: 
 
GAO Highlights: 
 
Highlights of GAO-08-413T, a testimony before the Subcommittee on 
Oversight of Government Management, the Federal Workforce, and the 
District of Columbia, Committee on Homeland Security and Governmental 
Affairs, U.S. Senate. 

Why GAO Did This Study: 

For decades, GAO has assisted Congress in its oversight role and helped 
federal departments and agencies with disparate missions to improve the 
economy, efficiency, and effectiveness of their operations. GAOï¿½s work 
provides important insight on matters such as best practices to be 
shared and benchmarked and how government and nongovernmental partners 
can become better aligned to achieve important outcomes for the nation. 
In addition, GAO provides Congress with foresight by highlighting the 
long-term implications of todayï¿½s decisions and identifying key trends 
and emerging challenges facing our nation before they reach crisis 
proportions. 
 
For this hearing, GAO was asked to (1) highlight governmentwide issues 
where it has made a major contribution to oversight and could assist 
the intelligence and other congressional committees in their oversight 
of the Intelligence Community, and (2) comment on the potential impact 
on GAOï¿½s access to perform audit work on personnel security clearances 
if the Office of the Director of National Intelligence (ODNI) were to 
assume management of this issue from the Office of Management and 
Budget (OMB). Given historical challenges to GAOï¿½s ability to audit the 
Intelligence Communityï¿½s programs and activities, this testimony also 
discusses GAOï¿½s views on Senate bill S. 82, known as the Intelligence 
Community Audit Act of 2007. 
 
What GAO Found: 
 
GAO has considerable experience in addressing governmentwide management 
challenges, including such areas as human capital, acquisition, 
information technology, strategic planning, organizational alignment, 
and financial and knowledge management, and has identified many 
opportunities to improve agenciesï¿½ economy, efficiency, and 
effectiveness, and the need for interagency collaboration in addressing 
21st century challenges. For example, over the years, GAO has addressed 
the human capital issues, such as acquiring, developing, and retaining 
talent; strategic workforce planning; building results-oriented 
cultures; pay for performance; contractors in the workforce; and 
personnel security clearances, which affect all federal agencies, 
including the Intelligence Community. Furthermore, GAO identified 
delays and other impediments in the Department of Defenseï¿½s (DOD) 
personnel security clearance program, which also maintains clearances 
for intelligence agencies within DOD. GAO designated human capital 
transformation and personnel security clearances as high-risk areas. 
GAO also recently issued reports addressing Intelligence Community-
related management issues, including intelligence, surveillance, and 
reconnaissance; space acquisitions; and the space acquisition 
workforce. 
 
If ODNI were to assume management responsibilities over security 
clearances across the federal government, GAOï¿½s ability to continue 
monitoring this area and provide Congress information for its oversight 
role could be adversely affected. In 2006, OMBï¿½s Deputy Director for 
Management suggested that OMBï¿½s oversight role of the governmentwide 
security clearance process might be transferred to the ODNI. GAO has 
established and maintained a relatively positive working relationship 
with the ODNI, but limitations on GAOï¿½s ability to perform meaningful 
audit and evaluation work persist. While GAO has the legal authority to 
audit the personnel security clearance area, if the ODNI were to assume 
management responsibilities over this issue, then it may be prudent to 
incorporate some legislative provision to reinforce GAOï¿½s access to 
information needed to conduct such audits and reviews. 
 
GAO supports S. 82 and believes that if it is enacted, the agency would 
be well-positioned to assist Congress in oversight of Intelligence 
Community management reforms. S. 82 would reaffirm GAOï¿½s existing 
statutory authority to audit and evaluate financial transactions, 
programs, and activities of elements of the Intelligence Community, and 
to access records necessary for such audits and evaluations. GAO has 
clear audit and access authority with respect to elements of the 
Intelligence Community, subject to a few limited exceptions. However, 
for many years, the executive branch has not provided GAO the level of 
cooperation needed to conduct meaningful reviews of elements of the 
Intelligence Community. This issue has taken on new prominence and is 
of greater concern in the post-9/11 context, especially since the 
ODNIï¿½s responsibilities extend well beyond traditional intelligence 
activities. The reaffirmation provisions in the bill should help to 
ensure that GAOï¿½s audit and access authorities are not misconstrued in 
the future. 
 
What GAO Recommends: 
 
To view the full product, including the scope and methodology, click on 
[hyperlink, http://www.GAO-08-413T]. For more information, contact Davi 
M. D'Agostino, 202-512-5431 or [email protected]. 
 
[End of section] 
 
Mr. Chairman and Members of the Subcommittee: 

I am pleased to be here before you today to address how GAO could 
assist Congress and the Intelligence Community.[Footnote 1] You asked 
that I discuss how GAO's expertise and capacity to perform program 
reviews of key governmentwide issues, as well as some recent work we 
have done related to intelligence activities, could be useful in 
assisting congressional oversight of Intelligence Community management 
reforms under consideration. Second, as requested, I will comment on 
the potential impact on GAO's ability to perform audit work on 
personnel security clearances if the Office of the Director of National 
Intelligence (ODNI) were to assume management of this issue from the 
Office of Management and Budget (OMB). Finally, given historical 
challenges to GAO's ability to audit the Intelligence Community's 
programs and activities, I would like to discuss GAO's views on Senate 
bill S. 82, known as the Intelligence Community Audit Act of 
2007.[Footnote 2] My comments today are based primarily on GAO's 
completed work and on our institutional knowledge, drawn from our prior 
reviews at the Department of Defense (DOD) and other federal agencies 
of human capital management, personnel security clearances, and other 
areas that directly affect the Intelligence Community, as well as on 
publicly available reports. (See the list of related GAO products at 
the end of this statement.) 

Summary: 
 
First, GAO has assisted Congress for decades in its oversight role and 
helped federal departments and agencies with disparate missions to 
improve the economy, efficiency, and effectiveness of their operations. 
In addition, GAO's work also provides important insight and foresight 
to complement the work we have performed for Congress for many years. A 
number of the governmentwide management challenges we have addressed, 
such as human capital transformation, acquisition, information 
technology, strategic planning, organizational alignment, financial and 
knowledge management, and personnel security clearances, affect most 
federal agencies, including those within the Intelligence Community. 
Moreover, we have designated some of these areas as high- risk for the 
federal government.[Footnote 3] Human capital transformation and 
personnel security clearances also have been repeatedly identified as 
areas of weakness within the Intelligence Community by others, 
including the Subcommittee on Oversight, House Permanent Select 
Committee on Intelligence; the Congressional Research Service; and 
independent commissions.[Footnote 4] Specifically, strategic human 
capital transformation and related management reforms; DOD's new pay-
for-performance system, known as the National Security Personnel System 
(NSPS); contractors in the workforce; and personnel security clearances 
are among the serious challenges going forward. We also have recently 
completed work on several management issues that are directly related 
to the Intelligence Community, and we have the capabilities to further 
support the intelligence and other appropriate congressional committees 
with their oversight needs. Specifically, we have performed in-depth 
reviews and issued reports on intelligence, surveillance, and 
reconnaissance (ISR) systems requirements, operations, and 
acquisitions; on space acquisitions; and on the space acquisition 
workforce--issues that are current and critical within the Intelligence 
Community.[Footnote 5] For the most part, DOD has agreed with our 
findings and recommendations. In addition, GAO's highly qualified and 
experienced staff--including its analysts, auditors, lawyers, and 
methodologists--and secure facilities position us to perform intensive 
reviews to assess the transformation and related management reforms 
under consideration within the Intelligence Community, especially in 
connection with human capital and acquisition and contracting-related 
issues. 

