1995 Congressional Documents
Intelligence and Security


   104th Congress 1st   HOUSE OF REPRESENTATIVES    Rept. 104-138
         Session
                                                        Part 1
_______________________________________________________________________

                                     

 
            INTELLIGENCE AUTHORIZATION ACT FOR FISCAL YEAR 1996

                               __________

                              R E P O R T

                                 of the


                       PERMANENT SELECT COMMITTEE
                            ON INTELLIGENCE
                        HOUSE OF REPRESENTATIVES

                             together with

                     ADDITIONAL AND MINORITY VIEWS

                        [To accompany H.R. 1655]

      [Including cost estimate of the Congressional Budget Office]


<GRAPHIC NOT AVAILABLE IN TIFF FORMAT>

                 June 14, 1995.--Ordered to be printed


                            C O N T E N T S

                                                                   Page
Purpose..........................................................     8
Overall perspective on the intelligence budget and committee         10
  intent.
Scope of committee review........................................    10
Committee findings and recommendations...........................    11
Areas of Special Interest........................................    13
    Personnel Issues.............................................    13
    Terrorism....................................................    15
    Satellite Architecture.......................................    15
    Aerial Reconnaissance........................................    16
    Intelligence Broadcasts and Receivers........................    23
    Fusion Development...........................................    25
    Tactical Space Operations....................................    25
    Intelligence Support to Targeting............................    25
Section-by-section analysis of bill as reported..................    26
Title I--Intelligence Activities.................................    26
    Section 101--Authorization of appropriations.................    26
    Section 102--Classified schedule of authorizations...........    26
    Section 103--Personnel ceiling adjustments...................    26
    Section 104--Community management account....................    27
Title II--Central Intelligence Agency Retirement and Disability      27
  System.
    Section 201--Authorization of appropriations.................    27
Title III--General Provisions....................................    27
    Section 301--Increase in employee compensation and benefits      27
      authorized by law.
    Section 302--Restriction on conduct of intelligence              27
      activities.
    Section 303--Application of sanctions laws to intelligence       28
      activities.
    Section 304--Thrift savings plan forfeiture..................    29
    Section 305--Authority to restore spousal pension benefits to    29
      spouses who cooperate in criminal investigations and 
      prosecutions for national security offenses.
    Section 306--Secrecy agreements used in intelligence             29
      activities.
    Section 307--Limitation on availability of funds for             31
      automatic declassification of records over 25 years old.
Title IV--Central Intelligence Agency............................    31
    Section 401--Extension of the CIA voluntary separation pay       31
      act.
    Section 402--Volunteer service program.......................    31
Title V--Department of Defense Intelligence Activities...........    31
    Section 501--Defense intelligence senior level positions.....    31
    Section 502--Comparable benefits and allowances for civilian     33
      and military personnel assigned to defense intelligence 
      functions overseas.
    Section 503--Extension of authority to conduct intelligence      33
      commercial activities.
    Section 504--Availability of funds for Tier II UAV...........    34
    Section 505--Temporary program to waive mandatory reductions     34
      to annuities.
Title VI--Technical Amendments...................................    36
    Section 601--Clarification with respect to pay for Director      36
      or Deputy Director of Central Intelligence appointed from 
      commissioned officers of the armed forces.
    Section 602--Change of designation of CIA office of security.    37
Title VII--Department of State Intelligence Activities...........    37
    Section 701--Consolidation of watch component of the Bureau      37
      of Intelligence and Research.
Committee Position...............................................    38
Findings and recommendations of the Committee on Government          38
  Reform and Oversight.
Oversight Findings...............................................    38
Congressional Budget Office estimate.............................    39
Committee cost estimates.........................................    43
Inflationary Impact Statement....................................    43
Changes in existing law made by the bill, as reported............    43
Minority and additional views....................................    54
H.L.C.

                                                                       
104th Congress                                            Rept. 104-138
                        HOUSE OF REPRESENTATIVES

 1st Session                                                     Part 1
_______________________________________________________________________


          INTELLIGENCE AUTHORIZATION ACT FOR FISCAL YEAR 1996

_______________________________________________________________________


                 June 14, 1995.--Ordered to be printed

                                _______


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

                              R E P O R T

                             together with

                     MINORITY AND ADDITIONAL VIEWS

                        [To accompany H.R. 1655]

      [Including cost estimate of the Congressional Budget Office]
  The Permanent Select Committee on Intelligence, to whom was 
referred the bill (H.R. 1655) to authorize appropriations for 
fiscal year 1996 for intelligence and intelligence-related 
activities of the United States Government, the Community 
Management Account, and the Central Intelligence Agency 
Retirement and Disability System, and for other purposes, 
having considered the same, report favorably thereon with an 
amendment and recommend that the bill as amended do pass.

  The amendment is as follows:
  Strike out all after the enacting clause and insert in lieu 
thereof the following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Intelligence Authorization Act for 
Fiscal Year 1996''.

                    TITLE I--INTELLIGENCE ACTIVITIES

SEC. 101. AUTHORIZATION OF APPROPRIATIONS.

  Funds are hereby authorized to be appropriated for fiscal year 1996 
for the conduct of the intelligence and intelligence-related activities 
of the following elements of the United States Government:
          (1) The Central Intelligence Agency.
          (2) The Department of Defense.
          (3) The Defense Intelligence Agency.
          (4) The National Security Agency.
          (5) The Department of the Army, the Department of the Navy, 
        and the Department of the Air Force.
          (6) The Department of State.
          (7) The Department of Treasury.
          (8) The Department of Energy.
          (9) The Federal Bureau of Investigation.
          (10) The Drug Enforcement Administration.
          (11) The National Reconnaissance Office.
          (12) The Central Imagery Office.

SEC. 102. CLASSIFIED SCHEDULE OF AUTHORIZATIONS.

  (a) Specifications of Amounts and Personnel Ceilings.--The amounts 
authorized to be appropriated under section 101, and the authorized 
personnel ceilings as of September 30, 1996, for the conduct of the 
intelligence and intelligence-related activities of the elements listed 
in such section, are those specified in the classified Schedule of 
Authorizations prepared to accompany the bill H.R. 1655 of the 104th 
Congress.
  (b) Availability of Classified Schedule of Authorizations.--The 
Schedule of Authorizations shall be made available to the Committees on 
Appropriations of the Senate and House of Representatives and to the 
President. The President shall provide for suitable distribution of the 
Schedule, or of appropriate portions of the Schedule, within the 
executive branch.

SEC. 103. PERSONNEL CEILING ADJUSTMENTS.

  (a) Authority for Adjustments.--With the approval of the Director of 
the Office of Management and Budget, the Director of Central 
Intelligence may authorize employment of civilian personnel in excess 
of the number authorized for fiscal year 1996 under section 102 when 
the Director of Central Intelligence determines that such action is 
necessary to the performance of important intelligence functions, 
except that the number of personnel employed in excess of the number 
authorized under such section may not, for any element of the 
intelligence community, exceed two percent of the number of civilian 
personnel authorized under such section for such element.
  (b) Notice to Intelligence Committees.--The Director of Central 
Intelligence shall promptly notify the Permanent Select Committee on 
Intelligence of the House of Representatives and the Select Committee 
on Intelligence of the Senate whenever he exercises the authority 
granted by this section.

SEC. 104. COMMUNITY MANAGEMENT ACCOUNT.

  (a) Authorization of Appropriations.--There is authorized to be 
appropriated for the Community Management Account of the Director of 
Central Intelligence for fiscal year 1996 the sum of $80,713,000. 
Within such amounts authorized, funds identified in the classified 
Schedule of Authorizations referred to in section 102(a) for the 
Advanced Research and Development Committee and the Environmental Task 
Force shall remain available until September 30, 1997.
  (b) Authorized Personnel Levels.--The Community Management Staff of 
the Director of Central Intelligence is authorized 247 full-time 
personnel as of September 30, 1996. Such personnel of the Community 
Management Staff may be permanent employees of the Community Management 
Staff or personnel detailed from other elements of the United States 
Government.
  (c) Reimbursement.--During fiscal year 1996, any officer or employee 
of the United States or a member of the Armed Forces who is detailed to 
the Community Management Staff from another element of the United 
States Government shall be detailed on a reimbursable basis, except 
that any such officer, employee or member may be detailed on a 
nonreimbursable basis for a period of less than one year for the 
performance of temporary functions as required by the Director of 
Central Intelligence.

 TITLE II--CENTRAL INTELLIGENCE AGENCY RETIREMENT AND DISABILITY SYSTEM

SEC. 201. AUTHORIZATION OF APPROPRIATIONS.

  There is authorized to be appropriated for the Central Intelligence 
Agency Retirement and Disability Fund for fiscal year 1996 the sum of 
$213,900,000.

                     TITLE III--GENERAL PROVISIONS

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

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

SEC. 302. RESTRICTION ON CONDUCT OF INTELLIGENCE ACTIVITIES.

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

SEC. 303. APPLICATION OF SANCTIONS LAWS TO INTELLIGENCE ACTIVITIES.

  (a) General Provisions.--The National Security Act of 1947 (50 U.S.C. 
401 et seq.), is amended by adding at the end thereof the following new 
title:

  ``TITLE IX--APPLICATION OF SANCTIONS LAWS TO INTELLIGENCE ACTIVITIES

                          ``stay of sanctions
  ``Sec. 901. Notwithstanding any other provision of law, the President 
may stay the imposition of an economic, cultural, diplomatic, or other 
sanction or related action by the United States Government concerning a 
foreign country, organization, or person when the President determines 
that to proceed without delay would seriously risk the compromise of an 
ongoing criminal investigation or an intelligence source or method. The 
President shall lift any such stay when the President determines that 
such stay is no longer necessary to that purpose.
                               ``reports
  ``Sec. 902. Whenever any stay is imposed pursuant to section 901, and 
whenever the duration of any such stay exceeds 120 days, the President 
shall promptly report to the Select Committee on Intelligence of the 
Senate and the Permanent Select Committee on Intelligence of the House 
of Representatives the rationale and circumstances that led the 
President to exercise the stay authority with respect to an 
intelligence source or method, and to the Judiciary Committees of the 
Senate and the House of Representatives the rationale and circumstances 
that led the President to exercise the stay authority with respect to 
an ongoing criminal investigation.''.
  (b) Clerical Amendment.--The table of contents in the first section 
of such Act is amended by adding at the end thereof the following:
``title ix--application of sanctions laws to intelligence activities
``Sec. 901. Stay of Sanctions.
``Sec. 902. Reports.''.
SEC. 304. THRIFT SAVINGS PLAN FORFEITURE.

  Section 8432(g) of title 5, United States Code, is amended by adding 
at the end the following new paragraphs:
  ``(5)(A) Notwithstanding any other provision of law, contributions 
made by the Government for the benefit of an employee or Member under 
subsection (c), and all earnings attributable to such contributions, 
shall be forfeited if the annuity of the employee or Member, or that of 
a survivor or beneficiary, is forfeited under subchapter II of chapter 
83.
  ``(B) Forfeitures under this paragraph shall occur only if the 
offenses upon which the requisite annuity forfeitures are based 
happened subsequent to the enactment of this paragraph.''.

SEC. 305. AUTHORITY TO RESTORE SPOUSAL PENSION BENEFITS TO SPOUSES WHO 
                    COOPERATE IN CRIMINAL INVESTIGATIONS AND 
                    PROSECUTIONS FOR NATIONAL SECURITY OFFENSES.

  Section 8318 of title 5, United States Code, is amended by adding at 
the end the following:
  ``(e) The spouse of an individual whose annuity or retired pay is 
forfeited under section 8312 or 8313 after the date of enactment of 
this subsection shall be eligible for spousal pension benefits if the 
Attorney General of the United States determines that the spouse fully 
cooperated with Federal authorities in the conduct of a criminal 
investigation and subsequent prosecution of the individual which 
resulted in such forfeiture.''.

SEC. 306. SECRECY AGREEMENTS USED IN INTELLIGENCE ACTIVITIES.

  Notwithstanding any other provision of law not specifically 
referencing this section, a nondisclosure policy form or agreement that 
is to be executed by a person connected with the conduct of an 
intelligence or intelligence-related activity, other than an employee 
or officer of the United States Government, may contain provisions 
appropriate to the particular activity for which such document is to be 
used. Such form or agreement shall, at a minimum, require that the 
person will not disclose any classified information received in the 
course of such activity unless specifically authorized to do so by the 
United States Government.

SEC. 307. LIMITATION ON AVAILABILITY OF FUNDS FOR AUTOMATIC 
                    DECLASSIFICATION OF RECORDS OVER 25 YEARS OLD.

  (a) In General.--Each agency of the National Foreign Intelligence 
Program shall use no more than $2,500,000 of the amounts authorized to 
be appropriated by this Act to carry out the provisions of section 3.4 
of Executive Order 12958.
  (b) Required Budget Submission.--The President shall submit for 
fiscal year 1997 and each of the following five years a budget request 
which specifically sets forth the funds requested for implementation of 
section 3.4 of Executive Order 12958.

                 TITLE IV--CENTRAL INTELLIGENCE AGENCY

SEC. 401. EXTENSION OF THE CIA VOLUNTARY SEPARATION PAY ACT.

  Section 2(f) of the Central Intelligence Agency Voluntary Separation 
Pay Act (50 U.S.C. 403-4(f)), is amended by striking out ``September 
30, 1997'' and inserting in lieu thereof ``September 30, 1999''.

SEC. 402. VOLUNTEER SERVICE PROGRAM.

  (a) General Authority.--The Director of Central Intelligence is 
authorized to establish and maintain a program from fiscal years 1996 
through 2001 to utilize the services contributed by not more than 50 
annuitants who serve without compensation as volunteers in aid of 
systematic or mandatory review for declassification or downgrading of 
classified information of the Central Intelligence Agency under 
applicable Executive orders governing the classification and 
declassification of national security information and Public Law 102-
526.
  (b) Costs Incidental to Services.--The Director is authorized to use 
sums made available to the Central Intelligence Agency by 
appropriations or otherwise for paying the costs incidental to the 
utilization of services contributed by individuals under subsection 
(a). Such costs may include (but need not be limited to) training, 
transportation, lodging, subsistence, equipment, and supplies. The 
Director may authorize either direct procurement of equipment, 
supplies, and services, or reimbursement for expenses, incidental to 
the effective use of volunteers. Such expenses or services shall be in 
accordance with volunteer agreements made with such individuals. Sums 
made available for such costs may not exceed $100,000.
  (c) Application of Certain Provisions of Law.--A volunteer under this 
section shall be considered to be a Federal employee for the purposes 
of subchapter I of title 81 (relating to compensation of Federal 
employees for work injuries) and section 1346(b) and chapter 171 of 
title 28 (relating to tort claims). A volunteer under this section 
shall be covered by and subject to the provisions of chapter 11 of 
title 18 of the United States Code as if they were employees or special 
Government employees depending upon the days of expected service at the 
time they begin volunteering.
         TITLE V--DEPARTMENT OF DEFENSE INTELLIGENCE ACTIVITIES

SEC. 501. DEFENSE INTELLIGENCE SENIOR LEVEL POSITIONS.

  Section 1604 of title 10, United States Code, is amended to read as 
follows:

``Sec. 1604. Civilian personnel management

  ``(a) General Personnel Authority.--The Secretary of Defense may, 
without regard to the provisions of any other law relating to the 
number, classification, or compensation of Federal employees--
          ``(1) establish such positions for employees in the Defense 
        Intelligence Agency and the Central Imagery Office as the 
        Secretary considers necessary to carry out the functions of 
        that Agency and Office, including positions designated under 
        subsection (f) as Defense Intelligence Senior Level positions;
          ``(2) appoint individuals to those positions; and
          ``(3) fix the compensation for service in those positions.
  ``(b) Authority To Fix Rates of Basic Pay; Other Allowances and 
Benefits.--(1) The Secretary of Defense shall, subject to subsection 
(c), fix the rates of basic pay for positions established under 
subsection (a) in relation to the rates of basic pay provided in 
subpart D of part III of title 5 for positions subject to that title 
which have corresponding levels of duties and responsibilities. Except 
as otherwise provided by law, an employee of the Defense Intelligence 
Agency or the Central Imagery Office may not be paid basic pay at a 
rate in excess of the maximum rate payable under section 5376 of title 
5.
  ``(2) The Secretary of Defense may provide employees of the Defense 
Intelligence Agency and the Central Imagery Office compensation (in 
addition to basic pay under paragraph (1)) and benefits, incentives, 
and allowances consistent with, and not in excess of the levels 
authorized for, comparable positions authorized by title 5.
  ``(c) Prevailing Rates Systems.--The Secretary of Defense may, 
consistent with section 5341 of title 5, adopt such provisions of that 
title as provide for prevailing rate systems of basic pay and may apply 
those provisions to positions in or under which the Defense 
Intelligence Agency or the Central Imagery Office may employ 
individuals described by section 5342(a)(2)(A) of such title.
  ``(d) Allowances Based on Living Costs and Environment for Employees 
Stationed Outside Continental United States or in Alaska.--(1) In 
addition to the basic compensation payable under subsection (b), 
employees of the Defense Intelligence Agency and the Central Imagery 
Office described in paragraph (3) may be paid an allowance, in 
accordance with regulations prescribed by the Secretary of Defense, at 
a rate not in excess of the allowance authorized to be paid under 
section 5941(a) of title 5 for employees whose rates of basic pay are 
fixed by statute.
  ``(2) Such allowance shall be based on--
          ``(A) living costs substantially higher than in the District 
        of Columbia;
          ``(B) conditions of environment which--
                  ``(i) differ substantially from conditions of 
                environment in the continental United States; and
                  ``(ii) warrant an allowance as a recruitment 
                incentive; or
          ``(C) both of those factors.
  ``(3) This subsection applies to employees who--
          ``(A) are citizens or nationals of the United States; and
          ``(B) are stationed outside the continental United States or 
        in Alaska.
  ``(e) Termination of Employees.--(1) Notwithstanding any other 
provision of law, the Secretary of Defense may terminate the employment 
of any employee of the Defense Intelligence Agency or the Central 
Imagery Office if the Secretary--
          ``(A) considers such action to be in the interests of the 
        United States; and
          ``(B) determines that the procedures prescribed in other 
        provisions of law that authorize the termination of the 
        employment of such employee cannot be invoked in a manner 
        consistent with the national security.
  ``(2) A decision by the Secretary of Defense to terminate the 
employment of an employee under this subsection is final and may not be 
appealed or reviewed outside the Department of Defense.
  ``(3) The Secretary of Defense shall promptly notify the Permanent 
Select Committee on Intelligence of the House of Representatives and 
the Select Committee on Intelligence of the Senate whenever the 
Secretary terminates the employment of any employee under the authority 
of this subsection.
  ``(4) Any termination of employment under this subsection shall not 
affect the right of the employee involved to seek or accept employment 
with any other department or agency of the United States if that 
employee is declared eligible for such employment by the Director of 
the Office of Personnel Management.
  ``(5) The authority of the Secretary of Defense under this subsection 
may be delegated only to the Deputy Secretary of Defense, the Director 
of the Defense Intelligence Agency (with respect to employees of the 
Defense Intelligence Agency), and the Director of the Central Imagery 
Office (with respect to employees of the Central Imagery Office). An 
action to terminate employment of an employee by any such officer may 
be appealed to the Secretary of Defense.
  ``(f) Defense Intelligence Senior Level Positions.--(1) In carrying 
out subsection (a)(1), the Secretary may designate positions described 
in paragraph (3) as Defense Intelligence Senior Level positions. The 
total number of positions designated under this subsection and in the 
Defense Intelligence Senior Executive Service under section 1601 of 
this title may not exceed the number of positions in the Defense 
Intelligence Senior Executive Service as of June 1, 1995.
  ``(2) Positions designated under this subsection shall be treated as 
equivalent for purposes of compensation to the senior level positions 
to which section 5376 of title 5 is applicable.
  ``(3) Positions that may be designated as Defense Intelligence Senior 
Level positions are positions in the Defense Intelligence Agency and 
Central Imagery Office that (A) are classified above the GS-15 level, 
(B) emphasize functional expertise and advisory activity, but (C) do 
not have the organizational or program management functions necessary 
for inclusion in the Defense Intelligence Senior Executive Service.
  ``(4) Positions referred to in paragraph (3) include Defense 
Intelligence Senior Technical positions and Defense Intelligence Senior 
Professional positions. For purposes of this subsection--
          ``(A) Defense Intelligence Senior Technical positions are 
        positions covered by paragraph (3) that involve any of the 
        following:
                  ``(i) Research and development.
                  ``(ii) Test and evaluation.
                  ``(iii) Substantive analysis, liaison, or advisory 
                activity focusing on engineering, physical sciences, 
                computer science, mathematics, biology, chemistry, 
                medicine, or other closely related scientific and 
                technical fields.
                  ``(iv) Intelligence disciplines including production, 
                collection, and operations in close association with 
                any of the activities described in clauses (i), (ii), 
                and (iii) or related activities; and
          ``(B) Defense Intelligence Senior Professional positions are 
        positions covered by paragraph (3) that emphasize staff, 
        liaison, analytical, advisory, or other activity focusing on 
        intelligence, law, finance and accounting, program and budget, 
        human resources management, training, information services, 
        logistics, security, and other appropriate fields.
  ``(g) `Employee' Defined as Including Officers.--In this section, the 
term `employee', with respect to the Defense Intelligence Agency or the 
Central Imagery Office, includes any civilian officer of that Agency or 
Office.''.
SEC. 502. COMPARABLE BENEFITS AND ALLOWANCES FOR CIVILIAN AND MILITARY 
                    PERSONNEL ASSIGNED TO DEFENSE INTELLIGENCE 
                    FUNCTIONS OVERSEAS.

