Intelligence, Surveillance, and Reconnaissance (ISR) Programs: Issues for Congress

Order Code RL32508

CRS Report for Congress

Received through the CRS Web

Intelligence, Surveillance, and

Reconnaissance (ISR) Programs:

Issues for Congress

Updated February 22, 2005

Richard A. Best, Jr.

Specialist in National Defense

Foreign Affairs, Defense, and Trade Division

Congressional Research Service ˜ The Library of Congress

Intelligence, Surveillance, and Reconnaissance (ISR)

Programs: Issues for Congress

Summary

Intelligence, surveillance, and reconnaissance (ISR) functions are principal

elements of U.S. defense capabilities, and include a wide variety of systems for

acquiring and processing information needed by national security decisionmakers and

military commanders. ISR systems range in size from hand-held devices to orbiting

satellites. Some collect basic information for a wide range of analytical products;

others are designed to acquire data for specific weapons systems. Some are

“national” systems intended primarily to collect information of interest to

Washington-area agencies; others are “tactical” systems intended to support military

commanders on the battlefield. Collectively, they account for a major portion of U.S.

intelligence spending that, according to media estimates, amounts to some $40 billion

annually.

For some time Congress has expressed concern about the costs and management

of ISR programs. With minor exceptions, ISR acquisition has been coordinated by

the Defense Department and the Intelligence Community. Although there are longexisting staff mechanisms for reviewing and coordinating ISR programs in the

context of the annual budget submissions, many in Congress believe that existing

procedures have not avoided duplication of effort, excessive costs, and gaps in

coverage. Examples that some observers cite are separate efforts to acquire a new

generation of reconnaissance satellites and a high altitude unmanned aerial vehicle

(UAV) known as Global Hawk. Both systems acquire some of the same sorts of

information and serve similar customers, but they are acquired in distinctly different

ways; moreover, in both cases procurement efforts have been beset by increasing

costs and schedule delays.

Recently enacted statutes mandate better integration of ISR capabilities and

require that the Defense Department prepare a roadmap to guide the development and

integration of ISR capabilities over the next fifteen years. An effective roadmap, if

developed, could potentially ensure more comprehensive coverage of targets and save

considerable sums of money. To establish responsibility for an Intelligence

Community-wide effort, the 9/11 Commission recommended that a new position of

Director of National Intelligence be established to manage the national intelligence

program (but not joint military and tactical intelligence programs, which would

continue to be managed by the Defense Department). This position was included,

after extended debate, in the Intelligence Reform and Terrorism Prevention Act of

2004 (P.L. 108-458) that was approved by the President on December 17, 2004. The

implications of this legislation for ISR programs are as yet uncertain, but Congress

may seek to assess the effectiveness of the statute in addressing long-existing

concerns with ISR programs. This report will be updated as circumstances warrant.

Contents

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Congressional Concerns with ISR: Lack of Coordination . . . . . . . . . . . . . . . . . . . 2

Congressional Budget Justification Books (CBJBs) . . . . . . . . . . . . . . . . . . . 5

Supplemental Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Reprogramming Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Momentum for Reorganization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Multiple Types of ISR Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

NIP Programs Serve National Decisionmaking . . . . . . . . . . . . . . . . . . . . . . 12

JMIP Programs Serve the Defense Department . . . . . . . . . . . . . . . . . . . . . . 13

TIARA Programs Serve the Military Services . . . . . . . . . . . . . . . . . . . . . . . 14

ISR Programming and Budgeting Procedures Differ Among Agencies . . . . . . . 15

Role of the DCI/DNI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Role of the Secretary of Defense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Changes in DOD’s Management of ISR . . . . . . . . . . . . . . . . . . . . . . . 18

How ISR Funding is Included in DOD’s Budget . . . . . . . . . . . . . . . . . 19

Internal DOD Coordinating Boards . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Coordination Between DOD and the IC . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Congressional Oversight of ISR Programs . . . . . . . . . . . . . . . . . . . . . . . . . 21

Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Appendix A: A Case Study in ISR Acquisition: The Future Imagery

Architecture (FIA) and Global Hawk UAVs . . . . . . . . . . . . . . . . . . . . . . . . 24

Intelligence, Surveillance, and

Reconnaissance Programs (ISR):

Issues for Congress

Introduction

The various systems that collect, process, and disseminate intelligence are

encompassed in the budget category known as Intelligence, Surveillance, and

Reconnaissance (ISR1). ISR covers a multitude of programs ranging from billiondollar satellites to hand-held cameras. The bulk of funding is for research and

development (R&D) and procurement; personnel costs are comparatively low. Some

systems are used only by military units; others are national systems operated by

Washington-level defense agencies. Most are surrounded in secrecy, but total

spending on ISR, while difficult to estimate with unclassified information,

undoubtedly runs into the tens of billions of dollars. The ISR programs considered

in this report are managed by the Central Intelligence Agency (CIA) and by the large

intelligence agencies and components of the Department of Defense (DOD).2

ISR acquisition has in recent years come under strong criticism. Reportedly,

there are technical problems with the new generation of reconnaissance satellites,

along with billion dollar cost-overruns; only a small number of the planned highaltitude UAVs are actually deployed; and there have been difficulties in ensuring that

the troops who need intelligence acquire it in a timely manner. There is a widespread

awareness that ISR spending, much greater than in past years, could easily absorb

even larger portions of defense and intelligence budgets, making the need for

tradeoffs even more important. Some observers point to the possibility that satellites

and UAVs potentially undertake the same or similar missions, but that the current

system gives little opportunity for cost comparisons or trade-offs to be made in the

1

ISR as used in Defense Department documents refers to the sets of collection and

processing systems, and associated operations, involved in acquiring and analyzing

information about foreign countries. Intelligence is a more general term; surveillance refers

to systematic observation of a targeted area or group, usually over an extended time;

reconnaissance refers to an effort or a mission to acquire information about a target and can

mean a one-time endeavor. See U.S. Department of Defense, Department of Defense

Dictionary of Military and Associated Terms, Joint Publication 1-02, 12 April 2001. As

used in this Report, the term “intelligence systems” encompasses all ISR systems.

2

The intelligence programs of the State, Justice (including the FBI), Energy, and Treasury

Departments have far fewer budgetary implications and will not be addressed herein. Many

of the activities of the Coast Guard, now part of the Department of Homeland Security

(DHS), have important intelligence implications, but only some are budgeted as intelligence

programs.

CRS-2

acquisition process. Appendix A provides a case study of the trade-offs between

satellites and unmanned aerial vehicles (UAVs).

Understanding the procedures for acquiring ISR systems is, however,

complicated by the fact that different ISR systems are acquired in entirely different

ways, by different intelligence agencies or military services, and are designed for

different users. In addition, the acquisition processes are overseen by different

congressional committees. It is difficult to ensure efficient acquisition in the separate

programs which are often based on innovative technologies. It is even more

challenging to envision a seamless and comprehensive system of systems and to

ensure the acquisition of an optimal mix of specific systems.

Congressional Concerns with ISR:

Lack of Coordination

Although procedures for coordinating the budgeting of ISR programs have long

been in place, some Members of Congress have concluded that the procedures have

not been wholly effective. There has been, it is argued, inadequate data to compare

systems capabilities and costs across the spectrum of intelligence programs, an

imbalance between collection and analysis programs, and an intelligence effort that

does not reflect an optimal allocation of extensive resources. Expressions of

congressional concern go back a number of years. In 1995, the Senate Select

Committee on Intelligence (SSCI) expressed its misgivings about existing

cooperation among agencies and recommended a joint review by the Director of

Central Intelligence (DCI) and the Deputy Secretary of Defense to ensure that “both

Intelligence Community and Defense Department equities are served in the planning,

programming, and management of all intelligence activities and programs.”3

Some believed that giving the DCI greater management responsibilities would

improve the management of ISR programs, including those in the Department of

Defense (DOD). Reflecting that view, the FY1997 Intelligence Authorization Act

(P.L. 104-293) included provisions that strengthened the ability of the DCI “to

manage the Intelligence Community by codifying his authority to participate in the

development of the budgets for defense-wide and tactical intelligence....”4 The

Conference Committee stated: “Giving the DCI a database of all intelligence

activities and requiring all National Foreign Intelligence Program (NFIP) elements5

3

U.S. Congress, Senate Select Committee on Intelligence, Authorizing Appropriations for

Fiscal Year 1996 for the Intelligence Activities of the United States Government and the

Central Intelligence Agency Retirement and Disability System 104th Congress, 1st session,,

S.Rept. 104-97, June 14, 1995, p. 4.

4

U.S. Congress, House Committee of Conference, Intelligence Authorization Act for Fiscal

Year 1997, 104th Congress, 2d session, H.Rept. 104-832, September 24, 1996, p. 38.

5

There are three types of intelligence programs; NFIP (renamed the National Intelligence

Program (NIP) by the 2004 Intelligence Reform Act) includes the national programs that

support senior policymakers; the Joint Military Intelligence Program (JMIP) that provides

(continued...)

