FY '88 INTELLIGENCE AUTHORIZATION BILL: SSCI ACTION

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP89G00643R001100200002-1
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 24
• Document Creation Date: December 23, 2016
• Document Release Date: December 7, 2011
• Sequence Number: 2
• Content Type: MEMO

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TO:
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REMARKS:
UN 1987
EX(~ 12 JUN 1987
18:2 JUN 1987,
FROM: OCA/Legislation
ROOM NO.
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I' TRANSMITTAL SLIP v l
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MEMORANDUM FOR: (INTERNAL ADDRESSEES - INTELLIGENCE
AUTHORIZATION BILL
Deputy Director for Legislation
Office of Congressional Affairs
STAT
SUBJECT: FY '88 Intelligence Authorization Bill: SSCI
Action
1. On May 20 1987, the Senate Select Committee on
Intelligence (SSCI) reported out H.R. 1243, its version of the
Fiscal Years 1988-1989 Intelligence Authorization bill. Unlike
the House bill, the Senate bill authorizes funds for two
years. Attached are copies of the S. 1243 and the accompanying
report.
2. The bill now goes to the Senate Armed Services and
Judiciary Committees for a 30 day time period. The bill could
come to the Senate floor during July.
3. Contained below are highlights from the Senate bill of
interest to the Intelligence Community.
Enhanced-Counterintelligence Capabilities
4. The bill requires the Attorney General to report
annually to the HPSCI and the SSCI regarding the circumstances
under which Soviet nationals are admitted to the U.S. despite
FBI objections that such persons are known or suspected
intelligence officers. The bill also gives the Director of the
FBI authority to pay additional compensation to the N.Y. Field
Division of the FBI to defray unusually high living expenses.
DoE-Intelligence Personnel Improvements
The bill provides several new benefits and enhanced
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authorities to intelligence components of the DoD. Included in
the bill is an allowance for civilian uniforms of Defense
Attache chauffeurs, tax exemption for allowances paid to NSA
and DIA employees, extension of special termination authorities
for DIA civilian employees and civilian employees of
intelligence components of the DoD, exemption for DIA from
requirement to disclose organizational and personnel data, and
a new NSA Graduate level program similar to the program
authorized last year for undergraduate students. Many of these
proposals were included in the Administration approved version
of the Intelligence Authorization Bill.
Congressional Oversight of Intelligence Activities
6. The Senate report notes that serious questions have
been raised by the Iran-Contra affair with respect to the
effectiveness of the Congressional oversight process. In view
of the continuing investigation by the Select Committees
examining the Iran-Contra affair, the SSCI agreed to defer
taking action in the area of congressional oversight within the
context of the Intelligence Authorization Act. However, the
SSCI notes in its report that the Committee will establish its
own independent audit capability. This capability will be
similar to that which exist in the the HAC Survey and
Investigation staff.
Assistance to the Contras
7. Unlike the House version of the Intelligence
Authorization Act, the Senate bill contains no explicit
restriction on paramilitary operations in Nicaragua. It is
expected that the House will insist on language restricting
expenditure of funds to that which is authorized in separate
legislation.
Attachment as
stated
STAT
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100TH CONGRESS
1 ST SESSION
.1243
[Report No. 100-591
To authorize appropriations for fiscal; years 19SS and 1984 for intelligence and
intrlligencc rel~ited activities of tht I-nited States Government. the InteiL-
gence Community Staff. and the Central Intelligence Agency Retirement and
I)isabilit.; System. and for other purposes.
IN THE SENATE OF THE UNITED STATES
MAY 20 (legislative day, MAY 13). 1987,
Mr. BOREN, from the Select Committee on Intelligence, reported the following
original bill; which was read twice and ordered referred jointly to the Com-
mittees on Armed Services and the Judiciary for the thirty-day time period
provided in section 3(b) of Senate Resolution 400, Ninety-fourth Congress:
Provided, That the Committee on the Judiciary be restricted to the consider-
ation of title IV: Provided further, That if either committee fails to report
within the thirty-day time limit, such committee shall be discharged from fur-
ther consideration of said bill
A BILL
To authorize appropriations for fiscal years 1988 and 1989 for
intelligence and intelligence-related activities of the United
States Government, the Intelligence Community Staff, and
the Central Intelligence Agency Retirement and Disability
System, and for other purposes.
1 Be it enacted by the Senate and House of Representa-
2 tires of the United States of America in Congress assembled,
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1 That this Act may be cited as the "Intelligence Authoriza-
2 tion Act, Fiscal Years 1988 and 1989".
3 TITLE I-INTELLIGENCE ACTIVITIES
4 AUTHORIZATION OF APPROPRIATIONS
5 SEC. 101. Funds are hereby authorized to be appropri-
6 ated for fiscal years 1988 and 1989 for the conduct of the
7 intelligence activities of the following elements of the United
8 States Government:
9 (1) The Central Intelligence Agency.
10 (2) The Department of Defense.
11 (3) The Defense Intelligence Agency.
12 (4) The National Security Agency.
13 (5) The Department of the Army, the Department
14 of the Navy, and the Department of the Air Force.
15 (6) The Department of State.
16 (7) The Department of the Treasury.
17 (8) The Department of Energy.
18 (9) The Federal Bureau of Investigation.