  (a) Civilian Personnel.--Section 1605 of title 10, United States 
Code, is amended--
          (1) in subsection (a)--
                  (A) by inserting ``(1)'' after ``(a)'';
                  (B) by striking out ``of the Department of Defense'' 
                and all that follows through ``this subsection,'' and 
                inserting in lieu thereof ``described in subsection 
                (d)''; and
                  (C) by designating the second sentence as paragraph 
                (2);
          (2) by striking out subsection (c) and inserting in lieu 
        thereof the following:
  ``(c) Regulations prescribed under subsection (a) may not take effect 
until the Secretary of Defense has submitted such regulations to--
          ``(1) the Committee on Armed Services and the Select 
        Committee on Intelligence of the Senate; and
          ``(2) the Committee on National Security and the Permanent 
        Select Committee on Intelligence of the House of 
        Representatives.''; and
          (3) by adding at the end the following new subsection:
  ``(d) Subsection (a) applies to civilian personnel of the Department 
of Defense who--
          ``(1) are United States nationals;
          ``(2) in the case of employees of the Defense Intelligence 
        Agency, are assigned to duty outside the United States and, in 
        the case of other employees, are assigned to Defense Attache 
        Offices or Defense Intelligence Agency Liaison Offices outside 
        the United States; and
          ``(3) are designated by the Secretary of Defense for the 
        purposes of subsection (a).''.
  (b) Military Personnel.--Section 431 of title 37, United States Code, 
is amended--
          (1) in subsection (a), by striking out ``who are assigned 
        to'' and all that follows through ``of this subsection'' and 
        inserting in lieu thereof ``described in subsection (e)'';
          (2) by striking out subsection (d) and inserting in lieu 
        thereof the following:
  ``(d) Regulations prescribed under subsection (a) may not take effect 
until the Secretary of Defense has submitted such regulations to--
          ``(1) the Committee on Armed Services and the Select 
        Committee on Intelligence of the Senate; and
          ``(2) the Committee on National Security and the Permanent 
        Select Committee on Intelligence of the House of 
        Representatives.''; and
          (3) by adding at the end the following new subsection:
  ``(e) Subsection (a) applies to members of the armed forces who--
          ``(1) are assigned--
                  ``(A) to Defense Attache Offices or Defense 
                Intelligence Agency Liaison Offices outside the United 
                States; or
                  ``(B) to the Defense Intelligence Agency and engaged 
                in intelligence-related duties outside the United 
                States; and
          ``(2) are designated by the Secretary of Defense for the 
        purposes of subsection (a).''.
SEC. 503. EXTENSION OF AUTHORITY TO CONDUCT INTELLIGENCE COMMERCIAL 
                    ACTIVITIES.

  Section 431(a) of title 10, United States Code, is amended by 
striking out ``1995'' and inserting in lieu thereof ``1998''.

SEC. 504. AVAILABILITY OF FUNDS FOR TIER II UAV.

  All funds appropriated for fiscal year 1995 for the Medium Altitude 
Endurance Unmanned Aerial Vehicle (Tier II) are specifically 
authorized, within the meaning of section 504 of the National Security 
Act of 1947 (50 U.S.C. 414), for such purpose.
SEC. 505. TEMPORARY PROGRAM TO WAIVE MANDATORY REDUCTIONS TO ANNUITIES.

  (a) General Authority.--The Secretary of Defense shall establish a 
program under which the reduction of annuities under subsection (h) of 
section 8339 of title 5, United States Code, may be waived to encourage 
eligible employees to separate voluntarily from service by retiring to 
lessen the possibility of involuntary separations due to reduction in 
force at the National Security Agency.
  (b) Computation of Annuity.--Under this program, annuities shall be 
computed under section 8339 of such title without regard to subsection 
(h) of such section.
  (c) Program Eligibility Requirements.--Under the program established 
under subsection (a), the waiver of the annuity reduction may be 
offered by the Director of the National Security Agency--
          (1) to an employee who--
                  (A) is an employee of the National Security Agency, 
                serving under an appointment without time limitation, 
                who is in the Civil Service Retirement System and is 
                eligible for an annuity under section 8336(d)(2) of 
                title 5, United States Code, other than--
                          (i) a reemployed annuitant under subchapter 
                        III of chapter 83 of such title 5; and
                          (ii) an employee having a disability on the 
                        basis of which such employee is or would be 
                        eligible for disability retirement under such 
                        chapter 83; and
                  (B) is within such occupational groups or geographic 
                locations, or subject to similar limitations or 
                conditions, as the Director may require; and
          (2) for a period not to exceed 90 days during the period 
        beginning on October 1, 1995, and ending on September 30, 1996.
  (d) Payments to the Civil Service Retirement and Disability Fund.--In 
addition to any other payment which it is required to make under 
subchapter III of chapter 83 of title 5, United States Code, the 
National Security Agency shall remit to the Office of Personnel 
Management for deposit in the Treasury of the United States to the 
credit of the Civil Service Retirement and Disability Fund the amount 
necessary to reimburse the Fund for the additional costs of the 
unreduced annuities payable under this section. Amounts may be made 
available to make such deposits from amounts authorized to be 
appropriated to the National Security Agency for the fiscal year in 
which this Act is enacted and for the succeeding four fiscal years.
  (e) Limitation on Availability of Funds.--No funds shall be payable 
under this section based on retirements occurring after September 30, 
1996.
  (f) Regulations.--The Secretary shall prescribe such regulations as 
may be necessary to carry out this section.
                     TITLE VI--TECHNICAL AMENDMENTS

SEC. 601. CLARIFICATION WITH RESPECT TO PAY FOR DIRECTOR OR DEPUTY 
                    DIRECTOR OF CENTRAL INTELLIGENCE APPOINTED FROM 
                    COMMISSIONED OFFICERS OF THE ARMED FORCES.

  (a) Clarification.--Subparagraph (C) of section 102(c)(3) of the 
National Security Act of 1947 (50 U.S.C. 403(c)(3)) is amended to read 
as follows:
  ``(C) A commissioned officer of the Armed Forces on active duty who 
is appointed to the position of Director or Deputy Director, while 
serving in such position and while remaining on active duty, shall 
continue to receive military pay and allowances. Funds from which such 
pay and allowances are paid shall be reimbursed from funds available to 
the Director.''.
  (b) Technical Corrections.--(1) Subparagraphs (A) and (B) of such 
section are amended by striking out ``pursuant to paragraph (2) or 
(3)'' and inserting in lieu thereof ``to the position of Director or 
Deputy Director''.
  (2) Subparagraph (B) of such section is amended by striking out 
``paragraph (A)'' and inserting in lieu thereof ``subparagraph (A)''.

SEC. 602. CHANGE OF DESIGNATION OF CIA OFFICE OF SECURITY.

  Section 701(b)(3) of the National Security Act of 1947 (50 U.S.C. 
431(b)(3)), is amended by striking out ``Office of Security'' and 
inserting in lieu thereof ``Office of Personnel Security''.
         TITLE VII--DEPARTMENT OF STATE INTELLIGENCE ACTIVITIES

SEC. 701. CONSOLIDATION OF WATCH COMPONENT OF THE BUREAU OF 
                    INTELLIGENCE AND RESEARCH.

  (a) Limitation.--The 24-Hour Watch component of the Bureau of 
Intelligence and Research of the Department of State may not be 
consolidated into, and its functions may not be transferred to, the 
Secretary's Operations Center of the Department of State until 60 days 
after the report described in subsection (b) has been submitted by the 
Secretary of State to the Permanent Select Committee on Intelligence 
and the Committee on International Relations of the House of 
Representatives and the Select Committee on Intelligence and the 
Committee on Foreign Relations of the Senate.
  (b) Report.--The report referred to in subsection (a) shall include--
          (1) the measures taken and proposed to be taken to assure 
        that adequate resources of the Secretary's Operations Center 
        are dedicated to fulfilling the needs and requirements of the 
        Bureau of Intelligence and Research;
          (2) the measures taken and proposed to be taken, in 
        consultation with the Director of Central Intelligence 
        particularly with regard to procedures, staff training, and 
        facilities, to upgrade the ability of the Secretary's 
        Operations Center to handle highly sensitive information so it 
        is properly safeguarded and provided to the Bureau of 
        Intelligence and Research in a timely manner; and
          (3) a comparison of the cost of the measures necessary to 
        upgrade the Secretary's Operations Center to fulfill the needs 
        of the Bureau of Intelligence and Research with the costs of 
        eliminating the 24-Hour Watch component of the Bureau of 
        Intelligence and Research.
                                Purpose

    The bill would:
          (1) Authorize appropriations for fiscal year 1996 for 
        (a) the intelligence and intelligence-related 
        activities of the U.S. Government, (b) the Community 
        Management Account, and (c) the Central Intelligence 
        Agency Retirement and Disability System;
          (2) Authorize the personnel ceilings on September 30, 
        1996 for the intelligence and intelligence-related 
        activities of the U.S. Government;
          (3) Permit the Director of Central Intelligence to 
        authorize personnel ceilings in Fiscal Year 1996 for 
        any Intelligence element up to two percent above the 
        authorized levels, with the approval of the Director of 
        the Office of Management and Budget;
          (4) Authorize the President to stay the imposition of 
        sanctions when to proceed without delay would seriously 
        risk the compromise of an intelligence source or method 
        or an ongoing criminal investigation and require 
        reports to the Intelligence of Judiciary committees of 
        the House and Senate;
          (5) Provide for the forfeiture of the U.S. 
        Government's contribution to the Thrift Savings Plan 
        and earnings attributable to the contribution when an 
        individual is convicted of certain national security 
        offenses;
          (6) Provide for eligibility for spousal pension 
        benefits to spouses who fully cooperate, as determined 
        by the Attorney General, in the criminal investigation 
        and prosecution of an individual whose federal annuity 
        is forfeited upon conviction of certain national 
        security offenses.
          (7) Provide for appropriate flexibility with regard 
        to the contents of secrecy agreements that individuals, 
        other than officers and employees of the United States 
        Government, sign in the conduct of authorized 
        intelligence activities;
          (8) Limit the funds that may be spent to carry out 
        section 3.4 of Executive Order 12958, regarding 
        automatic declassification, to no more than $2.5 
        million per Agency of the National Foreign Intelligence 
        Program.
          (9) Extend the provisions of the CIA Voluntary 
        Separation Pay Act through fiscal year 1999;
          (10) Establish a limited temporary volunteer service 
        program at the Central Intelligence Agency;
          (11) Authorize the Secretary of Defense to establish 
        the Defense Intelligence Senior Level Personnel System 
        for employees of the Defense Intelligence Agency and 
        the Central Imagery Office;
          (12) Provide civilian and military personnel assigned 
        to Defense intelligence functions outside the United 
        States benefits and allowances comparable to those 
        provided by the Secretary of State to officers and 
        employees of the Foreign Service;
          (13) Extend the authority of the Secretary of Defense 
        to engage in commercial activities as cover for 
        intelligence collection activities for three years, 
        through 1998;
          (14) Authorize expenditure of funds appropriated in 
        fiscal year 1995 for the Tier II Medium Altitude 
        Endurance Unmanned Aerial Vehicle;
          (15) Require the Secretary of Defense to establish a 
        temporary program for employees in the Civil Service 
        Retirement System at the National Security Agency to 
        retire and receive a waiver of mandatory annuity 
        reductions.
          (16) Clarify that a retired military officer 
        appointed as Director or Deputy Director of Central 
        Intelligence shall receive compensation at the 
        appropriate level of the Executive Schedule under Title 
        5 of the United States Code.

             Overall Perspective on the Intelligence Budget

                            Committee Intent

    The classified Schedule of Authorizations, and the detailed 
explanation of it found in the classified annex to this public 
report, contain a thorough discussion of all budget issues 
considered by the Committee and are available subject to the 
requirements of clause 13 of Rule XLIII of the House, to all 
Members of the House. The Schedule of Authorizations contains 
the dollar amounts and personnel ceilings for the programs 
authorized by the bill. The Schedule is directly incorporated 
into, and is an integral part of, the bill. It is the intent of 
the Committee that all intelligence programs discussed in the 
classified annex to this report be conducted in accordance with 
the guidance and limitations contained therein.

                       Scope of Committee Review

    U.S. intelligence and intelligence-related activities under 
the jurisdiction of the Committee include the National Foreign 
Intelligence Program, the Tactical Intelligence and Related 
Activities of the Department of Defense, and the newly created 
Joint Military Intelligence Program.
    The National Foreign Intelligence Program (NFIP) consists 
of all programs of the Central Intelligence Agency, as well as 
those national foreign intelligence and/or counterintelligence 
programs conducted by: (1) the Department of Defense; (2) the 
Defense Intelligence Agency; (3) the National Security Agency; 
(4) the Central Imagery Office; (5) the National Reconnaissance 
Office; (6) the Departments of the Army, Navy and Air Force; 
(7) the Department of State; (8) the Department of the 
Treasury; (9) the Department of Energy; (10) the Federal Bureau 
of Investigation; and (11) the Drug Enforcement Administration.
    The Department of Defense Tactical Intelligence and Related 
Activities (TIARA) are a diverse array of reconnaissance and 
target acquisition programs that are a functional part of the 
basic military force structure and provide direct information 
support to military operations. TIARA, as defined by the Joint 
Chiefs of Staff and the Secretary of Defense, includes those 
military intelligence activities outside the General Defense 
Intelligence Program that respond to the needs of military 
commanders for operational support information, as well as to 
national command, control and intelligence requirements. The 
programs comprising TIARA also fall within the jurisdiction of 
the Committee on National Security.
    The Joint Military Intelligence Program (JMIP) was 
established in 1995 to provide integrated program management of 
defense intelligence elements that support defense-wide or 
theater-level consumers. Included within JMIP are aggregations 
created for management efficiency and characterized by 
similarity, either in intelligence discipline (for example, 
SIGINT, IMINT) or function (for example, satellite support or 
aerial reconnaissance). The following aggregations are included 
in the JMIP: (1) the Defense Imagery Program (DIP); (2) the 
Defense Cryptologic Program (DCP); (3) the Defense Mapping, 
Charting, and Geodesy Program (DMCGP); and (4) the Defense 
General Intelligence Applications Program (GDIAP), which 
includes (a) the Defense Airborne Reconnaissance Program 
(DARP), (b) the Defense Intelligence Counterdrug Program 
(DICP), (c) the Defense Intelligence Agency Tactical Program 
(DIATP), (d) the Defense Intelligence Special Technologies 
Program (DISTP) and (e) the Defense Space Reconnaissance 
Program (DSRP).

