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[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4900 Introduced in House (IH)]

111th CONGRESS
  2d Session
                                H. R. 4900

  To amend chapter 35 of title 44, United States Code, to create the 
  National Office for Cyberspace, to revise requirements relating to 
         Federal information security, and for other purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                             March 22, 2010

  Ms. Watson introduced the following bill; which was referred to the 
              Committee on Oversight and Government Reform

_______________________________________________________________________

                                 A BILL

 
  To amend chapter 35 of title 44, United States Code, to create the 
  National Office for Cyberspace, to revise requirements relating to 
         Federal information security, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    (a) Short Title.--This Act may be cited as the ``Federal 
Information Security Amendments Act of 2010''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title.
Sec. 2. Coordination of Federal Information Policy.
Sec. 3. Information Security Acquisition Requirements.
Sec. 4. Technical and conforming amendments.
Sec. 5. Effective date.

SEC. 2. COORDINATION OF FEDERAL INFORMATION POLICY.

    Chapter 35 of title 44, United States Code, is amended by striking 
subchapters II and III and inserting the following:

                 ``SUBCHAPTER II--INFORMATION SECURITY

``Sec. 3551. Purposes
    ``The purposes of this subchapter are to--
            ``(1) provide a comprehensive framework for ensuring the 
        effectiveness of information security controls over information 
        resources that support Federal operations and assets;
            ``(2) recognize the highly networked nature of the current 
        Federal computing environment and provide effective 
        Governmentwide management and oversight of the related 
        information security risks, including coordination of 
        information security efforts throughout the civilian, national 
        security, and law enforcement communities;
            ``(3) provide for development and maintenance of minimum 
        controls required to protect Federal information and 
        information systems;
            ``(4) provide a mechanism for improved oversight of Federal 
        agency information security programs;
            ``(5) acknowledge that commercially developed information 
        security products offer advanced, dynamic, robust, and 
        effective information security solutions, reflecting market 
        solutions for the protection of critical information 
        infrastructures important to the national defense and economic 
        security of the Nation that are designed, built, and operated 
        by the private sector; and
            ``(6) recognize that the selection of specific technical 
        hardware and software information security solutions should be 
        left to individual agencies from among commercially developed 
        products.
``Sec. 3552. Definitions
    ``(a) Section 3502 Definitions.--Except as provided under 
subsection (b), the definitions under section 3502 shall apply to this 
subchapter.
    ``(b) Additional Definitions.--In this subchapter:
            ``(1) The term `adequate security' means security that 
        complies with the regulations promulgated under section 3554 
        and the standards promulgated under section 3558.
            ``(2) The term `incident' means an occurrence that actually 
        or potentially jeopardizes the confidentiality, integrity, or 
        availability of an information system or the information the 
        system processes, stores, or transmits or that constitutes a 
        violation or imminent threat of violation of security policies, 
        security procedures, or acceptable use policies.
            ``(3) The term `information infrastructure' means the 
        underlying framework that information systems and assets rely 
        on in processing, storing, or transmitting information 
        electronically.
            ``(4) The term `information security' means protecting 
        information and information systems from unauthorized access, 
        use, disclosure, disruption, modification, or destruction in 
        order to provide--
                    ``(A) integrity, which means guarding against 
                improper information modification or destruction, and 
                includes ensuring information nonrepudiation and 
                authenticity;
                    ``(B) confidentiality, which means preserving 
                authorized restrictions on access and disclosure, 
                including means for protecting personal privacy and 
                proprietary information; and
                    ``(C) availability, which means ensuring timely and 
                reliable access to and use of information.
            ``(5) The term `information technology' has the meaning 
        given that term in section 11101 of title 40.
            ``(6)(A) The term `national security system' means any 
        information system (including any telecommunications system) 
        used or operated by an agency or by a contractor of an agency, 
        or other organization on behalf of an agency--
                    ``(i) the function, operation, or use of which--
                            ``(I) involves intelligence activities;
                            ``(II) involves cryptologic activities 
                        related to national security;
                            ``(III) involves command and control of 
                        military forces;
                            ``(IV) involves equipment that is an 
                        integral part of a weapon or weapons system; or
                            ``(V) subject to subparagraph (B), is 
                        critical to the direct fulfillment of military 
                        or intelligence missions; or
                    ``(ii) is protected at all times by procedures 
                established for information that have been specifically 
                authorized under criteria established by an Executive 
                order or an Act of Congress to be kept classified in 
                the interest of national defense or foreign policy.
            ``(B) Subparagraph (A)(I)(V) does not include a system that 
        is to be used for routine administrative and business 
        applications (including payroll, finance, logistics, and 
        personnel management applications).
``Sec. 3553. National Office for Cyberspace
    ``(a) Establishment.--There is established within the Executive 
Office of the President an office to be known as the National Office 
for Cyberspace.
    ``(b) Director.--There shall be at the head of the Office a 
Director, who shall be appointed by the President by and with the 
advice and consent of the Senate. The Director of the National Office 
for Cyberspace shall administer all functions under this subchapter and 
collaborate to the extent practicable with the heads of appropriate 
agencies, the private sector, and international partners. The Office 
shall serve as the principal office for coordinating issues relating to 
achieving an assured, reliable, secure, and survivable information 
infrastructure and related capabilities for the Federal Government.
``Sec. 3554. Federal Cybersecurity Practice Board
    ``(a) Establishment.--Within the National Office for Cyberspace, 
there shall be established a board to be known as the `Federal 
Cybersecurity Practice Board' (in this section referred to as the 
`Board').
    ``(b) Members.--The Board shall be chaired by the Director of the 
National Office for Cyberspace and consist of at least one 
representative from--
            ``(1) the Office of Management and Budget;
            ``(2) civilian agencies;