Second, if the ODNI assumes management of governmentwide personnel 
security clearances, then GAO's ability to continue to review personnel 
security clearances could be impaired unless greater cooperation is 
forthcoming from the Intelligence Community. Although we have 
established and maintained a relatively positive working relationship 
with the ODNI, limitations on our ability to perform meaningful audit 
and evaluation work persist. The ODNI might assume management 
responsibilities for the security clearance process in the event that 
either of two potential changes were to occur. First, in 2006, OMB's 
Deputy Director for Management suggested that the agency's oversight 
role of the governmentwide security clearance process might be 
transferred to the ODNI. Alternatively, the ODNI could assume 
leadership, to some extent, over implementation of a new security 
clearance process. A team established by the Director of National 
Intelligence, the Under Secretary of Defense for Intelligence, and 
OMB's Deputy Director for Management is developing a proposed security 
clearance process that could be implemented governmentwide. If ODNI 
were to assume leadership or oversight responsibilities for 
governmentwide personnel security clearances, then it might be prudent 
to incorporate some legislative provision to reinforce GAO's access to 
the information needed to conduct audits and reviews in the personnel 
security clearance area. 
 
Third, with the support of Congress and S. 82, GAO would be well- 
positioned to provide the intelligence and other appropriate 
congressional committees with an independent, fact-based evaluation of 
Intelligence Community management reform initiatives. S. 82, if 
enacted, would amend title 31 of the United States Code to reaffirm 
GAO's authority to audit and evaluate financial transactions, programs, 
and activities of the Intelligence Community. The bill also would 
provide that GAO may conduct an audit or evaluation of intelligence 
sources and methods or covert actions only upon the request of the 
intelligence committees or congressional majority or minority leaders. 
It also would provide that GAO perform such work and use agency 
documents in space provided by the audited agencies. We support this 
bill and believe that if it is enacted, GAO would be well-positioned to 
assist Congress with its oversight functions relating to the 
Intelligence Community. The reaffirmation provisions in the bill should 
also help to ensure that GAO's audit and access authorities are not 
misconstrued in the future. 
 
Background: 

GAO's Authority to Review Intelligence Community Programs: 
 
Generally, we have broad authority to evaluate agency programs and 
investigate matters related to the receipt, disbursement, and use of 
public money.[Footnote 6] To carry out our audit responsibilities, we 
have a statutory right of access to agency records. Specifically, 
federal agencies are required to provide us information about their 
duties, powers, activities, organization, and financial 
transactions.[Footnote 7] In concert with our statutory audit and 
evaluation authority, this provision gives GAO a broad right of access 
to agency records, including records of the Intelligence Community, 
subject to a few limited exceptions. GAO's access statute authorizes 
enforcement of GAO's access rights through a series of steps specified 
in the statute, including the filing of a civil action to compel 
production of records in federal district court. However, GAO may not 
bring an action to enforce its statutory right of access to a record 
relating to activities that the President designates as foreign 
intelligence or counterintelligence activities.[Footnote 8] 
 
GAO's statutory authorities permit us to evaluate a wide range of 
activities in the Intelligence Community, including the management and 
administrative functions that intelligence agencies, such as the 
Central Intelligence Agency (CIA), have in common with all federal 
agencies. However, since 1988, the Department of Justice (DOJ) has 
maintained that Congress intended the intelligence committees to be the 
exclusive means of oversight, effectively precluding oversight by us. 
In our 2001 testimony about GAO's access to information on CIA programs 
and activities, we noted that in 1994 the CIA Director sought to 
further limit our audit work of intelligence programs, including those 
at DOD.[Footnote 9] In 2006, the ODNI agreed with DOJ's 1988 position, 
stating that the review of intelligence activities is beyond GAO's 
purview. While we strongly disagree with DOJ and the ODNI's 
view,[Footnote 10] we foresee no major change in limits on our access 
without substantial support from Congress--the requestor of the vast 
majority of our work. Congressional impetus for change would have to 
include the support of the intelligence committees, which have 
generally not requested GAO reviews or evaluations of CIA's or other 
intelligence agencies' activities for many years. With support, 
however, we could evaluate some of the basic management functions that 
we now evaluate throughout other parts of the federal government, such 
as human capital, acquisition, information technology, strategic 
planning, organizational alignment, and financial and knowledge 
management. 
 
Intelligence Reform and Terrorism Prevention Act of 2004: 
 
As this Subcommittee is well aware, the Intelligence Reform and 
Terrorism Prevention Act of 2004 (IRTPA) established the Director of 
National Intelligence to serve as the head of the Intelligence 
Community; act as the principal advisor to the President, the National 
Security Council, and the Homeland Security Council for intelligence 
matters related to national security; and oversee and direct the 
implementation of the National Intelligence Program.[Footnote 11] Since 
its inception, the ODNI has undertaken a number of initiatives, 
including the development of both 100-and 500-day plans for integration 
and collaboration. One of the core initiatives of these plans is to 
modernize the security clearance process across the Intelligence 
Community and at the national level, where other federal agencies, 
including DOD, OMB, and Office of Personnel Management (OPM) are also 
engaged. 
 