                 committee findings and recommendations

    For the past four years, the Committee has recommended 
authorization levels for intelligence and intelligence-related 
activities that were lower than the amounts requested by the 
President. These actions reflected the Committee's view that 
the justification for spending on intelligence programs had to 
be reexamined in light of the collapse of the Soviet Union and 
evolving threats to our national security. Through its budget 
review, a majority of the Committee at that time determined 
that reductions in the fiscal and personnel resources allocated 
to intelligence activities could be made without impairing the 
ability of intelligence agencies to provide timely and accurate 
information essential to policymakers and military commanders. 
A minority of the Committee believed that some cuts were also 
driven by a belief of what was a politically acceptable bottom 
line rather than a judgment that a program was no longer 
necessary in light of the changing world threat environment.
    In the examination of the intelligence budget request for 
fiscal year 1996, the Committee carefully considered whether 
there was a need to continue on the previous path of two to 
three percent cuts in the President's budget request. This 
review reflected the Committee's belief that intelligence 
activities must be examined by function as well as by program 
and, thus, was structured to look across program lines at 
intelligence disciplines and themes. The Committee held 11 full 
Committee budget hearings on the following issues: signals 
intelligence (SIGINT); imagery intelligence (IMINT), human 
intelligence (HUMINT); collection coordination; production and 
analysis; counterintelligence; support to the military; 
information security and information warfare; covert action; 
personnel; and the perspective of the Acting Director of 
Central Intelligence. These were in addition to the more than 
20 member briefings on specialized issues of budgetary 
significance and more than 200 staff briefings on specific 
activities and budgetary lines.
    The fiscal year 1996 budget request for the NFIP reflects 
an increase of approximately 5 percent over the amounts 
appropriated in fiscal year 1995. Based on the record developed 
at its hearings, the Committee has recommended an NFIP 
authorization that stops the steady decline in the intelligence 
budget that began in 1990 and provides for a small increase. 
When combined with the JMIP and TIARA accounts, the Committee's 
recommended authorization in the aggregate is 1.3 percent above 
the amounts requested by the President.
    It is the Committee's view that we must no longer examine 
the intelligence budget purely in terms of dollars; we must 
take a longer view and carefully examine the future needs and 
requirements for the Intelligence Community. It is the 
Committee's view that we must begin assessing both the threats 
that our nation will face in the year 2000 and beyond, and what 
intelligence programs, capabilities and capital equipment must 
be gotten underway now to meet these threats. The Committee 
placed a heavy emphasis on the future needs of the Intelligence 
Community. This emphasis is the key to the Committee's major 
activity in the 104th Congress--``IC21: The Intelligence 
Community in the 21st Century.'' In order to lay the groundwork 
for IC21, the Committee broke with past practices and merged 
its oversight, legislative and budgetary capabilities to make 
the review more intensive and evaluative. This year's 
authorization bill reflects a downpayment towards this 
approach.
    Four basic themes governed the Committee during its review. 
First, the Committee sought to evaluate each budgetary line in 
the request solely on the program's merits. Second, the 
Committee did not work toward a specific budget number while 
evaluating the programs. That is, the Committee did not 
specifically fund some programs and then make offsetting 
``cuts'' in other programs in order to meet an arbitrary total. 
The Committee believed that the Congress would accept an 
intelligence authorization consisting of properly funded 
programs--even if that amounted to a significant increase in 
the aggregate over the President's request for the Intelligence 
Community. Therefore, for the most part, each program 
adjustment was considered as an individual, substantive issue, 
rather than a fiscal one. As it turned out, despite some 80 
budget actions taken by the Committee, the authorization ended 
up only one percent above the President's request.
    The third theme was the Committee's desire to focus more 
attention on the ``downstream'' activities of processing, 
exploitation and dissemination of intelligence data and 
analysis. The Committee strongly registered its conviction that 
collection costs must be reduced over the long-term and funding 
increased for numerous processing activities. Moreover, we 
remain very concerned about the Community's ability to utilize 
the anticipated volume of information from planned collection 
increases.
    Finally, throughout the review the Committee applied a 
philosophy that is also central to the IC21 process: to avoid 
short-term thinking about intelligence priorities, needs and 
capabilities and to look longer range at these issues in the 
21st Century.
          Centralizing authorities to improve cross-program 
        management and operational efficiency and an effort to 
        end needless redundancies in collection and, to a 
        lesser degree, analysis;
          Denial and deception;
          Improving support to the military, but over the 
        longer term bearing in mind the need to balance support 
        to the policymaker and the military, especially given 
        the significant policy challenges that are likely to be 
        encountered in the 21st Century;
          Establishing priorities among and evaluating 
        intelligence requirements;
          Limiting intelligence collection and analysis to 
        those activities that justify the use of expensive and 
        sometimes risky intelligence capabilities; and
          Improving counterintelligence, security, 
        counterterrorism and counterproliferation capabilities.
    With the exception of one significant area, the President's 
request was largely funded by the Committee. We have taken a 
careful look at our national imagery program and the funds that 
are being allocated for it. We have studied the systems that 
are being procured to insure that they adequately address all 
the threats that our nation can reasonably foresee and that we 
have the appropriate mix of collectors at the lowest cost 
available to the U.S. taxpayer. Finally, the Committee believes 
that the authorization levels it has recommended are neither 
excessive nor will they encourage needless duplication of 
intelligence collection by the various agencies and departments 
that are funded by this bill.

                       Areas of Special Interest

Personnel issues

    In the fiscal year 1993 Intelligence Authorization Act, 
Congress mandated a 17.5 percent reduction in the number of 
civilian personnel in three agencies within the National 
Foreign Intelligence Program (NFIP): the Central Intelligence 
Agency (CIA), the National Security Agency (NSA), and the 
Defense Intelligence Agency (DIA). Congress directed that the 
reduction target be met by the end of fiscal year 1997. Former 
Director of Central Intelligence, R. James Woolsey, extended 
the downsizing program for another two years to achieve an 
overall reduction of 22.5 percent by the end of Fiscal Year 
1999.
    These reductions reflected a changed perspective in the 
Intelligence Community and the Committee on the personnel 
skills mix needed to meet a radically different threat. It was 
the Committee's hope that these personnel reductions would also 
make funds available for critically needed capital investment 
as well as permit hiring fresh talent.
    The Community has been successful over the last three years 
in meeting its overall reduction goals. It has been helped 
significantly by Congressionally authorized voluntary 
separation incentives. Were it not for these incentive 
programs, the agencies concerned would have had considerably 
less leeway both to hire needed new personnel and to stay 
within their mandated personnel ceilings. The Committee views 
these programs as useful personnel management tools and urges 
their continued application. Indeed, the Committee bill extends 
the CIA Voluntary Separation Pay Act through Fiscal Year 1999 
to ensure that the Director of Central Intelligence has this 
essential tool available as he manages and directs long-term 
downsizing. The Committee also realizes that the effectiveness 
of early retirement programs has decreased since the pool of 
likely candidates has dwindled because of incentive offerings 
over the past three years. As a result, the Committee has 
pushed the community to develop new proposals and submit them 
for consideration. One of these was adopted in the Committee 
bill.
    There is consensus in the Intelligence Community that 
serious personnel, issues remain unaddressed. The Committee has 
addressed them at hearings, in correspondence and, 
exhaustively, in Committee report language. Yet, senior 
community managers still appear unwilling to make admittedly 
difficult choices. The Acting Director of Central Intelligence 
formed a personnel task force to review community personnel 
policies. -It would have been useful if it had been completed 
prior to the beginning of this year's budgetary cycle.
    In keeping with the IC21 examination of the needs of the 
Intelligence Community in the year 2000 and beyond, the 
Committee believes it is vital for each NFIP agency to conduct 
a full skills mix study (as only NSA has done) to determine 
what its personnel requirements will be at the end of the 
downsizing period. Employees currently in the work force should 
be given effective career counseling to enable them to 
determine their relevance to future intelligence missions, the 
likelihood that they will make a significant contribution to 
them, and whether they are currently on a positive career 
track. Outplacement assistance should be improved at some 
agencies. The Committee notes once again that the Intelligence 
Community has failed overall to establish a personnel 
evaluation system that objectively evaluates the performance 
and contribution of each of its employees. There is no 
systematic ranking of employees. Therefore, should the 
Intelligence Community have to make selective involuntary 
personnel cuts, most managers do not have objective criteria 
with which to weed out those who are underachievers. The 
Committee recognizes that the current personnel system is very 
successful in finding, hiring and retaining well qualified and 
highly motivated personnel. Nonetheless, there are poor 
performers who remain entrenched in the system. A better 
evaluation system coupled with annual rankings would help to 
remedy this problem. Therefore, the Committee expects in next 
year's budget request that the Intelligence Community will 
present a personnel program designed to evaluate all 
Intelligence Community employees on an annual basis, ranking 
them to identify the high achievers and under-performers. 
Further, the Committee expects that CIA and DIA will conduct a 
full skills mix study to identify the appropriate personnel 
complement that should exist at the conclusion of the mandated 
personnel reductions on October 1, 1999.
    Recognizing that NSA has a particularly severe problem with 
the size, age, skills and make-up of its workforce, and in 
consideration of the work that NSA has already completed in 
this area, the Committee bill requires the Secretary of Defense 
to establish a temporary program to permit the Director of NSA 
to offer, on a one time basis, an opportunity for eligible 
employees in the Civil Service Retirement System at NSA to take 
early retirement and receive unreduced annuities. This program 
will address skills mix problems at NSA and permit the 
retention of newly hired employees who represent the diverse 
employee environment that the NSA and our nation demands.
    The Committee continues to watch carefully hiring and 
promotion practices at CIA, DIA and NSA pertaining to 
minorities and women. The representation of minorities at these 
agencies lags behind the percentage of minority employees 
throughout the federal sector. Women are also under-
represented, although not to the same degree as minorities.
    The Committee believes that the United States' diverse work 
force is not being tapped fully to bring to the Intelligence 
Community the very best minds. Many citizens have native 
fluency in languages other than English and intimate knowledge 
of diverse and different cultures. Although they may have 
recently gained their U.S. citizenship, they should not be 
excluded from employment simply because they were born abroad. 
Accordingly, the Committee will be holding another hearing on 
diversity hiring practices later this session to continue the 
same focus on these issues as in past years.

Terrorism

    Even as the conspiracy trials of the New York City bomb 
plotters continued, the United States was rocked again by a 
terrorist bombing. This time, the alleged perpetrators of the 
destruction of the Oklahoma City Federal Building were of 
domestic origin. Regardless, the horrific dimensions of the 
blast and the vulnerability of our nation to these acts were 
utmost in everyone's minds. In the wake of that event, 
increased attention has focused on how the U.S. Government is 
addressing the terrorist threat, what the nature of the threat 
is, and how the government can develop more effective means of 
deterring and investigating terrorist activities. The 
Committee, in its mark, has provided added support to the 
Intelligence Community programs focused on the terrorist 
threat.
    The Committee has a long-standing interest in anti-
terrorism program issues, resources levels and interagency 
cooperation. Recently, the Committee also has seen a strong 
need to define appropriate intelligence support to law 
enforcement that may be required in some terrorist cases. The 
new DCI has indicted that he recognizes the importance of the 
interplay between intelligence and law enforcement; and the 
Committee looks forward to working with him on this issue.
    Overall, the Committee believes that the work of the U.S. 
intelligence agencies against terrorism has been an exemplar of 
effective coordination and information sharing. Areas may 
remain, however, where information sharing processes may need 
continued improvement. Generally, the Committee is reluctant to 
see any one agency assume new authorities over the others with 
regard to counterterrorism intelligence gathering or 
operations. Each agency brings unique capabilities and a unique 
focus with responsibilities and programs that frequently cannot 
or should not be undertaken by its counterparts. That being 
said, the sharing of information in a timely and meaningful way 
is vitally important; the Committee will be looking into this 
in greater detail in the coming months.
Satellite architecture

    The Committee's major departure from the Administration's 
NFIP request this year occurred in the satellite area. The 
significance is most apparent in terms of long-term policy. 
Although the National Reconnaissance Program (NRP) received 99 
percent of the amount requested, funds were significantly 
redistributed, primarily from base accounts, in order to 
address areas that we consider urgent.
    In taking money from National Reconnaissance Office (NRO) 
support base accounts or, at the NRO's optional, from program 
funding, the Committee insists that support costs must be 
reduced and that the agency must become more streamlined, 
turning back toward its roots, when personnel, paperwork, 
studies and unproductive expenditures were minimized. Although 
the NRO remains relatively streamlined compared to the rest of 
DOD in this regard, it has drifted from its founding philosophy 
and practices. Fortunately, this need has become apparent even 
as the ``faster, cheaper, better'' approach has gained 
respectability, momentum and inroads within other space 
organizations. Management attention to this issue should be a 
very high priority.
    Program costs also must be curbed. The NRO must learn to 
balance technical elegance with cost-efficient solutions. Ever 
rising program costs no longer can be tolerated. There are 
other options and we believe that, with creativity and cost 
consciousness, most requirements can be met for far less money.
    This year, we concentrated on the imagery area, where many 
exciting developments in the commercial arena point the way 
toward large potential cost savings in national security 
programs. Over the past ten years, there have been major 
technology advances that reduce spacecraft weight, volume and 
power requirements. Since launch has been a primary cost 
driver, these potential weight reductions, coupled with new 
launch options, present the possibility of substantial savings 
even while largely retaining or even increasing spacecraft 
capabilities, especially when combined with shortened schedules 
and the management reforms discussed above. These developments 
have been particularly fruitful in the imagery area, where U.S. 
companies are marketing high performance systems, with 
resolutions of one-to-three meters, at costs much reduced from 
those to which we have become accustomed.
    Esclating denial and deception by target countries also is 
an urgent problem that the Intelligence Community must address 
without delay. Our very success in developing various types of 
worldwide surveillance, and the growing public and foreign 
knowledge of that success, has spawned a widespread drive by 
potential targets to ``go underground,'' both literally and 
figuratively. The Intelligence Community must meet the new 
challenge though more innovative collection, exploitation and 
analytical techniques. It has been slow in so doing. 
Accordingly, the Committee has initiated a number of new 
departures to address this problem.