            ``(3) the Department of Defense;
            ``(4) the law enforcement community; and
            ``(5) such additional military and civilian agencies as the 
        Director considers appropriate.
    ``(c) Responsibilities.--
            ``(1) Development of policies and procedures.--Subject to 
        the authority, direction, and control of the Director of the 
        National Office for Cyberspace, the Board shall be responsible 
        for developing and periodically updating information security 
        policies and procedures relating to the matters described in 
        paragraph (2). In developing such policies and procedures, the 
        Board shall require that all matters addressed in the policies 
        and procedures are consistent, to the maximum extent 
        practicable and in accordance with applicable law, among the 
        civilian, military, intelligence, and law enforcement 
        communities.
            ``(2) Specific matters covered in policies and 
        procedures.--
                    ``(A) Minimum security controls.--The Board shall 
                be responsible for developing and periodically updating 
                information security policies and procedures relating 
                to minimum security controls for information 
                technology, in order to--
                            ``(i) provide Governmentwide protection of 
                        Government-networked computers against common 
                        attacks; and
                            ``(ii) provide agencywide protection 
                        against threats, vulnerabilities, and other 
                        risks to the information infrastructure within 
                        individual agencies.
                    ``(B) Measures of effectiveness.--The Board shall 
                be responsible for developing and periodically updating 
                information security policies and procedures relating 
                to measurements needed to assess the effectiveness of 
                the minimum security controls referred to in 
                subparagraph (A). Such measurements shall include a 
                risk scoring system to evaluate risk to information 
                security both Governmentwide and within contractors of 
                the Federal Government.
                    ``(C) Products and services.--The Board shall be 
                responsible for developing and periodically updating 
                information security policies and procedures relating 
                to criteria for products and services to be used in 
                agency information systems and agency information 
                infrastructure that will meet the minimum security 
                controls referred to in subparagraph (A). In carrying 
                out this subparagraph, the Board shall, in consultation 
                with the Office of Management and Budget and the 
                General Services Administration--
                            ``(i) develop a list, set forth in order of 
                        priority, of technologies that agencies can use 
                        to automate security functions; and
                            ``(ii) define minimum standards for secure 
                        development of software products and services.
                    ``(D) Remedies.--The Board shall be responsible for 
                developing and periodically updating information 
                security policies and procedures relating to methods 
                for providing remedies for security deficiencies 
                identified in agency information systems.
            ``(3) Relationship to other standards.--The policies and 
        procedures developed under paragraph (1) are supplemental to 
        the standards promulgated by the Director of the National 
        Office for Cyberspace under section 3558.
            ``(4) Recommendations for regulations.--The Board shall be 
        responsible for making recommendations to the Director of the 
        National Office for Cyberspace on regulations to carry out the 
        policies and procedures developed by the Board under paragraph 
        (1).
    ``(d) Regulations.--The Director of the National Office for 
Cyberspace, in consultation with the Director of the Office of 
Management and the Administrator of General Services, shall promulgate 
and periodically update regulations to carry out the policies and 
procedures developed by the Board under subsection (c).
    ``(e) Annual Report.--The Director of the National Office for 
Cyberspace shall provide to Congress a report containing a summary of 
agency progress in implementing the regulations promulgated under this 
section as part of the annual report to Congress required under section 
3555(a)(8).
    ``(f) Exemption From Disclosure.--Information regarding threats, 
vulnerabilities, and risks submitted by agencies to the Board shall be 
exempt from disclosure under section 552 of title 5.
``Sec. 3555. Authority and functions of the Director of the National 
              Office for Cyberspace
    ``(a) In General.--The Director of the National Office for 
Cyberspace shall oversee agency information security policies and 
practices, including--
            ``(1) developing and overseeing the implementation of 
        policies, principles, standards, and guidelines on information 
        security, including through ensuring timely agency adoption of 
        and compliance with standards promulgated under section 3558;
            ``(2) requiring agencies, consistent with the standards 
        promulgated under section 3558 and other requirements of this 
        subchapter, to identify and provide information security 
        protections commensurate with the risk and magnitude of the 
        harm resulting from the unauthorized access, use, disclosure, 
        disruption, modification, or destruction of--
                    ``(A) information collected or maintained by or on 
                behalf of an agency; or
                    ``(B) information systems used or operated by an 
                agency or by a contractor of an agency or other 
                organization on behalf of an agency;
            ``(3) coordinating the development of standards and 
        guidelines under section 20 of the National Institute of 
        Standards and Technology Act (15 U.S.C. 278g-3) with agencies 
        and offices operating or exercising control of national 
        security systems (including the National Security Agency) to 
        assure, to the maximum extent feasible, that such standards and 
        guidelines are complementary with standards and guidelines 
        developed for national security systems;
            ``(4) overseeing agency compliance with the requirements of 
        this subchapter, including through any authorized action under 
        section 11303 of title 40, to enforce accountability for 
        compliance with such requirements;
            ``(5) reviewing at least annually, and approving or 
        disapproving, agency information security programs required 
        under section 3556(b);
            ``(6) coordinating information security policies and 
        procedures with related information resources management 
        policies and procedures;
            ``(7) overseeing the operation of the Federal information 
        security incident center required under section 3559; and
            ``(8) reporting to Congress no later than March 1 of each 
        year on agency compliance with the requirements of this 
        subchapter, including--
                    ``(A) a summary of the findings of audits required 
                by section 3557;
                    ``(B) an assessment of the development, 
                promulgation, and adoption of, and compliance with, 
                standards developed under section 20 of the National 
                Institute of Standards and Technology Act (15 U.S.C. 