Among other things, IRTPA also directed the President to select a 
single department, agency, or element of the executive branch to be 
responsible for day-to-day oversight of the government's security 
clearance process.[Footnote 12] In June 2005, the President issued an 
executive order that assigned OMB responsibility for ensuring the 
effective implementation of a policy that directs agency functions 
related to determinations of personnel eligibility for access to 
classified information be uniform, centralized, efficient, effective, 
timely, and reciprocal.[Footnote 13] In its new capacity, OMB assigned 
the responsibility for the day-to-day supervision and monitoring of 
security clearance investigations, as well as for tracking the results 
of individual agency-performed adjudications, to OPM. With respect to 
(1) personnel employed or working under a contract for an element of 
the Intelligence Community and (2) security clearance investigations 
and adjudications for Sensitive Compartmented Information, OMB assigned 
the responsibility for supervision and monitoring of security clearance 
investigations and tracking adjudications to the ODNI. In May 2006, 
OMB's Deputy Director for Management stated during a congressional 
hearing that the agency's oversight role in improving the 
governmentwide clearance process might eventually be turned over to the 
ODNI.[Footnote 14] 
 
GAO Experience in Governmentwide Human Capital Issues and Other 
Management Areas Can Assist Congress and the Intelligence Community on 
Management Reforms: 
 
For decades, we have assisted Congress in its oversight role and helped 
agencies with disparate missions to improve the economy, effectiveness, 
and efficiency of their operations and the need for interagency 
collaboration in addressing 21ST century challenges, and we could 
assist the intelligence and other appropriate congressional committees 
in their oversight of the Intelligence Community as well. Our work also 
provides important insight on matters such as best practices to be 
shared and benchmarked and how government and its nongovernmental 
partners can become better aligned to achieve important outcomes for 
the nation. In addition, GAO provides Congress with foresight by 
highlighting the long-term implications of today's decisions and 
identifying key trends and emerging challenges facing our nation before 
they reach crisis proportions. For the purpose of this hearing, I will 
discuss our extensive experience in addressing governmentwide human 
capital issues and other management issues that can assist the 
intelligence and other appropriate congressional committees in their 
oversight of Intelligence Community transformation and related 
management reforms.  

Human Capital Transformation and Management Are Governmentwide High- 
Risk Issues also Affecting the Intelligence Community: 

GAO has identified a number of human capital transformation and 
management issues over the years, such as acquisition, information 
technology, strategic planning, organizational alignment, financial and 
knowledge management, and personnel security clearances, as cross- 
cutting, governmentwide issues that affect most federal agencies, 
including those within the Intelligence Community. Human capital 
transformation and management issues have also been repeatedly 
identified as areas of weakness within the Intelligence Community by 
other organizations, including the Subcommittee on Oversight, House 
Permanent Select Committee on Intelligence; the Congressional Research 
Service; and independent commissions, such as the 9/11 Commission and 
Weapons of Mass Destruction Commission.[Footnote 15] Moreover, the ODNI 
has acknowledged that Intelligence Community agencies face some of the 
governmentwide challenges that we have identified, including 
integration and collaboration within the Intelligence Community 
workforce and inefficiencies and reciprocity of personnel security 
clearances.[Footnote 16] Significant issues affecting the Intelligence 
Community include strategic human capital transformation and reform 
issues, DOD's new pay-for-performance management system called NSPS, 
the extent to which agencies rely on, oversee, and manage their 
contractor workforce, and personnel security clearances. In fact, we 
have identified some of these programs and operations as high-risk 
areas due to a range of management challenges.[Footnote 17] 
 
Strategic Human Capital Transformation and Related Management Reforms 
across the Government: 
 
GAO and others have reported that the Intelligence Community faces a 
wide range of human capital challenges, including those dealing with 
recruiting and retaining a high-quality diverse workforce, 
implementation of a modernized performance management system, knowledge 
and skill gaps, integration and collaboration, and succession planning. 
Our extensive work on government transformation distinctly positions us 
to assist the intelligence and other appropriate congressional 
committees to oversee the Intelligence Community's efforts to address 
these human capital challenges as well as to inform congressional 
decision making on management issues. Our work on governmentwide 
strategic human capital management is aimed at transforming federal 
agencies into results-oriented, high-performing organizations. 
Transformation is necessary because the federal government is facing 
new and more complex challenges than ever before, and agencies must re- 
examine what they do and how they do it in order to meet those 
challenges. Central to this effort are modern, effective, economical, 
and efficient human capital practices, policies, and procedures 
integrated with agencies' mission and program goals. 
 
In 2001, we added strategic human capital management to the list of 
governmentwide high-risk areas because of the long-standing lack of a 
consistent strategic approach for marshaling, managing, and maintaining 
the human capital needed to maximize government performance and ensure 
its accountability. Although the federal government made progress in 
addressing these issues in the years that followed, we found that more 
can be done in four key areas: (1) top leadership in agencies must 
provide the attention needed to address human capital and related 
organizational transformation issues; (2) agencies' human capital 
planning efforts need to be fully integrated with mission and program 
goals; (3) agencies need to enhance their efforts to acquire, develop, 
and retain talent; and (4) organizational cultures need to promote high 
performance and accountability. 
 
NSPS Is a Key Example of GAO's Programmatic Review of Human Capital 
Transformation Challenges: 
 
Based on our experience in addressing agencies' performance management 
challenges, we are uniquely positioned to help Congress evaluate such 
issues within the Intelligence Community, including the development and 
implementation of its pay-for-performance personnel management 
system.[Footnote 18] As an example of our experience in this area, I 
would like to highlight our work on DOD's new civilian personnel 
management system--the NSPS--which has provided Congress with insight 
on DOD's proposal, design, and implementation of this system. The 
National Defense Authorization Act for Fiscal Year 2004[Footnote 19] 
provided DOD with authority to establish a new framework of rules, 
regulations, and processes to govern how the almost 700,000 defense 
employees are hired, compensated, promoted, and disciplined.[Footnote 
20] Congress provided these authorities in response to DOD's position 
that the inflexibility of the federal personnel systems was one of the 
most important constraints to the department's ability to attract, 
retain, reward, and develop a civilian workforce to meet the national 
security mission of the 21st century. 
 
Prior to the enactment of the NSPS legislation in 2003, we raised a 
number of critical issues about the proposed system in a series of 
testimonies before three congressional committees.[Footnote 21] Since 
then, we have provided congressional committees with insight on DOD's 
process to design its new personnel management system, the extent to 
which DOD's process reflects key practices for successful 
transformation, the need for internal controls and transparency of 
funding, and the most significant challenges facing DOD in implementing 
NSPS.[Footnote 22] 
 
Most important, we have noted in testimonies and reports that DOD and 
other federal agencies must ensure that they have the necessary 
institutional infrastructure in place before implementing major human 
capital reform efforts, such as NSPS. This institutional infrastructure 
includes, at a minimum, a human capital planning process that 
integrates the agency's human capital policies, strategies, and 
programs with its program goals, mission, and desired outcomes; the 
capabilities to effectively develop and implement a new human capital 
system; and the existence of a modern, effective, and credible 
performance management system that includes adequate safeguards to 
ensure a fair, effective, nondiscriminatory, and credible 
implementation of the new system. While GAO strongly supports human 
capital reform in the federal government, how it is done, when it is 
done, and the basis upon which it is done can make all the difference 
in whether such efforts are successful. 