19 CLASSIFIED SCHEDULE OF AUTHORIZATIONS
20 SEC. 102. The amounts authorized to be appropriated
21 under section 101, and the authorized personnel ceilings as of
22 September 30, 1988, and September 30. 1989. for the con-
23 duct of the intelligence activities of the elements listed in
24 such section, are those specified in the classified Schedule of
25 Authorizations prepared by the Select Committee on Intelli-
26 Bence of the Senate. That Schedule of Author izcw;nn:~ shall
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1 be made available to the Committee on Appropriations of the
2 Senate and House of Representatives and to the President.
3 The President shall provide for suitable distribution of the
4 Schedule, or of appropriate portions of the Schedule, within
5 the executive branch.
6 PERSONNEL CEILING ADJUSTMENTS
7 SEC. 103. The Director of Central Intelligence may au-
8 thorize employment of civilian personnel in excess of the
9 numbers authorized for fiscal years 1988 and 1989 under
10 sections 102 and 202 of this Act when he determines that
11 such action is necessary to the performance of important in-
12 telligence functions, except that such number may not, for
13 any element of the Intelligence Community, exceed 2 per
14 centum of the number of civilian personnel authorized under
15 such sections for such element. The Director of Central Intel-
16 ligence shall promptly notify the Permanent Select Commit-
17 tee on Intelligence of the House of Representatives and the
18
Select Committee on Intelligence of the Senate whenever he
19
exercises the authority granted by this section.
20
TITLE II-INTELLIGENCE CObBIUNITY STAFF
21
AUTHORIZATION OF APPROPRIATIONS
22
SEC. 201. There is authorized to be appropriated for the
23
Intelligence Community Staff for fiscal year 1988 the sum of
24
$21,900,000
and for fiscal year 1989 the sum of
25
$ 21,900,000.
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1 AUTHORIZATION OF PERSONNEL END STRENGTH
2 SEC. 202. (a) The Intelligence Community Staff is au-
3 thorized 237 full-time personnel as of September 30, 1988,
4 and 237 full-time personnel as of September 30, 1989. Such
5 personnel of the Intelligence Community Staff may be per-
6 marient employees of the Intelligence Community Staff or
7 personnel detailed from other elements of the United States
8 Government.
9 (b) During fiscal years 1988 and 1989, personnel of the
10 Intelligence Community Staff shall be selected so as to pro-
11 vide appropriate representation from elements of the United
12 States Government engaged in intelligence activities.
13 (c) During fiscal years 1988 and 1989, any officer or
14 employee of the United States or a member of the Armed
15 Forces who is detailed to the Intelligence Community Staff
16 from another element of the United States Government shall
17 be detailed on a reimbursable basis, except that any such
18 officer, employee, or member may be detailed on a nonreim-
19 burnable basis for a period of less than one year for the per-
20 formance of temporary functions as required by the Director
21 of Central Intelligence.
22 INTELLIGENCE COMMUNITY STAFF ADMINISTERED IN
23 SAME MANNER AS CENTRAL INTELLIGENCE AGENCY
24 SEC. 203. During fiscal years 1988 and 1989, activities
25 and personnel of the Intelligence Community Staft shall be
subject to the provisions of the -National Security Act of 194,
1 '4" Kh
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1 (50 U.S.C. 401 et seq.) and the Central Intelligence Agency
2 Act of 1949 (50 U.S.C. 403a et seq.) in the same manner as
3 activities and personnel of the Central Intelligence Agency.
4 TITLE III-CENTRAL INTELLIGENCE AGENCY
5 RETIREMENT AND DISABILITY SYSTEi11
6 AUTHORIZATION OF APPROPRIATIONS
7 SEC. 301. There is authorized to be appropriated for the
8 Central Intelligence Agency Retirement and Disability Fund
9 for fiscal year 1988 the sum of $134,700,000 and for fiscal
10 year 1989 the sum of $144,500.000.
11 TITLE II'-E'-HANCED COUNTERINTELLIGENCE
12 AND SECURITY CAPABILITIES
13 REPORT ON ADMISSION OF CERTAIN ALIENS
14 SEC. 401. The Attorney General shall report annually
15 to the House Permanent Select Committee on Intelligence
16 and the Senate Select Committee on Intelligence regarding
17 the circumstances of any admission to the United States over
18 the objections of the Federal Bureau of Investigation, of any
19 Soviet national employed by or assigned to a foreign mission
20 or international organization in the United States.
21 FBI NEW YORK FIELD DIVISION COMPENSATION
22 SEC. 402. The Director of the Federal Bureau of Inve.s-
23 tigation is authorized to pay from appropriated funds addi-
24 tional compensation to the _New York Field Division of the
25 Federal Bureau of Investigation to the extent necessary and
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1 appropriate to defray unusual living expenses associated -. ith
2 such employment.
3 TITLE V-DOD INTELLIGENCE PERSONNEL
4 MPRO-EMENTS
5 DIA CIVILIAN UNIFORM ALLOWANCE ADJUSTMENT
6 SEC. 501. (a) Chapter 13 of title 10, United States
7 Code, is amended by inserting after section 1605 the follow-
8 ing new section:
9 "? 1606. Civilian Uniform Allowance
10 "Notw-ithstanding the provisions of subsection 5901(a)
11 of title 5, United States Code, the Director Defense Intelli-
12 genre Agency is authorized to pay from appropriated funds
13 civilian employees of Defense attache offices located outside
14 the United States, who are required by agency regulations to
15 wear a prescribed uniform as part of their official duties, a
16 uniform allowance, not to exceed the amount prescribed by
17 the Secretary of State for its civilian employees outside the
18 United States pursuant to section 2669(e) of title 22, United
19 States Code.".
20 SPECIAL TERMINATION AUTHORITY-DIA CIVILIAN
21 EMPLOYEES
22
SEC. 502. Paragraph 1604(e)(1) of title 10, United
23 States Code, is amended by striking the words "1986" and
24 "1987", and inserting in lieu thereof the words "1988" any
5 "1989", respectively.