                278g-3) and promulgated under section 3558;
                    ``(C) significant deficiencies in agency 
                information security practices;
                    ``(D) planned remedial action to address such 
                deficiencies; and
                    ``(E) a summary of, and the views of the Director 
                of the National Office for Cyberspace on, the report 
                prepared by the National Institute of Standards and 
                Technology under section 20(d)(10) of the National 
                Institute of Standards and Technology Act (15 U.S.C. 
                278g-3).
    ``(b) National Security Systems.--Except for the authorities 
described in paragraphs (4) and (8) of subsection (a), the authorities 
of the Director of the National Office for Cyberspace under this 
section shall not apply to national security systems.
    ``(c) Department of Defense and Central Intelligence Agency 
Systems.--(1) The authorities of the Director of the National Office 
for Cyberspace described in paragraphs (1) and (2) of subsection (a) 
shall be delegated to the Secretary of Defense in the case of systems 
described in paragraph (2) and to the Director of Central Intelligence 
in the case of systems described in paragraph (3).
    ``(2) The systems described in this paragraph are systems that are 
operated by the Department of Defense, a contractor of the Department 
of Defense, or another entity on behalf of the Department of Defense 
that processes any information the unauthorized access, use, 
disclosure, disruption, modification, or destruction of which would 
have a debilitating impact on the mission of the Department of Defense.
    ``(3) The systems described in this paragraph are systems that are 
operated by the Central Intelligence Agency, a contractor of the 
Central Intelligence Agency, or another entity on behalf of the Central 
Intelligence Agency that processes any information the unauthorized 
access, use, disclosure, disruption, modification, or destruction of 
which would have a debilitating impact on the mission of the Central 
Intelligence Agency.
``Sec. 3556. Agency responsibilities
    ``(a) In General.--The head of each agency shall--
            ``(1) be responsible for--
                    ``(A) providing information security protections 
                commensurate with the risk and magnitude of the harm 
                resulting from unauthorized access, use, disclosure, 
                disruption, modification, or destruction of--
                            ``(i) information collected or maintained 
                        by or on behalf of the agency; and
                            ``(ii) information systems used or operated 
                        by an agency or by a contractor of an agency or 
                        other organization on behalf of an agency;
                    ``(B) complying with the requirements of this 
                subchapter and related policies, procedures, standards, 
                and guidelines, including--
                            ``(i) the regulations promulgated under 
                        section 3554 and the information security 
                        standards promulgated under section 3558;
                            ``(ii) information security standards and 
                        guidelines for national security systems issued 
                        in accordance with law and as directed by the 
                        President; and
                            ``(iii) ensuring the standards implemented 
                        for information systems and national security 
                        systems under the agency head are complementary 
                        and uniform, to the extent practicable; and
                    ``(C) ensuring that information security management 
                processes are integrated with agency strategic and 
                operational planning processes;
            ``(2) ensure that senior agency officials provide 
        information security for the information and information 
        systems that support the operations and assets under their 
        control, including through--
                    ``(A) assessing the risk and magnitude of the harm 
                that could result from the unauthorized access, use, 
                disclosure, disruption, modification, or destruction of 
                such information or information systems;
                    ``(B) determining the levels of information 
                security appropriate to protect such information and 
                information systems in accordance with regulations 
                promulgated under section 3554 and standards 
                promulgated under section 3558, for information 
                security classifications and related requirements;
                    ``(C) implementing policies and procedures to cost 
                effectively reduce risks to an acceptable level; and
                    ``(D) continuously testing and evaluating 
                information security controls and techniques to ensure 
                that they are effectively implemented;
            ``(3) delegate to an agency official designated to oversee 
        agency information security the authority to ensure and enforce 
        compliance with the requirements imposed on the agency under 
        this subchapter, including--
                    ``(A) overseeing the establishment and maintenance 
                of a security operations capability on an automated and 
                continuous basis that can--
                            ``(i) assess the state of compliance of all 
                        networks and systems with prescribed controls 
                        issued pursuant to section 3558 and report 
                        immediately any variance therefrom and, where 
                        appropriate, shut down systems that are found 
                        to be non-compliant;
                            ``(ii) detect, report, respond to, contain, 
                        and mitigate incidents that impair adequate 
                        security of the information and information 
                        infrastructure, in accordance with policy 
                        provided by the Director of the National Office 
                        for Cyberspace, in consultation with the Chief 
                        Information Officers Council, and guidance from 
                        the National Institute of Standards and 
                        Technology;
                            ``(iii) collaborate with the National 
                        Office for Cyberspace and appropriate public 
                        and private sector security operations centers 
                        to address incidents that impact the security 
                        of information and information infrastructure 
                        that extend beyond the control of the agency; 
                        and
                            ``(iv) not later than 24 hours after 
                        discovery of any incident described under 
                        subparagraph (A (ii)), unless otherwise 
                        directed by policy of the National Office for 
                        Cyberspace, provide notice to the appropriate 
                        security operations center, the National Cyber 
                        Investigative Joint Task Force, and inspector 
                        general;
                    ``(B) developing, maintaining, and overseeing an 
                agency wide information security program as required by 
                subsection (b);
                    ``(C) developing, maintaining, and overseeing 
                information security policies, procedures, and control 
                techniques to address all applicable requirements, 
                including those issued under sections 3555 and 3558;