Contractor Workforce in Government Is an Emerging Governmentwide Issue 
also Acknowledged as a Challenge for the Intelligence Community: 

An additional major issue of growing concern, both within and outside 
the Intelligence Community, deals with the type of work that is being 
performed by contractors, the need to determine the appropriate mix of 
government and contractor employees to meet mission needs, and the 
adequacy of oversight and accountability of contractors.[Footnote 23] 
These are areas where we also are well-positioned to provide additional 
support to the intelligence committees. While there are benefits to 
using contractors to perform services for the government--such as 
increased flexibility in fulfilling immediate needs--GAO and others 
have raised concerns about the federal government's increasing reliance 
on contractor services.[Footnote 24] A key concern is the risk 
associated with contractors providing services that closely support 
inherently governmental functions. Inherently governmental functions 
require the exercise of discretion in applying government authority 
and/or in making decisions for the government; as such, they should be 
performed by government employees, not contractors.[Footnote 25] In 
2007, I testified before the Senate Committee on Homeland Security and 
Governmental Affairs that the proper role of contractors in providing 
services to the government was the topic of some debate.[Footnote 26] I 
would like to reiterate that, in general, I believe there is a need to 
focus greater attention on which functions and activities should be 
contracted out and which should not, to review and reconsider the 
current independence and conflict-of-interest rules relating to 
contractors, and to identify the factors that prompt the government to 
use contractors in circumstances where the proper choice might be the 
use of civil servants or military personnel. Similarly, it is important 
that the federal government maintain an accountable and capable 
workforce, responsible for strategic planning and management of 
individual programs and contracts. 
 
In a September 2007 report, we identified a number of concerns 
regarding the risk associated with contractors providing services that 
closely support inherently governmental functions.[Footnote 27] For 
example, an increasing reliance on contractors to perform services for 
core government activities challenges the capacity of federal officials 
to supervise and evaluate the performance of these activities. The 
Federal Acquisition Regulation (FAR) provides agencies examples of 
inherently governmental functions that should not be performed by 
contractors.[Footnote 28] For example, the direction and control of 
intelligence and counter-intelligence operations are listed as 
inherently governmental functions.[Footnote 29] Yet in 2006, the 
Director of National Intelligence reported that the Intelligence 
Community finds itself in competition with its contractors for 
employees and is left with no choice but to use contractors for work 
that may be "borderline inherently governmental."[Footnote 30] Unless 
the federal government, including Intelligence Community agencies, pays 
the needed attention to the types of functions and activities performed 
by contractors, agencies run the risk of losing accountability and 
control over mission-related decisions. 
 
Personnel Security Clearances Continue to Experience Delays and 
Impediments: 
 
For more than 3 decades, GAO's reviews of personnel security clearances 
have identified delays and other impediments in DOD's personnel 
security clearance program, which maintains about 2.5 million 
clearances, including clearances for intelligence agencies within DOD. 
These long-standing problems resulted in our adding the DOD personnel 
security clearance program to our high-risk list in January 2005. One 
important outgrowth of this designation has been the level of 
congressional oversight from this Subcommittee, as well as some 
progress.[Footnote 31] 
 
In the past few years, several positive changes have been made to DOD-
-as well as governmentwide--clearance processes because of increased 
congressional oversight, recommendations from our work, and new 
legislative and executive requirements. One of OMB's efforts to improve 
the security clearance process involved taking a lead in preparing a 
November 2005 strategic plan to improve personnel security clearance 
processes governmentwide. In its February 2007 and 2008 annual IRTPA- 
mandated reports to Congress,[Footnote 32] OMB noted additional 
improvements that had been made to the security clearance process 
governmentwide. For example, OMB had issued standards for reciprocity 
(an agency's acceptance of a clearance issued by another agency), OPM 
had increased its investigative workforce, and DOD and other agencies 
had dramatically increased their use of OPM's Electronic Questionnaires 
for Investigations Processing system to reduce the time required to get 
a clearance by 2 to 3 weeks. Further, the Director of National 
Intelligence, the Under Secretary of Defense for Intelligence, and 
OMB's Deputy Director for Management established a team, the Joint 
Security Clearance Process Reform Team, to improve the security 
clearance process. The team is to develop a transformed, modernized, 
and reciprocal security clearance process that is supposed to be 
universally applicable to DOD, the Intelligence Community, and other 
federal agencies. The extent to which this new process will be 
implemented governmentwide, or whether leadership of the new system 
will be assigned to the ODNI, however, remains uncertain. 
 
Any attempts to reform the current security clearance process, 
regardless of which agency or organization undertakes the effort, 
should include some key factors. Specifically, current and future 
efforts to reform personnel security clearance processes should 
consider, among other things, determining whether clearances are 
required for positions, incorporating more quality control throughout 
the clearance processes to supplement current emphases on timeliness, 
establishing metrics for assessing all aspects of clearance processes, 
and providing Congress with the long-term funding requirements of 
security clearance reform. 
 
Although we have not worked with the entire Intelligence Community as 
part of our body of work on security clearances, we have worked with 
DOD intelligence agencies. For example, in the period from 1998 through 
2001, we reviewed National Security Agency clearance investigative 
reports and Defense Intelligence Agency adjudicative reports. 
Similarly, our February 2004 report examined information about 
adjudicative backlogs DOD-wide and the situation in those two 
intelligence agencies.[Footnote 33] Importantly, since 1974, we have 
been examining personnel security clearances mostly on behalf of 
Congress and some on behalf of this Subcommittee. Through scores of 
reports and testimonies, we have acquired broad institutional knowledge 
that gives us a historical view of key factors that should be 
considered in clearance reform efforts. We are well positioned to 
assist Congress in its oversight of this very important area. 
 
Recent GAO Reviews of Intelligence-Related Programs and Activities: 
 
In addition to our work on human capital transformation and personnel 
security clearance issues, our recent work has also addressed 
management issues--such as ISR systems, space acquisitions, and the 
space acquisition workforce--that directly affect the Intelligence 
Community and illustrate our ability to further support the 
intelligence and other appropriate congressional committees in their 
oversight roles. GAO's highly qualified and experienced staff-- 
including its analysts, auditors, lawyers, and methodologists--and 
secure facilities position us to perform intensive reviews that could 
be useful in assessing the transformation and related management 
reforms under consideration within the Intelligence Community, 
especially in connection with human capital and acquisition and 
contracting-related issues. GAO personnel who might perform work 
relating to the Intelligence Community have qualifications, skills, 
expertise, clearances and accesses, and experience across the federal 
government, in the national security arena, and across disciplines. For 
example, GAO methodologists have expertise in designing and executing 
appropriate methodological approaches that help us develop 
recommendations to improve government operations. Our attorneys advise 
GAO's analysts, issue external legal decisions and legal opinions, and 
prepare testimony, legislation, and reports on subjects reflecting the 
range of government activity. This legal work, for example, involves 
subjects such as information technology, international affairs and 
trade, foreign military sales, health and disability law, and education 
and labor law. GAO also already has personnel with appropriate 
clearances and accesses. I would like to highlight a couple of examples 
of GAO's work to demonstrate our expertise and capacity to perform 
intensive reviews in intelligence-related matters. 
 