CRS-3

to submit periodic budget execution reports should enable the DCI to make better use

of his existing authorities — given to him by Congress in 1992 — to approve the

budgets of NFIP elements and to transfer funds and personnel with the concurrence

of affected agency heads. The conferees in considering the FY1997 legislation urged

the DCI to be more assertive in using these authorities.”6

In May 2000, the Senate Intelligence Committee reported that, “the budget

practices of the [Central Intelligence Agency (CIA)] and the Intelligence Community

as a whole are simply inadequate to address current requirements. Upper level

program managers lack sufficient insight into the process to make informed and

timely decisions regarding the allocation of funds, and to assure Congress, and

themselves, that funds are being spent as appropriated and authorized.”7

The next year the committee again argued that the Intelligence Community “is

handicapped by the lack of comprehensive strategic and performance plans that can

be used to articulate program goals, measure program performance, improve program

efficiency and aid in resource planning.” Accordingly, the Committee directed the

DCI to produce a “comprehensive Intelligence Community strategic plan and

performance plan, as well as complementary strategic and performance plans for the

intelligence agencies within the National Foreign Intelligence Program aggregation.”

The Committee asked that such plans be undertaken annually and made available to

congressional committees by March 1 of each year.8

In 2002, the Senate Intelligence Committee acknowledged receipt of the “firstever plans coordinated across the Intelligence Community aimed at establishing

performance measures aligned with the stated goals and priorities of the Director of

Central Intelligence.” The Committee went on, however, to indicate that further

work is needed and suggested that developing new systems merely to acquire a new

capability was insufficient; the capability had to meet validated intelligence needs.

“A key issue is the development of performance plans and measures that are not

focused solely on the attainment of intelligence capabilities but also on the value

received from such capabilities in pursuit of Intelligence Community missions.”9

Despite this admonition, the next year the Committee called attention to the

absence of a 2003 performance plan submission, even though the deadline had passed

5

(...continued)

support to officials throughout DOD; and Tactical Intelligence and Related Programs

(TIARA) that are designed to support a single military service. For further background, see

below, pp. 11-14.

6

Ibid., p. 39.

7

S.Rept. 106-279, p. 33.

8

S.Rept. 107-63, p. 17.

9

U.S. Congress, Senate Select Committee on Intelligence, To Authorize Appropriations for

Fiscal Year 2003 for Intelligence and Intelligence-Related Activities of the United States

Government, the Community Management Account, and the Central Intelligence Agency

Retirement and Disability System, 107th Congress, 2nd session, S.Rept. 107-149, May 9,

2002, p. 28.

CRS-4

with no request for an extension.10 More significantly, the Committee noted that it

is aware

of no capability within DoD or the Intelligence Community for objectively,

independently, and comprehensively evaluating alternative sensor and platform

architecture and capabilities. There are some capabilities within different

agencies and departments, but none that are available, independent of the

program offices, to model and assess cross-program trades without regard to the

location of the sensor or platform (air, space, land, or sea) or the level of

compartmentation. Consequently, although DoD and Intelligence Community

officials expend substantial effort and time evaluating program trades, they do

so without the benefit of the rigorous quantitative modeling necessary to

optimize collection capabilities and architectures. Given the vast sums involved

in these programs, even modest increases in the efficiency of resources allocation

could lead to substantial benefits. Further, the Committee notes that the national

military strategy, as well as the Defense Planning Guidance, have been

developed in recent years without the participation of the Director of Central

Intelligence or his staff, notwithstanding the growing importance of intelligence

to military operations and the need to build forces commensurate to validated

threats.11

Section 355 of the FY2004 Intelligence Authorization Act (P.L. 108-177) required

a report from the DCI and the Secretary of Defense assessing progress in the

development of “a comprehensive and uniform analytical capability to assess the

utility and advisability of various sensor and platform architectures and capabilities

for the collection of intelligence ... [and] the improvement of coordination between

the Department [of Defense] and the intelligence community on strategic and

budgetary planning.

10

U.S. Congress, Senate Select Committee on Intelligence, Authorizing Appropriations for

Fiscal Year 2004 for Intelligence and Intelligence-Related Activities of the United States

Government, the Community Management Account, and the Central Intelligence Agency

Retirement and Disability System, 108th Congress, 1st session, S.Rept. 108-44, May 8, 2003,

pp. 12-13.

11

Ibid., p. 13. Furthermore, the Committee complained that the National Security Agency

(NSA), a major intelligence agency, had been unable to provide basic information about its

acquisition efforts:

It is very difficult for the Committee to understand what needs to be done

to modernize NSA when NSA cannot provide an adequate baseline of ongoing

development and acquisition programs, projects, and activities....

The Committee has fenced funds over the past two fiscal years to try to bring

command attention to this problem. Submissions to date have shown progress,

but are not comprehensive in identifying known projects and programs that are

being funded in the CCP.... Future funding requests will be balanced against the

NSA acquisition baseline so it is in the agency’s best interest to get this done

right, and soon. Ibid., p. 17.

CRS-5

In separate legislation, Congress also urged that DOD take a greater role in

managing ISR; in section 923 of the FY2004 Defense Authorization Act (P.L. 108136) Congress found that:

... there is not currently a well-defined forum through which the integrators of

intelligence, surveillance, and reconnaissance capabilities for each of the Armed

Forces can routinely interact with each other and with senior representatives of

Department of Defense intelligence agencies, as well as with other members of

the intelligence community, to ensure unity of effort and to preclude unnecessary

duplication of effort.12

P.L. 108-136 further stated that the existing structure of intelligence programming

may not be the best approach for supporting the development of an intelligence,

surveillance, and reconnaissance structure that is integrated to meet the national

security requirements of the United States in the 21st century.

Accordingly, the FY2004 Defense Authorization Act directed the Under Secretary

of Defense for Intelligence to establish an “ISR Integration Council” to provide a

permanent forum for assessing ISR capabilities. The council is to consist of senior

intelligence officers of the services, the Special Operations Command, the Joint Staff,

and the directors of DOD intelligence agencies. The DCI would be “invited” to

participate. The council would be charged with developing a comprehensive

roadmap “to guide the development and integration” of DOD ISR capabilities for 15

years.13

In addition to its general concerns about ISR programs, some Members of

Congress have specifically focused on two issues related to budget processes that

they argued undermine their abilities to conduct oversight of ISR efforts. They argue

that congressional budget justification books have been inadequate, and that there has

been an over-reliance on supplemental appropriations to fund continuing ISR

programs.

Congressional Budget Justification Books (CBJBs)

Effective congressional oversight depends on accurate, consistent information

over a multi-year period; the House Permanent Select Committee on Intelligence

12

The accompanying committee report noted that the U.S. has “ the most capable ISR

system in the world” but “as good as this system is, however, it is often plagued by gaps,

competition for assets, unavailability at the required level, and parallel systems (so-called

‘stovepipes’) that do not fully complement one another.... the Department has continued to

develop some capabilities without regard to their place within an overarching ISR

architecture.” U.S. Congress, Senate Committee on Armed Services, National Defense

Authorization Act for Fiscal Year 2004, 108th Congress, 1st session, S.Rept. 108-46, May 13,

2003, p. 355.

13

Section 923, P.L. 108-136; on April 7, 2004, the Senate Armed Services was informed

that the Council had recently started meeting. Testimony of Stephen Cambone,

Undersecretary of Defense for Intelligence before the Senate Armed Services Committee,

April 7, 2004.

CRS-6

(HPSCI), in particular, has criticized the inadequacy of intelligence budget

justification materials and asked for more complete budgetary submissions in the

form of congressional budget justification books. Proposals for ISR programs are to

be forwarded to intelligence committees along with armed services and

appropriations committees. Justification materials on national programs are

submitted to the two intelligence committees along with classified CBJBs, which

include one volume for each NIP program plus an additional summary volume. The

classified books, available to Members and committee staff, include explanatory

narrative and resource displays for all resources requested by the program. Also

included are descriptions of base levels of efforts, ongoing initiatives and new

initiatives with associated resource displays. CBJBs are submitted to Congress

within a few weeks of the delivery of the budget in early February and form the basis

for the committees’ review of the entire NIP prior to the drafting of annual

intelligence authorization bills. Once the intelligence committees complete their

review — generally in the spring and early summer — the legislation is referred to

the armed services committee which have the option of submitting a separate report

prior to floor consideration.