                    ``(D) training and overseeing personnel with 
                significant responsibilities for information security 
                with respect to such responsibilities; and
                    ``(E) assisting senior agency officials concerning 
                their responsibilities under paragraph (2);
            ``(4) ensure that the agency has trained and cleared 
        personnel sufficient to assist the agency in complying with the 
        requirements of this subchapter and related policies, 
        procedures, standards, and guidelines;
            ``(5) ensure that the agency official designated to oversee 
        agency information security, in coordination with other senior 
        agency officials, reports biannually to the agency head on the 
        effectiveness of the agency information security program, 
        including progress of remedial actions; and
            ``(6) ensure that the agency official designated to oversee 
        agency information security possesses necessary qualifications, 
        including education, professional certifications, training, 
        experience, and the security clearance required to administer 
        the functions described under this subchapter; and has 
        information security duties as the primary duty of that 
        official.
    ``(b) Agency Program.--Each agency shall develop, document, and 
implement an agencywide information security program, approved by the 
Director of the National Office for Cyberspace under section 
3555(a)(5), to provide information security for the information and 
information systems that support the operations and assets of the 
agency, including those provided or managed by another agency, 
contractor, or other source, that includes--
            ``(1) continuous automated monitoring of information 
        systems used or operated by an agency or by a contractor of an 
        agency or other organization on behalf of an agency to assure 
        conformance with regulations promulgated under section 3554 and 
        standards promulgated under section 3558;
            ``(2) penetration tests commensurate with risk (as defined 
        by the National Institute of Standards and Technology and the 
        National Office for Cyberspace) for agency information systems;
            ``(3) information security vulnerabilities are mitigated 
        based on the risk posed to the agency;
            ``(4) policies and procedures that--
                    ``(A) cost effectively reduce information security 
                risks to an acceptable level;
                    ``(B) ensure that information security is addressed 
                throughout the life cycle of each agency information 
                system; and
                    ``(C) ensure compliance with--
                            ``(i) the requirements of this subchapter;
                            ``(ii) policies and procedures as may be 
                        prescribed by the Director of the National 
                        Office for Cyberspace, and information security 
                        standards promulgated under section 3558;
                            ``(iii) minimally acceptable system 
                        configuration requirements, as determined by 
                        the Director of the National Office for 
                        Cyberspace; and
                            ``(iv) any other applicable requirements, 
                        including standards and guidelines for national 
                        security systems issued in accordance with law 
                        and as directed by the President; of how the 
                        controls described under subparagraph (A) 
                        maintain the appropriate level of 
                        confidentiality, integrity, and availability of 
                        information and information systems based on--
                                    ``(I) the policy of the Director of 
                                the National Office for Cyberspace;
                                    ``(II) the National Institute of 
                                Standards and Technology guidance; and
                                    ``(III) the Chief Information 
                                Officers Council recommended 
                                approaches;
                    ``(D) developing, maintaining, and overseeing an 
                agency wide information security program as required by 
                subsection (b);
                    ``(E) developing, maintaining, and overseeing 
                information security policies, procedures, and control 
                techniques to address all applicable requirements, 
                including those issued under sections 3555 and 3558;
                    ``(F) training and overseeing personnel with 
                significant responsibilities for information security 
                with respect to such responsibilities; and
                    ``(G) assisting senior agency officials concerning 
                their responsibilities under paragraph (2);
            ``(5) ensure that the agency has trained and cleared 
        personnel sufficient to assist the agency in complying with the 
        requirements of this subchapter and related policies, 
        procedures, standards, and guidelines;
            ``(6) ensure that the agency official designated to oversee 
        agency information security, in coordination with other senior 
        agency officials, reports biannually to the agency head on the 
        effectiveness of the agency information security program, 
        including progress of remedial actions; and
            ``(7) ensure that the agency official designated to oversee 
        agency information security possesses necessary qualifications, 
        including education, professional certifications, training, 
        experience, and the security clearance required to administer 
        the functions described under this subchapter; and has 
        information security duties as the primary duty of that 
        official.
            ``(8) to the extent practicable, automated and continuous 
        technical monitoring for testing, and evaluation of the 
        effectiveness and compliance of information security policies, 
        procedures, and practices, including--
                    ``(A) management, operational, and technical 
                controls of every information system identified in the 
                inventory required under section 3505(b); and
                    ``(B) management, operational, and technical 
                controls relied on for an evaluation under section 
                3556;
            ``(9) a process for planning, implementing, evaluating, and 
        documenting remedial action to address any deficiencies in the 
        information security policies, procedures, and practices of the 
        agency;
            ``(10) to the extent practicable, continuous technical 
        monitoring for detecting, reporting, and responding to security 
        incidents, consistent with standards and guidelines issued by 
        the Director of the National Office for Cyberspace, including--
                    ``(A) mitigating risks associated with such 
                incidents before substantial damage is done;
                    ``(B) notifying and consulting with the appropriate 
                security operations response center; and
                    ``(C) notifying and consulting with, as 
                appropriate--
                            ``(i) law enforcement agencies and relevant 
                        Offices of Inspectors General;
                            ``(ii) the National Office for Cyberspace; 
                        and
                            ``(iii) any other agency or office, in 
                        accordance with law or as directed by the 