GAO's Work Addressing ISR Requirements, Operations, and Acquisitions 
Identified Opportunities for Improvement: 
 
In the past year, we have testified and issued reports addressing DOD's 
ISR systems, including unmanned aircraft systems. The term "ISR" 
encompasses multiple activities related to the planning and operation 
of sensors and assets that collect, process, and disseminate data in 
support of current and future military operations. Intelligence data 
can take many forms, including optical, radar, or infrared images, or 
electronic signals. In April 2007, we testified that DOD has taken some 
important first steps to formulate a strategy for improving the 
integration of future ISR requirements, including the development of an 
ISR Integration Roadmap and designating ISR as a test case for its 
joint capability portfolio management concept. We also testified that 
opportunities exist for different services to collaborate on the 
development of similar weapon systems as a means for creating a more 
efficient and affordable way of providing new capabilities to the 
warfighter.[Footnote 34] As part of another review of ISR programs, we 
found that nearly all of the systems in development we examined had 
experienced some cost or schedule growth.[Footnote 35] As part of our 
work, we selected 20 major airborne ISR programs and obtained 
information on current or projected operational capabilities, 
acquisition plans, cost estimates, schedules, and estimated 
budgets.[Footnote 36] We analyzed the data to determine whether pairs 
of similar systems shared common operating concepts, capabilities, 
physical configurations, or primary contractors. We reviewed 
acquisition plans for programs in development to determine whether they 
had established sound business cases or, if not, where the business 
case was weak. We reviewed cost and schedule estimates to determine 
whether they had increased and, where possible, identified reasons for 
the increases. Based on our research and findings, we recommended that 
DOD develop and implement an integrated enterprise-level investment 
strategy, as well as report to the congressional defense committees the 
results of ISR studies underway and identify specific plans and actions 
it intends to take to achieve greater jointness in ISR programs. DOD 
generally agreed with our recommendations. 
 
We have also performed in-depth reviews of individual space programs 
that are shared with the Intelligence Community. For example, in recent 
years we have examined the Space Radar program, which is expected to be 
one of the most complex and expensive satellite developments ever. We 
reported that while the program was adopting best practices in 
technology development, its schedule and cost estimates may be overly 
optimistic and its overall affordability for DOD, which was 
parternering with the Intelligence Community, was 
questionable.[Footnote 37] Our concerns were cited by the Senate Select 
Committee on Intelligence in its discussion of reasons for reducing 
funding for Space Radar.[Footnote 38] 
 
GAO's Work on the Space Acquisition Workforce Recommended Management 
Improvements: 
 
Our work on the space acquisition workforce is another example of in- 
depth programmatic reviews we have been able to perform addressing 
intelligence-related matters. In a September 2006 report, we identified 
a variety of management issues dealing with Air Force space 
personnel.[Footnote 39] This is a critical issue because the Air Force 
provides over 90 percent of the space personnel to DOD, including the 
National Reconnaissance Office (NRO). We found that the Air Force has 
done needs assessments on certain segments of its space workforce, but 
it has not done an integrated, zero-based needs assessment of its space 
acquisition workforce. In the absence of an integrated, zero-based 
needs assessment of its space acquisition workforce and a career field 
specialty, the Air Force cannot ensure that it has enough space 
acquisition personnel or personnel who are technically proficient to 
meet national security space needs--including those in the Intelligence 
Community. As a part of this work, we collected and analyzed Air Force 
personnel data in specific specialty codes related to space acquisition 
and tracked their career assignments, training, and progression, 
including those assigned to the NRO. For example, we collected and 
analyzed data on space acquisition positions and personnel from 
multiple locations, and conducted discussion groups about topics 
including education and prior experience with junior and midgrade 
officers at the Space and Missile Systems Center in California. We made 
recommendations to DOD to take actions to better manage its limited 
pool of space acquisition personnel, and DOD generally agreed with our 
findings and recommendations. 
 
GAO's Access to Perform Audit Work Could be Affected If the ODNI 
Assumes Management of Personnel Security Clearances: 
 
Our ability to continue monitoring security clearance-related problems 
in DOD as well as other parts of the federal government and to provide 
Congress with information for its oversight role could be adversely 
affected if the ODNI assumes management responsibility over this area. 
First, in 2006, OMB's Deputy Director for Management has suggested that 
the agency's oversight role of the governmentwide security clearance 
process might be transferred to the ODNI. Alternatively, the ODNI could 
assume leadership, to some extent, of a new security clearance process 
that is intended for governmentwide implementation by a team 
established by the Director of National Intelligence, the Under 
Secretary of Defense for Intelligence, and OMB's Deputy Director for 
Management. While we have the legal authority to audit the personnel 
security clearance area if its oversight is moved to the ODNI or if the 
Joint Security Clearance Process Reform Team's proposed process is 
implemented governmentwide, we could face difficulties in gaining the 
cooperation we need to access the information. 
 
Although we have established and maintained a relatively positive 
working relationship with the ODNI, limitations on our ability to 
perform meaningful audit and evaluation work persist. Specifically, we 
routinely request and receive substantive threat briefings and copies 
of finished intelligence products prepared under the ODNI, and we meet 
with officials from the ODNI and obtain information about some of their 
activities. We also receive the ODNI agency comments and security 
reviews on most of our draft reports, as appropriate. However, since 
some members of the Intelligence Community have taken the position that 
the congressional intelligence committees have exclusive oversight 
authority, we do not audit or evaluate any programs or activities of 
the ODNI, nor are we able to verify or corroborate factual briefings or 
information provided. This resistance to providing us access to 
information has taken on new prominence and is of greater concern in 
the post-9/11 context, especially since the Director of National 
Intelligence has been assigned responsibilities addressing issues that 
extend well beyond traditional intelligence activities. For example, 
the ODNI and the National Counterterrorism Center refused to provide us 
security-related cost data for the 2006 Olympic Winter Games in Turin, 
Italy, although we were provided this type of data in prior reviews of 
the Olympic Games. 
 
If we continue to experience limitation on the types and amounts of 
information we can obtain from the Intelligence Community, then GAO may 
not be able to provide Congress with an independent, fact-based 
evaluation of the new security clearance process during its development 
and, later, its implementation. Either of these actions could occur 
without legislation. If the ODNI were to take leadership or oversight 
responsibilities for governmentwide personnel security clearances, it 
might be prudent to incorporate some legislative provision to reinforce 
GAO's access to the information needed to conduct audits and reviews in 
the personnel security clearance area. 
 