Aerial reconnaissance

            Defense Airborne Reconnaissance Office
    The Committee is concerned that the Defense Airborne 
Reconnaissance Office's (DARO's) organizational subordination 
to the Under Secretary of Defense (Acquisition and Technology) 
does not provide a dedicated intelligence focus and may lead to 
fractured management of programs within the Joint Military 
Intelligence Program (JMIP). Therefore, the Committee strongly 
urges the Department to realign DARO under the Assistant 
Secretary of Defense for Command, Control, Communication and 
Intelligence (C\3\I). The Committee's view is that a C\3\I 
management structure will provide better JMIP stability and 
better long-term focus on the intelligence and reconnaissance 
support requirements of the Community.
            HUNTER joint tactical unmanned aerial vehicle
    The Committee remains concerned about continuing technical 
development and management problems within the HUNTER joint 
tactical unmanned aerial vehicle's (UAV) program. Also, the 
Committee is deeply troubled by the apparent willingness of the 
Department to restructure a fixed-price contract, particularly 
since several other major programs have been canceled to avoid 
this. Further, the Committee is not convinced by the Army's 
argument that tactical reconnaissance support requires physical 
ownership of air vehicles at all combat echelons. The Committee 
believes that are alternatives to the HUNTER that bear 
considerable review. Specifically, the PREDATOR medium altitude 
endurance UAV offers a potential for fulfilling the medium 
altitude and short/close range missions. This option appears 
viable, assuming a shift in operational concepts. Indeed, this 
bill specifically authorizes $20 million in fiscal year 1995 
monies that had been previously appropriated but not authorized 
to augment the Predator fleet by ten aircraft. However, because 
of the significant ``sunk costs'' in infrastructure and the 
apparent progress toward overcoming the technical problems, the 
Committee believes that is sufficient merit in continuing the 
HUNTER program until a thorough evaluation of the system can be 
accomplished.
    Therefore, the bill authorizes DOD to continue research and 
development (R&D) of the HUNTER UAV. However, no fiscal year 
1996 procurement funds of additional/ attrition HUNTER air 
vehicles or systems may be expended until the DARO conducts, 
and reports back to the Committee on, a joint-service objective 
field test and evaluation of both the HUNTER and the Predator 
systems at operation units. This evaluation should determine 
and compare the capabilities of both, and determine whether a 
single air vehicle can be selected to fulfill both missions as 
well as the close-range mission. This evaluation should also 
include the infrastructure--training, logistics and 
maintenance--necessary to compare the two systems on an equal 
basis. This comparison should provide an analysis of the 
current level of electronics/imagery processing capabilities 
for each system and their upgrade potential. In addition, the 
report should provide the Department's rationale for changing 
the terms of a fixed-price contract if the Department wants to 
proceed with HUNTER. The Department shall provide its 
recommendations to the Committee no later than February 1, 1996
            Predator MAE UAV
    The bill authorizes $45.9 million for continuing R&D of the 
PREDATOR UAV, $25.9 million over the amount requested. This 
additional funding is to be used to develop and test a sea-
based version of the PREDATOR (at least four air vehicles) and 
a single sea-based ground station.
            LO HAE UAV
    The bill authorizes $83.0 million for the Low Observable 
High Altitude Endurance (LO HAE) UAV program. This addition of 
$35.0 million over the Department's request is to be used for 
the early development and procurement of air vehicles three and 
four. The Committee believes there is merit, both from 
industrial base and cost savings perspectives, in accelerating 
procurement of these two planned additional air vehicles. The 
Committee believes that moving this procurement forward will 
allow for a more coherent and meaningful customer demonstration 
phase.
    Additionally, the Committee is concerned that the unique 
capabilities of the LO HAE will not be fully realized because 
of the imposed $10 million per vehicle cost limitations. 
Therefore the Committee directs the Department to investigate 
the potential for increasing the LO HAE's edurence and payload 
capabilities. The Committee requests that the Department 
provide a report before the fiscal year 1996 authorization 
conference. The report should provide an assessment of what 
intelligence support capability improvements can be realized by 
increasing the vehicle's fly-away cost to no more than $20.0 
million.
            U-2/Conventional HAE
    The Committee believes the Tier II+, or Conventional High-
Altitude Endurance (CONHAE) UAV, duplicates the capabilities, 
concepts of operation, and some of the missions of the U-2. 
Developing a follow-on to the U-2 would be reasonable if the U-
2 were nearing the end of this useful life or if the proposed 
follow-on offered substantially better performance and/or 
significantly lower life-cycle costs. Other than increased 
endurance, the Department has not made the case than any of 
these conditions exist. In fact, DOD has not advanced any of 
these arguments, and has failed to recognize and acknowledge 
that the CONHAE duplicates the mission of the U-2.
    DOD will have invested approximately $500 million in the U-
2 fleet by the end of the decade to preserve its viability for 
at least another 30 years. The proposed CONHAE is designed to 
have much longer endurance that the U-2, but the U-2 carries 
almost three times the payload, as well as multiple sensors 
simultaneously. Although the CONHAE is being designed for low 
aircraft unit costs, development and acquisition costs will not 
be trivial, whereas the cost of developing and acquiring the U-
2 has already been borne. In terms of operating costs, no data 
are available to demonstrate that a CONHAE fleet will be less 
expensive to operate than the U-2 fleet for a given set of 
operational capabilities--much less that a CONHAE fleet's 
operating costs will be so low as to more than compensate for 
the cost of its development and procurement.
    Developing a CONHAE fleet also would be justified if the 
number of U-2s was clearly insufficient to meet the needs of 
the two-MRC strategy. Again, however, DOD has provided no data 
to the Committee that would support such an assertion. Indeed, 
the Department has yet to seek funds to procure even a 
reasonably full complement of sensors for the U-2 fleet, 
suggesting that the existing fleet is under-utilized and that 
additional capability could be acquired faster and cheaper by 
buying additional sensors for the U-2 than by procuring newly 
designed aircraft and sensors.
    Since defense modernization funds are extremely scarce, the 
Committee is hard passed to endorse the need for the CONHAE 
system at this time. At the same time, the Committee is 
reluctant to terminate this innovative program without giving 
the Department an opportunity to make a better case. 
Accordingly, the Committee expects that not more than 25 
percent of the funds authorized and appropriated for the CONHAE 
program for fiscal year 1996 will be obligated for the CONHAE 
program until thirty days after the Department submits a report 
to this Committee and the House National Security Committee 
that provides:
          (1) an independent cost analysis of the life-cycle 
        costs of the U-2 and the proposed CONHAE based one 
        equal operational performance;
          (2) the number of U-2, CONHAE, or a mix of both 
        systems (including sensor numbers and types) required 
        to support the combatant commanders in peacetime and 
        wartime and the costs of each approach; and,
          (3) recommendations and a program plan for the 
        Secretary of Defense for high-altitude, endurance 
        airborne reconnaissance systems.
    If the Secretary of Defense decides that the CONHAE program 
cannot be justified at this time, the Secretary may utilize 
funds ($117 million) requested for CONHAE to acquire additional 
sensors and a modernized cockpit for the U-2. Specifically, at 
least $50 million is used for competitive acquisition of a 
total of 12 long-range electro-optical cameras, with multi-
spectral and targeting-quality geolocation systems, to enable 
the U-2 to carry multiple imaging sensors as well as other 
intelligence payloads simultaneously. Achieving this would, in 
effect, free up a sizable number of aircraft for additional 
duties in a two-MRC (major regional conflict) scenario. If the 
Secretary determines that the CONHAE should be continued, the 
plan should include a U-2 retirement profile and provide for a 
transition of the CONHAE from an advanced concept technology 
demonstration to a formal procurement program.
            RC-135 rivet joint
    The bill authorizes $37.0 million above the Department's 
request, and intends for the Air Force to modify one existing 
C-135 aircraft into an RC-135 RIVET JOINT configuration. The 
Air Force is also directed to develop this aircraft using 
existing RIVET JOINT baseline equipment to the maximum extent 
possible. The Air Force, however, is directed to make the 
infrastructure modifications necessary to make this 
implementation compliant with Joint Airborne SIGINT 
Architecture (JASA) standards. The Committee's intent is to 
make this the first JASA implementation aircraft.
            SR-71
    The resurrection of the SR-71 program has been 
controversial. The Committee opposed this action in fiscal year 
1995. Although the Department has made no request for the SR-71 
program for fiscal year 1996, the Committee specifically denies 
authorization of any funds for SR-71 R&D, procurement, or 
operations. The Department is to use remaining fiscal year 1995 
funds to terminate the program.
            Joint airborne SIGINT architecture
    The Committee remains extremely interested in the evolving 
concept and development of the Department's Joint Airborne 
SIGINT Architecture (JASA). The Committee commends the 
Department's efforts to comply with Congressional direction to 
move to a common architecture with associated, enforceable 
standards applicable to all airborne SIGINT platforms. The 
Committee is also pleased that the Directors of the National 
Security Agency and the Defense Airborne Reconnaissance Office 
have elevated JASA to a ``top priority'' initiative and have 
established the Joint Airborne SIGINT program office (JASPO) to 
oversee implementation of competitive solutions.
    The Committee is concerned, however, about the funding 
available over the Future Year Defense Program (FYDP) and 
beyond to effectively implement the architecture in all major 
airborne SIGINT platforms. The Department's Joint Airborne 
SIGINT System (JASS) approach to providing a scalable, 
commercial-off-the-shelf (COTS)-based, open architecture has 
the potential for reducing service duplication of effort in 
acquiring and supporting new airborne SIGINT systems. The 
Department, however, acknowledges this approach may be, at 
least initially, more costly than previous individual service 
efforts. Further, this apparent funding shortfall is made 
substantially worse because the Navy has apparently contributed 
almost nothing to the common pool of funds created to field 
JASA. Without additional funding, the Department could be 
forced to recommend a reduction in SIGINT platform force 
structure. Indeed, the Department has initiated a force mix 
study, in part to address this issue.
    The Committee is concerned about the prospect of 
significantly changing the force mix for several reasons. 
First, airborne SIGINT force structure reductions would be 
completely inconsistent with the Department's report to 
Congress on the RC-135/EP-3 tradeoff study. Second, all the 
major airborne SIGINT systems are experiencing high OPTEMPO 
rates, and the Air Force is requesting additional RC-135s. 
Third, the Department's decision to use an EP-3 aircraft as the 
lead Joint Airborne SIGINT System (JASS) integration effort 
suggests that the Navy will, in effect, be rewarded for failing 
to contribute monetarily to the joint program. The force mix 
study leads the Committee to question the Department's 
commitment to manned tactical airborne SIGINT support to the 
warfighter.
    Further, the Committee is most concerned about sustaining 
current operational systems and eliminating the potential for 
an airborne SIGINT modernization gap prior to fielding JASA 
components. This particular concern is most important when 
viewed against the explosion of commercial communications 
technologies. The funding shortfall discussed above would be 
compounded by any near-term improvements needed to ensure that 
operational capabilities are adequately maintained during the 
transition to JASA. The need for such improvements depends both 
on the pace of advances in commercial communications 
technologies, and on an assessment of the cost, schedule and 
technical risk in the JASA program.
    After in-depth review, and based on the Department's 
assurances of open competition, the Committee remains guardedly 
optimistic concerning the JASS approach. Specifically, the 
Committee is very interested in the Department's management of 
technical risk in developing a single common system solution; 
its ability to respond to near and mid-term threats; its 
capitalization of previous investments in currently fielded 
collection exploitation technologies; and its approach to fully 
exploiting the commercial sector's ability to rapidly evolve 
technology. In light of the above, the Committee requests the 
following actions:
    (1) The Under Secretary of Defense for Acquisition and 
Technology (USD (A&T)) is to conduct an independent cost and 
capability analysis comparing the FYDP and life-cycle costs of 
the JASS program to an evolutionary product-improvement 
approach. The comparison should be made on the basis of 
equivalent system performance. The analysis should evaluate 
cost and schedule risk as well. The Committee requests an 
interim report prior to conference on the Fiscal Year 1996 
Defense Authorization Act. The report should also include the 
Department's assessment of its ability to predict both the 
future threat and technology environments. Not more than 25 
percent of the funds authorized for the JASS program may be 
obligated until a final report is submitted to this Committee 
and the House National Security Committee.
    (2) to ensure there are no airborne SIGINT capability gaps 
during the transition to JASA, DARO shall determine and 
implement necessary quick-reaction and evolutionary 
improvements to existing airborne systems. The Committee's 
intent is to provide a balanced approach to JASA development by 
allowing the services to program funds for such evolutionary 
upgrades, provided they comply with an overall migration to the 
JASA architecture. These upgrades should comply with JASA 
standards, and should not be service-unique. These upgrades 
should be funded through the service DARP accounts. DARO should 
submit a report on any service proposals, and DARO's 
recommendations thereon, along with future fiscal year budget 
submissions. The Committee is encouraged by DARO's preliminary 
plans to incorporate NSA-developed quick reaction capabilities 
across multiple platforms, as well as to improve the U-2 in 
compliance with JASA.
    The Committee concurs with the Department's position that 
the Joint Airborne SIGINT Program Office (JASPO) become the 
single focal point for all research and development efforts to 
field new airborne SIGINT capabilities. The JASPO should ensure 
that all other non-developmental, procurement and integration 
efforts comply with JASA standards. DARO should make maximum 
practical use of existing subsystems and capabilities in the 
transition to the JASA architecture, and ensure that open 
competition is applied to hardware and software acquisitions 
wherever possible.
    Finally, the Committee rejects DARO's decision to use an 
operational EP-3 platform as the first JASA integration. There 
is inherent risk in this course of action, and the Committee 
believes there is a more appropriate option. As noted 
elsewhere, the Committee authorizes $37 million to modify an 
existing C-135 aircraft into an RC-135 RIVET JOINT platform. 
This aircraft will use existing RC-135 equipment and 
technologies to the maximum extent possible consistent with 
implementation of the JASA infrastructure and new capabilities. 
The Committee believes this balanced approach is consistent 
with the development of an advanced joint airborne SIGINT 
architecture that satisfies 21st Century defense needs while 
preserving today's warfighting readiness.
            PACER COIN
    The Committee denies all of the requested $25.0 million for 
continuation of the Air Force's PACER COIN program. PACER COIN 
currently supports only Southern Command's missions. The 
Committee understands the Air Force plan is to turn the mission 
over to the Air National Guard in fiscal year 1996, supporting 
SOUTHCOM on a rotational basis. The Committee believes that 
service support for, and the operational utility of, this 
counterdrug-focused mission has been steadily declining, 
indicating a need to either expand its mission or terminate 
this marginally employed system. The Committee does not see 
support for an expanded mission and, therefore, recommends 
termination. However, the Committee strongly recommends that 
the Department of the Navy consider modifying the PACER COIN 
aircraft to become REEF POINT mission capable and evaluate 
assuming operational control of the aircraft. The Navy should 
provide an evaluation of this recommendation to the Committee 
prior to the fiscal year 1996 authorization conference.
            JSTARS communications
    The Committee recommends authorization of an additional 
$20.0 million for the joint surveillance and target attack 
radar system (JSTARS). The baseline JSTARS program does not 
include satellite communications to permit command and control 
information to be exchanged with the platform beyond line of 
sight or to disseminate JSTARS moving target indicator (MTI) 
radar data to a remote air operations center. This capability 
is ranked highly on the Air Force priority list for future 
improvements to the aircraft, but no funding has been 
programmed. Similarly, the Army has an unfunded requirement for 
JSTARS to disseminate target track data directly to attack 
helicopters, and has successfully tested an improved data modem 
(IDM) for use with existing voice radios for this purpose. The 
Committee believes that both of these proposals are critically 
important and should be pursued expeditiously. The Committee 
recommends that $15.0 million of the additional funds be 
allocated for satellite communications, and that the remainder 
be applied to developing an IDM capability. the IDM effort 
should investigate the feasibility and cost of integrating the 
IDM data link into the JSTARS workstation to provide automated 
target updates rather than requiring an operator to prepare 
manually and transmit target updates.
    The Committee is encouraged by the recent contract award to 
complete development of message formats for the JSTARS Joint 
Tactical Information Dissemination System (JTIDS) subsystem to 
enable operators to disseminate ground target tracks to any 
JTIDS-equipped user in near-real time. This long overdue effort 
is essential for our tactical air forces to exploit JSTARS 
effectively and attack moving ground forces with precision-
guided weapons. However, a comprehensive JTIDS capability on-
board JSTARS is worth little unless the Services procure and 
install JTIDS data links on tactical aircraft and heavy 
bombers. Although the Navy appears to be serious about making 
this investment, it has not exhibited much interest in, or even 
knowledge of, how useful JSTARS could be in improving navy 
interdiction capabilities. The Air Force has yet to demonstrate 
that JTIDS data links for the ground-attack mission for all its 
combat aircraft is even a priority, despite assurances in the 
roles and missions debate that battlefield air interdiction is 
an important Air Force mission.
    The Committee is concerned that the nation's large 
investment in intelligence systems able to support targeting, 
expensive combat aircraft, and new, advanced conventional 
munitions will be substantially cheapened by a failure to 
procure simple, but robust, data links.
            Battlegroup passive horizon extension system (BGPHES)
    The bill authorizes $7.1 million, an increase of $5.0 
million, for continuing R&D on the Navy's BGPHES surface 
terminal. The Committee directs the Navy to continue 
development of the Surface Terminal to process additional 
collection system data as well as emitter locations from other 
service platforms. The Committee believes these improvements 
are critical to ensuring that the Navy can receive and process 
reconnaissance data from other service platforms.
            Common imagery ground/surface system
    The Committee authorizes $182.0 million for the Common 
Imagery Ground/Surface System. This increase of $16.0 million 
over the Department's request is to help fix a near-term 
funding shortfall for DARO's ``migration'' of the various 
imagery ground stations to a common architecture. The Committee 
believes the Department's shortfall is actually greater, but 
also believes it is inherently a DoD action to properly fund 
for migration. However, the Committee intends to signal its 
support for the Department's move to the Distributed Common 
Ground System, that incorporates all intelligence disciplines, 
and for which the CIGSS is a necessary first step.

Intelligence broadcasts and receivers

            Intelligence dissemination architecture
    The Committee is concerned that the Department of Defense 
has not developed a coherent near-real time intelligence data 
dissemination architecture. Additionally, there appears to be 
no single dissemination focal point for ensuring cohesive 
development of standards or oversight of hardward/software 
procurement. This lack of firm leadership and direction has 
forced the various services to develop independently their own 
dissemination architectures (TRAP, TIBS, TRIXS, TADIXS-B, TDDS, 
etc.) and to build separate tactical receiver equipment (TRE, 
MATT, CITT, TRU, QUADNET, etc.). Although these efforts have 
developed critical dissemination capabilities, they have led to 
service rivalries, competition for hardware development funds 
and a general inability to ensure that critical data is made 
available to joint consumers. Further, this has forced users to 
own, and integrate, multiple radios to ensure receipt of the 
various data broadcasts.
    The Committee is fully aware of, and appreciates, the 
Department's study to ``migrate'' the broadcasts and receiver 
efforts, but is not pleased that a formal, implementable plan 
has yet to result. This is an issue that has been languishing 
for several years. Unique development and acquisition efforts 
are continuing, and the Committee believes, had these efforts 
been coordinated, authorized funds would have been better spent 
ensuring interoperability. Additionally, the Department has 
directed a ``migration'' to a common data format (TADIL-J, Link 
16), but the Committee is not aware of any enforcement 
mechanism for implementation of these various dissemination 
capabilities. The Department appears unable or unwilling to 
make the tough decisions necessary to eliminate duplication of 
effort or to terminate the rivalries between systems and 
programs.
    Therefore, the Committee requests that no more than 25 
percent of fiscal year 1996 authorized and appropriated funds 
for intelligence/information data broadcasts and their related 
tactical receivers be obligated until 30 days after the 
Department provides the Committee formal plans for:
          (1) ``migrating'' to a single data broadcast format 
        and an integrated intelligence broadcast/dissemination 
        architecture; and,
          (2) ``evolving'' to a single, related receiver 
        family.
    Due to its developmental/technical maturity, the Committee 
believes the Commanders' Tactical Terminal family of receivers 
is a likely candidate for basing a future Joint Tactical 
Terminal, and has authorized additional funding to this 
program. The Committee is very interested in, and wishes to 
remain informed of the future potential of ARPA's SPEAK EASY 
radio effort, which may have the potential to evolve into the 
future software programmable joint tactical terminal.
    The Committee believes a robust architecture does not imply 
a single dissemination system, but rather a system of systems 
that relies on a common data format. It is not the Committee's 
intention to force a specific solution, but rather to promote 
an architectural construct that is independent of transmission 
media (e.g. UHF SATCOM) and that provides for a wide range of 
customers with varying data requirements. This suggests an 
implementation that allows for multiple data transmission 
rates, varied media (terrestrial and space-based) and multiple 
information security levels, but one that is interoperable and 
minimizes unique data processing requirements.
            Commander's tactical terminal
    The bill authorizes $31.4 million for procuring additional 
Commander's Tactical Terminals, an increase of $18.7 million 
over the Administration's request. The Committee believes that 
rapid procurement and fielding of this receiver will improve 
tactical intelligence support to operational forces and allow 
the community to move forward with the development of the 
logical functional basis for the future Joint Tactical Terminal 
(JTT). However, the Committee is concerned about the 
proliferation of intelligence data broadcasts and associated 
tactical receivers. Therefore, the Committee fences $23.5 
million of the authorized funds until the Department develops 
and submits both a broadcast dissemination architecture and a 
plan for ``migrating'' the associated receivers into a single 
family development.

Fusion development

    The Committee understands that the Army's All Source 
Analysis System (ASAS) program office at Ft. Huachuca has been 
working with the other services to improve functional 
interoperability among the various service intelligence fusion 
systems: the Army's ASAS, the Navy's Joint Maritime Command 
Information System (JMCIS), the Air Force's Combat Intelligence 
System (CIS), and the Marine Corps' Intelligence Analysis 
System (IAS). The Committee applauds this long-overdue effort 
and recommends an additional $2.0 million to further this 
endeavor, with the proviso that the SOCOM SOCRATES system be 
included in the integration effort, and that all 
recommendations/actions remain Joint Deployable Intelligence 
Support System (JDISS)-compatible. The Committee requests that 
a memorandum of agreement among the services and a spending 
plan be provided to the Intelligence Systems Board for 
validation prior to the beginning of the fiscal year, and that 
the ISB provide a copy to the intelligence committees and the 
defense committees.

Tactical space operations

    The bill authorizes $10.0 million, an increase of $5.0 
million for the Navy's national imagery support program 
element. This additional funding is provided for lease of 
commercial satellite communications to continue Challenge 
Athena tactical support. The Committee is pleased by the Navy's 
successful use of commercial satellite communications to 
support intelligence and operations as well as morale and 
welfare applications, and urges the Navy to proceed with the 
proposed multi-ship demonstration.

Intelligence support to targeting

    The Committee has been concerned for some time that 
intelligence support to targeting is not being managed in a 
coherent manner. The concern has intensified with the 
increasing doctrinal reliance upon and development of precision 
weapons and munitions. In the hearing on this topic held by the 
Technical and Tactical Subcommittee, it was clear that some 
progress is being made in addressing intelligence support 
issues during the development phase of some weapons systems, 
rather than after the fact, through the Joint Warfighting 
Capabilities Assessment (JWCA) process and the expanded Joint 
Requirements Oversight Council (JROC). Although this is an 
improvement, the Committee still sees no viable mechanism or 
organization charged with ensuring that national or theater 
systems respond, whenever technically and fiscally feasible, to 
today's ever more stringent targeting requirements. There is 
good work being done in this area on a variety of fronts, but 
progress is uneven. In the SIGINT arena, experiments with 
cross-platform geolocation using various reconnaissance assets 
have been quite successful, but the Committee is concerned 
about competing national and tactical architectures and 
insufficient management coordination. In the imagery realm, 
there is less solid progress and some concern about the United 
States Imagery System's (USIS) ability to support real-time 
targeting applications in addition to providing imagery 
products for intelligence purposes. In its authorization bill 
for 1996, the Committee has recommended that $2.0 million be 
provided to the Central Imagery Office (CIO) or its successor 
organization to look at how the USIS--including all national 
and theater imagery collection platforms; all types of imagery 
products, including the Defense Mapping Agency's; and all 
imagery exploitation software packages--can better support 
targeting of precision weapons. The Committee also requests 
that the CIO also look at how imagery targeting support could 
be enhanced by greater interaction with SIGINT collectors, both 
national and theater-level. The Committee requests a report 
from the CIO by March 1, 1996, on what actions, in priority 
order, could be taken to improve imagery support in this area, 
how much they would cost, and who the responsible agency would 
be. The Committee requests that the report be coordinated with 
the Defense Intelligence Agency, and any dissenting views 
noted.
            Section-by-Section Analysis of Bill As Reported

                    title 1--intelligence activities

Section 101--Authorization of appropriations

    Section 101 lists the departments, agencies, and other 
elements of the United States Government for whose intelligence 
and intelligence-related activities the Act authorizes 
appropriations for fiscal year 1996.