Classified budget justification books, provided by the Administration to

Congress, are the primary ways, in addition to oral testimony, by which Congress

obtains information about intelligence programs. In 1997 HPSCI criticized

justification books for lacking “several critical components necessary for the

Committee to ensure proper alignment of funding within the funding appropriations

categories. Clear identification of each project; its specific budget request numbers;

the appropriation category (e.g., Other Procurement, Defense-wide; RDT&E, Navy,

etc.); the budget request line number, and if a research and development project, the

Program Element number [are] essential to this task.... Therefore, the Committee

directs the CMS [Community Management Staff] and the Defense Department to

provide this specific data in all future budget justification documents.”14

In 2000, HPSCI expressed its continued frustration with a perceived lack of

detail provided in justification books (which are classified) and strongly criticized

financial management practices at some NFIP agencies. HPSCI stated that:

14

U.S. Congress, House Permanent Select Committee on Intelligence, Intelligence

Authorization Act for Fiscal Year 1998, 105th Congress, 1st session, H.Rept. 105-135, Part

1, June 18, 1997, p. 64. The subsequent Conference Report noted that the CMS was then

in the process of revising the structure of the CBJBs and deferred the provision pending the

outcome of CMS efforts; see U.S. Congress, House Committee of Conference, Intelligence

Authorization Act for Fiscal Year 1998, 105th Congress, 1st session, H.Rept. 105-350,

October 28, 1997, p. 30. In the same year, House Committee on National Security, also

concerned that all costs of all aspects of programs were not being identified, directed that

future CBJBs show “all direct and associated costs, in each budget category (e.g.,

procurement, research and development, operations and maintenance, military construction,

etc.)....” U.S. Congress, House Committee on National Security, National Defense

Authorization Act for Fiscal Year 1998, 105th Congress, 1st session, H.Rept. 105-132, June

16, 1997, p. 304. A year later, HPSCI noted good progress by the IC in preparing

submissions for FY1999, but asked for additional data. H.Rept. 105-508, p. 16.

CRS-7

... the NFIP agencies need greater insight into their financial obligations and the

capabilities that they are developing. NSA’s baseline activity, for example,

identified many areas of duplicative development, as well as lack of investment

in key strategic areas. Yet, due to the lack of detail, the CBJB did not provide

this information. The Committee notes that, at least at some agencies, internal

financial management practices seriously complicate this process....15

In 2003, HPSCI again called attention to limitations in the data included in

CBJBs which is often less extensive than that routinely provided in DOD budget

materials:

The Committee believes, for example, that acquisition program details in the

CBJBs should include major milestones and deliverables for contracted projects

for the entire length of a contract and contain more specificity for the budget year

of the request. Many of the project milestones in the CBJBs are, however, at

such a high-level that the Committee is unable to determine the stage of the

development activity or what will be accomplished in the coming year. The

project descriptions are often so vague that the Committee is unable to determine

the value of, or even what is being developed.16

Supplemental Appropriations

While procedures for annual budget submissions have long been established,

there has been an increasing practice in recent years, and especially since the

September 11, 2001 attacks, of providing intelligence funding in supplemental

appropriations acts.17 Of the $165.6 billion in supplemental appropriations that the

Defense Department has received since September 2001, a significant, but not

publicly identified, portion of these sums — at least $16 billion (not counting funds

received in the FY2004 Iraq supplemental) — was directed at intelligence and

intelligence-related activities.18

15

H.Rept. 106-620, p. 24.

16

H.Rept. 108-163, p. 25.

17

Section 504(a)(1) of the National Security Act requires that funds for intelligence

activities be “specifically authorized by the Congress.” Intelligence authorization acts

(including their classified annexes) provide specific authorization, although appropriations

acts also usually have generalized language providing specific authorization to meet the

504(a)(1) requirement. (The inclusion of such provisions in appropriations acts serves as

authorization until authorization bills are enacted or in the absence of authorization bills, as

often occurs when supplemental appropriations bills are enacted.) Even when authorization

legislation is under consideration the two appropriations committees also review intelligence

budget submissions, and intelligence funds for most intelligence activities are included in

annual defense appropriation bills. Supplemental appropriations that fund intelligence

activities include an authorizing provision to comply with section 504 of the National

Security Act, but they are not reported by the two intelligence committees.

18

During floor consideration of the FY2004 intelligence authorization bill, Representative

Hastings, a member of HPSCI, stated: “it is important to note that this bill authorizes only

part of the operating funds for the intelligence community. A huge portion of intelligence

funds were provided in the $87 billion Iraqi counterterrorism supplemental and in the

(continued...)

CRS-8

Arguably, there is less opportunity for consideration of proposed supplemental

intelligence spending within the context of established programs. The HPSCI noted

in July 2002:

The “advantage” of the supplemental process to the Intelligence Community is

that pressing budgetary demands can be met in a shorter time (and with fewer

bureaucratic hurdles) than the regular yearly process. However, by continuing

to rely on supplemental appropriations year after year, the Intelligence

Community risks fostering a budget process that is ripe for abuse and long-term

funding gaps.

The House Committee also argued that the Defense Emergency Response Fund

(DERF) (a funding initiative that permits DOD to shift funds from a central fund to

specific appropriations accounts after enactment as required for counterterrorist

operations) “has turned into just another vehicle to fund items that the Intelligence

Community did not get through the regular budget and planning process.”19 In

particular, it is argued, supplemental legislation can undercut established budgeting

and congressional oversight procedures making it more difficult to weigh trade-offs

and adjust overall priorities. It can, in some situations, lead to the launching of

programs that are unlikely to be sustained in the regular authorization and

appropriation process.

Some question the propriety of funding “core” programs in emergency

supplemental legislation which are intended to provide for additional unforeseen

needs resulting from combat and occupation duties. In June 2003, HPSCI reiterated

its concerns, regretting that “core mission and core mission support programs have

also been funded in supplemental appropriations.” It argued that, “The repeated

reliance on supplemental appropriations has an erosive negative effect on planning,

and impedes long-term, strategic planning. The Committee hopes that the IC has

finally reached a plateau of resources and capabilities on which long-term strategic

planning can now begin.”

Further, HPSCI concluded:

The Committee cannot help but note that budgeting by supplemental

consequentially limits congressional oversight. The Committee strongly believes

that the health of the IC is directly related to the oversight from Congress it

receives. Certainly, the confidence of the American people activities, and

programs of the IC is increased significantly as a result of the transparency that

exists between the IC and its congressional overseers.20

Concern in not limited to the House Committee. In its report on a FY2005

Intelligence Authorization bill (S. 2386) the Senate Intelligence Committee argued,

18

(...continued)

supplementals that proceeded it.” Congressional Record, November 20, 2003, p. H11674.

19

U.S. Congress, House Permanent Select Committee on Intelligence, Intelligence

Authorization Act for Fiscal Year 2003, 107th Congress, 2nd session, H.Rept. 107-592, July

18, 2002, p. 15.

20

H.Rept. 108-163, p. 22.

CRS-9

“While the practice of funding baseline expenditures using supplemental vehicles has

become more prevalent in the past 10 years, ... it is time to rein in this practice.”21

Reprogramming Issues

A concern for some observers of the Intelligence Community are the current

procedures for reprogramming of previously appropriated funds. Reprogrammings

are intended to permit shifting funds to meet unanticipated new requirements that

arise during the course the year. The National Security Act permitted the DCI to

transfer funds appropriated for one program within NIP to another program within

the NIP, but there were congressional concerns that reprogramming procedures did

not invariably met statutory requirements.22 In May 2000, the House Intelligence

Committee complained about “significant and deleterious movements of money”

from field stations to CIA Headquarters that were inconsistent with National Security

Act provisions and asked the CIA Inspector General to investigate whether statutory

provisions were being followed.23 Similar concerns were expressed by the Senate

Intelligence Committee: “Recent actions, including taxing directorates for funds to

be used in other areas, and moving funds within expenditure centers without

congressional notification, have eroded this Committee’s confidence that

appropriations are used as intended.”24 During floor consideration of the FY2004

intelligence authorization conference report, Senator Roberts, Chairman of the Senate

Intelligence Committee, commented on “difficulties in the out years as the National

Foreign Intelligence Program becomes burdened with content that is more costly than

the budgeted funding. This underestimation of future costs has resulted in significant

re-shuffling of NFIP funds to meet emerging shortfalls.”25

Congress also criticized the process for reprogramming funds between NFIP

programs and non-NFIP programs. In May 2002, the Senate Intelligence Committee

expressed concern that “the correspondence it receives notifying it of the

21

U.S. Congress, Senate Select Committee on Intelligence, To Authorize Appropriations for

Fiscal Year 2005 for Intelligence and Intelligence-Related Activities of the United States

Government, the Intelligence Community Management Account, and the Central

Intelligence Agency Retirement and Disability System, 108th Congress, 2nd session, S.Rept.

108-258, May 5, 2004, p. 10.

22

50 USC 403-4 required that transfers be approved by the Director of the Office of

Management and Budget, the receiving intelligence activity must be of a higher priority than

the one from which funds were taken, the transfer must be based on unforeseen

requirements, and the head of the department from which funds are to be transferred must

not object. In addition, appropriate congressional committees had to be notified.

Procedures for reprogramming and transfers, while seemingly esoteric, are designed to

ensure that congressional directions are followed in the expenditure of funds.

23

H.Rept. 106-620, p. 25.

24

U.S. Congress, Senate Select Committee on Intelligence, Authorizing Appropriations for

Fiscal Year 2001 for the Intelligence Activities of the United States Government and the

Central Intelligence Agency Retirement and Disability System, 106th Congress, 2nd session,

S.Rept. 106-279, May 4, 2000, p. 33.

25

Congressional Record, November 21, 2003, pp.S15354-15355.