GAO Comments on the Intelligence Community Audit Act of 2007: 

Finally, GAO supports S. 82 and we would be well-positioned to provide 
Congress with an independent, fact-based evaluation of Intelligence 
Community management reform initiatives with the support of Congress 
and S. 82. Specifically, S. 82 would, if enacted, reaffirm GAO's 
authority, under existing statutory provisions, to audit and evaluate 
financial transactions, programs, and activities of elements of the 
Intelligence Community, and to access records necessary for such audits 
and evaluations. GAO has clear audit and access authority with respect 
to elements of the Intelligence Community,[Footnote 40] subject to a 
few limited exceptions. However, since 1988, DOJ and some members of 
the Intelligence Community have questioned GAO's authority in this 
area. In addition, for many years, the executive branch has not 
provided GAO with the level of cooperation needed to conduct meaningful 
reviews of elements of the Intelligence Community. As previously noted, 
this issue has taken on new prominence and is of greater concern in the 
post-9/11 context, especially since the Director of National 
Intelligence has been assigned responsibilities addressing issues that 
extend well beyond traditional intelligence activities, such as 
information sharing. The implications of executive branch resistance to 
GAO's work in the intelligence area were highlighted when the ODNI 
refused to comment on GAO's March 2006 report involving the 
government's information-sharing efforts, maintaining that DOJ had 
"previously advised" that "the review of intelligence activities is 
beyond the GAO's purview." We strongly disagree with this view. GAO has 
broad statutory authorities to audit and evaluate agency financial 
transactions, programs, and activities, and these authorities apply to 
reviews of elements of the Intelligence Community.[Footnote 41] 
 
Importantly, S. 82, in reaffirming GAO's authorities, recognizes that 
GAO may conduct reviews, requested by relevant committees of 
jurisdiction, of matters relating to the management and administration 
of elements of the Intelligence Community in areas such as strategic 
planning, financial management, information technology, human capital, 
knowledge management, information sharing, organizational 
transformation and management reforms, and collaboration practices. In 
recognition of the heightened level of sensitivity of audits and 
evaluations relating to intelligence sources and methods or covert 
actions, this bill would restrict GAO audits and evaluations of 
intelligence sources and methods or covert actions to those requested 
by the intelligence committees or congressional majority or minority 
leaders. In addition, in the context of reviews relating to 
intelligence sources and methods or covert actions, the bill contains 
several information security-related provisions. The bill includes, for 
example, provisions (1) requiring GAO to perform our work and use 
agency documents in facilities provided by the audited agencies; (2) 
requiring GAO to establish, after consultation with the Select 
Committee on Intelligence of the Senate and the Permanent Select 
Committee on Intelligence of the House of Representatives, procedures 
to protect such classified and other sensitive information from 
unauthorized disclosure; and (3) limiting GAO's reporting of results of 
such audits and evaluations strictly to the original requester, the 
Director of National Intelligence, and the head of the relevant element 
of the Intelligence Community. In our view, Congress should consider 
amending the bill language to include the intelligence committees in 
these reporting provisions when the congressional leadership is the 
original requester. 

The reaffirmation provisions in the bill should help to ensure that 
GAO's audit and access authorities are not misconstrued in the future. 
One particularly helpful provision in this regard is the proposed new 
section 3523a(e) of title 31, specifying that no "provision of law 
shall be construed as restricting or limiting the authority of the 
Comptroller General to audit and evaluate, or obtain access to the 
records of, elements of the intelligence community absent specific 
statutory language restricting or limiting such audits, evaluations, or 
access to records." This provision makes clear that, unless otherwise 
specified by law, GAO has the right to evaluate and access the records 
of elements of the Intelligence Community pursuant to its authorities 
in title 31 of the United States Code. 
 
Chairman Akaka, Senator Voinovich, and Members of the Subcommittee, 
this concludes my prepared testimony. I would be happy to respond to 
any questions that you or other Members of the Subcommittee may have at 
this time. 
 
Contact and Acknowledgments: 
 
For further information regarding this testimony, please contact Davi 
M. D'Agostino, Director, Defense Capabilities and Management, at (202) 
512-5431 or [email protected]. Contact points for our Offices of 
Congressional Relations and Public Affairs may be found on the last 
page of this statement. Individuals who made key contributions to this 
testimony are Mark A. Pross, Assistant Director; Tommy Baril; Cristina 
T. Chaplain; Jack E. Edwards; Brenda S. Farrell; Robert N. Goldenkoff; 
John P. Hutton; Julia C. Matta; Erika A. Prochaska; John Van Schaik; 
Sarah E. Veale; and Cheryl A. Weissman. 
 
[End of section] 
 
Related GAO Products: 
 
General Cross-Cutting Issues: 

GAO Strategic Plan 2007-2012. GAO-07-1SP. Washington, D.C.: March 2007. 

High Risk Series: An Update. GAO-07-310. Washington, D.C.: January 
2007. 
 
Results-Oriented Government: Practices That Can Help Enhance and 
Sustain Collaboration among Federal Agencies. GAO-06-15. Washington, 
D.C.: October 21, 2005. 

Defense Management: Key Elements Needed to Successfully Transform DOD 
Business Operations. GAO-05-629T. Washington, D.C.: April 28, 2005. 
 
DOD's High-Risk Areas: Successful Business Transformation Requires 
Sound Strategic Planning and Sustained Leadership. GAO-05-520T. 
Washington, D.C.: April 13, 2005. 

High-Risk Series: An Update. GAO-05-207. Washington, D.C.: January 
2005. 

Results-Oriented Cultures: Implementation Steps to Assist Mergers and 
Organizational Transformations. GAO-03-669. Washington, D.C.: July 2, 
2003. 
 
Human Capital: 
 
Human Capital: Federal Workforce Challenges in the 21st Century. GAO- 
07-556T. Washington, D.C.: March 6, 2007. 

Intelligence Reform: Human Capital Considerations Critical to 9/11 
Commission's Proposed Reforms. GAO-04-1084T. Washington, D.C.: 
September 14, 2004. 
 
Aviation Security: Federal Air Marshal Service Is Addressing Challenges 
of Its Expanded Mission and Workforce but Additional Actions Needed. 
GAO-04-242. Washington, D.C.: November 19, 2003. 
 
High-Risk Series: Strategic Human Capital Management. GAO-03-120. 
Washington, D.C.: January 2003. 
 
National Security Personnel System: 
 
Human Capital: DOD Needs Better Internal Controls and Visibility over 
Costs for Implementing Its National Security Personnel System. GAO-07- 
851. Washington, D.C.: July 16, 2007. 
 