2
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I NSA AND DIA EMPLOYEES-EQUALIZING TAX TREATMENT
OF PERSONNEL BENEFITS
3 SEC. 503. Section 912(1) of chapter 1 of title 26,
4 United States Code, is amended by striking the "or" in Para-
5 graph (C) and inserting at the end thereof the following new
6 paragraphs:
"(E) Subsection (b) of section 9 of the 'N a-
8 tional Security Agency Act of 1959, as amended
9 (50 U.S.C. Section 402 note), whenever the al-
10 lowance would be excluded from gross income
11 under paragraphs (1)(A) or (1)(B) of this section.
12 or
13 "(F) Subsection 1605(a) of title 10, United
14 States Code, whenever the allowance would be
15 excluded from gross income under paragraph 1(A)
16 of this section.".
17 SPECIAL PERSONNEL MANAGEMENT AUTHORITY DOD
18 MILITARY INTELLIGENCE
19 SEC. 504. Paragraph 1590(e)(1) of chapter 81 of title
20 10. United States Code, is amended by striking "Fiscal Year
21 1987" and inserting in lieu thereof "Fiscal Years 1988 and
22 1989".
23 REQUIREMENTS TO DISCLOSE ORGANIZATIONAL AND
24 PERSONAL DATA: DIA EXEMPTION
25! SEC. 505. (a) Chapter 83 of title 10. United States
26 Code, is amended by inserting the following new section:
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1 "? 1607. Exemption from disclosing organizational and
2 personnel data
3 "Notw"ithstanding the provisions of any other law, and
4 except as provided herein, the Defense Intelligence Agency
5 shall not be required to disclose the organization or any func-
6 tion of the Defense Intelligence Agency or the names, official
7 titles, occupational series. grades, salaries or numbers of per-
8 sonnet employed by such Agency. This section shall not
9 apply to information provided the Congress.".
10 NSA GRADUATE-LEVEL "CRITICAL SKILLS" PROGRAAN
11 SEC. 506. (a) Section 16(a) of the National Security
12 Agency Act of 1959 is amended to read as follows:
13 "SEC. 16. (a). The purposes of this section are: (1) to
14 establish an undergraduate training program, which may lead
15 to the baccalaureate degree, to facilitate the recruitment of
16 individuals, particularly minority high school students, with it
17 demonstrated capability to develop skills critical to the mis-
18 lion of the National Security Agency, including mathematics.
19 computer science, engineering. and foreign languages: and (2)
20 to establish a graduate training program which may lead to a
21 graduate degree to facilitate the retention of employees and
22 the recruitment of new employees with a demonstrated eapo-
23 bility to develop skills critical to this mission of NSA."
24 (b) Section 16(b) is amended by inserting the worm (1-
25 graduate" after "under-raduate".
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1 (c) Paragraph (2) of Section 16(e) is amended by insert-
2 ing the words "or graduate" after "undergraduate".
3 TITLE U-GEN-ER AL PROVISIONS
4 AUTHORITY FOR THE CONDUCT OF INTELLIGENCE
5 ACTIVITIES
6 SEC. 601. The authorization of appropriations by this
7 Act shall not be deemed to constitute authority for the con-
8 duct of any intelligence activity which is not otherwise au-
9 thorized by the Constitution or laws of the United States.
10 INCREASES IN EMPLOYEE COMPENSATION AND BENEFITS
11 AUTHORIZED BY LAIN'
12 SEC. 602. Appropriations authorized by this Act for
13 salary, pay, retirement, and other benefits for Federal em-
14 ployees may be increased by such additional or supplemental
15 amounts as may be necessary for increases in such compensa-
16 tion or benefits authorized by lacy.
0
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IUVTH L.ONt:Rb23b SENATE i
Ist Session 100-59
AUTHORIZING APPROPRIATIONS FOR FISCAL YEARS 1988 AND 1989 FOR
INTELLIGENCE ACTIVITIES OF THE UNITED STATES GOVERNMENT, THE
INTELLIGENCE COMMUNITY STAFF, THE CENTRAL INTELLIGENCE
AGENCY RETIREMENT AND DISABILITY SYSTEM (CIARDS. AND FOR
OTHER PURPOSES
MAY 20 (legislative day, Mwe 13), 198, .-Ordered to be printed
Mr. BOREN, from the Select Committee on Intelligence.
submitted the following
REPORT
fTo accompany S. 1243]
The Select Committee on Intelligence, having considered the
original bill (S. 1243) authorizing appropriations for fiscal years
1988 and 1989 for intelligence activities of the U.S. Government,
the Intelligence Community Staff, the Central Intelligence Agency
Retirement and Disability System, and for other purposes, reports
favorably thereon without amendment and recommends that the
bill do pass.