CRS-10

reprogramming of funds from one activity to another often does not set forth clearly

how the ... requirements of ‘higher priority’ and ‘unforeseen’ circumstances have

been satisfied.” Section 305 of the FY2003 Intelligence Authorization Act “clarifies

the ‘unforeseen’ requirement by stating that such a requirement does not include the

failure of the Director of Central Intelligence to anticipate an action by Congress,

such as an authorization or appropriation level lower than that requested in the

President’s budget.”26 The provision was not, however, included in the version of the

bill that was enacted as P.L. 107-306. Section 311 of the Senate version of the

FTY2004 intelligence authorization bill would have deleted the “unforeseen

requirements” criterion altogether, but the provision was not adopted in conference.

Momentum for Reorganization

Given the congressional concerns indicated above, a number of Members and

outside observers have argued that a major restructuring of the Intelligence

Community would be required if certain challenges in ISR efforts are to be addressed

effectively. The 2002 Joint Inquiry conducted by the two intelligence committees to

review the background of the 9/11 attacks recommended the establishment of a

position of Director of National Intelligence who would have “the full range of

management, budgetary and personnel requirements needed to make the entire U.S.

Intelligence Community operate as a coherent whole.”27 The National Commission

on Terrorist Attacks Upon the United States (the 9/11 Commission) also

recommended establishing a position of National Intelligence Director (NID) to

oversee national programs, but not joint military or tactical intelligence programs

which would managed solely by DOD. Furthermore, a senior Intelligence

Community official, Larry Kindsvater, the DCI’s Executive Director for Intelligence

Community Affairs and subsequently Deputy DCI for Community Management,

argued the need to reorganize the Intelligence Community, and proposed, among

other things, to give the DCI authority to transfer funding across agencies with

congressional approval.28

The publication of the 9/11 Commission’s report in July 2004 provided the

impetus for congressional action in an election year. The 9/11 Commission’s

recommendations regarding the role of the new DNI appear to have been based

primarily on the perceived inability of the DCI to ensure interagency communications

and effectively control the allocation of intelligence assets. The Commission noted

26

U.S. Congress, Senate, To Authorize Appropriations for Fiscal Year 2003 for Intelligence

and Intelligence-Related Activities of the United States Government, the Community

Management Account, and the Central Intelligence Agency Retirement and Disability

System, 107th Congress, 2nd session, S.Rept. 107-149, May 9, 2002, p. 9.

27

Recommendations of the Final Report of the Senate Select Committee on Intelligence and

the House Permanent Select Committee on Intelligence Joint Inquiry into the Terrorist

Attacks of September 11, 2001, December 10, 2002, p. 1.

28

Larry C. Kindsvater, “The Need to Reorganize the Intelligence Community,” Studies in

Intelligence, vol. 47, no. 1, 2003. This recommendation was echoed by former DCI Robert

Gates, “How Not to Reform Intelligence,” Wall Street Journal, September 3, 2003, p. A16;

see also, Richard Lardner, “Is the DNI DOA? Push for Intelligence ‘Czar’ Faces Major

Obstacles,” Inside the Pentagon, October 9, 2003, p. 1.

CRS-11

that DCI Tenet was reported to have placed the Intelligence Community “at war”

with Al Qaeda in December 1998, but without being able to ensure that all agencies

concentrated significant resources on the terrorist group.29 The Commission also

noted efforts in the 1990s to address the DCI’s perceived lack of personnel and

budget authority over intelligence agencies. It further pointed out the results of

intelligence reorganization legislation introduced in the 1996:

The Department of Defense and its congressional authorizing committees rose

in opposition to the proposed changes. The President and the DCI did not

actively support these changes. Relatively small changes made in 1996 gave the

DCI consultative authority and created a new deputy for management and

assistant DCIs for collection and analysis. The reforms occurred only after the

Senate Select Committee on Intelligence took the unprecedented step of

threatening to bring down the defense authorization bill. Indeed, rather than

increasing the DCI’s authorities over national intelligence, the 1990s witnessed

movement in the opposite direction through, for example, the transfer of the

CIA’s imaging analysis capability to the new imagery and mapping agency

created within the Department of Defense.30

Nevertheless, as former Representative Hamilton, the Vice Chairman of the 9/11

Commission testified:

I do not recall us finding a failure of a DOD agency, so far as we know. But we

certainly think that part of the problem has been an unwillingness to share the

information that a number of agencies had.31

Although some observers argued that the “wall” separating intelligence and law

enforcement agencies may have been a primary reason for the unwillingness to share

information and that the wall had been effectively removed by the USA Patriot Act

of October 2001 (P.L. 107-56), the recommendation of the 9/11 Commission to

establish a DNI with stronger oversight and management responsibilities for all

intelligence agencies (including components of law enforcement agencies) was

ultimately accepted by both the Bush Administration and the Congress.

As described below, the Intelligence Reform Act provides the DNI with

important statutory authorities in the intelligence budget process. It also enhances

the reprogramming authorities of the DNI; the DNI may transfer or reprogram funds

within the National Intelligence Program with the approval of the Director of the

Office of Management and Budget, after consultation with heads of department

affected, and subject to provisions in annual appropriations acts. In addition, the

funds must be transferred to an activity that is a higher priority intelligence activity,

that supports an emergent need or improves program effectiveness. The transfer or

reprogramming out of any department or agency in a single fiscal year must be less

than $150 million or 5% of the amounts available to the department or agency from

29

9/11 Commission Report, p. 357.

30

Ibid., p. 104.

31

Testimony of Lee Hamilton, Vice Chairman of the 9/11 Commission to the House Armed

Services Committee, August 10, 2004.

CRS-12

the National Intelligence Program. These limitations do not apply if the transfer has

the concurrence of the department or agency head involved.

Multiple Types of ISR Programs

One argument that has been used by those who have proposed a major

reorganization of intelligence programming and budgeting is that the different

categories of intelligence programs are obsolete in today’s complex technological and

threat environment. ISR programs are currently grouped into three major categories

— the National Intelligence Program (NIP), the Joint Military Intelligence Program

(JMIP), and Tactical Intelligence and Related Activities (TIARA).32 The three

categories of intelligence activities used in programming and budgeting are based on

the different consumer being served, different management arrangements, and

different oversight in Congress.33

NIP Programs Serve National Decisionmaking

The NIP (formerly, NFIP) is defined in statute as:

All programs, projects, and activities of the intelligence community, as well as

any other programs of the intelligence community designated jointly by the

Director of Central Intelligence and the head of a United States department or

agency or by the President. Such term does not include programs, projects, or

activities of the military departments to acquire intelligence solely for the

planning and conduct of tactical military operations by United States Armed

Forces.34

The NIP is usually described as consisting of programs to support national

decisionmakers, especially the President, the National Security Council (NSC) staff,

and heads of cabinet departments, especially the Secretaries of State and Defense.

Major NIP programs include:

!

Central Intelligence Agency Program (CIAP)

!

General Defense Intelligence Program (GDIP)

!

Consolidated Cryptologic Program (CCP)

32

NIP is defined by statute (50 USC 401a(6)); the National Security Act refers to JMIP and

TIARA (50 USC 403-3(c)(1)). The U.S. Government collects vast quantities of other data

— including the reports of diplomats, information gathered by non-intelligence components

of the military services, open source materials, and economic statistics — that are of great

importance to policy makers, military leaders, and to intelligence analysts, but such

collection is not undertaken by intelligence agencies and is not included in intelligence

budgets.

33

Intelligence spending totals remain classified (although appropriations levels for FY1997

($26.6 billion) and FY1998 ($26.7 billion) were made public). It should be understood that

other DOD accounts, unrelated to intelligence efforts, are also classified.

34

50 USC 401a(6).

CRS-13

!

National Geospatial-Intelligence Program [formerly the National

Imagery and Mapping Agency Program (NIMAP)]

!

National Reconnaissance Program (NRP)

!

DOD Foreign Counterintelligence Program35 (FCIP)

NIP encompasses more than half of overall intelligence spending and includes

most efforts of the Intelligence Community (IC) — the CIA, the Defense Intelligence

Agency (DIA), the National Reconnaissance Office (NRO), the National GeospatialIntelligence Agency (NGA) [formerly the National Imagery and Mapping Agency

(NIMA)], and the National Security Agency (NSA). In accordance with the

Intelligence Reform Act, the DNI has overall responsibility for preparing NIP budget

submissions based on priorities established by the President and taking into account

input from DOD agencies that have NIP responsibilities. NIP budget totals are

authorized in annual intelligence authorization acts; total amounts are specified in the

classified schedule that accompany appropriations legislation, but are not made

public.36

JMIP Programs Serve the Defense Department

The JMIP was established in 1995 to include defense-wide efforts that provide

support to multiple defense consumers. There are four principal components to the

JMIP:

!

the Defense Cryptologic Program designed to provide cryptologic

support to military commands;

!

the Defense Imagery Program designed to provide imagery support

to military commands;

!

the Defense Mapping, Charting, and Geodesy Program;

!

the Defense General Intelligence and Applications Program that

includes sub-programs managed by DIA and other agencies in

support of DOD commands.37

In its report on the FY2001 Intelligence Authorization act, the House Intelligence

Committee described a number of JMIP programs in the year 2000, including

35

U.S., Defense Intelligence Agency, Joint Military Intelligence Training Center,

Intelligence Resource Manager’s Guide, 1997 ed., p. 44.