Section 102--Classified schedule of authorizations

    Section 102 makes clear that the details of the amounts 
authorized to be appropriated for intelligence and 
intelligence-related activities and applicable personnel 
ceilings covered under this title for fiscal year 1996 are 
contained in a classified Schedule of Authorizations. The 
Schedule of Authorizations is incorporated into the Act by this 
section. The details of the Schedule are explained in the 
classified annex to this report.

Section 103--Personnel ceiling adjustments

    Section 103 authorizes the Director of Central 
Intelligence, with the approval of the Director of the Office 
of Management and Budget, in fiscal year 1996 to exceed the 
personnel ceilings applicable to the components of the 
Intelligence Community under section 102 by an amount not to 
exceed two percent. The Director may exercise this authority 
only when doing so is necessary to the performance of important 
intelligence functions. Any exercise of this authority must be 
reported to the two intelligence committees of the Congress.
    The Committee emphasizes that the authority conferred by 
Section 103 is not intended to permit the wholesale raising of 
personnel strength in any intelligence component. Rather, the 
section provides the Director of Central Intelligence with 
flexibility to adjust personnel levels temporarily for 
contingencies and for overages caused by an imbalance between 
hiring of new employees and attrition of current employees. The 
Committee does not expect the Director of Central Intelligence 
to allow heads of intelligence components to plan to exceed 
levels set in the Schedule of Authorizations except for the 
satisfaction of clearly identified personnel needs which are 
consistent with the authorization of personnel strengths in 
this bill. In no case is this authority to be used to provide 
for positions denied by this bill.

Section 104--Community management account

    Section 104 authorizes appropriations for the Community 
Management Account of the Director of Central Intelligence and 
sets the personnel end-strength for the Community Management 
Staff for fiscal year 1996.
    Subsection (a) authorizes appropriations of $80,713,000 for 
fiscal year 1996 for the activities of the Community Management 
Account of the Director of Central Intelligence. It also 
authorizes funds identified for the Advanced Research and 
Development Committee and the Environmental Task Force to 
remain available for two years.
    Subsection (b) authorizes 247 full-time personnel for the 
Community Management Staff for fiscal year 1996 and provides 
that such personnel may be permanent employees of the Staff or 
detailed from various elements of the United States Government.
    Subsection (c) requires that personnel be detailed on a 
reimbursable basis except for temporary situations of less than 
one year.

 title ii--central intelligence agency retirement and disability system

Section 201--Authorization of appropriations

    Section 201 authorizes appropriations in the amount of 
$213,900,000 for fiscal year 1996 for the Central Intelligence 
Agency Retirement and Disability Fund.

                     title iii--general provisions

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

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

Section 302--Restriction on conduct of intelligence activities

    Section 302 provides that the authorization of 
appropriations by the bill 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.
Section 303--Application of sanctions laws to intelligence activities

    Section 303 amends the National Security Act of 1947 to add 
a new title IX entitled ``Application of Sanctions Laws to 
Intelligence Activities.''
    Section 901 of the new title authorizes the President, 
notwithstanding any other provision of law, to stay the 
imposition of an economic, cultural, diplomatic, or other 
sanction or related action by the United States Government when 
the President determines that to proceed without delay would 
seriously risk the compromise of an ongoing criminal 
investigation or an intelligence source or method. The 
President is to lift the stay when he determines that it is no 
longer necessary to that purpose.
    Section 902 of the new title requires that whenever a stay 
is authorized, and additionally whenever its duration exceeds 
120 days, the President shall promptly report the rationale and 
circumstances for the stay to the congressional intelligence 
committees in the case of intelligence sources and methods and 
to the congressional judiciary committees in the case of an 
ongoing criminal investigation.
    Sanctions have been useful policy tool in encouraging 
behavior consistent with U.S. nonproliferation and other 
foreign and security policies. U.S. law requires sanctions to 
be imposed for violations of key norms in the area of missile 
technology controls; chemical and biological weapons; 
terrorism; certain transfers of munition items; proliferation 
of nuclear weapons; and transfer of advanced conventional 
weapons to Iran or Iraq.
    The Committee does not wish to undermine current sanctions 
law. However, it does believe there may be cases when it is 
necessary to delay temporarily the imposition of sanctions to 
protect a sensitive source or method or an ongoing criminal 
investigation. In particular, the Committee is concerned that 
situations may arise where the imposition of a sanction risks 
the life of a sensitive human source supplying information on 
activities that trigger sanction actions. The Committee is also 
concerned that under current law the imposition of a required 
sanction may impede the flow of information that is necessary 
to the full imposition of sanctions against all violators 
involved.
    The Committee wishes to make clear that the stay of the 
imposition of a sanction provided under this section is 
appropriate in limited cases. It expects that the stay 
authority will be used rarely and not to protect generic or 
speculative intelligence interest. Although the Committee does 
not place a limit on the duration of a stay, the delay should 
not be indefinite and the time provided should be used to 
resolve sources and methods or law enforcement concerns. The 
President must have sufficient information to determine whether 
the risk to intelligence sources and methods is significant and 
outweighs potential harm to U.S. or other foreign policy or 
security objectives nonproliferation. The Committee thus 
expects that determinations to invoke a stay authorized under 
this section will be preceded by a rigorous interagency review 
process in which the recommendations, of all relevant agencies, 
together with supporting facts, are made available to the 
President. The Committee intends to closely monitor the use of 
the authority provided under this section.

Section 304--Thrift savings plan forfeiture

    Section 304 adds a new subsection to section 8432(g) of 
title 5, United States Code, to provide that the Government's 
contribution to the Thrift Savings Plan under the Federal 
Employees Retirement System (FERS) and interest earned on that 
contribution shall be forfeited if the employee's annuity has 
been forfeited under subchapter II of Chapter 83, title 5, 
United States Code. This provision closes a loophole that was 
created when the FERS was established.
    Prior to the enactment of the FERS, an employee's 
retirement annuity was based entirely on contributions made by 
the employee and by the Government to the applicable retirement 
fund. Under subchapter II of Chapter 83, any employee convicted 
of various national security offenses, including espionage, 
would forfeit his annuity and be entitled to receive only his 
monetary contributions to the annuity. A new retirement 
benefit, however, was created with the establishment of FERS, 
payable under the Thrift Savings Plan.
    The Thrift Savings Plan now permits the employee to 
contribute into the Government-managed fund and requires that 
the Government also contribute to the fund on the employee's 
behalf. When FERS was enacted, the forfeiture provisions of 
subchapter II were not amended to cover the Government's 
contributions to the Plan. This situation clearly undermines 
the intent of subchapter II by permitting an employee convicted 
of espionage to retain the Government's contributions to the 
Plan. Section 304 corrects this anomaly by requiring the 
forfeiture of the Government's contribution to the Plan and 
earnings attributable to that contribution in situations where 
an individual's annuity is forfeited under subchapter II.

Section 305--Authority to restore spousal pension benefits to spouses 
        who cooperate in criminal investigations and prosecutions for 
        national security offenses

    Section 305 amends section 8318 of title 5, United States 
Code, to make the spouse of an individual whose annuity or 
retired pay has been forfeited under section 8312 or 8313 of 
title 5 eligible for spousal pension benefits if the Attorney 
General determines that the spouse fully cooperated in the 
criminal investigation and prosecution of the individual. 
Enactment of this legislation will help to protect the national 
security interests of the United States by encouraging the 
spouses of federal employees who know or suspect that their 
husband or wife is engaged in espionage activities to inform 
the Government and to cooperate in a subsequent criminal 
investigation and prosecution. Current law actually discourages 
cooperation with the Government, since under current law 
pension benefits are lost fully upon conviction and forfeiture 
of the husband's or wife's annuity, even if the spouse has 
cooperated fully with the Government.

Section 306--Secrecy agreements used in intelligence activities

    Section 306 addresses a problem that CIA has experienced 
with secrecy agreements in the conduct of authorized 
intelligence activities. Beginning with the Treasury, Postal 
Service, and General Government Appropriations Act for fiscal 
year 1991 and in each year thereafter, Congress has required 
that agreements to protect classified information must contain 
certain prescribed language to put the executor on notice that 
the agreement does not supersede specified laws and Executive 
Order 12356. The language is as follows:

          These restrictions are consistent with and do not 
        supersede, conflict with or otherwise alter the 
        employee obligations, rights or liabilities created by 
        Executive Order 12356; section 7211 of title 5, United 
        States Code (governing disclosures to Congress); 
        section 1034 of title 10, United States Code, as 
        amended by the Military Whistleblower Protection Act 
        (governing disclosure to Congress by members of the 
        military); section 2302(b)(8) of title 5, United States 
        Code, as amended by the Whistleblower Protection Act 
        (governing disclosures of illegality, waste, fraud, 
        abuse or public health or safety threats); the 
        Intelligence Identities Protection Act of 1982 (50 
        U.S.C. 421 et seq.) (governing disclosures that could 
        expose confidential Government agents), and the 
        statutes which protect against disclosure that may 
        compromise the national security, including sections 
        641, 793, 794, 798, and 952 of title 18, United States 
        Code, and section 4(b) of the Subversive Activities Act 
        of 1950 (50 U.S.C. section 783(b)). The definitions, 
        requirements, obligations, rights, sanctions and 
        liabilities created by said Executive Order and listed 
        statutes are incorporated into this Agreement and are 
        controlling.

    Notwithstanding that several of the laws cited apply only 
to federal employees, the Treasury appropriations acts have 
required CIA to include the specified language in nondisclosure 
agreements intended to be executed by private parties. The 
recitation of numerous statutes in the overbearing but required 
``legalese'' has caused confusion, complicated authorized 
intelligence activities, and even disrupted them when parties 
refused to sign agreements containing provisions that do not 
apply to them. The required language is intimidating and has 
chilled otherwise promising intelligence relationships.
    Consequently, section 306 clarifies that CIA and other 
intelligence agencies have the flexibility to tailor 
nondisclosure agreements according to the needs of the 
intelligence activity at hand, as long as the agreement at a 
minimum requires nondisclosure without specific authorization. 
The section makes it clear, however, that the prescribed 
language must still be included in the nondisclosure agreements 
to be signed by federal employees and officers. This section, 
when enacted, will permit the use of secrecy agreements stated 
in plain and understandable English, that will not intimidate 
the layman, and that will not send him in frantic search of his 
lawyer. The provision will make it easier for people to 
understand their rights and obligations when signing a secrecy 
agreement, which will ultimately enhance the protection of 
national security information.

Section 307--Limitation on availability of funds for automatic 
        declassification of records over 25 years old

    Section 307 limits the availability of funds to a maximum 
of $2,500,000 for each agency of the National Foreign 
Intelligence Program for automatic declassification of records 
over 25 years old consistent with section 3.4 of Executive 
Order 12958. The President is required to submit a request in 
the President's fiscal year 1997 budget that specifically 
identifies the funds necessary to implement section 3.4. The 
Committee believes that the potential costs associated with the 
declassification programs required by Executive Order 12958 
have not been fully evaluated. This section would permit 
preliminary work to be done in FY 1996 to assess the scope and 
cost of the declassification program. In the budget submission, 
for FY 1997, the President would then provide a detailed 
request supported by firm estimates of declassification costs.

                 title iv--central intelligence agency

Section 401--Extension of the CIA Voluntary Separation Pay Act

    Section 401 amends section 2(f) of the CIA Voluntary 
Separation Pay Act, 50 U.S.C. Sec. 403-4(f), to extend the 
Agency's authority to offer separation incentives until 
September 30, 1999. Without this amendment, the Agency's 
authority to offer such incentives will expire on September 30, 
1997.
    CIA's separation incentive program has been an effective 
force reduction tool. It is necessary to extend this authority 
until September 30, 1999, because CIA, like DoD, will continue 
to downsize through that year. Enactment of this provision will 
ensure that CIA can more effectively manage downsizing and will 
minimize the need to separate employees involuntarily.

Section 402--Volunteer Service Program

    Sectoin 402 authorizes the Director to establish a limited 
volunteer service program for fiscal years 1996 through 2001, 
whereby no more than 50 retirees can volunteer their services 
to the CIA to assist the Agency in its systematic or mandatory 
review for declassification or downgrading of classified 
information under certain Executive Orders and Public Law 102-
526. The provision limits expenditures to no more than 
$100,000.
    This section authorizes the Agency to pay costs incidental 
to the use of the services of volunteers, such as training, 
equipment, lodging, subsistence, equipment and supplies. It 
also ensures that volunteers are covered by workers 
compensation and the Federal Torts Claim Act. Without this 
legislation, the CIA would be unable to pay costs incident to 
the use of gratuitous services provided by volunteers, such as 
training and equipment. The program established under this 
section will be temporary and limited.

                     title v--department of defense

Sectoin 501--Defense intelligence senior level positions

    Section 501 amends section 1604 of title 10, United States 
Code, by authorizing the Secretary of Defense to establish the 
Defense Intelligence Senior Level (DISL) personnel system for 
the Defense Intelligence Agency (DIA) and the Central Imagery 
Office (CIO). Section 1604 currently authorizes the Secretary 
of Defense to establish positions for civilian officers and 
employees in DIA and CIO. The rates of basic pay for these 
positions, however, are fixed in relation to the rates of basic 
pay provided in the General Schedule under section 5332 of 
title 5. Section 5332, however, which limits the grades of 
employees to GS-15, is insufficient for the needs of DIA and 
CIO.
    In 1991 two Army field activities were transferred to DIA. 
The employees at the Missile and Space Intelligence Center and 
the Armed Forces Medical Intelligence Center are high level 
technical employees. Their positions do not meet the management 
and program criteria for Senior Executive Service (SES) 
inclusion, but they do exceed the GS-15 criteria. DIA is also 
acquiring the Human Intelligence (HUMINT) resources of the 
Military Services. This functional transfer will add over 1,000 
civilian and military personnel to DIA's rolls, and there may 
be a need to structure at least one senior advisory assignment 
as part of the Defense HUMINT Service (DHS) architecture. 
Additionally, the increased Defense intelligence leadership 
roles of DIA and CIO require increased high level activity in 
technical analysis, liaison and advisory services.
    The primary purpose of DISL positions will be to provide 
technical expertise and advisory services beyond the GS-15 
level established by DIA and CIO. Employees in DISL positions 
will not be responsible for managerial and program oversight, 
which are functions of the SES. DISL positions will include 
Defense Intelligence Senior Technical (DIST) and Defense 
Intelligence Senior Professional (DISP) assignments. These 
positions are classifiable above the DIA and CIO GS-15 level 
but do not involve the organizational or program management 
functions necessary for the Defense Intelligence Senior 
Executive Service.
    DIST positions are those that involve research and 
development; test and evaluation; or substantive analysis, 
liaison, and/or advisory activity focusing on engineering, 
physical sciences, computer science, mathematics, medicine, 
biology, chemistry, or other closely related scientific and 
technical fields; and intelligence disciplines including 
production, collection, and operations in close association 
with the preceding or related activities.
    DISP positions are those that emphasize staff, liaison, 
analytical, advisory, or other activity focusing on 
intelligence, law, finance and accounting, program and budget, 
human resources management, training, information services, 
logistics, and other appropriate support fields.
    DISL positions will provide DIA and CIO with the 
flexibility that is essential to recruit effectively and to 
retain highly competent employees with scientific, technical, 
or other complex skills. This provision would allow the 
Secretary of Defense to establish a basic rate of pay that does 
not exceed the rate paid to Executive Level IV. It would also 
authorize the Secretary of Defense to provide to DIA and CIO 
employees other benefits, allowances, incentives, or 
compensation that similarly situated federal employees are 
eligible to receive under title 5, United States Code.

Section 502--Comparable benefits and allowances for civilian and 
        military personnel assigned to defense intelligence functions 
        overseas

    Section 502 amends section 1605 of title 10, United States 
Code, and section 431 of title 37, United States Code, to 
provide to civilian personnel and members of the armed forces 
serving with the Defense HUMINT Service outside the United 
States benefits and allowances comparable to those provided by 
the Secretary of State to officers and employees of the Foreign 
Service.
    The Secretary of Defense has the authority to provide to 
civilian personnel and members of the armed forces assigned to 
the Defense Attache Offices and the Defense Intelligence Agency 
Liaison Offices outside the United States benefits and 
allowances comparable to those provided by the Secretary of 
State to officers and employees of the Foreign Service. This 
authority was attained in 1983 (P.L. 98-215) because travel 
allowances and related benefits for overseas personnel at the 
Defense Attache Offices and the Defense Intelligence Agency 
Liaison Offices were different from Foreign Service personnel 
assigned overseas.
    With the consolidation of Department of Defense human 
intelligence into the Defense HUMINT Service, the Defense 
Intelligence Agency will be responsible for a significant 
number of employees overseas. Although a number of these 
employees may be assigned to Defense Attache Offices or Defense 
Intelligence Agency Liaison Offices outside the United States, 
there will be some assigned to other overseas locations. Since 
the Agency's authority to provide benefits and allowances to 
overseas employees is limited to the Defense Attache Office and 
the Defense Intelligence Agency Liaison Offices, inequities 
will once again occur. Section 502 ensures comparable benefits 
for civilian and military personnel assigned to the Defense 
HUMINT Service overseas.