This bill would:
(1) Authorize appropriations for fiscal years 1988 and 1989
for (a) intelligence activities of the United States, (b) the Intel-
ligence Community Staff, and (c) the CIA Retirement and Dis-
ability System;
(2) Authorize the personnel ceilings as of September 30, 1988
and September 30, 1989 for (a) the Central Intelligence Agency,
(b) the Intelligence Community Staff, and (c) the other intelli-
gence activities of the U.S. Government;
(3) Authorize the Director of Central Intelligence to make
certain personnel ceiling adjustments when necessary to the
performance of important intelligence functions;
14, Make several legislative changes designed to enhance in-
telligence and counterintelligence capabilities and to promote
the more effective and efficient conduct of intelligence and
counterintelligence.
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OVERALL SUMMARY OF COMMITTEE ACTION
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THE CLASSIFIED SUPPLEMENT TO THE COMMITTEE REPORT
The classified nature of U.S. intelligence activities prevents the
Committee from disclosing the details of its budgetary recommen-
dations in this Report.
The Committee has prepared a classified supplement to the
Report, which describes the full scope and intent of its action. The
Committee intends that the classified supplement, although not
available to the public. will have the full force of a Senate Report.
and that the Intelligence Community will fully comply with the
limitations, guidelines, directions, and recommendations contained
therein.
The classified supplement to the Committee Report is available
for review and by any Member of the Senate, subject to the provi-
sions of Senate Resolution 400 of the 94th Congress.
The Committee conducted a detailed review of the Intelligence
Community's budget request for Fiscal Years 1981; and 1989. This
was the first year in which the Committee has required and acted
upon a budget request covering more than one fiscal year. The
Committee's review included:
Hearings involving some 30 hours of testimony from the princi-
pal program managers for U.S. Intelligence, including: The Acting
Director of Central Intelligence, the Director and Deputy Director
Intelligence Community Staff, the Director National Security
Agency, the Director Defense Intelligence Agency, the Executive
Director of the Central Intelligence Agency, and senior officials of
the Military Departments.
A hearing involving some 3 hours of testimony from the Assist-
ant Secretary of Defense for Command, Control, Communications.
and Intelligence relative to Tactical Intelligence and Related Ac-
tivities programs of the Department of Defense.
A hearing involving some 3 hours of testimony from the Director
of the Arms Control and Disarmament Agency and the Undersecre-
tary of Defense for Policy covering the Intelligence Community's
arms control monitoring capabilities.
Detailed examination of over 3,000 pages of budget justification
material provided by national and tactical intelligence program
managers and all major government security activities.
Review of written answers from various officials to several hun-
dred questions for the record.
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Numerous briefings and interviews with officials on major topics
of interest.
The Committee continued to review intelligence programs based
on the DCI's National Intelligence Strategy prepared in 1986 and
updated in 1987. This Strategy projects the challenges and require-
ments that will face U.S. intelligence over the next decade, identi-
fies the intelligence programs and activities necessary to meet
those challenges, and sets forth a plan for the acquisition of needed
capabilities taking into account the tight fiscal environment faced
by all government activities.
COMMITTEE FINDINGS AND RECOMMENDATIONS
In previous years the Committee has reported its judgment that
intelligence activities must be assigned a very high priority in over-
all national security investment. The Committee has also stated its
concern over the debilitating effect budget constraints could have
on the ability of the United States to field an effective intelligence
capability in the future. These judgments have not changed:
indeed, the situation has worsened.
U.S. intelligence has incurred significantly increased costs as a
result of the tragic loss of the Space Shuttle Challenger and two
successive failures of TITAN 34D launch vehicles. These unavoid-
able costs are absorbing scarce resources that otherwise could have
financed needed investment in new intelligence capabilities.
The Committee has carefully reviewed intelligence capabilities
against the broad range of requirements faced by the United States
for detailed, timely, and accurate intelligence support. The Com-
mittee is confident that the recommendations it has made for the
Fiscal Years 1988 and 1989 intelligence authorization, as contained
in the classified supplement to this report, will deliver the type of
intelligence system needed by the Nation as it approaches the 21st
Century.
Congressional oversight of intelligence activities
The Committee recognizes that during the past year, as a result
of the Iran-Contra affair, serious questions have been raised with
respect to the effectiveness of the Congressional oversight process.
particularly as it relates to oversight of covert actions. The Com-
mittee itself carried out a preliminary investigation of this matter,
culminating in the issuance of a report on January 29, 1987, titled:
"Preliminary Inquirty into the Sale of Arms to Iran and Possible
Diversion of Funds to the Nicaraguan Resistance." The Senate
voted to create a special select committee to carry out a more de-
tailed examination of the affair and submit a report to the Senate
by October 30, 1987.
In view of this continuing investigation, the Committee deferred
taking any action in this area within the context of the Intelli-
gence Authorization bill for Fiscal Years 1988 and 1989. The Chair-
man has expressed his intention to conduct a broad review- of Con-
gressional oversight of intelligence activities at the conclusion of
the new select committee's work, at which time the Committee will
recommend to the Senate such changes to the statutory oversight
requirements as it,considers appropriate.
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Notwithstanding this anticipated review of Congressional over-
sight, the Committee believes immediate action should be pursued
? to provide the Committee with its own independent audit capabil-
ity of certain elements of the Intelligence Community. Currently,
the budget staff of the Committee is not of sufficient size or requi-
site background to permit more than a few such reviews each year.