36

Funding for two small NIP programs, the Community Management Account (which funds

community-wide coordination efforts) and the CIA Retirement and Disability System

accounts is, however, made public.

37

U.S. Congress, 104th Congress, 1st session, House of Representatives, Permanent Select

Committee on Intelligence, Intelligence Authorization Act for Fiscal Year 1996, H.Rept.

104-138, Part 1, June 14, 1995, pp. 10-11.

CRS-14

modifications to reconnaissance aircraft, Global Hawk UAVs, and antenna systems

for reconnaissance aircraft.38

TIARA Programs Serve the Military Services

TIARA programs 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.”39 In the year 2000 the House

Intelligence Committee described a number of TIARA programs — cryptologic and

language skills training for the Army, an Army ground station to use with the

JSTARS aircraft, funds for extending naval space surveillance, hyper spectral sensing

systems on Air Force UAVs, and a tactical video system for Special Operations

Forces.40 An annual list of TIARA programs is not published, although some are

indicated in appropriations reports.41 Unlike JMIP programs which tend to be

completely intelligence systems, TIARA includes “related activities,” systems that

are essentially parts of various weapons systems (and that can be reclassified out of

TIARA).

Over a number of years it has become apparent that, to consumers of

intelligence, distinctions among NIP, JMIP, and TIARA programs are becoming

indistinct. As the Intelligence Resource Manager’s Guide noted, “As systems grow

in complexity and capability and methods become more sophisticated, increasing

numbers of intelligence assets are capable of simultaneously serving both national

and tactical purposes.”42 For example, there has been for a number of years a

program, known as Tactical Exploitation of National Capabilities (TENCAP), which

is designed to facilitate the use of satellite imagery and other NIP products by

military commanders. In some military engagements with important diplomatic and

political implications, low-level tactical intelligence acquired through TIARA

systems is also desired by senior officials to support their efforts at crisis

management. In August 2004 testimony, Under Secretary of Defense for Intelligence

Stephen Cambone stated, in response to a question about the existence of a clear line

between national and tactical intelligence:

38

U.S. Congress, House Permanent Select Committee on Intelligence, Intelligence

Authorization Act for Fiscal Year 2001, 106th Congress, 2nd session, H.Rept. 106-620, May

16, 2000.

39

U.S. Congress, House Permanent Select Committee on Intelligence, Intelligence

Authorization Act for Fiscal Year 2004, 108th Congress, 1st session, H.Rept. 108-163, June

18, 2003, p. 16.

40

H.Rept. 106-620, pp. 35-39.

41

See, for example, U.S. Congress, Senate Committee on Appropriations, Department of

Defense Appropriations Bill, 2004, 108th Congress, 1st session, S.Rept. 108-87, July 10,

2003. TIARA programs include equipment for the Army’s All Source Analysis System

(ASAS) — a mobile computer-assisted processing, analysis, fusion, dissemination and

presentation system, as well as a tactical UAV. Pp. 71-72.

42

Intelligence Resource Manager’s Guide, p. 67.

CRS-15

... an irony of this, sir, is that we spent a good deal of time, at least during my

tenure, trying to merge and blur the line and distinction between what is strategic

and tactical and what is national and military, since it’s increasingly difficult to

distinguish either in the product that is produced or in the capability that is

applied. So Global Hawks, which are built by the Air Force, are as significant

and important as SIGINT satellites that are built by the National Reconnaissance

Office and whose take is managed by the National Security Agency.43

As a result, some observers argued that the three categories of ISR programs

cannot be meaningfully considered by themselves; they must be considered as parts

of a greater whole and, accordingly, the NIP, JMIP, and TIARA categories are

outmoded. Changing the statutes, regulations, and rules which established the three

categories obviously would be difficult and would affect organizational relationships

in both executive and legislative branches. One result of abolishing the system could

mean a devolution of acquisition to a multitude of program managers throughout the

military services — an approach that most observers would argue could have major

drawbacks.

Some have suggested that the growing interrelationships among NIP, JMIP, and

TIARA systems may complicate provisions in the Intelligence Reform Act that

establish separate responsibilities for NIP on one hand and JMIP and TIARA on the

other. Arguably, the act could complicate, rather than facilitate, effort to coordinate

the acquisition and operation of ISR systems. A major challenge for the Office of the

DNI, when activated, will be to coordinate ISR programs within the NIP for which

it is primarily responsible with those that are in JMIP and TIARA for which the

Defense Department has primary responsibility. The same types of coordinative

mechanisms that have long existed will undoubtedly continue to be required. In any

event, Congress will have a major influence on ISR acquisition; it may also choose

to determine whether the enhanced authorities of the DNI (in comparison to those of

the DCI) permit more effective coordination of ISR programs.

ISR Programming and Budgeting Procedures

Differ Among Agencies

Programming and budgeting of ISR systems have been managed by the

Department of Defense (DOD) and its many components, and by the Intelligence

Community (through the office responsible to the DCI for inter-agency coordination,

the Community Management Staff (CMS)). The Office of Management and Budget

(OMB) also plays a critical role in allocating budgetary goals that can constrain

intelligence spending proposals. Congressional responsibilities are spread among

armed services, intelligence, appropriations, and other committees. Although it

would be easy to question the number of entities involved, the reality is that the

overlap results from the evolution of a multiplicity of systems and the variety of

consumers. Whereas NASA can singlehandedly manage a moon probe, no

intelligence agency will ordinarily by itself collect, analyze, and disseminate finished

43

Stephen A. Cambone, Undersecretary of Defense for Intelligence, testimony before House

Armed Services Committee, August 11, 2004.

CRS-16

intelligence. Different procedures used for different ISR systems by different

agencies can also complicate efforts to achieve compatibility and maximize

effectiveness.

Role of the DCI/DNI

Prior to passage of the Intelligence Reform Act, the DCI was responsible for

facilitating the development of an annual budget for intelligence and intelligencerelated activities and for presenting to the President an annual budget for the NFIP.

He participated in the development by the Secretary of Defense of the annual budgets

for JMIP and TIARA. Observers have argued that these responsibilities did not

provide for the comprehensive management of ISR programs that is needed.

Although the 9/11 Commission did not focus at length on the role of the DCI in

systems acquisition, it concluded that there was an urgent need to restructure the

Intelligence Community and establish stronger authorities for the DCI or a DNI.44

Consideration of intelligence reform legislation in the 108th Congress included

extensive debate on the role of the new DNI in developing budgets and overseeing

their execution. On one side was a determination to ensure that the DNI would be

effectively in charge of the entire Intelligence Community and able to direct its

resources at the most critical threats. On the other was a determination to ensure that

the combat support agencies of the Department of Defense would not be diverted by

non-DOD officials.

The language incorporated in the final version that became law requires that the

DNI provide, based on priorities set by the President, guidance to departments and

agencies regarding their portion of the National Intelligence Program. Then, based

on budget proposals provided by agency and department heads, the DNI is to develop

and determine the annual NIP budget. Funds appropriated by Congress are to be

apportioned by the OMB “at the exclusive direction of the Director of National

Intelligence.” Furthermore, “[d]epartment comptrollers or appropriate budget

execution officers shall allot, allocate, reprogram, or transfer funds appropriated for

the National Intelligence Program in an expeditious manner.”45

The legislation did not, however, repeal statutory authorities of the Secretary of

Defense for managing the components of DOD. In addition, Section 1018 requires

that the President issue guidelines to ensure the effective implementation and

execution of the DNI’s authorities “in a manner that respects and does not abrogate

the statutory responsibilities of the heads” of other departments. Some believe that

this provision reflects separate, even conflicting priorities and suggest that it may be

as difficult to write the guidelines as it was to draft the legislation.

Much of the media analysis of this question tends to focus on a “turf battle” and

differences among key officials. Although elements of individual and bureaucratic

competition are inevitable, the underlying reality is that intelligence systems must

44

See 9/11 Commission Report, pp. 407-416.

45

P.L. 108-458, Section 1011.

CRS-17

support different sets of consumers; no serious observers suggest that duplicate

systems could be available in the foreseeable future. Priorities in acquisition of new

systems and in tasking collection must be set and the mechanisms of coordination

will inevitably be subject to different, but legitimate, requirements of different

agencies and policymakers.

In recent years, the CIA budget — the only part of the NIP that has been

managed solely by the DCI — is comprised mainly of personnel expenses — the

salaries of case officers, assets, analysts, managers, etc. along with associated costs

for equipment, buildings and grounds. In the past, the CIA was also involved in

significant procurement efforts such as reconnaissance satellites, manned aircraft

such as the U-2, and UAVs46. The CIA Program is managed by the Executive

Director of the CIA, a senior staff official at CIA; other agencies play a relatively

minor role in CIA acquisition efforts.