                        President; and
            ``(11) plans and procedures to ensure continuity of 
        operations for information systems that support the operations 
        and assets of the agency.
    ``(c) Agency Reporting.--Each agency shall--
            ``(1) submit an annual report on the adequacy and 
        effectiveness of information security policies, procedures, and 
        practices, and compliance with the requirements of this 
        subchapter, including compliance with each requirement of 
        subsection (b) to--
                    ``(A) the National Office for Cyberspace;
                    ``(B) the Committee on Homeland Security and 
                Governmental Affairs of the Senate;
                    ``(C) the Committee on Oversight and Government 
                Reform of the House of Representatives;
                    ``(D) other appropriate authorization and 
                appropriations committees of Congress; and
                    ``(E) the Comptroller General;
            ``(2) address the adequacy and effectiveness of information 
        security policies, procedures, and practices in plans and 
        reports relating to--
                    ``(A) annual agency budgets;
                    ``(B) information resources management of this 
                subchapter;
                    ``(C) information technology management under this 
                chapter;
                    ``(D) program performance under sections 1105 and 
                1115 through 1119 of title 31, and sections 2801 and 
                2805 of title 39;
                    ``(E) financial management under chapter 9 of title 
                31, and the Chief Financial Officers Act of 1990 (31 
                U.S.C. 501 note; Public Law 101-576) (and the 
                amendments made by that Act);
                    ``(F) financial management systems under the 
                Federal Financial Management Improvement Act (31 U.S.C. 
                3512 note); and
                    ``(G) internal accounting and administrative 
                controls under section 3512 of title 31; and
            ``(3) report any significant deficiency in a policy, 
        procedure, or practice identified under paragraph (1) or (2)--
                    ``(A) as a material weakness in reporting under 
                section 3512 of title 31; and
                    ``(B) if relating to financial management systems, 
                as an instance of a lack of substantial compliance 
                under the Federal Financial Management Improvement Act 
                (31 U.S.C. 3512 note).
    ``(d) Performance Plan.--(1) In addition to the requirements of 
subsection(c), each agency, in consultation with the National Office 
for Cyberspace, shall include as part of the performance plan required 
under section 1115 of title 31 a description of--
                    ``(A) the time periods; and
                    ``(B) the resources, including budget, staffing, 
                and training, that are necessary to implement the 
                program required under subsection (b).
    ``(2) The description under paragraph (1) shall be based on the 
risk assessments required under subsection (b)(2)(1) and operational 
evaluations required under section 3553(d).
    ``(e) Public Notice and Comment.--Each agency shall provide the 
public with timely notice and opportunities for comment on proposed 
information security policies and procedures to the extent that such 
policies and procedures affect communication with the public.
``Sec. 3557. Annual independent audit
    ``(a) In General.--(1) Each year each agency shall have performed 
an independent audit of the information security program and practices 
of that agency to determine the effectiveness of such program and 
practices.
    ``(2) Each audit under this section shall include--
            ``(A) testing of the effectiveness of the information 
        systems of the agency for automated, continuous monitoring of 
        the state of compliance of its information systems with 
        regulations promulgated under section 3554 and standards 
        promulgated under section 3558 in a representative subset of--
                    ``(i) the information systems used or operated by 
                the agency; and
                    ``(ii) the information systems used, operated, or 
                supported on behalf of the agency by a contractor of 
                the agency, a subcontractor (at any tier) of such 
                contractor, or any other entity;
            ``(B) an assessment (made on the basis of the results of 
        the testing) of compliance with--
                    ``(i) the requirements of this subchapter; and
                    ``(ii) related information security policies, 
                procedures, standards, and guidelines;
            ``(C) separate presentations, as appropriate, regarding 
        information security relating to national security systems; and
            ``(D) a conclusion regarding whether the information 
        security controls of the agency are effective, including an 
        identification of any significant deficiencies in such 
        controls.
    ``(3) Each audit under this section shall be performed in 
accordance with applicable generally accepted Government auditing 
standards.
    ``(b) Independent Auditor.--Subject to subsection (c)--
            ``(1) for each agency with an Inspector General appointed 
        under the Inspector General Act of 1978 or any other law, the 
        annual audit required by this section shall be performed by the 
        Inspector General or by an independent external auditor, as 
        determined by the Inspector General of the agency; and
            ``(2) for each agency to which paragraph (1) does not 
        apply, the head of the agency shall engage an independent 
        external auditor to perform the audit.
    ``(c) National Security Systems.--For each agency operating or 
exercising control of a national security system, that portion of the 
audit required by this section directly relating to a national security 
system shall be performed--
            ``(1) only by an entity designated head; and
            ``(2) in such a manner as to ensure appropriate protection 
        for information associated with any information security 
        vulnerability in such system commensurate with the risk and in 
        accordance with all applicable laws.
    ``(d) Existing Audits.--The audit required by this section may be 
based in whole or in part on another audit relating to programs or 
practices of the applicable agency.
    ``(e) Agency Reporting.--(1) Each year, not later than such date 
established by the Director of the National Office for Cyberspace, the 
head of each agency shall submit to the Director the results of the 
audit required under this section.
    ``(2) To the extent an audit required under this section directly 
relates to a national security system, the results of the audit 
submitted to the Director of the National Office for Cyberspace shall 
contain only a summary and assessment of that portion of the audit 
directly relating to a national security system.
    ``(f) Protection of Information.--Agencies and auditors shall take 
appropriate steps to ensure the protection of information which, if 
disclosed, may adversely affect information security. Such protections 
shall be commensurate with the risk and comply with all applicable laws 
and regulations.
    ``(g) OMB Reports to Congress.--(1) The Director of the National 
Office for Cyberspace shall summarize the results of the audits 
conducted under this section in the annual report to Congress required 
under section 3555(a)(8).
    ``(2) The Director's report to Congress under this subsection shall 
summarize information regarding information security relating to 
national security systems in such a manner as to ensure appropriate 
protection for information associated with any information security 