The Committee notes that the House of Representatives routine-
ly subjects selected CIA and other Intelligence Community activi-
ties to detailed audits by the Surveys and Investigations staff of the
Committee on Appropriations. The work of the Appropriations
Committee in this regard has been of great benefit to the Intelli-
gence Committees. The Senate does not have a comparable staff
with the requisite security clearances dedicated to the conduct of
such audit, or investigations.
The Committee believes the time has come to consider strength-
ening its auditing capabilities to permit detailed in-depth independ-
ent review of a number of selected intelligence programs The Com-
mittee plans to consider alternatives in this regard and make ap-
propriate recommendations to the Committee on Rules and Admin-
istration in the near future.
Securih matters pertaining to the Senate
The Committee notes that notwithstanding its recommendation
to the Senate in the last Congress that an Office of Senate Security
be established-a recommendation that was concurred in by the
Committees on Rules and Administration, and Government Af-
fairs-no such office has yet been established. The Committee con-
tinues to be concerned for the administration of security within the
Senate as a whole, and fears that unless uniform, stringent con-
trols are adopted and enforced, it is only a matter of time before a
serious compromise of classified information occurs. The Commit-
tee strongly reiterates its concern and its recommendation that an
Office of Senate Security be established to ensure the appropriate
handling of classified information provided by the Executive
branch and to monitor Senate staff security clearances.
In a matter related to the Committee on Armed Services, the
classified annex to the conference report on the FY 1987 Depart-
ment of Defense Appropriation Act directed the Executive branch
to provide TEMPEST-shielded computer equipment to the Congres-
sional Committees which review the National Foreign Intelligence
Program and the DOD Tactical Intelligence and Intelligence-Relat-
ed Program budgets. The Act reserved $200,000 for DIA for this
purpose, over half of which remains available for obligation.
The report specified that TEMPEST-shielded equipment be pro-
vided to the Intelligence and Appropriations Committees, but omit-
ted the Armed Services Committees who also have responsibility
for portions of the budgets mentioned above. The Committee ac-
cordingly recommends that the same computer support provided
the Intelligence and Appropriations Committees should also be pro-
vided the Armed Services Committees out of the funds which have
been appropriated but remain unobligated.
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SECTION-BY-SECTION ANALYSIS
( Title I-Intelligence activities
Section 101 lists the departments, agencies, and other elements
of the United States Government for whose intelligence activities
the Act authorizes appropriations for Fiscal Years 1988 and 1989.
Section 102 makes clear that details of the amounts authorized
to be appropriated for intelligence and intelligence-related activi-
ties and personnel ceilings covered under this title for Fiscal Years
1988 and 1989 are contained in a classified Schedule of Authoriza-
tions. The Schedule of Authorizations is incorporated into the Act
by this section.
Section 103 authorizes the Director of Central Intelligence in
Fiscal Years 1988 and 1989 to expand the personnel ceilings appli-
cable to the components of the Intelligence Community under Sec-
tions 102 and 202 by an amount not to exceed 2 percent of the total
of the ceilings applicable under these sections. The Director may
exercise this authority only when necessary to the performance of
important intelligence functions or to the maintenance of a stable
personnel force. and any exercise of this authority must be report-
ed to the two Intelligence Committees of the Congress.
Title 11-Intelligence community staff
Section 201 authorizes appropriations in the amount of
$21,900,000 for the staffing and administration of the Intelligence
Community Staff for Fiscal Year 1988 and $21,900,000 for Fiscal
Year 1989. This staff supports the DCI in the execution of his re-
sponsibilities to develop. review, and approve the National Foreign
Intelligence program budget, to evaluate the performance of for-
eign intelligence activities, and to develop issues, goals and other
required guidelines for the Intelligence Community.
Section 202(a) authorizes a personnel end strength of 237 full-
time staff for the Intelligence Community Staff as of September 30,
1988 and September 30, 1989; and provides that such staff may be
either permanent employees or personnel detailed from other ele-
ments of the Intelligence Community.
Section 202(b) directs that the personnel employed by the Intelli-
gence Community Staff be selected to provide appropriate repre-
sentation from various elements of the Intelligence Community.
Section 202(c) requires that personnel be detailed on a reimbursa-
ble basis except for temporary situations of less than a year. In the
opinion of the Committee, the authorized size of the Intelligence
Community Staff is sufficient for the performance of its duties.
This provision is intended to insure that its ranks are not swelled
by detailees, the personnel costs for whom are not reimbursed to
their present agency.
Section 203 provides that the Director of Central Intelligence
shall manage the activities and personnel of the Intelligence Com-
munity Staff in accordance with the same statutory authorities
under which the Central Intelligence Agency is managed. However.
it is the Committee's intent that in the case of detailed personnel.
the DCI's authority to discharge personnel shall only extend to dis-
charging detailed personnel from service at the Intelligence Com-
munity Staff and not from Federal employment or military service.
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b
Intelligence communit staff
Fiscal year:
M,ln?ti
19F7 program.... ..............................................................__................................__
121.9
I98R reque::t .................................................. ................... ............................... ...._..
24 3
Committee recommended change ...... .................... .................. ................... _..._
-2 4
Committee recommendation ................................................ ...... .......... ............ .
21.9
198E request .............................................................................................................
2,5 l
Committee recommended change............................................. . .
3
Committee recommendation .................. ........ ................... ............ ............ ...._.