Role of the Secretary of Defense

The Secretary of Defense has had a major role in developing programs to

address DOD’s intelligence needs and in managing most NIP programs. The

National Security Act assigns to the Secretary of Defense the responsibility to ensure,

in consultation with the DCI, that:

(1) the budgets of the elements of the intelligence community within the

Department of Defense are adequate to satisfy the overall intelligence needs of

the Department of Defense, including the needs of the chairman of the Joint

Chiefs of Staff and the commanders of the unified and specified commands and,

wherever such elements are performing government-wide functions, the needs

of other departments and agencies;

(2) ensure appropriate implementation of the policies and resource decisions of

the Director of Central Intelligence by elements of the Department of Defense

within the National Foreign Intelligence Program;

(3) ensure that the tactical intelligence activities of the Department of Defense

complement and are compatible with intelligence activities under the National

Foreign Intelligence Program....47

Executive Order (EO) 12333, United States Intelligence Activities, required that

the DCI, together with the Secretary of Defense, “ensure that there is no unnecessary

overlap between national foreign intelligence programs and Department of Defense

intelligence programs....”48 There have been, in addition, a number of inter-agency

46

In recent years, such procurement has been the responsibility of DOD agencies, but in the

first months of the George W. Bush Administration there was considerable discussion of

Predator UAV acquisition that is carefully documented in the 9/11 Commission Report. See

U.S., National Commission on Terrorist Attacks Upon the United States, The 9/11

Commission Report, July 2004, pp. 210-214.

47

50 USC 403-5.

48

Section 1.5(q). EO 12333 was signed on December 4, 1981 by President Reagan and

(continued...)

CRS-18

agreements within the executive branch that govern the coordination of intelligence

programs and budget processes.49

Most NIP programs have been managed by the Defense Department. National

programs managed by DOD are gathered into several intelligence program categories

— the General Defense Intelligence Program (GDIP), the Consolidated Cryptologic

Program (CCP), the DOD Foreign Counterintelligence Program (FCIP), the National

Geospatial-Intelligence Program [formerly, the National Imagery and Mapping

Agency Program (NIMAP), and the National Reconnaissance Program (NRP).50

In some cases, a single agency within DOD has managed one program; in other

cases responsibility has been shared. The CCP is managed by NSA. The GDIP

largely covers the work of DIA; the CCP is implemented by NSA; geospatial

intelligence is the responsibility of the NGA, the NRP is the responsibility of the

NRO, and specialized programs are found in various agencies and offices.

Counterintelligence (FCIP) is a responsibility of all agencies. Satellites and sigint —

responsibilities of the NRO, NGA, and NSA — are the largest ISR programs and

constitute a very sizable portion of the estimated $40 billion in annual intelligence

spending.

Changes in DOD’s Management of ISR. Overall coordination of these

programs within DOD was for years the responsibility of the Assistant Secretary of

Defense for Communications, Command, Control and Intelligence (C3I); but in May

2003 these functions were transferred to the Under Secretary of Defense for

Intelligence, a newly created post headed by Stephen Cambone, a longtime associate

of Defense Secretary Rumsfeld. The USD(I) is granted authority to “lead

departmental activities in programmatic processes related to intelligence and

intelligence-related programs, including, but not limited to, program change

proposals, program evaluations, assessments, and recommendations.”51

Cambone has noted that making decisions on ISR programs early in the process

could have major implications for years ahead: “There are a lot of efforts, I think

perhaps more than some people appreciate, that are either early in their development

or just beginning or are envisioned over the next 18 months or so where a choice

between spending the dollar in one direction or another could have a big payoff

48

(...continued)

remains in effect.

49

Intelligence Resource Manager’s Guide, 1997 edition, pp. 115-122.

50

Non-DOD NIP programs include the Central Intelligence Agency Program (CIAP); the

Department of State, Bureau of Intelligence and Research Program; the Department of

Justice, FBI Counterintelligence Program; Department of Treasury, Office of Intelligence

Support Program; Department of Energy, Foreign Intelligence Program; CIA Retirement and

Disability System (CIARDS); and the Community Management Account (CMA). It is to

be noted that funding for only the last two programs, CIARDS and CMA, is unclassified and

identified in annual intelligence authorization legislation.

51

See John Liang and Keith J. Costa, “Pentagon Reworking Unified Command Structure to

Better Exploit NCW,” Inside the Pentagon, October 9, 2003, p. 1.

CRS-19

downstream.”52 The ultimate role of Cambone and his successors may not be fully

determined as yet, but the establishment of his office appears to reflect a more

centralized and coordinated approach to ISR acquisition. The Intelligence Reform

Act provides important acquisition and management authorities over DOD’s national

intelligence programs to the DNI. These authorities will have to be implemented in

a way that is consistent with the existing authorities of the Defense Department; the

timing and contours of the implementation process are as yet uncertain.

How ISR Funding is Included in DOD’s Budget. Managing programs

involves planning for future acquisition, preparation of budget documents, and

monitoring expenditures. Intelligence funds are programmed, budgeted, and

expended in accordance with Defense Department procedures.53 They are contained

with the Budget’s 050 National Defense Function (within Function 051, DOD

Budget, or Function 054 Defense-related Activities categories). Funds for CIA are

included (“hidden”) in the DOD budget but, once appropriated, are transferred by

OMB directly to the DCI for execution. Of the eleven major programs in DOD’s

Future Years Defense Program (FYDP), most ISR funding is in Program 3,

Command, Control, Communications, Intelligence, and Space. Funding for other

programs, such as aircraft, may include intelligence-related research and

development; training, and intelligence-related functions may be in other categories.

These major categories are, in turn, divided into program elements (PEs) that can be

aggregated for different purposes, including the identification of intelligence efforts.

Slightly more than half of annual authorized intelligence spending is devoted

to the agencies that are part of the NIP; the remainder goes to programs that are part

of JMIP and TIARA. JMIP programs extend beyond one service and are included

in defense authorization and appropriations bills. Some JMIP programs are the

responsibility of a single defense agency while others are managed by one service as

an “executive agent” for the rest of DOD.

Funding for specific intelligence programs is included in the budgets of the

services and defense agencies. This funding is largely hidden in appropriations

legislation although some RDT&E programs with special code names are known to

fund intelligence efforts. Other funds are included in larger “pots” of money, such

as the appropriation account, “O&M Defensewide.”

TIARA programs are usually managed by a single service for its own forces.

One analyst describes TIARA as:

nothing more than a reporting concept. It is a designation applied to

aggregations of programs, projects and activities in military Service budgets

that provide tactical-level intelligence and related support to military operations.

These aggregations comprise two types of assets, i.e., organic military

52

Amy Butler, “Cambone: DoD, Intel Community Launch Study for ‘Horizontal

Integration,’ Defense Daily, September 30, 2003, p. 8.

53

Except for the comparatively small intelligence accounts of the State, Justice, and

Treasury Departments.

CRS-20

intelligence assets and funding for Service-specific tactical intelligence

programs.54

As a reporting concept, the TIARA category consists of a variety of programs that

may vary from year to year. In some cases, it may be difficult to distinguish among

TIARA programs and other surveillance and targeting efforts that may not be

categorized as TIARA. To complicate matters further, surveillance programs may

be characterized as TIARA one year but not necessarily the next.55

TIARA programs are perhaps the most challenging to review because they are

forwarded as part of budget requests from the three military departments. They have

to be disaggregated and considered along with TIARA programs of the other

services, a process that is not necessarily easy and may involve a program that the

parent service believes to be an integral part of a favored weapons system. Under

such circumstances, assessing trade-offs among intelligence programs can become

difficult. Similarly, when a weapon system with a TIARA component is delayed or

cancelled, there can be significant implications for intelligence efforts that were

designed to be integrated with the delayed or cancelled effort.

Internal DOD Coordinating Boards. A number of steps have been taken

in the past to ensure an integrated approach to intelligence programs, whether NIP,

JMIP, or TIARA. An unusual DOD entity, the Expanded Defense Resources Board,

consisting not only of senior DOD military and civilian officials but also the DCI,

was established in the mid-1990s to provide a broader executive branch review.

Another interagency review entity is the Intelligence Program Review Group which

reviews issues, analyzes priorities, and studies funding alternatives at the staff level

prior to consideration by the Expanded Defense Resources Board.

Coordination Between DOD and the IC

Different procedures used by the Defense Department and the Intelligence

Community in dealing with the diffuse efforts that are collectively part of the

collection, analysis, and dissemination of intelligence have long been a source of

concern to resource managers. As noted in the Intelligence Resource Manager’s

Guide, by 1993 there was a perceived need to (a) depict intelligence capabilities and

associated resources, (b) ensure adequate levels of detail for program review and

analysis, (c) ensure that compatible processes were in place to support

decisionmaking. “The time had come to tear down barriers that had made it difficult

to identify shortfalls and unwanted NFIP/TIARA duplication.”56

Accordingly, at congressional urging, the then-DCI, R. James Woolsey,

undertook a number of measures during his tenure (1993-1995) to ensure a

comprehensive review process by adjusting schedules to ensure that DOD and IC

54

Intelligence Resource Manager’s Guide, p. 58 (emphases in original).