Section 503--Extension of authority to conduct intelligence commercial 
        activities

    Section 503 would extend for three years, until December 
31, 1998, the authority of the Secretary of Defense to initiate 
intelligence commercial activities to provide cover security to 
intelligence collection activities undertaken abroad by the 
Defense Department. This authority permits the Secretary to 
waive compliance with certain types of federal laws and 
regulations pertaining to the management and administration of 
federal entities when he determines that compliance by the 
commercial cover activity would create an unacceptable risk of 
compliance by the commercial cover activity would create an 
unacceptable risk of compromise of an authorized intelligence 
collection activity. This authority is similar to the authority 
granted to the Central Intelligence Agency and the Federal 
Bureau of Investigation.
    The Secretary's intelligence commercial cover authority was 
originally enacted as part of the FY 1991 Intelligence 
Authorization Act (Public Law 102-88) August 14, 1991. However, 
the intelligence commercial cover authority did not become 
effective until December 2, 1992, after the statutorily 
required promulgation and submission to Congress of a directive 
from the Secretary governing the implementation of the statute. 
Due to a variety of reasons, including the launching of a plan 
in 1993 to create a new Defense Humint Service under which all 
Defense Department Human intelligence activities are being 
consolidated, this intelligence commercial activities authority 
has not yet been used.
    The Administration's intelligence authorization legislative 
proposal sought repeal of the existing ``sunset'' clause, thus 
making the Secretary intelligence commercial activities 
authority permanent. Senior officials from both the Defense 
Department and the Central Intelligence Agency testified to the 
continuing and growing need for the Secretary to have this 
authority under certain circumstances to provide bona fide 
commercial cover that can withstand detailed investigation by 
hostile foreign intelligence services as well as domestic 
scrutiny. The Committee agreed to the extension of the 
authority. However, in view of the lack of a record of use thus 
far, Section 503 extends the authority for three years, instead 
of the permanent extension originally sought by the 
Administration. Three years should provide time for the 
development and oversight of a track record on the use of this 
authority without encouraging overuse of it, and particularly 
its more elaborate and sophisticated applications. At the end 
of that time, and based on its oversight of the record, the 
Committee can address whether to make this authority permanent, 
extend it for a specific period or allow it to lapse.

Section 504--Availability of funds for tier II UAV

    The Fiscal year 1995 authorization bill authorized full 
funding of the Defense Department's request for the Tier-2 
Medium Altitude endurance Unmanned Aerial Vehicle (UAV) 
Advanced Concept Technology Demonstration. The Fiscal Year 1995 
defense appropriations bill included appropriations $20 million 
above the amount authorized for the program. As these 
additional funds were not specifically authorized, as required 
by Section 504 of the National Security Act of 1947, the 
Department of Defense could not spend them. To remedy this 
problem, Section 504 of the bill specifically authorizes an 
additional $20 million for this program.

Section 505--Temporary program to waive mandatory reductions to 
        annuities

    During the current period of downsizing and reorganization, 
NSA has diligently worked to meet Congressionally--mandated 
work force reductions with good success. Three Voluntary 
Separation Incentive Programs (VSIPs) have been conducted by 
NSA to date, resulting in the attrition of almost 1900 
employees. Although the VSIPs have enabled NSA to meet the 
yearly strength cuts thus far, some disconcerting trends have 
emerged. Interest in the program is sagging and smaller 
percentages of employees eligible for the retirement separation 
incentive are electing to retire. Of particular concern is the 
drop in retirements of the early-out eligible population--NSA's 
latest VSIP saw a 35 percent reduction in the percentage of 
early-out eligible employees who elected to retire. Considering 
that almost four times as many employees are eligible for 
early-out retirement as compared to regular retirement, this 
downward trend will have significant negative consequences for 
the success of any future VSIPs. This points to the need for a 
more imaginative and aggressive strategy to foster voluntary 
attrition in order to forestall more draconian approaches.
    To help ensure continued downsizing through voluntary 
attrition, Section 505 authorizes the Director of the NSA to 
waive the 2 percent retirement annuity reduction penalty 
employees normally incur when accepting an early retirement (25 
years of service at any age or with 20 years of service at age 
50). The annuity reduction penalty is 2 percent for every year 
under age 55. For example, if an employee retires at age 50, 
with 25 years of service, his or her annuity is reduced 10 
percent. This is a major impediment to employees who would 
otherwise be willing to consider early retirement.
    Although the provision was not cleared by the Office of 
Management and Budget (OMB), NSA management strongly supports 
this pilot program, a one time 2 percent waiver authorization, 
as an innovative approach to downsizing that is not fraught 
with the many negative consequences of involuntary reductions. 
Working in a highly sensitive and technical arena, with strict 
security clearance requirements, NSA is committed to exercising 
every option possible to forestall or eliminate the possibility 
of an involuntary Reduction-In-Force (RIF). Enhancing voluntary 
attrition through the use of a 2 percent penalty waiver 
initiative, as opposed to the use of involuntary reductions, is 
the clear choice to minimize any negative impact to mission, 
morale, and diversity while also reducing the possibility of 
security-related problems resulting from a RIF.
    Although this authority does not preclude offering both 
separation pay under 5 U.S.C. Section 5597 and a waiver of the 
penalty under 5 U.S.C. Section 8339(h), the Committee 
recommends that the Secretary authorize the Agency to grant 
both incentives only if required to achieve the desired 
workforce reduction and with prior consultation with both the 
House and Senate Intelligence Committees.
    Under the program authorized by this section, the waiver of 
the annuity reduction may be offered by the National Security 
Agency only to employees within such occupational groups or 
geographic locations, or subject to similar limitations or 
conditions, as the Director of NSA may require and for a period 
not to exceed ninety days during the period from 1 October 1995 
to 30 September 1996.
    The Committee intends under Section 505 for NSA to cover 
the net present value of the long-run actuarial cost to the 
retirement system of this retirement incentive program. Section 
505 requires NSA to remit to the Office of Personnel Management 
(OPM) for deposit in the Treasury to the credit of the Civil 
Service Retirement and Disability Fund (CSRDF) the amount 
equivalent to the additional costs of the unreduced annuities 
payable under this section. Since the amount would be 
determined by the number of respondents and the particulars of 
their retirement circumstances, payment would have to occur 
after the penalty waiver window. The Committee intends for this 
to be done as soon as feasible, but no later than the end of 
fiscal year 1996.
    The Committee intends for the payment to be calculated for 
the full life cycle of this retirement benefit. Using OPM's 
standard inflation and pay growth assumptions and actuarial 
tables, a total dollar amount should be determined that would 
hold the Civil Service Retirement Fund harmless. This is done 
by discounting the annual pension amounts by 7 percent per year 
back to the present value of the differences between early and 
regular pension payments for each retiree who received a 
penalty waiver. These annual payments are also reduced to 
reflect deaths in the penalty waiver population using OPM's 
mortality tables for pensioners. Pension outlays are projected 
into the future far enough to a low for the possibility that 
the youngest penalty waiver retiree lives to the age of 109 
years. Using the same OPM actuarial table and OMB's discount 
rate, the Committee intends that NSA will also compensate OPM 
for the 7 percent of salary that each penalty waiver retiree 
would have paid to OPM if they had not retired early in 
response to the penalty waiver but had instead worked until 
they were 55 years of age and could retire without penalty.
    The Committee plans to hold a public hearing on this 
legislation. Representatives from NSA, the Office of Personnel 
Management and others have been invited to address this 
legislation. Testimony will be heard both on the effect it will 
have at NSA as well as its implications for federal employees 
at other agencies and departments that are beginning 
congressionally-mandated downsizing.
    The Committee commends NSA for seeking authorities that are 
not presently available to the Director of the NSA to encourage 
downsizing of its workforce while avoiding involuntary 
terminations and reductions in force with the problems 
associated with such reductions. This a one-time, 90-day 
program, and the Committee does not intend to extend it. Should 
the workforce at NSA fail to respond to this enhanced 
incentive, and any others that the NSA exercises, then 
involuntary separations options must be re-examined. If NSA is 
forced to resort to involuntary terminations to meet its 
workforce requirements, it must have a system of realistic 
employee evaluations in place and available as a reference tool 
for managers to rank employees and assess their relative skills 
and contributions in meeting NSA's present and future mission.

                     title vi--technical amendments

Section 601--Clarification with respect to pay for Director or Deputy 
        Director of Central Intelligence appointed from commissioned 
        officers of the Armed Forces

    Section 601 amends section 102(c)(3)(C) of the National 
Security Act of 1947 by striking out the parenthetical 
reference ``including military pay'' and inserting ``active 
duty'' before ``commissioned.'' These technical corrections 
clarify that a retired military officer appointed as Director 
or Deputy Director of Central Intelligence can receive 
compensation at the appropriate level of the Executive Schedule 
under 5 U.S.C. Sec. 5313 (Director) or 5 U.S.C. Sec. 5314 
(Deputy Director). This clearly reflects the intent of the 
drafters of this provision which was included in the 
Intelligence Authorization Act for Fiscal Year 1993 to ensure 
that an active duty military officer appointed as Director or 
Deputy Director only receives his or her military pay, not to 
restrict the compensation of a retired military officer 
appointed to one of the two positions.

Section 602--Change of designation of CIA Office of Security

    Section 602 amends the CIA Information Act of 1984 to 
reflect the recent reorganization of the CIA Office of Security 
into the Office of Personnel Security and the Office of 
Security Operations. The amendment will ensure that the Office 
of Personnel Security, where the records intended to be subject 
to the Act are kept, will continue to receive the benefit of 
the Act's exception from search and review under the Freedom of 
Information Act.

                               title vii

Section 701--Consolidation of watch component of the Bureau of 
        Intelligence and Research

    The State Department's Bureau of Intelligence and Research 
(INR) is one of three all-source analytical groups within the 
Intelligence Community and the Secretary of State's own 
intelligence support agency. Concomitant with these functions, 
INR has its own 24-Hour Watch. Reaching this status and 
capability has taken INR many years, in particular struggling 
to achieve necessary independence from the Secretary's 
Operations Center.
    Like most other departments and agencies, the State 
Department is seeking ways to reduce duplication and costs. The 
Committee understands and supports these necessary economies. 
As part of this effort, the Secretary of State has agreed to a 
proposal that would eliminate INR's 24-Hour Watch and 
consolidate its functions with the Secretary's Operations 
Center. This reversal of over 30 years of policy calls into 
question the future envisioned for INR within the State 
Department and the Intelligence community.
    The overwhelming priority of the Secretary's Operations 
Center is the servicing of the Secretary and his principal 
subordinates, and coordinating virtually all Operations Center 
activities towards that goal. The Committee has grave doubts as 
to the ability and willingness of the Operations Center to 
devote to INR on a regular and consistent basis the types of 
support it needs to maintain its functions. The Committee is 
concerned that INR will be treated as a second-class customer 
when it relies on the Operations Center for support.
    Moreover, there are functions carried out by the INR 24-
Hour Watch for which the Secretary's Operations Center is not 
currently well suited. The Committee is particularly concerned 
about the Operations Center's ability to handle the large 
amounts of highly sensitive information that regularly flow 
into INR's 24-Hour Watch so that this information is properly 
safeguarded and is transmitted to INR in a timely manner. The 
Committee has learned that tests of the consolidated function 
have revealed deficiencies in this area. Addressing these 
shortcomings will likely entail costs that will offset the 
savings expected to be gained by the consolidation.
    The elimination of the 24-Hour Watch makes INR dependent on 
the Operations Center for services vital to its functions. ONe 
of INR's great strengths has been it close proximity to its 
policy customers and its ability to be very responsive to their 
needs. An INR that is little more than a subsidiary of the 
Secretary's Operations Center is unlikely to be as responsive. 
Moreover, an INR that is greatly reduced in function will be 
less able to participate in national intelligence products.
    Therefore, the Committee has sought a postponement of this 
proposed consolidation until 60 days after the submission of a 
report from the Secretary of State to this Committee, its 
Senate counterpart and the committees with jurisdiction over 
the State Department. The Secretary is asked to report on: (1) 
steps to be taken within the Operations Center specifically to 
support INR under this proposal; (2) steps to be taken to 
update the ability of the Operating Center to handle highly 
sensitive information and to distribute it in an efficient and 
timely manner (this section is to be written in consultation 
with the Director of Central Intelligence, given his 
responsibility for the protection of intelligence sources and 
methods); and (3) a comparison of the savings to be realized by 
eliminating the INR 24-Hour Watch versus the costs necessary to 
update the Operations Center.
                           committee position

    On May 18, 1995, the Permanent Select Committee on 
Intelligence, a quorum being present, approved the bill, as 
amended by an amendment in the nature of a substitute, and, by 
a recorded vote of 9 ayes to 0 noes, ordered it favorably 
reported. On that recorded vote the Members present voted as 
follows: Mr. Combest (Chairman)--aye; Mr. Young--aye; Mr. 
Lewis--aye; Mr. Goss-- aye; Mr. McCollum--aye; Mr. Castle--aye; 
Mr. Dicks--aye; Mr. Dixon--aye; Ms. Pelosi--aye. The Committee, 
by voice vote, also authorized and directed the Chairman, or 
his designee, to make a motion under rule XX of the House at 
the appropriate time to expedite taking the bill to conference 
with the Senate.

findings and recommendations of the committee on government reform and 
                               oversight

    With respect to clause 2(l)(3)(D) of rule XI of the House 
of Representatives, the Committee has not received a report 
from the Committee on Government Reform and Oversight 
pertaining to the subject of this bill.

                           oversight findings

    With respect to clause 2(l)(3)(A) of rule XI of the Rules 
of the House of Representatives, the Committee held 13 
hearings, as well as a number of briefings, on the classified 
legislative, personnel, programmatic and budgetary issuers 
raised by H.R. 1655. Testimony was heard from the Acting 
Director of Central Intelligence, the Director of the National 
Security Agency, the Director of the Defense Intelligence 
Agency, numerous program managers and various other 
knowledgeable witnesses on the activities and plans of the 
Intelligence Community covered by this intelligence 
authorization bill. The bill, as reported by the Committee, 
reflects conclusions reached by the Committee in light of that 
oversight activity.

                      fiscal year cost projections

    The Committee has attempted pursuant to clause 7(a)(1) of 
rule XIII of the Rules of the House of Representatives to 
ascertain the outlays that will occur in fiscal year 1996 and 
the five years following if these amounts are appropriated. 
These estimates are contained in the classified annex and are 
in accordance with those of the executive branch.

                  Congressional Budget Office Estimate

    In compliance with clause 2(l)(3)(B) and (C) of rule XI of 
the Rules of the House of Representatives, an estimate prepared 
by the Congressional Budget Office submitted pursuant to 
sections 308 and 403 of the Congressional Budget Act of 1974 is 
as follows:
                                     U.S. Congress,
                               Congressional Budget Office,
Washington, DC, June 12, 1995.
Hon. Larry Combest,
Chairman, Permanent Select Committee on Intelligence,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1655, the 
Intelligence Authorization Act for Fiscal Year 1996, as ordered 
reported by the House Permanent Select Committee on 
Intelligence on May 18, 1995.
    The bill would affect direct spending and thus would be 
subject to pay-as-you-go procedures under section 252 of the 
Balanced Budget and Emergency Deficit Control Act.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                           James L. Blense,
                                             (For June E. O'Neill).
    Enclosure.
               congressional budget office--cost estimate

    1. Bill number: H.R. 1655.
    2. Bill title: Intelligence Authorization Act for Fiscal 
Year 1996.
    3. Bill status: As ordered reported by the House Permanent 
Select Committee on Intelligence on May 18, 1995.
    4. Bill purpose: H.R. 1655 would authorize appropriations 
for fiscal year 1996 for intelligence activities of the United 
States government, the Community Management Staff of the 
Director of Central Intelligence, and the Central Intelligence 
Agency Retirement and Disability System (CIARDS).
    5. Estimated cost to the Federal Government of titles I 
(except sections 101-103), II, III (except section 301), IV, V, 
and VI:

----------------------------------------------------------------------------------------------------------------
                                                   1995       1996       1997       1998       1999       2000  
----------------------------------------------------------------------------------------------------------------
                                                 DIRECT SPENDING                                                
                                                                                                                
Direct spending:                                                                                                
    Estimated budget authority................          0         -2         27         30         32         28
    Estimated outlays.........................          0         -2         27         30         32         28
                                                                                                                
                                    SPENDING SUBJECT TO APPROPRIATIONS ACTION                                   
                                                                                                                
Spending under current law                                                                                      
    Budget Authority \1\......................        291          0          0          0          0          0
    Estimated outlays.........................        291         38         22          9          0          0
Proposed changes:                                                                                               
    Estimated authorization level \2\.........          0        310      (\3\)          4          5      (\3\)
    Estimated outlays.........................          0        279         23         11          7      (\3\)
Spending under H.R. 1655:                                                                                       
    Estimated authorization level.............        291        310      (\3\)          4          5      (\3\)
    Estimated outlays.........................        291        317         45         20          7      (\3\)
----------------------------------------------------------------------------------------------------------------
\1\ The 1995 figure is the amount already appropriated.                                                         
\2\ Because parts of this bill are highly classified, CBO is unable to provide a full accounting of the bill's  
  costs over the 1996-2000 period and a comparison with the 1995 level.                                         
\3\ Less than $500,000.                                                                                         

    CBO was unable to obtain the necessary information to 
estimate the costs for Title I (except section 104) and section 
301 of Title III of this bill because they are classified at a 
level above clearances now held by CBO employees. The estimated 
costs in the above table, therefore, reflect only the costs of 
section 104 and Titles II, III (except section 301), IV, V, and 
VI.
    6. Basis of estimate:
    For proposes of this estimate, CBO assumed that H.R. 1655 
will be enacted by October 1, 1995, and that the full amounts 
authorized will be appropriated for fiscal year 1996. Outlays 
are estimated according to historical spending patterns for 
intelligence programs.