Human Capital: Observations on Final Regulations for DOD's National 
Security Personnel System. GAO-06-227T. Washington, D.C.: November 17, 
2005. 
 
Human Capital: DOD's National Security Personnel System Faces 
Implementation Challenges. GAO-05-730. Washington, D.C.: July 14, 2005. 
 
Contracting Workforce in Government: 
 
Military Operations: Implementation of Existing Guidance and Other 
Actions Needed to Improve DODï¿½s Oversight and Management of Contractors 
in Future Operations. GAO-08-436T. Washington, D.C.:ï¿½January 24, 2008. 
 
Federal-Aid Highways: Increased Reliance on Contractors Can Pose 
Oversight Challenges for Federal and State Officials. GAO-08-198. 
Washington, D.C.: January 8, 2008. 
 
Department of Homeland Security: Improved Assessment and Oversight 
Needed to Manage Risk of Contracting for Selected Services. GAO-07-990. 
Washington, D.C.: September 17, 2007. 
 
Federal Acquisitions and Contracting: Systemic Challenges Need 
Attention. GAO-07-1098T. Washington, D.C.: July 17, 2007. 
 
Defense Acquisitions: Improved Management and Oversight Needed to 
Better Control DOD's Acquisition of Services. GAO-07-832T. Washington, 
D.C.: May 10, 2007. 
 
Security Clearances: 

Personnel Clearances: Key Factors to Consider in Efforts to Reform the 
Security Processes. GAO-08-352T. Washington, D.C.: February 27, 2008. 

DOD Personnel Clearances: Improved Annual Reporting Would Enable More 
Informed Congressional Oversight. GAO-08-350. Washington, D.C.: 
February 13, 2008. 

DOD Personnel Clearances: Delays and Inadequate Documentation Found for 
Industry Personnel. GAO-07-842T. Washington, D.C.: May 17, 2007. 

DOD Personnel Clearances: New Concerns Slow Processing of Clearances 
for Industry Personnel. GAO-06-748T. Washington, D.C.: May 17, 2006. 

DOD Personnel Clearances: Government Plan Addresses Some Long-standing 
Problems with DOD's Program, But Concerns Remain. GAO-06-233T. 
Washington, D.C.: November 9, 2005. 
 
DOD Personnel Clearances: Some Progress Has Been Made but Hurdles 
Remain to Overcome the Challenges That Led to GAO's High-Risk 
Designation. GAO-05-842T. Washington, D.C.: June 28, 2005. 
 
DOD Personnel Clearances: DOD Needs to Overcome Impediments to 
Eliminating Backlog and Determining Its Size. GAO-04-344. Washington, 
D.C.: Feb. 9, 2004. 

Footnotes: 
 
[1] An Intelligence Community member is a federal government agency, 
service, bureau, or other organization within the executive branch that 
plays a role in national intelligence. The Intelligence Community 
consists of the Office of the Director of National Intelligence and 16 
different agencies or components: Central Intelligence Agency; Defense 
Intelligence Agency; Departments of the Army, the Navy, and the Air 
Force; U.S. Marine Corps; National Geospatial-Intelligence Agency; 
National Reconnaissance Office; National Security Agency; Department of 
Energy; Department of Homeland Security; U.S. Coast Guard; Drug 
Enforcement Administration; Federal Bureau of Investigation; Department 
of State's Bureau of Intelligence and Research; and Department of the 
Treasury. The following members of the Intelligence Community are 
organizationally aligned within the Department of Defense: Defense 
Intelligence Agency; Departments of the Army, the Navy, and the Air 
Force; U.S. Marine Corps; National Geospatial- Intelligence Agency; 
National Reconnaissance Office; and National Security Agency. 
Additionally, the U.S. Coast Guard is organizationally aligned with the 
Department of Homeland Security and the Drug Enforcement Administration 
and the Federal Bureau of Investigation are organizationally aligned 
with the Department of Justice. 
 
[2] S. 82, Intelligence Community Audit Act of 2007, was introduced on 
January 4, 2007. 
 
[3] GAO, High-Risk Series: An Update, GAO-07-310 (Washington, D.C.: 
January 2007). Agencies within the Intelligence Community also are 
vulnerable to other high-risk areas, such as contract management, 
management of interagency contracting, protecting the federal 
government's information systems and the nation's critical 
infrastructures, and ensuring the effective protection of technologies 
critical to U.S. national security interests. 

[4] See U.S. Congress, Subcommittee on Oversight, House Permanent 
Select Committee on Intelligence, Initial Assessment on the 
Implementation of The Intelligence Reform and Terrorism Prevention Act 
of 2004 (Washington, D.C.: July 27, 2006); Congressional Research 
Service, Intelligence Issues for Congress, RL33539 (Washington, D.C.: 
Updated Dec. 18, 2007); National Commission on Terrorist Attacks Upon 
the United States, The 9/11 Commission Report: Final Report of the 
National Commission on Terrorist Attacks Upon the United States 
(Washington, D.C.: July 22, 2004); and The Commission on the 
Intelligence Capabilities of the United States Regarding Weapons of 
Mass Destruction, Report to the President of the United States 
(Washington, D.C.: Mar. 31, 2005). 
 
[5] GAO, Space Based Infrared System High Program and its Alternative, 
GAO-07-1088 (Washington, D.C.: Sep. 12, 2007); DOD is Making Progress 
in Adopting Best Practices for the Transformational Satellite 
Communications System and Space Radar but Still Faces Challenges, GAO-
07-1029R (Washington, D.C.: Aug. 2, 2007); Unmanned Aircraft Systems: 
Advance Coordination and Increased Visibility Needed to Optimize 
Capabilities, GAO-07-836 (Washington, D.C.: July 11, 2007); Defense 
Acquisitions: Greater Synergies Possible for DOD's Intelligence, 
Surveillance, and Reconnaissance Systems, GAO-07-578 (Washington, D.C.: 
May 17, 2007); Intelligence, Surveillance, and Reconnaissance: 
Preliminary Observations on DOD's Approach to Managing Requirements for 
New Systems, Existing Assets, and Systems Development, GAO-07-596T 
(Washington, D.C.: Apr. 19, 2007); and Defense Space Activities: 
Management Actions Are Needed to Better Identify, Track, and Train Air 
Force Space Personnel, GAO-06-908 (Washington, D.C.: Sept. 21, 2006). 
 
[6] 31 U.S.C. ï¿½ï¿½ 712, 717, 3523, and 3524. 
 
[7] 31 U.S.C. ï¿½ 716. 
 
[8] 31 U.S.C. ï¿½ 716(d)(1)(A). 
 
[9] GAO, Central Intelligence Agency: Observations on GAO Access to 
Information on CIA Programs and Activities, GAO-01-975T (Washington, 
D.C.: July 18, 2001). 