55

A recent complication is the growing consideration of using UAVs to deliver missiles; a

system designed for reconnaissance becoming a weapons delivery systems.

56

Intelligence Resource Manager’s Guide, p. 101.

CRS-21

milestones coincided and that there were joint TIARA/NFIP reviews and that a

“common budget framework” was established to make characterization of NFIP and

TIARA resources consistent. The goal was “to allow resource managers to peer

across seams into all programs, projects, and activities containing dollars and/or

manpower assets designed to meet the same or similar types of missions.”57 One goal

was to identify changes in one program that might have an unintended consequence,

e.g. eliminating a TIARA program to collect imagery by an airborne sensor might

lead to a requirement for additional, and more expensive, satellite coverage of the

area previously covered by reconnaissance aircraft. Implementation of this effort

began with the FY1995 budget and continues to be used. Related changes involved

DOD, including the Expanded Defense Resources Board and the Intelligence

Program Review Group. An interagency Mission Requirements Board was

established by the Community Management Staff to ensure that the national and

tactical needs of all consumers were addressed.

The process has been coordinated by DOD and Intelligence Community officials

ranging from the Secretary of Defense and DCI down to lower-level budget

specialists. The DCI and the Secretary of Defense (represented by the Under

Secretary of Defense for Intelligence) are responsible for jointly deciding major

issues (and negotiating any percentage reductions that might be required to meet cuts

ordered by the President or OMB), while their respective staffs interact in defining

issues and preparing submissions to congressional committees. In practice, some

observers believe that DOD has greater influence in the process given its size and the

need to ensure that the military services have the intelligence they need to meet their

operational responsibilities.58

Congressional Oversight of ISR Programs

Procedures for congressional oversight of intelligence activities also affect the

acquisition of ISR resources. On Capitol Hill, the NIP is overseen by the two

congressional intelligence committees. HPSCI’s jurisdiction is specified in

programmatic terms. It has oversight over NIP along with “intelligence and

intelligence-related activities of all other departments and agencies of the

Government, including the tactical intelligence and intelligence-related activities of

the Department of Defense.”59 Senate rules, on the other hand, focus on agencies;

SSCI has jurisdiction over the CIA, DIA, NSA, other DOD agencies and

subdivisions, and the intelligence activities of the State Department and the FBI. A

crucial difference between the two chambers is the exclusion from SSCI’s

jurisdiction of “tactical military intelligence serving no national policymaking

function.”60 HPSCI oversees JMIP and TIARA programs, coordinating with the

House Armed Services Committee. In practice, SSCI also has an opportunity to

provide comments on JMIP and TIARA programs to the Armed Services committee,

57

Ibid.

58

See Loch K. Johnson, “The DCI vs the Eight-Hundred Pound Gorilla,” International

Journal of Intelligence and CounterIntelligence, spring 2000.

59

Rule X, Section 11(b)(B), of the House of Representatives.

60

S.Res. 400, Section 14(a), 94th Congress.

CRS-22

which has primary jurisdiction. Both intelligence committees have sole jurisdiction

over budgets for the CIA, the CIA retirement system, and the Community

Management Staff. After committee review, all NIP programs are included in annual

intelligence authorization legislation; NIP programs are included as well as national

defense authorization bills.

JMIP and TIARA programs are authorized by HPSCI and the House Armed

Services Committee. As a result of differing jurisdictions of the two intelligence

committees, the Senate Armed Services Committees authorizes JMIP and TIARA

expenditures. SSCI does not have authorizing authority over JMIP and TIARA, but

it reviews and analyzes the JMIP and TIARA budget request, and recommends

actions to the Armed Services Committee.

Although the relationship between intelligence committees and armed services

committees is generally cooperative, in some instances their approaches have

differed. The National Defense Authorization Act of FY1997 (P.L. 104-201)

established the National Imagery and Mapping Agency (NIMA) despite the

misgivings of Members of HPSCI.61 The position of Under Secretary of Defense for

Intelligence was established by the FY2003 National Defense Authorization Act

(P.L. 107-314, section 901), not by an intelligence authorization act. Similarly, it

was the FY2004 National Defense Authorization Act (P.L. 108-136, section 921) that

changed the name of NIMA to the National Geospatial-Intelligence Agency, not

intelligence authorization legislation.

Conclusion

Despite the existence of the coordinative mechanisms described above,

Congress formally expressed its concerns that ISR has been ill-coordinated. In part,

coordination difficulties have derived from the challenges faced by large

governmental organizations in managing fast-moving technological developments.

In addition, U.S. post-cold war defense planning continues to evolve into new, and

uncertain, approaches to a wide variety of possible conflict situations. This evolution

may make it even more difficult to reach consensus on ISR requirements in future

years. How the provisions of the Intelligence Reform Act will be implemented

remains unknown. Many complex issues will have to be addressed, including the

roles of congressional authorizing and appropriations committees. In regard to ISR

systems, the act provides the DNI with an opportunity and a staff (the Community

Management Staff is to be transferred to the Office of the DNI) to assess whether

government-wide ISR requirements are being effectively addressed.

Some observers believe that past failures to satisfy congressional concerns about

coordination resulted in significant measure from the lower relative influence of the

DCI and the Community Management Staff compared with that of the Secretary of

Defense and DOD. The DCI was arguably at a disadvantage in any dispute with

61

See (name redacted),

The Creation of the National Imagery and Mapping Agency:

Congress’s Role as Overseer, Joint Military Intelligence College, Occasional Paper Number

Nine, April 2001.

CRS-23

DOD because of the latter’s size, influence, and prestige. Similarly, questions have

existed regarding the relative influence of intelligence and Armed Services

committees (and some Members have suggested that certain intelligence matters

should receive oversight from other committees). The Intelligence Reform Act did

not specify procedures for congressional oversight, but Congress may choose to

develop new approaches to reviewing ISR programs.

Some observers go so far as to argue that longstanding distinctions among

national, joint military, and tactical systems have outlived their usefulness and that

a more comprehensive approach should be attempted. Since these distinctions are

provided for in statutes and have been recently been included in the Intelligence

Reform Act, any major changes would require further congressional action.

There is a widespread sense that the optimal mix of ISR systems has not yet

been determined. Admittedly, it would be almost impossible to design analytical

processes that would identify definitive options for ISR systems readily acceptable

to all interested parties. The diverse nature of the systems, the multiple customers for

data, the number of intelligence agencies, and the dynamics of ever-changing ISR

technologies make a multi-year “roadmap” extremely difficult. Yet, a more

disciplined assessment of the potential advantages and disadvantages of different ISR

options could be required for review in the executive branch and in congressional

committees.

Given the potential for the need for future budgetary restraints on ISR programs,

with or without a new procedural framework, the acquisition of expensive new

systems will undoubtedly remain an especially complex challenge to government

decisionmakers.

CRS-24

Appendix A: A Case Study in ISR Acquisition:

The Future Imagery Architecture (FIA)

and Global Hawk UAVs

Efforts to procure a new generation of reconnaissance satellites and high altitude

unmanned aerial vehicles (UAVs) serve as a case study that illustrates the dilemmas

involved in the acquisitions of intelligence platforms and systems. Both of the these

expensive and technologically sophisticated platforms can support national

policymakers as well as military commanders. Each has strengths and limitations.62

While no serious observer would argue that U.S. ISR requirements could be met by

only one approach, many believe that there have been insufficient efforts to achieve

an appropriate mix that provides optimal collection capabilities while avoiding

unnecessary duplication or wasted resources.

Satellite imagery has long been one of the most valuable tools of the intelligence

profession. The need for to obtain accurate estimates of Soviet military forces in the

mid-1950s led the United States, in order to avoid highly dangerous overflights by

conventional aircraft, to develop special planes that could fly at very high altitudes

and ultimately to build reconnaissance satellites that could identify small objects

from space. Satellite imagery became the cornerstone of arms control efforts in the

Cold War and, coupled with the availability of precision guided munitions, became

the key to those post-Cold War defense tactics that rely on highly selective targeting

to destroy selected targets with minimal collateral damage.

Satellite programs are among the most expensive intelligence efforts, with

individual satellites costing a billion dollars each. The need to replace aging satellite

programs led the Intelligence Community in the mid-1990s to initiate the Future

Imagery Architecture (FIA) program that is intended to provide a greater number of

smaller satellites that can provide coverage of more regions for longer periods. FIA

has, however, received considerable criticism. In 1998, the House Intelligence

Committee has concluded:

For several years, the committee has been concerned with the increasing costs of

several major National Reconnaissance Office (NRO) programs and the NRP’s

[National Reconnaissance Program through which the NRO is funded] growing

share of the NFIP budget. Not seeing any relief from the tight fiscal

environment, the committee has sought to find technological innovations and

managerial reforms in the NRP that could reduce costs. This goal lay behind the

committee’s push to shift to larger numbers of smaller satellites, which the

committee thought also would provide better performance against hard targets,

62

In the 1980s, manned aircraft, especially the SR-71 Blackbird, which flew at very high

altitudes, had an important role in overhead reconnaissance, but limited inventories of

skilled pilots with highly specialized training and the potential for human casualties were

among the factors that led to demise of the program. U-2s, which fly at somewhat lower

altitudes, remain in service. Manned aircraft continue to constitute an important component

of U.S. ISR capabilities; see Nick Cook, “ISR — Manned or Unmanned? Going Solo?”