                            direct spending

    CIA separation incentives.--Section 401 would allow the 
Central Intelligence Agency (CIA) to offer separation incentive 
payments to employees from the end of fiscal year 1997 to the 
end of fiscal year 1999. Additional retirement costs would 
occur in the near term because employees who retire under this 
program would receive their annuities earlier than they would 
otherwise. The cost of these annuities would constitute direct 
spending. CBO estimates no costs to occur in 1996 and 1997 as a 
result of section 401. However, direct spending costs are 
estimated to be $2 million in 1998, $3 million in 1999, and $1 
million in 2000.
    Based on projections from the CIA, CBO estimates that 550 
employees would be offered an incentive payment in 1998 and 700 
in 1999. The CIA expects that one quarter of those offered an 
incentive payment would take the incentive and retire. The 
estimate assumes that about 60 percent of the retirees would 
have retired anyway, without the incentive. The estimate 
assumes that the remaining 40 percent who accept the incentive 
would retire one or two years earlier than they would have 
otherwise.
    Changes in annuities for NSA retirees.--Section 505 would 
allow employees at the National Security Agency (NSA) enrolled 
in the Civil Service Retirement System (CSRS) who retire before 
reaching age 55 to receive unreduced annuities. Under current 
law, employees who take early retirement receive a permanent 
reduction in their annuity of 2 percent per year for each year 
under age 55. Eligibility for benefits under section 505 would 
be limited to a 90-day period established by the Director of 
the NSA during fiscal year 1996. This section also requires NSA 
to deposit to the Civil Service Trust Fund amounts necessary to 
cover the cost to the retirement system of this retirement 
incentive program. Receipt of these agency contributions would 
cause the net impact on direct spending in 1996 to be $2 
million. After 1996, the bill would have net direct spending 
costs of $27 million in 1997, $28 million in 1998, $29 million 
in 1999, and $27 million in 2000.
    Since fiscal year 1993, NSA has had the authority to offer 
voluntary separation incentive payments of up to $25,000 to 
encourage employees to retire or quit. The authority lasts 
until the end of fiscal year 1999. According to NSA, the 
separation incentive payment program has not been successful in 
inducing enough employees who are eligible for early retirement 
to leave. NSA offered incentive payments twice and about 6 
percent of eligible employees took an incentive during the 
first offering and 4 percent took the second offering. Although 
the penalty for early retirees under age 55 has never been 
waived before, CBO assumes that many more people would be 
induced to leave since the penalty has a significant impact on 
a retiree's lifetime benefit. For example, employees retiring 
at age 50 under current law would receive a permanent reduction 
in their annuities of 10 percent. This estimate assumes that 25 
percent of NSA employees eligible for early retirement would 
retire with unreduced annuities.
    Direct spending costs would result for two reasons. First, 
some employees (NSA projects about 80) who would have taken 
early retirement under current law with reduced annuities would 
now retire with larger, unreduced benefits. Second, many 
employees under age 55, who would have waited for their normal 
retirement age, assumed to be age 58, would accelerate their 
retirement. The benefits paid to these estimated 925 retirees 
constitute direct spending. Based on data supplied by NSA, 
which shows the distribution by age of employees eligible for 
early retirement, CBO estimates the average age of an employee 
taking advantage of the penalty waiver to be 50.
    Section 505 would also require NSA to make special 
contributions to the retirement trust fund for each person who 
retires before reaching age 55 with an unreduced annuity. 
Section 505(d) is intended to require NSA to contribute amounts 
necessary to cover the long-run actuarial cost to the 
retirement system of this retirement incentive program. 
Although CBO believes that the language in the reported bill 
does not adequately define cost, the cost estimate is based on 
the explanation in the Committee's report and section-by-
section analysis. According to the report, this payment would 
occur after the penalty waiver window, but no later than the 
end of fiscal year 1996. The payment would recognize the costs 
associated with not reducing the advanced benefit payments of 
early retirees and forgoing the retirement contributions the 
employees would have made had they remained in federal service. 
To estimate the contributions required under this section, CBO 
used a preliminary Office of Personnel Management (OPM) 
analysis, which estimates the actuarial cost of the penalty 
waiver. Based on the OPM analysis, CBO estimates that the 
average cost is 57 percent of final salary for each person 
retiring before reaching age 55 with an unreduced annuity. The 
receipt of these payments from NSA into the trust fund would 
offset retirement benefit costs.
    Thrift savings plan (TSP) forfeiture.--Section 304 would 
allow forfeiture of the U.S. government contribution to the TSP 
under the Federal Employees Retirement System, along with 
interest, if an employee is convicted of national security 
offenses. According to the CIA, savings from this provision 
would not exceed $35,000 annually.
    Spousal pension benefits.--Section 305 would allow 
restoration of spousal pension benefits to those spouses who 
cooperate in criminal investigations and prosecutions for 
national security offenses. According to the CIA, costs from 
this provision would not exceed $35,000 annually.

                    authorizations of Appropriations

    Section 104 would authorize appropriations of $80.7 million 
for 1996 for the Intelligence Community Management Account of 
the Director of Central Intelligence (DCI). Similarly, section 
201 specifies an authorization of appropriations for a 
contribution to the Central Intelligence Agency Retirement and 
Disability Fund of $213.9 million.
    In addition to the added retirement costs, section 401 
(discussed above under direct spending) would increase 
discretionary spending for incentive costs. The cash incentives 
would cost $4 million in 1998 and $5 million in 1999. CBO 
assumes that the savings in salary and benefits from these 
reductions would be incurred under current law as part of the 
anticipated reduction in the CIA workforce. Thus, these savings 
would not be a result of this bill and would not offset the 
cost of incentive payments in this estimate.
    Section 502 would extend comparable benefits and allowances 
to civilian and military personnel assigned to defense 
intelligence functions overseas. According to the Defense 
Intelligence Agency, this provision would increase personnel 
costs by approximately $200,000 annually.
    In addition to the added retirement costs, section 505 
would require NSA to make a one-time payment to the CSRS trust 
fund to cover the long-run actuarial cost to the retirement 
system of this incentive program. CBO estimates that this 
payment would total $15 million in 1996.
    7. Pay-as-you-go considerations: The Balanced Budget and 
Emergency Deficit Control Act of 1985 sets up pay-as-you-go 
procedures for legislation affecting direct spending or 
receipts through 1998. CBO estimates that H.R. 1655 would have 
the following pay-as-you-go impact:

------------------------------------------------------------------------
                                        1995     1996     1997     1998 
------------------------------------------------------------------------
Change in outlays...................        0       -2       27       30
Change in receipts..................    (\1\)    (\1\)    (\1\)   (\1\) 
------------------------------------------------------------------------
\1\ Not applicable.                                                     

    8. Estimated cost to State and local governments: None.
    9. Estimate comparison: None.
    10. Previous CBO estimate: None
    11. Estimate prepared by: Wayne Boyington and Elizabeth 
Chambers.
    12. Estimate approved by:
                                 Robert A. Sunshine
                                 (For Paul N. Van de Water,
                           Assistant Director for Budget Analysis).

                        Committee Cost Estimates

    The Committee is in overall agreement with the estimate of 
the Congressional Budget Office (CBO). Nevertheless, with 
regard to that part of the estimate dealing with the limited, 
one-time authority for the Director of the National Security 
Agency (NSA) to waive the 2 percent per year reduction in the 
annuity of Civil Service Retirement System (CSRS) participants 
who retire before the age of 55, the Committee would note two 
things. First, given the technical rules under which the CBO 
must prepare its estimates and the assumptions used, the 
Committee understands and accepts the estimate on this 
provision. Second, those technical rules do not take into 
account as cost saving offsets the salary savings that will 
occur to the Government from those NSA employees induced by the 
2 percent waiver to retire earlier than they otherwise would 
because, unlike the annuity payments, the foregone salary 
payments are not direct spending.
    However, the cost analysis done by NSA, which takes these 
salary savings into account, demonstrates a net life cycle cost 
savings to the Government, even after offsetting the cost of 
NSA's contribution to the CSRS trust fund to cover the present 
value of providing an unreduced annuity to early retirees under 
this provision. In fact, based on an assumption that 20 percent 
of the eligible NSA population takes advantage of this one-time 
early retirement option, NSA estimates that the Government 
would realize a net life cycle cost savings of $146.5 million.

                     Inflationary Impact Statement

    Pursuant to clause 2(l)(4) of rule XI of the Rules of the 
House of Representatives, the Committee has attempted to 
estimate the inflationary impact of enactment of the bill.
    The Committee finds no adequate method to identify the 
inflationary impact of this legislation. The bill does not 
provide specific budget authority but rather authorizations for 
appropriations. Thus, any inflationary impact would depend on 
the amounts actually appropriated and the effects that supplies 
of materials, production capacity or other economic resources 
would have on prices and costs in the operation of the national 
economy.
         Changes in Existing Law Made by the Bill, as Reported

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

                     NATIONAL SECURITY ACT OF 1947
                            TABLE OF CONTENTS

Sec. 2. Declaration of policy.
     * * * * * * *
    TITLE IX--APPLICATION OF SANCTIONS LAWS TO INTELLIGENCE ACTIVITIES
Sec. 901. Stay of Sanctions.
Sec. 902. Reports.
              TITLE I--COORDINATION FOR NATIONAL SECURITY

          * * * * * * *
                      central intelligence agency

  Sec. 102. (a)  * * *
          * * * * * * *
  (c)(1)  * * *
          * * * * * * *
  (3)(A) A commissioned officer of the Armed Forces appointed 
[pursuant to paragraph (2) or (3)] to the position of Director 
or Deputy Director, while serving in such position--
          (i) shall not be subject to supervision or control by 
        the Secretary of Defense or by any officer or employee 
        of the Department of Defense;
          (ii) shall not exercise, by reason of the officer's 
        status as a commissioned officer, any supervision or 
        control with respect to any of the military or civilian 
        personnel of the Department of Defense except as 
        otherwise authorized by law; and
          (iii) shall not be counted against the numbers and 
        percentages of commissioned officers of the rank and 
        grade of such officer authorized for the military 
        department of which such officer is a member.
  (B) Except as provided in clause (i) or (ii) of [paragraph 
(A)] subparagraph (A), the appointment of a commissioned 
officer of the Armed Forces [pursuant to paragraph (2) or (3)] 
to the position of Director or Deputy Director shall in no way 
affect the status, position, rank, or grade of such officer in 
the Armed Forces, or any emolument, perquisite, right, 
privilege, or benefit incident to or arising out of any such 
status, position, rank, or grade.
  [(C) A commissioned officer of the Armed Forces appointed 
pursuant to subsection (a) or (b), while serving in such 
position, shall continue to receive military pay and allowances 
(including retired pay) payable to a commissioned officer of 
the officer's grade and length of service for which the 
appropriate military department shall be reimbursed from funds 
available to the Director of Central Intelligence.]
  (C) A commissioned officer of the Armed Forces on active duty 
who is appointed to the position of Director or Deputy 
Director, while serving in such position and while remaining on 
active duty, shall continue to receive military pay and 
allowances. Funds from which such pay and allowances are paid 
shall be reimbursed from funds available to the Director.
          * * * * * * *

TITLE VII--PROTECTION OF OPERATIONAL FILES OF THE CENTRAL INTELLIGENCE 
                                 AGENCY

      exemption of certain operational files from search, review, 
                       publication, or disclosure

  Sec. 701. (a)  * * *
  (b) For the purposes of this title the term ``operational 
files'' means--
         (1)  * * *
          * * * * * * *
          (3) files of the [Office of Security] Office of 
        Personnel Security which document investigations 
        conducted to determine the suitability of potential 
        foreign intelligence or counterintelligence sources;
except that files which are the sole repository of disseminated 
intelligence are not operational files.
          * * * * * * *
   TITLE IX--APPLICATION OF SANCTIONS LAWS TO INTELLIGENCE ACTIVITIES


                           stay of sanctions


  Sec. 901. Notwithstanding any other provision of law, the 
President may stay the imposition of an economic, cultural, 
diplomatic, or other sanction or related action by the United 
States Government concerning a foreign country, organization, 
or person when the President determines that to proceed without 
delay would seriously risk the compromise of an ongoing 
criminal investigation or an intelligence source or method. The 
President shall lift any such stay when the President 
determines that such stay is no longer necessary to that 
purpose.


                                reports


  Sec. 902. Whenever any stay is imposed pursuant to section 
901, and whenever the duration of any such stay exceeds 120 
days, the President shall promptly report to the Select 
Committee on Intelligence of the Senate and the Permanent 
Select Committee on Intelligence of the House of 
Representatives the rationale and circumstances that led the 
President to exercise the stay authority with respect to an 
intelligence source or method, and to the Judiciary Committees 
of the Senate and the House of Representatives the rationale 
and circumstances that led the President to exercise the stay 
authority with respect to an ongoing criminal investigation.
                              ----------                              


                      TITLE 5, UNITED STATES CODE

          * * * * * * *

                          PART III--EMPLOYEES

          * * * * * * *

                   Subpart G--Insurance and Annuities

          * * * * * * *

                         CHAPTER 83--RETIREMENT

          * * * * * * *

         SUBCHAPTER II--FORFEITURE OF ANNUITIES AND RETIRED PAY

          * * * * * * *

Sec. 8318. Restoration of annuity or retired pay

  (a)  * * *
          * * * * * * *
  (e) The spouse of an individual whose annuity or retired pay 
is forfeited under section 8312 or 8313 after the date of 
enactment of this subsection shall be eligible for spousal 
pension benefits if the Attorney General of the United States 
determines that the spouse fully cooperated with Federal 
authorities in the conduct of a criminal investigation and 
subsequent prosecution of the individual which resulted in such 
forfeiture.
          * * * * * * *

            CHAPTER 84--FEDERAL EMPLOYEES' RETIREMENT SYSTEM

          * * * * * * *

                  SUBCHAPTER III--THRIFT SAVINGS PLAN

          * * * * * * *

Sec. 8432. Contributions

  (a)  * * *
          * * * * * * *
  (g)(1)  * * *
          * * * * * * *
  (5)(A) Notwithstanding any other provision of law, 
contributions made by the Government for the benefit of an 
employee or Member under subsection (c), and all earnings 
attributable to such contributions, shall be forfeited if the 
annuity of the employee or Member, or that of a survivor or 
beneficiary, is forfeited under subchapter II of chapter 83.
  (B) Forfeitures under this paragraph shall occur only if the 
offenses upon which the requisite annuity forfeitures are based 
happened subsequent to the enactment of this paragraph.
          * * * * * * *
                              ----------                              


 SECTION 2 OF THE CENTRAL INTELLIGENCE AGENCY VOLUNTARY SEPARATION PAY 
                                  ACT

SEC. 2. SEPARATION PAY.

  (a)  * * *
          * * * * * * *
  (f) Termination.--No amount shall be payable under this 
section based on any separation occurring after [September 30, 
1997] September 30, 1999.
          * * * * * * *
                              ----------                              


                      TITLE 10, UNITED STATES CODE

                    Subtitle A--General Military Law

          * * * * * * *

            PART I--ORGANIZATION AND GENERAL MILITARY POWERS

          * * * * * * *

                   CHAPTER 21--DEPARTMENT OF DEFENSE

                          INTELLIGENCE MATTERS

          * * * * * * *

           SUBCHAPTER II--INTELLIGENCE COMMERCIAL ACTIVITIES

          * * * * * * *

Sec. 431. Authority to engage in commercial activities as security for 
                    intelligence collection activities

  (a) Authority.--The Secretary of Defense, subject to the 
provisions of this subchapter, may authorize the conduct of 
those commercial activities necessary to provide security for 
authorized intelligence collection activities abroad undertaken 
by the Department of Defense. No commercial activity may be 
initiated pursuant to this subchapter after December 31, [1995] 
1998.
          * * * * * * *
                           PART II--PERSONNEL

          * * * * * * *

  CHAPTER 83--DEFENSE INTELLIGENCE AGENCY AND CENTRAL IMAGERY OFFICE 
                           CIVILIAN PERSONNEL

          * * * * * * *

[Sec. 1604. Civilian personnel management

  [(a) The Secretary of Defense may, without regard to the 
provisions of any other law relating to the number, 
classification, or compensation of employees--
          [(1) establish such positions for civilian officers 
        and employees in the Defense Intelligence Agency and 
        the Central Imagery Office, as may be necessary to 
        carry out the functions of such Agency;
          [(2) appoint individuals to such positions; and
          [(3) fix the compensation of such individuals for 
        service in such positions.
  [(b) The Secretary of Defense shall, subject to subsection 
(c), fix the rates of basic pay for positions established under 
subsection (a) in relation to the rates of basic pay provided 
in the General Schedule under section 5332 of title 5 for 
positions subject to such Schedule which have corresponding 
levels of duties and responsibilities. Except in the case of an 
officer or employee of the Defense Intelligence Agency or the 
Central Imagery Office serving as a member of the Defense 
Intelligence Senior Executive Service, no officer or employee 
of the Defense Intelligence Agency or the Central Imagery 
Office may be paid basic compensation at a rate in excess of 
the highest rate of basic pay contained in such General 
Schedule.
  [(c) The Secretary of Defense is authorized, consistent with 
section 5341 of title 5, to adopt such provisions of such title 
as provide for prevailing rate systems of basic pay and to 
apply such provisions to positions in or under which the 
Defense Intelligence Agency or the Central Imagery Office may 
employ individuals described by section 5342(a)(2)(A) of such 
title.
  [(d) In addition to the basic compensation payable under 
subsection (b), officers and employees of the Defense 
Intelligence Agency and the Central Imagery Office who are 
citizens or nationals of the United States and who are 
stationed outside the continental United States or in Alaska 
may be paid compensation, in accordance with regulations 
prescribed by the Secretary of Defense, not in excess of an 
allowance authorized to be paid by section 5941(a) of title 5 
for employees whose rates of basic pay are fixed by statute. 
Such allowances shall be based on--
          [(1) living costs substantially higher than in the 
        District of Columbia;
          [(2) conditions of environment which differ 
        substantially from conditions of environment in the 
        continental United States and warrant an allowance as a 
        recruitment incentive; or
          [(3) both the factors described in paragraphs (1) and 
        (2).
  [(e)(1) Notwithstanding any other provision of law, the 
Secretary of Defense may terminate the employment of any 
civilian officer or employee of the Defense Intelligence Agency 
or the Central Imagery Office whenever he considers that action 
to be in the interests of the United States and he determines 
that the procedures prescribed in other provisions of law that 
authorize the termination of the employment of such officer or 
employees cannot be invoked in a manner consistent with the 
national security. The decisions of the Secretary under this 
paragraph are final and may not be appealed or reviewed outside 
the Department of Defense. The Secretary of Defense shall 
promptly notify the Permanent Select Committee on Intelligence 
of the House of Representatives and the Select Committee on 
Intelligence of the Senate whenever this termination authority 
is exercised.
  [(2) Any termination of employment under this subsection 
shall not affect the right of the officer or employee involved 
to seek or accept employment with any other department or 
agency of the United States if he is declared eligible for such 
employment by the Director of the Office of Personnel 
Management.
  [(3) The Secretary of Defense may delegate authority under 
this subsection only to the Deputy Secretary of Defense, the 
Director of the Defense Intelligence Agency, the Director of 
the Central Imagery Office, or all three. An action to 
terminate any civilian officer or employee by any such officer 
shall be appealable to the Secretary of Defense.]
Sec. 1604. Civilian personnel management