vulnerability in such system commensurate with the risk and in 
accordance with all applicable laws.
    ``(3) Audits and any other descriptions of information systems 
under the authority and control of the Director of Central Intelligence 
or of National Foreign Intelligence Programs systems under the 
authority and control of the Secretary of Defense shall be made 
available to Congress only through the appropriate oversight committees 
of Congress, in accordance with applicable laws.
    ``(h) Comptroller General.--The Comptroller General shall 
periodically evaluate and report to Congress on--
            ``(1) the adequacy and effectiveness of agency information 
        security policies and practices; and
            ``(2) implementation of the requirements of this 
        subchapter.
    ``(i) Contractor Audits.--Each year each contractor that operates, 
uses, or supports an information system by or on behalf of an agency 
and each subcontractor of such contractor--
            ``(1) shall conduct an audit using an independent external 
        auditor, as determined by the Comptroller General, in 
        accordance with subsection (a), including an assessment of 
        compliance with the applicable requirements of this subchapter; 
        and
            ``(2) shall submit the results of such audit to such agency 
        not later than such date established by the Agency.
``Sec. 3558. Responsibilities for Federal information systems standards
    ``(a) Requirement To Prescribe Standards.--
            ``(1) In general.--
                    ``(A) Requirement.--Except as provided under 
                paragraph (2), the Director of the Office of Management 
                and Budget shall, on the basis of proposed standards 
                developed by the National Institute of Standards and 
                Technology pursuant to paragraphs (2) and (3) of 
                section 20(a) of the National Institute of Standards 
                and Technology Act (15 U.S.C. 278g-3(a)) and in 
                consultation with the Secretary of Homeland Security, 
                promulgate information security standards pertaining to 
                Federal information systems.
                    ``(B) Required standards.--Standards promulgated 
                under subparagraph (A) shall include--
                            ``(i) standards that provide minimum 
                        information security requirements as determined 
                        under section 20(b) of the National Institute 
                        of Standards and Technology Act (15 U.S.C. 
                        278g-3(b)); and
                            ``(ii) such standards that are otherwise 
                        necessary to improve the efficiency of 
                        operation or security of Federal information 
                        systems.
                    ``(C) Required standards binding.--Information 
                security standards described under subparagraph (B) 
                shall be compulsory and binding.
            ``(2) Standards and guidelines for national security 
        systems.--Standards and guidelines for national security 
        systems, as defined under section 3552(b), shall be developed, 
        promulgated, enforced, and overseen as otherwise authorized by 
        law and as directed by the President.
    ``(b) Application of More Stringent Standards.--The head of an 
agency may employ standards for the cost-effective information security 
for all operations and assets within or under the supervision of that 
agency that are more stringent than the standards promulgated by the 
Director of the Office of Management and Budget under this section, if 
such standards--
            ``(1) contain, at a minimum, the provisions of those 
        applicable standards made compulsory and binding by the 
        Director; and
            ``(2) are otherwise consistent with policies and guidelines 
        issued under section 3555.
    ``(c) Requirements Regarding Decisions by Director.--
            ``(1) Deadline.--The decision regarding the promulgation of 
        any standard by the Director of the Office of Management and 
        Budget under subsection (b) shall occur not later than 6 months 
        after the submission of the proposed standard to the Director 
        by the National Institute of Standards and Technology, as 
        provided under section 20 of the National Institute of 
        Standards and Technology Act (15 U.S.C. 278g-3).
            ``(2) Notice and comment.--A decision by the Director of 
        the Office of Management and Budget to significantly modify, or 
        not promulgate, a proposed standard submitted to the Director 
        by the National Institute of Standards and Technology, as 
        provided under section 20 of the National Institute of 
        Standards and Technology Act (15 U.S.C. 278g-3), shall be made 
        after the public is given an opportunity to comment on the 
        Director's proposed decision.
``Sec. 3559. Federal information security incident center
    ``(a) In General.--The Director of the National Office for 
Cyberspace shall ensure the operation of a central Federal information 
security incident center to--
            ``(1) provide timely technical assistance to operators of 
        agency information systems regarding security incidents, 
        including guidance on detecting and handling information 
        security incidents;
            ``(2) compile and analyze information about incidents that 
        threaten information security;
            ``(3) inform operators of agency information systems about 
        current and potential information security threats, and 
        vulnerabilities; and
            ``(4) consult with the National Institute of Standards and 
        Technology, agencies or offices operating or exercising control 
        of national security systems (including the National Security 
        Agency), and such other agencies or offices in accordance with 
        law and as directed by the President regarding information 
        security incidents and related matters.
    ``(b) National Security Systems.--Each agency operating or 
exercising control of a national security system shall share 
information about information security incidents, threats, and 
vulnerabilities with the Federal information security incident center 
to the extent consistent with standards and guidelines for national 
security systems, issued in accordance with law and as directed by the 
President.
    ``(c) Review and Approval.--In coordination with the Administrator 
for Electronic Government and Information Technology, the Director of 
the National Office for Cyberspace shall review and approve the 
policies, procedures, and guidance established in this subchapter to 
ensure that the incident center has the capability to effectively and 
efficiently detect, correlate, respond to, contain, and mitigate 
incidents that impair the adequate security of the information systems 
and information infrastructure of more than one agency. To the extent 
practicable, the capability shall be continuous and technically 
automated.
``Sec. 3560. National security systems
    ``The head of each agency operating or exercising control of a 
national security system shall be responsible for ensuring that the 
agency--
            ``(1) provides information security protections 
        commensurate with the risk and magnitude of the harm resulting 
        from the unauthorized access, use, disclosure, disruption, 
        modification, or destruction of the information contained in 
        such system;
            ``(2) implements information security policies and 
        practices as required by standards and guidelines for national 
        security systems, issued in accordance with law and as directed 
        by the President; and
            ``(3) complies with the requirements of this subchapter.''.