21.4
Title II-Central Intelligence Agency retirement and discbilit'
svstem
Section 301 authorizes appropriations for the Central Intelligence
Agency Retirement and Disability System (CIARDS) in the amount
of $134,700,000 for Fiscal Year 198r and $144.500.000 for Fiscal
Year 19x9. The Central Intelligence Agency Retirement Act of 1964
for Certain Employees (Public Law 8?'-643 authorized the estab-
lishment of CIARDS for a limited number of Agency employees
and authorized the establishment and maintenance of a fund from
which benefits would be paid to qualified beneficiaries
The benefits structure of CIARDS is essentially the same as for
the Civil Service Retirement System, with several special provi-
sions. These special CIARDS provisions are: (a) annuities based
upon a straight 2 percent of high 3-year average salary for each
year of service, not exceeding 35; (b) under stipulated conditions a
participant may retire at age 50 with 20 years of service, or a par-
ticipant with 25 years of service may be retired by the Director re-
gardless of age; and (c) retirement is mandatory at age 65 for per-
sonnel receiving compensation at the rate of GS-18 or above, and
at age 60 for personnel receiving compensation at a rate less than
GS-18. except that the Director may in the public interest. extend
service up to 5 years.
Annuities to beneficiaries are provided exclusively from the
CIARDS fund, which is maintained through; (a) contributions, cur-
rently at the rate of 7 percent, deducted from basic salaries of par-
ticipants; (b) matching Agency (employer) contributions from the
appropriation from which salaries are paid, based on the actual
rate of contributions received from participants; (c) transfers from
the Civil Service Retirement and Disability Fund representing em-
ployee and matching employer contributions for service of Agency
employees prior to the date of their participation in CIARDS. and
contributions for service of integrated Agency employees included
in CIARDS following termination of integrated status; (d, income
on investments in U.S. Government securities: and (e) beginning in
1977 direct appropriations consistent with the provisions of Public
Law 94-552.
Central Intelligence Agenc) retirement and dcsabiht~ sYstern
Fisca! year:
M:1h,.a-
19~; program ................................. _........ ................ ..._............. ......... ...... ...... ....
$125 E
..................................................................... _ ... . . . . . .
19S' request.................. .. .
1;34
Committee recommended change ............................ .........................................
0
Committee recommendation ........... .._............ .......... ........... ............. ............ _.
134 7
14- request ............................... ............... ..._........._.................................. ......._
144
Committee recommended change...... ...... ...... .............._...._....__.._ ..............
Committee recommendation ........ .........._.............................................. ........ .....
144.r1
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Title IV-Enhanced counterintelligence and security capabilities
Section 401 requires the Attorney General to report annually to
the two Intelligence Committees any cases where Soviet nationals
have been admitted to the United States over the objections of the
Director of the Federal Bureau of Investigation, for employment
by, or assignment to. a diplomatic establishment or international
organization in the United States.
Under section 813 of the Foreign Relations Authorization Act for
Fiscal Years 1986 and 1987, Congress adopted a policy which pro-
vided that the number of nationals of the Soviet Union who were
admitted to the United States to serve as diplomatic or consular
personnel should be substantially equivalent to the number of U.S.
personnel serving in similar posts in the Soviet Union, unless the
President determines that the admission of additional Soviet na-
tionals would be in the best interests of the United States. This
provision also required a report from the Secretary of State setting
forth how these limitations would be maintained
The Administration submitted the required report to the Con-
gress, which proposed comparable ceilings of 320 personnel in the
U.S. and in the Soviet Union, respectively. The Administration also
announced in March, 1986, that it would require the Soviet Union
to draw down the size of its staff at its mission to the United Na-
tions from 275 persons to 170, to be accomplished by April, 1985.
This timetable was considerably accelerated by the Daniloff affair
which occurred in October, 1986, which led to the expulsion of 80
Soviet officials from the United States. Most of these officials were
chosen to leave the U.S. based upon the FBI's intelligence-gather-
ing activities here.
The Committee applauds these actions of the Administration
which it considers fully consistent with the intent of the Foreign
Relations Authorization Act, cited above, and with the recommen-
dations of the Committee made in its 1986 report "Meeting the Es-
pionage Challenge."
The Committee is nonetheless concerned that these gains not be
nullified by permitting the Soviet Union to replace its diplomatic
and consular personnel, admitted under the approved ceilings, with
known or suspected intelligence officers. Under section 1182(a)(27 i
of title 8, United States Code. the U.S. may exclude any aliens
"who the consular officer or the Attorney General knows or has
reason to believe seek to enter the United States solely, principally.
or incidentally to engage in activities which would be prejudicial to
the public interest, or endanger the welfare, safety, or security of
the United States". The Committee believes this provision provides
sufficient authority for the United States to deny admittance to
known or suspected intelligence officers of the Soviet Union.
The purpose of section 401 is to provide both Intelligence Com-
mittees with information on cases where the FBI has objected to
the admission of Soviet nationals to the United States based upon
its assessment of such persons as known or suspected intelligence
officers, and yet such persons have been admitted for other more
compelling reasons.
Section 402 authorizes the Director of the Federal Bureau of In-
vestigation to pay from appropriated funds such additional compen-
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cation as he considers necessary and appropriate to defray unusual-
Iy high living expenses of FBI employees assigned to the New York
Field Division
The Committee has been advised for some time by the FBI that
due to the high costs of living in the New York area, which exceed
any other area of the country, the FBI has a difficult time recruit-
ing agents for such assignments, which impose a considerable fi-
nancial burden on agents and their families under the current pay
structure. Agents who are assigned routinely attempt to leave at
the earliest opportunity.