  (a) General Personnel Authority.--The Secretary of Defense 
may, without regard to the provisions of any other law relating 
to the number, classification, or compensation of Federal 
employees--
          (1) establish such positions for employees in the 
        Defense Intelligence Agency and the Central Imagery 
        Office as the Secretary considers necessary to carry 
        out the functions of that Agency and Office, including 
        positions designated under subsection (f) as Defense 
        Intelligence Senior Level positions;
          (2) appoint individuals to those positions; and
          (3) fix the compensation for service in those 
        positions.
  (b) Authority To Fix Rates of Basic Pay; Other Allowances and 
Benefits.--(1) The Secretary of Defense shall, subject to 
subsection (c), fix the rates of basic pay for positions 
established under subsection (a) in relation to the rates of 
basic pay provided in subpart D of part III of title 5 for 
positions subject to that title which have corresponding levels 
of duties and responsibilities. Except as otherwise provided by 
law, an employee of the Defense Intelligence Agency or the 
Central Imagery Office may not be paid basic pay at a rate in 
excess of the maximum rate payable under section 5376 of title 
5.
  (2) The Secretary of Defense may provide employees of the 
Defense Intelligence Agency and the Central Imagery Office 
compensation (in addition to basic pay under paragraph (1)) and 
benefits, incentives, and allowances consistent with, and not 
in excess of the levels authorized for, comparable positions 
authorized by title 5.
  (c) Prevailing Rates Systems.--The Secretary of Defense may, 
consistent with section 5341 of title 5, adopt such provisions 
of that title as provide for prevailing rate systems of basic 
pay and may apply those provisions to positions in or under 
which the Defense Intelligence Agency or the Central Imagery 
Office may employ individuals described by section 
5342(a)(2)(A) of such title.
  (d) Allowances Based on Living Costs and Environment for 
Employees Stationed Outside Continental United States or in 
Alaska.--(1) In addition to the basic compensation payable 
under subsection (b), employees of the Defense Intelligence 
Agency and the Central Imagery Office described in paragraph 
(3) may be paid an allowance, in accordance with regulations 
prescribed by the Secretary of Defense, at a rate not in excess 
of the allowance authorized to be paid under section 5941(a) of 
title 5 for employees whose rates of basic pay are fixed by 
statute.
  (2) Such allowance shall be based on--
          (A) living costs substantially higher than in the 
        District of Columbia;
          (B) conditions of environment which--
                  (i) differ substantially from conditions of 
                environment in the continental United States; 
                and
                  (ii) warrant an allowance as a recruitment 
                incentive; or
          (C) both of those factors.
  (3) This subsection applies to employees who--
          (A) are citizens or nationals of the United States; 
        and
          (B) are stationed outside the continental United 
        States or in Alaska.
  (e) Termination of Employees.--(1) Notwithstanding any other 
provision of law, the Secretary of Defense may terminate the 
employment of any employee of the Defense Intelligence Agency 
or the Central Imagery Office if the Secretary--
          (A) considers such action to be in the interests of 
        the United States; and
          (B) determines that the procedures prescribed in 
        other provisions of law that authorize the termination 
        of the employment of such employee cannot be invoked in 
        a manner consistent with the national security.
  (2) A decision by the Secretary of Defense to terminate the 
employment of an employee under this subsection is final and 
may not be appealed or reviewed outside the Department of 
Defense.
  (3) The Secretary of Defense shall promptly notify the 
Permanent Select Committee on Intelligence of the House of 
Representatives and the Select Committee on Intelligence of the 
Senate whenever the Secretary terminates the employment of any 
employee under the authority of this subsection.
  (4) Any termination of employment under this subsection shall 
not affect the right of the employee involved to seek or accept 
employment with any other department or agency of the United 
States if that employee is declared eligible for such 
employment by the Director of the Office of Personnel 
Management.
  (5) The authority of the Secretary of Defense under this 
subsection may be delegated only to the Deputy Secretary of 
Defense, the Director of the Defense Intelligence Agency (with 
respect to employees of the Defense Intelligence Agency), and 
the Director of the Central Imagery Office (with respect to 
employees of the Central Imagery Office). An action to 
terminate employment of an employee by any such officer may be 
appealed to the Secretary of Defense.
  (f) Defense Intelligence Senior Level Positions.--(1) In 
carrying out subsection (a)(1), the Secretary may designate 
positions described in paragraph (3) as Defense Intelligence 
Senior Level positions. The total number of positions 
designated under this subsection and in the Defense 
Intelligence Senior Executive Service under section 1601 of 
this title may not exceed the number of positions in the 
Defense Intelligence Senior Executive Service as of June 1, 
1995.
  (2) Positions designated under this subsection shall be 
treated as equivalent for purposes of compensation to the 
senior level positions to which section 5376 of title 5 is 
applicable.
  (3) Positions that may be designated as Defense Intelligence 
Senior Level positions are positions in the Defense 
Intelligence Agency and Central Imagery Office that (A) are 
classified above the GS-15 level, (B) emphasize functional 
expertise and advisory activity, but (C) do not have the 
organizational or program management functions necessary for 
inclusion in the Defense Intelligence Senior Executive Service.
  (4) Positions referred to in paragraph (3) include Defense 
Intelligence Senior Technical positions and Defense 
Intelligence Senior Professional positions. For purposes of 
this subsection--
          (A) Defense Intelligence Senior Technical positions 
        are positions covered by paragraph (3) that involve any 
        of the following:
                  (i) Research and development.
                  (ii) Test and evaluation.
                  (iii) Substantive analysis, liaison, or 
                advisory activity focusing on engineering, 
                physical sciences, computer science, 
                mathematics, biology, chemistry, medicine, or 
                other closely related scientific and technical 
                fields.
                  (iv) Intelligence disciplines including 
                production, collection, and operations in close 
                association with any of the activities 
                described in clauses (i), (ii), and (iii) or 
                related activities; and
          (B) Defense Intelligence Senior Professional 
        positions are positions covered by paragraph (3) that 
        emphasize staff, liaison, analytical, advisory, or 
        other activity focusing on intelligence, law, finance 
        and accounting, program and budget, human resources 
        management, training, information services, logistics, 
        security, and other appropriate fields.
  (g) ``Employee'' Defined as Including Officers.--In this 
section, the term ``employee'', with respect to the Defense 
Intelligence Agency or the Central Imagery Office, includes any 
civilian officer of that Agency or Office.
Sec. 1605. Benefits for certain employees of the Defense Intelligence 
                    Agency 
  (a)(1) The Secretary of Defense may provide to civilian 
personnel [of the Department of Defense who are United States 
nationals, who are assigned to Defense Attache Offices and 
Defense Intelligence Agency Liaison Offices outside the United 
States, and who are designated by the Secretary of Defense for 
the purposes of this subsection,] described in subsection (d) 
allowances and benefits comparable to those provided by the 
Secretary of State to officers and employees of the Foreign 
Service under paragraphs (2), (3), (4), (5), (6), (7), (8), and 
(13) of section 901 and sections 705 and 903 of the Foreign 
Service Act of 1980 (22 U.S.C. 4081 (2), (3), (4), (5), (6), 
(7), (8), and (13), 4025, 4083) and under section 5924(4) of 
title 5.
  (2) The Secretary may also provide to any such civilian 
personnel special retirement accrual benefits in the same 
manner provided for certain officers and employees of the 
Central Intelligence Agency in section 303 of the Central 
Intelligence Agency Retirement Act (50 U.S.C. 2153) and in 
section 18 of the Central Intelligence Agency Act of 1949 (50 
U.S.C. 403r).
  (b) The authority of the Secretary of Defense to make 
payments under subsection (a) is effective for any fiscal year 
only to the extent that appropriated funds are available for 
such purpose.
  [(c) Regulations issued pursuant to subsection (a) shall be 
submitted to the Committee on Armed Services and the Permanent 
Select Committee on Intelligence of the House of 
Representatives and the Committee on Armed Services and the 
Select Committee on Intelligence of the Senate before such 
regulations take effect.]
  (c) Regulations prescribed under subsection (a) may not take 
effect until the Secretary of Defense has submitted such 
regulations to--
          (1) the Committee on Armed Services and the Select 
        Committee on Intelligence of the Senate; and
          (2) the Committee on National Security and the 
        Permanent Select Committee on Intelligence of the House 
        of Representatives.
  (d) Subsection (a) applies to civilian personnel of the 
Department of Defense who--
          (1) are United States nationals;
          (2) in the case of employees of the Defense 
        Intelligence Agency, are assigned to duty outside the 
        United States and, in the case of other employees, are 
        assigned to Defense Attache Offices or Defense 
        Intelligence Agency Liaison Offices outside the United 
        States; and
          (3) are designated by the Secretary of Defense for 
        the purposes of subsection (a).
          * * * * * * *
                              ----------                              


              SECTION 431 OF TITLE 37, UNITED STATES CODE

Sec. 431. Benefits for certain members assigned to the Defense 
                    Intelligence Agency

  (a) The Secretary of Defense may provide to members of the 
armed forces [who are assigned to Defense Attache Offices and 
Defense Intelligence Agency Liaison Offices outside the United 
States and who are designated by the Secretary of Defense for 
the purposes of this subsection] described in subsection (e) 
allowances and benefits comparable to those provided by the 
Secretary of State to officers and employees of the Foreign 
Service under paragraphs (2), (3), (4), (6), (7), (8), and (13) 
of section 901 and sections 705 and 903 of the Foreign Service 
Act of 1980 (22 U.S.C. 4081 (2), (3), (4), (6), (7), (8), and 
(13), 4025, 4083) and under section 5924(4) of title 5.
          * * * * * * *
  [(d) Regulations prescribed pursuant to subsection (a) shall 
be submitted to the Committee on Armed Services and the 
Permanent Select Committee on Intelligence of the House of 
Representatives and the Committee on Armed Services and the 
Select Committee on Intelligence of the Senate before such 
regulations take effect.]
  (d) Regulations prescribed under subsection (a) may not take 
effect until the Secretary of Defense has submitted such 
regulations to--
          (1) the Committee on Armed Services and the Select 
        Committee on Intelligence of the Senate; and
          (2) the Committee on National Security and the 
        Permanent Select Committee on Intelligence of the House 
        of Representatives.
  (e) Subsection (a) applies to members of the armed forces 
who--
          (1) are assigned--
                  (A) to Defense Attache Offices or Defense 
                Intelligence Agency Liaison Offices outside the 
                United States; or
                  (B) to the Defense Intelligence Agency and 
                engaged in intelligence-related duties outside 
                the United States; and
          (2) are designated by the Secretary of Defense for 
        the purposes of subsection (a).
                     MINORITY AND ADDITIONAL VIEWS

                              introduction

    We wish to make clear that our support for the bill as 
reported does not reflect complete satisfaction with all of its 
provisions. We have particular reservations, which we hope will 
be addressed in conference, with the Committee's position on 
the programs managed by the National Reconnaissance Office 
(NRO), the funding level for the Environmental Task Force, and 
the implementation of the provision for the automatic 
declassification of certain records as required by Executive 
Order 12958.
    The classified annex to this report contains a thorough 
discussion of our concerns about actions the Committee 
recommends with respect to certain NRO activities. These 
actions involve programs which, because of their classified 
status, cannot be discussed even in general terms here. The 
actions, however, are predicated on critical conclusions about 
the management of the NRO which we do not believe are 
justified. We urge that our views be carefully considered 
because the Committee's actions represent a significant change 
of direction for the NRO. This change has the potential for 
sizeable risk and substantial long-term costs and, in our 
judgment, the evidentiary basis for it is not compelling.
    The classified annex also contains additional views of 
Congressman Dicks on a maritime collection program.

                            declassification

    Section 308 of the bill limits each agency of the National 
Foreign Intelligence Program to use no more than $2.5 million 
to carry out section 3.4 of Executive Order 12958 on Classified 
National Security Information. This executive order, signed by 
President Clinton on April 17, 1995, prescribes a uniform 
system for classifying, safeguarding, and declassifying 
national security information. It is intended to protect 
information critical to our national security, but recognizes 
that the nation's democratic principles require that the 
America people be informed of the activities of their 
government when it is possible to do so. Section 3.4 requires 
that, unless grounds for an exemption exist, classified 
information contained in records that are over 25 years old, 
and of permanent historical value, shall be automatically 
declassified within five years of the order whether or not the 
records have been reviewed. Information is exempt from 
declassification if, among other reasons, its release can be 
expected to reveal the identity of human sources; impair U.S. 
cryptologic systems or activities; undermine ongoing diplomatic 
activities; or assist in the development of weapon of mass 
destruction.
    Section 3.4 has proven to be controversial in the 
Committee, largely because of concerns about the costs of 
reviewing documents to determine whether they contain 
information that fits in one of the nine categories for 
exemption. In part these concerns are the product of the widely 
varying estimates of the costs of compliance generated by 
intelligence agencies. As an example, one agency informed the 
Committee in writing in 1995 that its costs to comply with 
Section 3.4 would be an amount thirty times greater than the 
estimate the same agency provided to the Community Management 
Staff during the interagency review of the draft executive 
order in 1994.
    Our lack of confidence in the current estimates of the cost 
of compliance are the result of the Community Management 
Staff's failure to develop an adequate methodology to account 
for the costs of protecting classified information under the 
former executive order despite this Committee's repeated 
requests that it do so. The Joint Security Commission, 
chartered by the Secretary of Defense and the Director of 
Central Intelligence to review and recommend changes to 
security and classification procedures, also expressed its 
frustration with the efforts of the intelligence community to 
capture security costs, calling the data produced by National 
Foreign Intelligence Program agencies ``incomplete, 
inconsistent, and not coherently integrated.'' Nevertheless, 
additional information should be available in July when certain 
intelligence agencies are required under Section 702 of Public 
Law 103-359 to submit a phased plan to implement the 
declassification provisions of Executive Order 12958. The plans 
are to include an accounting of archived classified materials, 
levels of classification, types of storage media and locations, 
review methods to be employed, and estimated costs of the 
declassification activity itself, as well as an assessment of 
the projected costs of classification management activities for 
the succeeding five years.
    While uncertainties over costs might under some 
circumstances be grounds for not proceeding with an activity, 
we believe that a carefully proscribed system for declassifying 
those documents which remain classified for no reason other 
than inertia is long overdue. Accordingly, we are pleased that 
the Committee agreed to require the agencies of the National 
Foreign Intelligence Program to begin to comply with Section 
3.4, while limiting the cost of compliance in fiscal year 1996 
to no more than $2.5 million per agency. This should give the 
agencies and the Committee a chance to better assess actual 
compliance costs rather than speculative ones. It should also, 
in combination with the requirement that the President submit a 
specific budget request for implementation of Section 3.4 in 
the fiscal year 1997 budget request, clarify the extent of the 
effort in comparison to other classification management 
expenditures in the future.
                        environmental task force

    We are encouraged that the Committee agreed to the 
continuation of the Environmental Task Force (ETF), although at 
only $5 million for fiscal year 1996. We would have preferred 
funding authorized at or near the $17.6 million level requested 
by the President and believe the Committee should reconsider 
its reduction in the program prior to the conference on the 
bill.
    The Environmental Task Force (ETF) is a collection of 
several efforts designed to make environmental information 
derived from intelligence assets more accessible to the general 
public, the scientific community, and personnel from federal 
agencies that do not currently receive top secret intelligence 
products. The information has national security, as well as 
environmental, applications. For example, the ETF has helped to 
educate senior defense officials of potential dual-use 
applications for national technical assets--with particular 
benefit for the development of naval warfare doctrine.
    The ETF began in 1993 when approximately 60 highly esteemed 
hydrologists, geologists, and other environmental scientists 
from universities around the country received security 
clearances to review the potential application of classified 
technologies and data to environmental problems. These 
scientists (now known as the MEDEA group) concluded that the 
intelligence community's holdings and technologies are unique 
and would be valuable for scientific research. This led to 
President Clinton signing Executive Order 12951, on February 
22, 1995, declassifying the Corona, Lanyard, and Argon 
satellites and their associated images, and directing a 
complete set of the imagery (a total of 860,000 images 
collected between 1960 and 1972) be transferred to the National 
Archives and the Department of the Interior. (We understand 
that when four of these images were released on the Internet 
over 500,000 requests for the data were received the next day.)
    In addition, the Environmental Task Force includes an 
effort involving intelligence community agencies and civil 
environmental agencies in the Departments of Commerce, Defense, 
Energy, Interior, Transportation, the National Aeronautics and 
Space Administration the Environmental Protection Agency, and 
the National Science Foundation to allow the environmental 
agencies to utilize data collected by national technical assets 
on problems such as disaster relief assessments, environmental 
science, and international environmental policy. This effort 
has involved developing protocols for tasking systems, 
collecting and processing imagery, and disseminating images to 
appropriately cleared personnel. A fully operational system 
should be in place, if funding is maintained at the requested 
level, within four fiscal years. The ETF also involves 
reviewing whether slight modifications in planned 
reconnaissance technology could bring corresponding benefits to 
environmental science.
    Furthermore, the ETF has provided support for the first 
joint U.S.-Russian Ecological/Environmental Seminar, led by Dr. 
D. James Baker, Under Secretary of Commerce for Oceans and 
Atmosphere and Administrator of the National Oceanic and 
Atmospheric Administration, and Dr. Viktor I. Danilov-Danilyan, 
Minister of the Russian Ministry of Environmental Protection 
and Natural Resources. This seminar brought together for five 
days in Washington senior U.S. and Russian scientists, policy 
makers, and military and intelligence officials for an 
unclassified exchange of ideas and information including 
discussions of areas in which remote sensing and other 
methodologies are being used in the U.S. and Russia for 
ecological or environmental applications. Further discussions 
may lead to joint projects to use remote sensing technologies 
for environmental monitoring.
    Some have criticized the ETF for engaging in activities 
outside the ``normal'' mission of the intelligence community 
and have asserted that the civilian agencies should pay for the 
information they receive. This argument ignores the fact that 
the function of intelligence is to support policymakers. 
Processing and disseminating to policymakers information 
collected by intelligence assets is at the heart of what 
intelligence agencies do, and those agencies are unarguably in 
the best position to task the system, exploit the data it 
provides, and protect the sources and methods involved. While 
there may be merit in developing a system whereby intelligence 
consumers are ``billed'' in some way for intelligence products 
(in fact, the Committee in the past has advocated pilot 
projects to test this concept), such a system should apply to 
all consumers. Currently, no consumer is required to pay for 
intelligence information. Nevertheless, the ETF envisions that 
once the information system it is developing for the 
environmental agencies is operational, those agencies will fund 
its operation and maintenance.
    The Environmental Task Force effort is an important 
initiative. It promises to lead to better understanding of 
long-term environmental change as well as better management of 
crisis situations involving natural and ecological disasters. 
The country has made an enormous investment in classified 
systems and technologies. For a relatively modest additional 
expenditure, these resources can be exploited to benefit 
science and the environment for the well-being of future 
generations of Americans.
                                   Norm Dicks.
                                   Bill Richardson.
                                   Julian C. Dixon.
                                   Robert G. Torricelli.
                                   Ronald D. Coleman.
                                   Nancy Pelosi.
                                   Greg Laughlin.
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