S. 2525 - PROPOSED CHARTER LEGISLATION - TITLE IV, CIA - PROPRIETARIES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85-00988R000300010017-1
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 3
• Document Creation Date: December 15, 2016
• Document Release Date: November 10, 2003
• Sequence Number: 17
• Publication Date: August 3, 1978
• Content Type: MF

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MEMORANDUM FOR : Chief, Operations & Management Division/OGC
FROM
SUBJECT S.2525 - Proposed Charter Legislation
Title IV, CIA - Proprietaries
1. As you know, on Tuesday, 1 August 1978, a group of
OGC representatives (includin of
your office) met with Pat Norton, John Elliff, and Keith
Raffel of the Senate Select Committee on Intelligence staff
concerning CIA's suggested revisions of the proposed CIA
charter.
2. Among other things, we discussed the changes pro-
posed for Section 403(b), defining "proprietary," and Section
421(d)(1) and (2), concerning certain aspects of proprietary
financing. (Copies attached.) In response to our previously
expressed concerns regarding disposition of proceeds from
liquidation of proprietaries, the staffers provided a draft-
of a new section which would replace Section 421(d) entirely.
That proposal is attached also and I would appreciate your
comments.on, this language.
3. The staffers were unable to rationalize the con-
tinued inclusion of the Attorney General in the liquidation
procedure.in Subsection (d) over our objection except to say
that this was a recommendation of the Church Committee.
(See Book I, Foreign and Military Intelligence, pp. 456-59,
Rec. 52.) Your comments as to the acceptability or advis-
ability of this requirement, representing on its face nothing
more than a notification provision, also would be. helpful.-
4. In addition, you will note that the liquidation
procedure continues to be keyed to proprietaries with a
net value in excess of $50,000.00. The staffers do not feel
strongly about this particular figure as the "floor" for
reporting proprietary liquidations and have indicated a
willingness to modify the figure upward if the current level
is so low as to cause needless administrative reporting of
relatively trivial transactions. What is needed from you as
the basis for urging any increase in this level is a specific
breakdown of the numbers and net values of Agency proprie-
taries, and perhaps, an average net value figure, as well as
some idea of how often various classes of proprietaries are
liquidated.
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5. The staffers continue to be nonreceptive to our
requests for authority to utilize proprietary profits in
excess of "operational requirements" for the purposes of
establishing additional proprietaries. There was some dis-
cussion, at John Elliff's instigation, of the idea of an
annually appropriated "revolving fund" into which excess
profits would be poured and from which proprietary start-up
monies could be drawn, but this concept was not endorsed
warmly. If we are to make any headway in this regard, we
must have some justification for such authorization. Can
you generate any real instances, and the frequency with
which they arise, in which requiring that excess proprietary
profits be deposited in the Treasury and that new proprie-
taries be established from appropriations or supplemental
appropriations would cause us problems? Why would not the
Contingency Fund established in Section 425(c) be sufficient
for these purposes?
appreciate your comments as soon as is possible.
f. Finally, as to the definition of "proprietary" now
in Section 403(b), our suggested revisions were not deemed
necessary but the definition is being reexamined and will be
moved to Title I. Our interests would be served greatly if
you are able to develop specific support for the changes we
have proposed.
7. Generally, the sooner we are able to respond to
these needs, and the more thorough and persuasive the nature
of that response, the better our chances to influence the
content of the revised version of Title IV. Thus, I would
~l-000 Subj LEGISLATION (ARC holding)
1-ARC Signer
1-OGC Chrono
OGC/ IV
Distribution:
Orig-Addressee
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Approved For Release 2004/03/31 : CIA-RDP85-00988R000300010017-1