Jane’s Defence Weekly, November 19, 2003.

CRS-25

reduce satellite vulnerability, and help to counter foreign denial and deception

practices.

The committee, in summary, is not satisfied that all appropriate measures have

been taken to reduce or control costs in the NRP or to adequately measure the

cost-effectiveness of all overhead collection activities. The committee believes

that the DCI needs to exercise much more knowledgeable and diligent oversight

of NRO programs, with an eye to freeing up funds for investment elsewhere,

wherever possible. This oversight must extend from requirements tradeoffs, to

cost estimating, to acquisition oversight. The DCI also needs to acquire the

expertise necessary to make tradeoffs across the major NFIP programs. The DCI

can no longer afford to rely on the major program managers to police their

organizations and budgets. The committee has recommended additional funds

for the DCI to accelerate the development of these capabilities.63

One media account in December 2002 reported that “The National Reconnaissance

Office’s next-generation spy satellites, known as Future Imagery Architecture, are

more than a year delayed and almost $3 billion over cost, spurring an internal

Pentagon debate about whether to proceed with the program at all, say people

familiar with the discussions.”64 Further criticism was voiced in May 2003 by a task

force established by the Defense Science Board which submitted a report finding that

“the FIA program under contract at the time of our review to be significantly

underfunded and technically flawed. The task force believes that the FIA program —

thus structured — is not executable.”65

The process of satellite procurement and the role of the DCI vis-a-vis DOD has

come under some criticism. One former CIA official who worked with the NRO has

described “an incredibly inefficient requirements process,” and suggested that the

DCI’s role has been reduced to the detriment of the overall satellite reconnaissance

effort:

The process for deriving the requirements for the new imagery architecture (FIA)

took two years and makes the point about the DCI’s diminished power clear.

DoD and the Joint Requirements Oversight Council (JROC) played key roles in

the FIA requirements process; now DoD essentially controls all major NRO

requirements. The DCI and the CIA have let DoD significantly erode what

63

U.S. Congress, House Permanent Select Committee on Intelligence, Intelligence

Authorization Act for Fiscal Year 1999, 105th Congress, 2d session, H.Rept. 105-508, May

5, 1998, pp. 11-12.

64

Anne Marie Squeo, Officials Say Space Programs, Facing Delays, Are ‘In Trouble.’” Wall

Street Journal, December 2, 2002, p. A1.

65

Department of Defense, Office of the Under Secretary of Defense for Acquisition,

Technology, and Logistics, Report of the Defense Science Board/Air Force Scientific

Advisory Board Joint Task Force on Acquisition of National Security Space Programs, May

2003, p. 31. The Task Force added that theses problems could be mitigated by various

changes in approach, including additional funding.

CRS-26

should be the DCI’s major responsibility: the arbitration, consolidation, and

establishment of national intelligence requirements.66

FIA, whose satellites are expected to be launched beginning around 2008,

absorbs a major portion of the intelligence budget and reportedly continues to be

plagued with serious delays and management problems.67 According to one media

account, the program is more than a year behind schedule and is forcing a shift of

some $4 billion from other ISR programs.68Some observers have, accordingly,

suggested that many of the capabilities of reconnaissance satellites could be realized

by relying on less expensive, high-altitude unmanned aerial vehicles such as Global

Hawk, which has recently become available for operational missions and has been

used during Operation Iraq Freedom. Proponents of Global Hawks, which have been

estimated to cost some $57 million per unit, maintain that these vehicles could

provide a considerable portion of the imagery that could otherwise be obtainable by

satellites that cost many times that figure.69

There are advantages and disadvantages to both satellites and UAVs (as well as

manned aircraft which can also be used advantageously in some circumstances).

Satellites have been considered invulnerable to attacks from all but the most

sophisticated adversary and can be launched from U.S. territory.70 They are in orbit

for years and can be shifted from target to target as needs change. On the other hand,

they are expensive and there are inevitably limited numbers in the U.S. inventory.

Global Hawks, on the other hand, can be launched when needed, and can be targeted

by local commanders. They do not, however, have the capability to remain overhead

for lengthy periods (sometimes termed a “long-dwell capability”), and they may be

vulnerable to attack. While inexpensive in comparison with satellites, they are far

too costly to be considered expendable, as is the case with some tactical UAVs.

66

Robert Kohler, “One Officer’s Perspective: The Decline of the National Reconnaissance

Office,” Studies in Intelligence, Unclassified Articles, Vol. 46, No. 2, 2002.

67

One media account is Douglas Pasternak, “Lack of Intelligence,” U.S. News & World

Report, August 11, 2003. Consideration has been given to much greater use of civilian

reconnaissance systems; in 1999, the Senate Intelligence Committee urged NIMA to identify

imagery requirements that could be met by commercial imagery in order that funds could

be target for that purpose. U.S. Congress, Senate Select Committee on Intelligence,

Authorizing Appropriations for Fiscal Year 2000 for the Intelligence Activities of the United

States Government and the Central Intelligence Agency Retirement and Disability System,

106th Congress, 1st session, S.Rept. 106-48, May 11, 1999, p. 5.

68

Douglas Jehl, “Boeing Lags in Building Spy Satellites,” New York Times, December 4,

2003, p. C1.

69

See CRS Report RL31872,Unmanned Aerial Vehicles: Background and Issues for

Congress, by Elizabeth Bone and (name redacted); see also, Jason Bates and Jeremy

Singer, “Pentagon May Merge FIA with Space Based Radar,” Space News, September 15,

2003, p. 26.

70

The relative invulnerability of satellites from hostile attack is no longer considered a

given, however; see Jeremy Singer, “Importance of Protecting Satellites, Ground Systems

Growing,” Space News, September 15, 2003, p. 26.

CRS-27

UAV acquisition has been as heavily criticized as FIA. HPSCI, in particular,

has pointed out problems with Global Hawk procurement:

The Committee is very concerned about the management and cost growth of the

Global Hawk endurance UAV program.... [Because of Air Force-initiated

upgrades] a $10 million per copy Global Hawk platform has become at least a

$30-40 million aircraft, and the cost will increase substantially further as

additional and improved sensors, and corresponding power/payload upgrades, are

added. In fact, the Air Force projects that the average total unit cost (including

all program costs) will exceed $75 million per copy.

... there is now an effort to flood the Global Hawk program with money, there are

ad hoc plans for rapid, major upgrades before requirements have been

established, and no sign of serious examination of where and how Global Hawk

fits into an overall collection architecture.... DoD has taken no serious steps to

be able to relay and process the huge amounts of data from Global Hawk, or to

process, exploit, and disseminate all the data that a fleet of 51 Global Hawks

with highly capable sensors will generate.71

Satellites are budgeted under NIP and operated by the NRO; Global Hawk

UAVs, on the other hand, have been budgeted under JMIP and operated by Air Force

components of regional commands. These separate paths have made the possibility

of potential trade-offs between space and UAV collection vastly more difficult.

Observers sense that current procedures to integrate intelligence acquisition efforts

have not led to a comprehensive assessment of major issues relating to satellite and

UAV programs. If UAVs can do at least part of the work of satellites then, arguably,

considerable budgetary savings might be realized. On the other hand, a failure to

take advantage of U.S. satellite technological superiority could limit intelligencegathering capabilities for decades to come and prompt the decline of an important

U.S. industry.

71

U.S. Congress, House Permanent Select Committee on Intelligence, Intelligence

Authorization Act for Fiscal Year 2003, 107th Congress, 2nd session, H.Rept. 107-592, July

18, 2002, pp. 21-22.

EveryCRSReport.com

The Congressional Research Service (CRS) is a federal legislative branch agency, housed inside the

Library of Congress, charged with providing the United States Congress non-partisan advice on

issues that may come before Congress.

EveryCRSReport.com republishes CRS reports that are available to all Congressional staff. The

reports are not classified, and Members of Congress routinely make individual reports available to

the public.

Prior to our republication, we redacted names, phone numbers and email addresses of analysts

who produced the reports. We also added this page to the report. We have not intentionally made

any other changes to any report published on EveryCRSReport.com.

CRS reports, as a work of the United States government, are not subject to copyright protection in

the United States. Any CRS report may be reproduced and distributed in its entirety without

permission from CRS. However, as a CRS report may include copyrighted images or material from a

third party, you may need to obtain permission of the copyright holder if you wish to copy or

otherwise use copyrighted material.

Information in a CRS report should not be relied upon for purposes other than public

understanding of information that has been provided by CRS to members of Congress in

connection with CRS' institutional role.

EveryCRSReport.com is not a government website and is not affiliated with CRS. We do not claim

copyright on any CRS report we have republished.