SEC. 3. INFORMATION SECURITY ACQUISITION REQUIREMENTS.

    (a) In General.--Chapter 113 of title 40, United States Code, is 
amended by adding at the end of subchapter II the following new 
section:
``Sec. 11319. Information security acquisition requirements.
    ``(a) Prohibition.--Notwithstanding any other provision of law, 
beginning one year after the date of the enactment of the Federal 
Information Security Amendments Act of 2010, no agency may enter into a 
contract, an order under a contract, or an interagency agreement for--
            ``(1) the collection, use, management, storage, or 
        dissemination of information on behalf of the agency;
            ``(2) the use or operation of an information system on 
        behalf of the agency; or
            ``(3) information technology;
unless such contract, order, or agreement includes requirements to 
provide effective information security that supports the operations and 
assets under the control of the agency, in compliance with the 
policies, standards, and guidance developed under subsection (b), and 
otherwise ensures compliance with this section.
    ``(b) Coordination of Secure Acquisition Policies.--
            ``(1) In general.--The Director, in consultation with the 
        Director of the National Institute of Standards and Technology, 
        the Director of the National Office for Cyberspace, and the 
        Administrator of General Services, shall oversee the 
        development and implementation of policies, standards, and 
        guidance, including through revisions to the Federal 
        Acquisition Regulation and the Department of Defense supplement 
        to the Federal Acquisition Regulation, to cost effectively 
        enhance agency information security, including--
                    ``(A) minimum information security requirements for 
                agency procurement of commercial off-the-shelf 
                information technology and other products and services; 
                and
                    ``(B) approaches for evaluating and mitigating 
                significant supply chain security risks associated with 
                products or services to be acquired by agencies.
            ``(2) Report.--Not later than two years after the date of 
        the enactment of the Federal Information Security Amendments 
        Act of 2010, the Director shall submit to Congress a report 
        describing--
                    ``(A) actions taken to improve the information 
                security associated with the procurement of products 
                and services by the Federal Government; and
                    ``(B) plans for overseeing and coordinating efforts 
                of agencies to use best practice approaches for cost-
                effectively purchasing more secure products and 
                services.
    ``(c) Vulnerability Assessments of Major Systems.--
            ``(1) Requirement for initial vulnerability assessments.--
        The Director shall require each agency to conduct an initial 
        vulnerability assessment for any major system and its 
        significant items of supply prior to its development. The 
        initial vulnerability assessment of a major system and its 
        significant items of supply shall include use of an analysis-
        based approach to--
                    ``(A) identify vulnerabilities;
                    ``(B) define exploitation potential;
                    ``(C) examine the system's potential effectiveness;
                    ``(D) determine overall vulnerability; and
                    ``(E) make recommendations for risk reduction.
            ``(2) Subsequent vulnerability assessments.--
                    ``(A) The Director shall require, if the Director 
                determines that a change in circumstances warrants the 
                issuance of a subsequent vulnerability assessment, a 
                subsequent vulnerability assessment of each major 
                system and its significant items of supply within the 
                program.
                    ``(B) Upon the request of a congressional 
                committee, the Director may require a subsequent 
                vulnerability assessment of a particular major system 
                and its significant items of supply within the program.
                    ``(C) Any subsequent vulnerability assessment of a 
                major system and its significant items of supply shall 
                include use of an analysis-based approach and, if 
                applicable, a testing-based approach, to monitor the 
                exploitation potential of such system and reexamine the 
                factors described in subparagraphs (A) through (E) of 
                paragraph (1).
            ``(3) Congressional oversight.--The Director shall provide 
        to the appropriate congressional committees a copy of each 
        vulnerability assessment conducted under paragraph (1) or (2) 
        not later than 10 days after the date of the completion of such 
        assessment.
    ``(d) Definitions.--In this section:
            ``(1) Item of supply.--The term `item of supply'--
                    ``(A) means any individual part, component, 
                subassembly, assembly, or subsystem integral to a major 
                system, and other property which may be replaced during 
                the service life of the major system, including a spare 
                part or replenishment part; and
                    ``(B) does not include packaging or labeling 
                associated with shipment or identification of an item.
            ``(2) Vulnerability assessment.--The term `vulnerability 
        assessment' means the process of identifying and quantifying 
        vulnerabilities in a major system and its significant items of 
        supply.
            ``(3) Major system.--The term `major system' has the 
        meaning given that term in section 4 of the Office of Federal 
        Procurement Policy Act (41 U.S.C. 403).''.