From the standpoint of the effectiveness of the FBI's Foreign
Counterintelligence Program, the New York Field Division is criti-
cally important. To have employees assigned to this division
against their wishes, at a considerable financial sacrifice, and to
have them take the first opportunity to leave, for the same reason.
inevitably undermines the effectiveness of the New York Office in
terms of its counterintelligence responsibilities.
The Committee believes that the Director should have authority
to pay, if he chooses to do so, additional compensation to this cate-
gory of employees to deal with this situation. Obviously, the intent
is to equalize the financial burden of living in the New York area
with that of other areas of the country. It is not to provide employ-
ees of the New York Office with compensation which, in reality, ex-
ceeds that of other FBI employees.
Title V-DOD intelligence personnel improvements
Section 501 would add a new Section 1606 to Chapter 83 of Title
10, U.S.C., to allow the annual uniform appropriation authorization
for civilian employees working for Defense Attache Offices who are
required to wear uniforms to be increased to a maximum of $400
per year, an amount comparable to that paid by the Department of
State for similar employees working at United States Embassies.
Currently, the maximum amount that can be expended under 5
U.S.C. 5901 is $125 per year. The statutory authority for the De-
partment of State to pay uniform allowances (see 22 U.S.C. 2669ie)'
sets no maximum amount and the uniform allowance is controlled
by regulations of the Department of State. The current amount au-
thorized by Department of State regulations is $360 annually (see 6
Foreign Affairs Manual 241.51.
The Defense Attache Offices currently employ foreign nationals
as chauffeurs and uniforms are required to be worn. Similar posi-
tions at diplomatic posts for the Department of State afford foreign
national employees a uniform allowance benefit which far exceeds
the limits imposed on the Defense Attache Offices by Title 5. The
State Department has the flexibility to increase the amount of the
annual uniform allowance as required while Defense Attache Of-
fices. have been bound by the statutory $125 limit since 1966. This
has become an increasing problem over the course of 20 years, par-
ticularly in times such as these when there is a substantial devalu-
ation in the dollar.
Section 502 extends for the next two fiscal years the termination
authority of the Secretary of Defense with respect to the employ-
ment of any civilian officer or employee of the Defense Intelligence
Agency. Subsection 501(al of the Intelligence Authorization Act of
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Fiscal Year 1985, Public Law 98-618, authorized the Secretary of
Defense to exercise the termination authority described above
whenever such an action was considered by him to be in the best
interests of the United States and he determined that the termina-
tion procedures otherwise authorized by law could not be "invoked
in a manner consistent with the national security". This authority
was extended by paragraph 1604(0 1) of Chapter 83 of Title 10.
United States Code, for Fiscal Years 1985 and 1986. The regula-
tions which were written to implement this authority were not fi-
nalized with the Department of Defense, however. until mid-19rU.
Section 502 of the Intelligence Authorization Act for Fiscal Year
1987, Public Law 99-569, granted a one-year extension of this au-
thority through Fiscal Year 1987.
The Committee notes that this authority has not been exercised
since it was originally provided. Nevertheless. it recognizes that sit-
uations might yet arise where such authority would be desirable. It
therefore extends this authority for the next two fiscal years.
Section 503 would amend Section 912(ai of the Internal Revenue
Code of 1954 to grant tax treatment of allowances currently provid-
ed to certain Department of Defense personnel under Section
9(b1 ( of the National Security Agency Act of 1959 and Section
1605 of Title 10. United States Code comparable with that provided
to Foreign Service employees for similar allowances.
The Intelligence Authorization Act of 1982 (Public Law 97-89(
amended the National Security Agency Act of 1959 to allow the Di-
rector, National Security Agency, to provide allowances and bene-
fits to certain civilian employees of the Department of Defense
which were comparable to those provided to the State Depart-
ment's Foreign Service and to employees of the Central Intelli-
gence Agency. During the implementation of this statute, it was
discovered that comparability of the allowances could not be
achieved unless the tax exemption provided for Foreign Service
and Central Intelligence Agency employees under Section 912(1((A~
and (B( of the Internal Revenue Code was also available for civil-
iat.s employed and assigned to the National Security Agency.
The Intelligence Authorization Act for Fiscal Year 1984 (Public
Law 98-215) amended title 10, U.S.C., to provide certain allowances
and benefits to personnel assigned to Defense Attache Offices and
Defense Intelligence Agency Liaison Offices overseas comparable to
those provided by the Secretary of State to officers and employees
of the Foreign Service under Chapter 9 of Title 1 of the Foreign
Service Act of 1980 and the provisions of 5 U.S.C. ? 5924(4). Al-
though Section 1605 was designed to establish equivalence between
DAO/DIALO civilians and Foreign Service personnel with respect
to many allowances and benefits, the actual value of the allow-
ances and benefits to DAO and DIALO personnel is less than the
value of the benefits to Foreign Service personnel, since the bene-
fits granted under the Foreign Service Act and Title 5 are tax free
by virtue of Section 912 of the Internal Revenue Code. while those
granted under Section 1605 are not exempt from taxation
The current inequity in taxation has been compounded by Sub-
section 1232(b( of the Tax Reform Act of 1986 (Public Law 99-514).