[10] DOJ's position and our analysis is set forth in more detail in 
GAO, Information Sharing: The Federal Government Needs to Establish 
Policies and Processes for Sharing Terrorism-Related and Sensitive But 
Unclassified Information, GAO-06-385 (Washington, D.C.: Mar. 17, 2006). 

[11] Pub. L. No. 108-458 ï¿½ 1011 (2004) (codified at 50 U.S.C. ï¿½ 403). 
 
[12] Pub. L. No. 108-458 ï¿½ 3001(b) (2004). 

[13] The White House, Executive Order 13381, Strengthening Processes 
Relating to Determining Eligibility for Access to Classified National 
Security Information (Washington, D.C.: June 27, 2005), as amended. 

[14] Senate Committee on Homeland Security and Governmental Affairs, 
Progress or More Problems: Assessing the Federal Government's Security 
Clearance Process, S. Hrg 109-621 (Washington, D.C.: May 17, 2006). 
 
[15] GAO, Intelligence Reform: Human Capital Considerations Critical to 
9/11 Commission's Proposed Reforms, GAO-04-1084T (Washington, D.C.: 
Sept. 14, 2004). Also see Intelligence Issues For Congress; The 9/11 
Commission Report: Final Report of the National Commission on Terrorist 
Attacks Upon the United States; and Report to the President of the 
United States. 

[16] ODNI, United States Intelligence Community 100 Day Plan for 
Integration and Collaboration (Washington, D.C.: Apr. 11, 2007) and 
Office of the Director of National Intelligence, The US Intelligence 
Community's Strategic Five Year Human Capital Plan (Washington, D.C.: 
June 22, 2006). 
 
[17] GAO-07-310. 
 
[18] Section 308 of H.R. 2082, the bill to authorize appropriations for 
fiscal year 2008 for the Intelligence Community, would require the 
Director of National Intelligence to submit to Congress a detailed plan 
for the compensation-based system of a particular element of the 
Intelligence Community before it is implemented. 
 
[19] Pub. L. No. 108-136, ï¿½ 1101 (2003). 
 
[20] The Department of Homeland Security also has received new 
statutory authority to help manage its workforce more strategically. 
 
[21] GAO, Defense Transformation: Preliminary Observations on DOD's 
Proposed Civilian Personnel Reforms, GAO-03-717T (Washington, D.C.: 
Apr. 29, 2003); Defense Transformation: DOD's Proposed Civilian 
Personnel Systems and Governmentwide Human Capital Reform, GAO-03-741T 
(Washington, D.C.: May 1, 2003); and Human Capital: Building on DOD's 
Reform Efforts to Foster Governmentwide Improvements, GAO-03-851T 
(Washington, D.C.: June 4, 2003). 
 
[22] GAO, Human Capital: DOD Needs Better Internal Controls and 
Visibility Over Costs for Implementing Its National Security Personnel 
System, GAO-07-851 (Washington, D.C.: July 16, 2007) and Human Capital: 
Observations on Final Regulations for DOD's National Security Personnel 
System, GAO-06-227T (Washington, D.C.: Nov. 17, 2006). 

[23] For example, Section 307 of H.R. 2082, the bill to authorize 
appropriations for fiscal year 2008 for the Intelligence Community, 
would require the Director of National Intelligence to submit a report 
to the congressional intelligence committees describing the personal 
services activities performed by contractors across the Intelligence 
Community, the impact of such contractors on the Intelligence Community 
workforce, plans for conversion of contractor employment into 
government employment, and the accountability mechanisms that govern 
the performance of such contractors. 
 
[24] See, for example, GAO, Highlights of a GAO Forum: Federal 
Acquisition Challenges and Opportunities in the 21st Century, GAO-07-
45SP (Washington, D.C.: Oct. 6, 2006) and Acquisition Advisory Panel, 
Report of the Acquisition Advisory Panel to the Office of Federal 
Procurement Policy and the United States Congress (January 2007). 

[25] OMB Circular A-76, Performance of Commercial Activities, May 29, 
2003; Federal Acquisition Regulation, Subpart 7.5. 

[26] GAO, Federal Acquisitions and Contracting: Systemic Challenges 
Need Attention, GAO-07-1098T (Washington, D.C.: July 17, 2007). 
 
[27] GAO, Department of Homeland Security: Improved Assessment and 
Oversight Needed to Manage Risk of Contracting for Selected Services, 
GAO-07-990 (Washington, D.C.: Sept. 17, 2007). 

[28] FAR ï¿½ 7.503(c). 
 
[29] FAR ï¿½ 7.503(c)(8). 
 
[30] The US Intelligence Community's Strategic Five Year Human Capital 
Plan. 
 
[31] GAO, DOD Personnel Clearances: Delays and Inadequate Documentation 
Found for Industry Personnel, GAO-07-842T (Washington, D.C.: May 17, 
2007); DOD Personnel Clearances: New Concerns Slow Processing of 
Clearances for Industry Personnel, GAO-06-748T (Washington, D.C.: May 
17, 2006); DOD Personnel Clearances: Government Plan Addresses Some 
Long-standing Problems with DOD's Program, But Concerns Remain, GAO-06-
233T (Washington, D.C.: Nov. 9, 2005); and DOD Personnel Clearances: 
Some Progress Has Been Made but Hurdles Remain to Overcome the 
Challenges That Led to GAO's High-Risk Designation, GAO-05-842T 
(Washington, D.C.: June 28, 2005). 
 
[32] Office of Management and Budget, Report of the Security Clearance 
Oversight Group Consistent with Title III of the Intelligence Reform 
and Terrorism Prevention Act of 2004 (February 2007), and Report of the 
Security Clearance Oversight Group Consistent with Title III of the 
Intelligence Reform and Terrorism Prevention Act of 2004, (February 
2008). 

[33] GAO, DOD Personnel Clearances: DOD Needs to Overcome Impediments 
to Eliminating Backlog and Determining Its Size, GAO-04-344 
(Washington, D.C.: Feb. 9, 2004). 
 
[34] GAO-07-596T. 
 
[35] GAO-07-578. 

[36] These programs were either in technology or systems development, 
already fielded but undergoing significant upgrade, or operating in the 
field but due to be replaced by a system in development and one space- 
based program in technology development. 

[37] GAO-07-1029R. 
 
[38] S. Rep. No. 110-75, at 48 (2007). 
 
[39] GAO-06-908. 
 
[40] IRTPA (Pub. L. No. 108-458), which established a Director of 
National Intelligence, did not alter GAO's authority to audit and 
evaluate financial transactions, programs, and activities of elements 
of the Intelligence Community. 

[41] DOJ's position and our analysis of it is set forth in more detail 
in GAO-06-385. 

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