SEC. 4. TECHNICAL AND CONFORMING AMENDMENTS.

    (a) Table of Sections in Title 44.--The table of sections for 
chapter 35 of title 44, United States Code, is amended by striking the 
matter relating to subchapters II and III and inserting the following:

                  ``subchapter ii--information security

``3551. Purposes.
``3552. Definitions.
``3553. National Office for Cyberspace.
``3554. Federal Cybersecurity Practice Board.
``3555. Authority and functions of the Director of the National Office 
                            for Cyberspace.
``3556. Agency responsibilities.
``3557. Annual independent audit.
``3558. Responsibilities for Federal information systems standards.
``3559. Federal information security incident center.
``3560. National security systems.''.
    (b) Table of Sections in Title 40.--The table of sections for 
chapter 113 of title 40, United States Code, is amended by inserting 
after the item relating to section 11318 the following new item:

``Sec. 11319. Information security acquisition requirements.''.
    (c) Other References.--
            (1) Section 1001(c)(1)(A) of the Homeland Security Act of 
        2002 (6 U.S.C. 511(c)(1)(A)) is amended by striking ``section 
        3532(3)'' and inserting ``section 3552(b)''.
            (2) Section 2222(j)(6) of title 10, United States Code, is 
        amended by striking ``section 3542(b)(2))'' and inserting 
        ``section 3552(b)''.
            (3) Section 2223(c)(3) of title 10, United States Code, is 
        amended, by striking ``section 3542(b)(2))'' and inserting 
        ``section 3552(b)''.
            (4) Section 2315 of title 10, United States Code, is 
        amended by striking ``section 3542(b)(2))'' and inserting 
        ``section 3552(b)''.
            (5) Section 20 of the National Institute of Standards and 
        Technology Act (15 U.S.C. 278g-3) is amended--
                    (A) in subsections (a)(2) and (e)(5), by striking 
                ``section 3532(b)(2)'' and inserting ``section 
                3552(b)'';
                    (B) in subsection (e)(2), by striking ``section 
                3532(1)'' and inserting ``section 3552(b)''; and
                    (C) in subsections (c)(3) and (d)(1), by striking 
                ``section 11331 of title 40'' and inserting ``section 
                3558 of title 44''.
            (6) Section 8(d)(1) of the Cyber Security Research and 
        Development Act (15 U.S.C. 7406(d)(1)) is amended by striking 
        ``section 3534(b)'' and inserting ``section 3556(b)''.
    (d) Repeal.--
            (1) Subchapter III of chapter 113 of title 40, United 
        States Code, is repealed.
            (2) The table of sections for chapter 113 of such title is 
        amended by striking the matter relating to subchapter III.

SEC. 5. EFFECTIVE DATE.

    This Act (including the amendments made by this Act) shall take 
effect 30 days after the date of enactment of this Act.
                                 <all>
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