This subsection provides that civilian employees of the Department
of Defense stationed in Panama may exclude from gross income a]-
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1U
lowances which are comparable to the allowances excludable under
Section 912(a) of the Internal Revenue Code by employees of the
Department of State stationed in Panama. Thus, it appears that
any Defense Intelligence Agency or National Security Agency per-
sonnel stationed in Panama will, in future taxable years, be able to
exclude from their gross income Foreign Service-equivalent allow-
ances and benefits granted to them
As a result of the provisions discussed above, there is now a situ-
ation where the tax laws treat identical allowances and benefits of
NSA and DIA civilian personnel stationed overseas differently
from those of Foreign Service personnel. Moreover, under the Tax
Reform Act of 1986, the tax laws now treat identical allowances
and benefits differently for NSA and DIA civilian personnel sta-
tioned overseas. The addition of the proposed Paragraphs (El and
(Fi to Section 912111 of the Internal Revenue Code of 1954 will pro-
vide equal tax treatment for identical allowances and benefits re-
ceived by NSA. DIA and Foreign Service civilian personnel sta-
tioned around the world.
Section 504 would extend the authority of the Secretary of De-
fense to terminate civilian employees of intelligence elements
within the military departments. comparable to the authority
granted under section 502 with regard to civilian employees of
DIA. Section 504 of the Fiscal Year 198 i Intelligence Authorization
Act had provided such authority limited to Fiscal Year 1987. The
Committee proposes to extend this authority for the next two fiscal
years, pursuant to the same rationale cited for section 502. above.
Section 505 would add a new section 1607 to Chapter 83 of Title
10, United States Code, to exempt the Defense Intelligence Agency
from any requirement to disclose information on its organization,
functions. or personnel. It would authorize DIA to establish a
system similar to that already afforded by statute to CIA and NSA.
The purpose of the section is to reduce the potential for compro-
mise of sensitive information through general administrative re-
porting systems. There are numerous and detailed Executive
branch personnel reporting requirements to which CIA and NSA
are not required to respond. DIA, lacking similar statutory author-
ity, is required to respond. However, the information requested is
for the purposes of compiling and publishing various unclassified
personnel reports. The personnel data required to be submitted by
DIA is classified and the Executive branch personnel who would re-
ceive the classified data are not cleared to handle it. Furthermore.
the computer systems into which the personnel data from through-
out the government are compiled are not set up to handle classified
information. This has placed DIA in the difficult position of being
technically required to submit personnel data which is classified
but which the receiving Executive branch offices cannot securely
handle or use. The proposed statutory exemption would resolve this
situation and preclude similar situations in the future.
The second sentence of the proposed provision makes clear that
this authority in no manner affects the responsibility of DIA to
report information to the Congress. including its responsibilities
under section 501 of the National Security Act of 1941 (50 U.S.C.
413, to make certain types of reports to the two Congressional In-
telligence Committees.
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The Committee also notes that this authority would be discre-
tionary, not mandatory. To the extent that organizational data con-
cerning DIA can be disclosed either to the public or in satisfaction
of Executive branch administrative requirements without jeopard-
izing sensitive functions of that agency, the Committee believes it
should do so. It intends that this authority be limited to those situ-
ations where it is needed to protect sensitive activities.
Section 506 amends Section 16 of the National Security Agency
Act, enacted in the Intelligence Authorization Act for fiscal year
1987. That section authorizes the establishment of an undergradu-
ate training program to facilitate recruitment of individuals for
NSA, particularly minority high school students, needed to develop
skills critical to the NSA mission Section 506 amends that provi-
sion to allow the Secretary of Defense to offer advanced training in
critical skills such as mathematics, engineering, computer science
and foreign languages to sought-after college recruits and valued
employees.
The success of the NSA mission depends upon the Agency's abili-
ty to recruit and retain the most talented available mathemati-
cians, computer scientists, engineers, and linguists. The Agency's
ability to recruit and retain these critical skilled individuals has
been severely challenged and diminished in recent years because of
the increase in the demand for these important skills in the pri-
vate industrial community. This is due in part to special incentives
that industry can offer to graduating college and university seniors
but which the Agency is prohibited by law from offering to its re-
cruits. Among those special incentives is sponsorship for advanced
degrees. Section 506 would significantly aid the Agency in compet-
ing for the finest graduating talent available by permitting the
Agency to match the offers of private firms to sponsor qualified in-
dividuals for advanced degrees.
Title VI-General provisions
Section 601 provides that 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 laws of the United States.
Section 602 provides advance authorization for such additional
appropriations as may be necessary for increases in Federal em-
ployee compensation and benefits which are authorized by current
or subsequently enacted law during Fiscal Years 1988 and 1989.
Section 602 obviates the necessity for separate authorizations for
such matters during the fiscal year.
COMMITTEE ACTION
On April 29, 1987, the Select Committee on Intelligence, ap-
proved the bill as amended and ordered it favorably reported.
EVALUATION OF REGULATORY IMPACT
In accordance with Paragraph 11ib! of Rule XXV'I of the Stand-
ing Rules of the Senate, the Committee finds no regulatory impact
will be incurred in implementing the provisions of this legislation.
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CHANCES IN EXISTING LAW
In the opinion of the Committee, it is necessary to dispense with
the requirements of Section 12 of Rule XXVI of the Standing Rules
of the Senate in order to expedite the business of the Senate.
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